Friday, June 9, 2017

In a good think tank, the scholars won't march in lockstep

I'd been rather concerned- distressed, I guess, would not be inaccurately severe -  with the fact that the American Enterprise Insititute, long one of the very top tier of freedom-defending think tanks in the nation, was collaborating with the Brookings Institution to draft a report predicated on the notion that the need for paid family leave is a given. The report was issued this week.  AEI economic-policy specialist Aparna Mathur was the that organization's signatory.

Thus it was with relief and delight that I saw a piece today at AEI Ideas by AEI resident scholar Benjamin Zycher taking issue with the basic premise as well as some of the points Mathur thinks she is substantiating it with.

Check this out:

From a purely analytic standpoint, there is no difference between an expansion of paid leave and, say, a “free” limousine ride to and from work each day.  After all, the latter too would be very nice, but is unlikely to be worth the unavoidable cost in terms of other employment conditions and parameters that also are desirable.
And this:

 . . . what does it mean to say that the costs of such a policy might be “shared across society?”  Does that mean that everyone not benefitting from the policy would bear an equal share of the costs?  That is impossible given the myriad differences among individuals in terms of consumption patterns, employment conditions, ad infinitum.  If taxes are used to finance expanded leave, then it is obvious that the costs (“incidence”) of the taxes would vary dramatically depending on the particular tax applied, and demand and supply conditions in the attendant markets.  If “cutting spending in some [other] areas” is the financing source, then it is the beneficiaries of those programs who would bear the burden, and a vague allusion to the virtues of sharing the costs “across society” is little more than an obfuscation.

Whatever “socializing the costs” comes to mean, it is inevitable that the proponents of such a policy, unconcerned with the expansion of government power, will demand that businesses give something up in exchange for being relieved of the paid-leave burden itself assumed rather than demonstrated to be efficient by Mathur.  So much again, for the free-lunch atmospherics: Such increases in costs will reduce employment, and with it the expanded paid leave itself.

Which brings us to the final assertion: “In some areas, markets fail or may underprovide a benefit.”  Wow.  What does “underprovide” mean?  Clearly: Less than Mathur believes is appropriate.  Sadly, opinions inexorably will differ on what is appropriate, and there are only two basic approaches to answering that question.  The first: the outcomes emerging from competitive markets, in this case the amount of paid leave employers offer to employees and the amount that employees are willing to accept as part of total compensation, including working conditions defined broadly.  Mathur simply rejects that outcome as too little.  The second: Political determination of the appropriate amount of paid leave, in which majorities impose their will on everyone regardless of individual preferences.  Why stop at paid leave?  Why not have voters determine wages, vacation policies, dress codes, and everything else?  And are voters really qualified to do so?  Why not… such experts as Mathur?

Zycher mentions in conclusion that Mathur herself has conceded from the get-go that paid family leave "goes against the idea of limited government."

Exit question: Then why the hell even consider it?


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