Wednesday, February 08, 2006

Standing up for job creation:

You may recall back on Jan 23, I wrote a post on New York’s ridiculous idea in joining Maryland by forcing large retailers to pay a $3 an hour tax for each employee to cover healthcare costs. As I said then, such policies are disastrous for not only the company but also the state that implements it. Price floors as they are known in economics, only lower the demand for workers, which leads to higher unemployment. Wage flexibility that moves with current labor demand is the only way to keep unemployment low and is why we have currently 4.7% unemployment in this country compared to the 11% unemployment rate in Germany.

It looks like now I’m not the only one complaining. Yesterday a national retail trade association filed a lawsuit against both Maryland and New York for coming up this job killer. As the CEO of Best Buy, Brad Anderson said in his statement, which was reported in the New York Sun by Tom Stuckey, “We all agree that access to health care is vital, but these spending mandates will drive away business and discourage job creation”.

I couldn’t have said it better myself.

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