From: mccall@mksol.dseg.ti.com (fred j mccall 575-3539)
Subject: Re: The end of the Reagan Era
Organization: Texas Instruments Inc
Distribution: usa,tx
Date: Wed, 11 Nov 1992 03:50:49 GMT

In <1992Nov7.153140.16015@midway.uchicago.edu> sug6@benedict.uchicago.edu (Patrick Sugent) writes:

>mccall@mksol.dseg.ti.com (fred j mccall 575-3539) writes:
>>In <1992Nov6.171351.13253@oakhill.sps.mot.com> pjm@anegada.sps.mot.com (Patrick J. McGuinness) writes:
>>
>>>(fred j mccall 575-3539) writes:
>>>>
>>>>Let me get this straight.  Training workers so they are more
>>>>productive and better at their jobs hurts productivity?  I don't THINK
>>>>so.  What assumptions were they using to arrive at these conclusions,
>>>>with regard to economic growth impacts with and without the plan,
>>>>etc.? 
>>
>>>Regulations add costs to businesses, in hiring, they get factored
>>>into capital goods. example:
>>>Regulations in L.A. concerning paint and varnish fumes, for environmental
>>>reasons, virtually wiped out the furniture business there. It moved
>>>elsewhere, like a lot of other CA businesses. Some of it went to Mexico.
>>>As for training, that's not the only regulation involved, but
>>>maybe we should force you to spend half your working time in a class.
>>>Would you get the same amount done? 
>>
>>Gee, and if I spent ALL my working time in class, I wouldn't get
>>anything done at all.  However, if I spend 5% of my time in training,
>>I will get MORE done over the long run because the remaining 95% of my
>>time will be more productive.
>>
>>According to your logic above, we should never waste the time training
>>anyone to do anything, since that takes away from work time.  Of
>>course, in that case, no one will ever know how to do the job in the
>>first place, but that's just a detail, right?

> 
>   Here is the point as I see it.  Clinton's 1.5% payroll tax forces
>me to spend 1.5% of my money on training that is dictated by my
>company.  

And here we go again, with this idea that because your employer has to
pay something that it is YOUR money and you could somehow get it in
cash.  That ain't gonna happen.  Your employer (if he's worth a damn)
is going to have a training budget; studies indicate that expenditures
in the 6%-7% of payroll are what the best (most economically
successful in the long term) companies tend to spend.

>I would much rather keep 1.5% of my money and decide for
>myself how much to spend on training and what sort of training I would
>like to spend it on.  It could be that I come to the exact same
>decision as would happen under the Clinton Plan (tm), but it could be
>that I'm much better off spending that 1.5% getting my MBA at night
>(which my employer may not allow) or that I'm about to retire and
>want to spend that money on my kid's education.  At any rate, Clinton's
>plan eliminates my ability to choose for myself and I not only resent that,
>but I dislike the inherent inefficiency it imposes.

But that's not the choice the plan addresses.  What you get is the
option of having your employer spending that 1.5% training you or of
getting no training at all.  This law won't even affect a lot of
companies, since they already spend more than that on training.

>  Of course, you could claim that your "employer" pays the 1.5%, but
>if you believe that, you probably believe in "employer contribution"
>to FICA.  Businesses do not pay taxes, they collect them.  People pay
>taxes in one way or another.  This is all fairly basic micro really.

A prime example of proof by assertion, I see.  If you say something
with enough confidence, people aren't supposed to questoin it?  Sorry,
but the reality of things just isn't quite as cut and dried as your
statement portrays it, nor is there anything like unanimity of belief
in it.

>  Finally, all these regulations add to the cost of labor.  If you
>make it more expensive to employ people, it should surprise you not
>at all that less people are hired (or they work for less gross
>pay).  This is particularly true for small businesses, which is where
>the large job growth in this country has been for some time.  Creating
>payroll taxes is no way to create job or wage growth.

Well, ANY actions taken to correct the abysmal record of American
industry in correcting its neglect of its human resources (which goes
hand in hand with that short-term thinking that has led to the neglect
of physical plant an equipment (and national infrastructure) is going
to make doing business more expensive IN THE SHORT RUN.  But that
short-run thinking amounts to eating seed corn instead of planting it
and wasting all that work to get it to grow.

-- 
"Insisting on perfect safety is for people who don't have the balls to live
 in the real world."   -- Mary Shafer, NASA Ames Dryden
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Fred.McCall@dseg.ti.com - I don't speak for others and they don't speak for me.
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