David R. Henderson  

Friday Night Video: Government "Protection" of Workers

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Last Friday, I posted the first video in a series of five called "Love Gov." Today I watched the second and it's as good as, if not better than, the first.

In it, the personified government tries to protect the employee from her employer friend and, apparently, "succeeds" in persuading the employer to shut down. Exaggerated? Maybe. But I remember talking to my colleague Tim Kane at the Hoover Institution who told me that when he started his own business, the decision that made him most nervous was about whether to hire one employee. I live in California, where the "protections" for employees seem to be stronger than in many other states. When I was doing the first edition of the Concise Encyclopedia of Economics, then called The Fortune Encyclopedia of Economics, I hit a point where it would have made sense to hire an employee part-time if I could have paid her hourly and kept zero or minimal records. But I knew enough about the law to know that that could get me in trouble. So I went to Kelly and hired a temp. That worked out alright, but not as well as if I could have hired directly and had few laws to comply with.


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CATEGORIES: Labor Market , Regulation

COMMENTS (3 to date)
MaoCzar writes:

The great goal of capitalism is to exploit workers in the name of profits. American industry did it during the industrial revolution and now other countries like China are repeating the same atrocities. Were it not for government, workers would have no protections at all. We'd all be slaves to a handful of greedy capitalists, working for a pittance, and subject to harsh working conditions.

Fortunately, countries like Russia, Venezuela, and Cuba have gotten it right with regard to its citizens (and workers).

guthrie writes:

" 'Look, the last thing I want to do is tell somebody else what to do... go away' [shove]"

Excellent! Very much enjoyed!

JK Brown writes:


Capitalism wasn't quite perfected in the 14th century, but here we have the government "protecting" workers. Yeah, protecting, that's the ticket.

(1388) The Statute of Richard II restricts laborers to their hundred and makes it compulsory for them to follow the same trade as their father after the age of twelve. The wages of both industrial and agricultural laborers are again fixed — shepherds, ten shillings a year; ploughmen, seven; women laborers, six shillings, and so on. Servants are permitted to carry bows and arrows, but not swords, and they may not play tennis or foot-ball. And here b the historical origin of the important custom of exacting recommendations: servants leaving employment are required to carry a testimonial, and none are to receive servants without such letter — the original of the blacklist.

Of course, there was a national emergency back then. By 1377, the Black Death had halved the population and those workers had started commanding higher wages until government "protected" them with the Statute of Laborers in 1349 that fixed wages by trade. The continued until the late 16th century when real wages had declined and the population had recovered. Although the Statute of Laborers was still on the books in England until 1868.

As we see, government is always ready to "protect" the working man. There was the brief period between the collapse of the labor laws in favor of employers of labor and the growth of labor laws in favor of the, do they really do the laboring man any favors, when the inalienable rights in a free market resurged.

But freedom of contract in this connection results generally from personal liberty itself; although it results also from the right to property; that is to say, a man's wages (or his trade, for matter of that) is his property, and the right of property is of no practical use if you cannot have the right to make contracts concerning it.
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