My Political Ideological Journey Part #1: The Role of Government and the Basis of Government Authority

(Note: this is the first of a handful of posts that cover my evolving interests and thoughts regarding political theory.)

As far as I can remember, my interesting in political theory began in high school. The pivotal book that directed me towards considering the role of government was “The Second Treatise of Government” by John Locke. Looking back at this book, there’s quite a bit that Locke states which I disagree with. However, this book does a good job of guiding its readers to consider the appropriate role of government and the basis upon which government derives its authority.

Locke introduces this topic by saying, “To understand political power right, and derive it from its original, we must consider what state all men are naturally in, and that is, a state of perfect freedom to order their actions, and dispose of their possessions and persons as they think fit, within the bounds of the law of nature, without asking leave, or depending upon the will of any other man” (Chapter 2, Section 4). Locke begins by asking his readers to consider the state of the world prior to the introduction of government. After all, government is not an eternal entity and had to be created at some point. If nothing else, this thought experiment guides Locke’s readers to contemplate why people would institute government, which would imply its original purpose and role.

Continuing, Locke argues that government was formulated based on voluntary individual decisions, motivated by self-preservation (Chapter 15, Section 171):

Political power is that power which every man having in the state of nature has given up into the hands of the society, and therein to the governors whom the society has set over itself, with this express or tacit trust, that it shall be employed for their good and the preservation of their property. Now this power, which every man has in the state of Nature, and which he parts with to the society in all such cases where the society can secure him, is to use such means for the preserving of his own property as he thinks good and Nature allows him; and to punish the breach of the law of Nature in others so as (according to the best of his reason) may most conduce to the preservation of himself and the rest of mankind; so that the end and measure of this power, when in every man’s hands, in the state of Nature, being the preservation of all of his society- that is, all mankind in general- it can have no other end or measure, when in the hands of the magistrate, but to preserve the members of that society in their lives, liberties, and possessions, and so cannot be an absolute, arbitrary power over their lives and fortunes, which are as much as possible to be preserved; but a power to make laws, and annex such penalties to them as may tend to the preservation of the whole, by cutting off those parts, and those only, which are so corrupt that they threaten the sound and healthy, without which no severity is lawful. And this power has its original only from compact and agreement and the mutual consent of those who make up the community.”

Locke, in this quote, argues that government’s power is derived from the voluntary submission of individuals. Implicit in this argument are two key points. First, a state of governance is a contractual position, which allows individuals to leave government authority at any point in time. Second, government’s only purpose is the protection of individual life and property. These were both key factors in my viewpoint of the role of government and greatly shaped my thinking going forward. Like I mentioned before, I have some issues with a few of his ideas. That being said, this book was helpful in getting me to think about political theory and the role of government.

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I’d love to hear what you think of this post and my early thoughts on the role of government. Feel free to leave a comment or send me an email. Thanks for reading!

The Frying Pan Fable Follow-Up

Imagine you are in your house when suddenly you hear an intruder. Fearing for the safety of your family, you rush over to your closet and start loading your Tommy gun. As you are preparing your weapon, you have a random thought: “This Tommy gun is pretty effective for self-defense, but I think I might just use my trusty frying pan instead. Sure I’ll have to get closer to the intruder and put my life at considerable risk, but I just like my frying pan a whole lot.” Throwing your Tommy gun aside, you pick up your frying pan and go to defend your house.

Last week I made the point that created items generally work best when put to use according to their intended design. Additionally, this opening illustration highlights another key point about roles: when you utilize something beyond its intended role, you often usurp the designed function of something else. 

In terms of the role of government, this is an important concept to understand. When weighing benefits and costs, we must realize that as the role of government expands, the roles of other societal forces shrink. Just as the frying pan rendered the Tommy gun useless when its role expanded unnecessarily, so government enlargement can hinder the effective and intended functions of other societal institutions. This can be seen in two specific areas: social welfare and economic regulation. (I will merely touch on these issues as an illustration of the above point. A fuller discussion of either topic will have to be put off until a later date.)

Social Welfare

Most people would likely agree that it is important to help the poor and the less fortunate. And through welfare, the federal government is very involved in attempting to achieve this goal. However, as government gets involved in these poverty-reduction endeavors, it pushes out other more appropriate institutions, such as the church. Tony Evan notes, “The primary job of caring for those in need was never intended to be a function of government. Can you imagine Paul going to Caesar and asking for a federal grant to fix the problems of poverty within the church in Jerusalem?” (“Turn Neither to the Right Nor to the Left” page 241).

The Bible calls believers to look out for the interests of others (Phil. 2:4, 1 Cor. 10:24), and to materially give to those in need (Rom. 12:13, James 2:15-16). Thus, through the church, we have an institution that is designed for dealing with poverty.  Government welfare, on the other hand, is patently inefficient and unable to make noticeable improvements in terms of poverty reduction, because government was not designed to eliminate or alleviate poverty. Marvin Olasky describes our current welfare system as “the ultimate bureaucracy –an anonymous public supporting anonymous machinery supporting anonymous clients” (“Turn Neither to the Right Nor to the Left” page 208). As follows, the government suffers from a lack of knowledge about individuals and a (potential) lack of motivation to actually help the poor improve their productivity and get off of welfare.*

In summary, the government was never designed to financially provide for the poor. And by acting outside of its role, it inhibits the normal functioning of other effective private institutions, such as the church.

(There’s much more that could be said about the relative efficiencies of private versus public charity, improving private poverty relief, and the morality of government income redistribution. These topics are beyond the scope of this post, but if you’re interested in learning more, I would recommend two books: “Poor Policy: How Government Harms the Poor” by D. Eric Schansberg and “The Tragedy of American Compassion” by Marvin Olasky.)

Economic Regulation

While government economic interference is a very broad topic, the main point that I want to highlight is that government interference in the economy via interventions, such as price controls, usurps the effective and intended function of the price system.

What is the price system, you ask? Economist Robert Murphy explains the role of prices, “A market price is the balance between how eager you are to buy something and how reluctant the producer is to sell it. If something has a high price tag, it’s because it is scarce; if it has a low price tag, it’s because ‘they’re a dime a dozen.’ In short, market prices are not arbitrary” (“The Politically Incorrect Guide to Capitalism” page 9). Among other purposes, the price system has at least two important and related functions in the market: signaling and coordinating.

Prices act as signals to market participants, demonstrating the value that market participants place on the goods in question. Additionally, prices enable individuals to calculate profit and loss, which direct the actions of entrepreneurs. Economist Gene Callahan describes the market process as, “the ceaseless striving of entrepreneurs to locate price discrepancies and profit from them, thus adjusting production to the wishes of consumers” (“Economics For Real People” page 159). Thus, the price system signals to entrepreneurs areas of unsatisfied consumer wants and to intervene to provide the requested good or service. Without a price system, entrepreneurs would be unable to determine which new enterprises might be viable and profitable.

Prices also function to ration goods and services. Rather than allocating goods to consumers based on preference, nepotism, or some other form of discrimination, the price system allocates goods based on the consumer’s willingness to pay. Callahan again states, “the market guides scarce resources toward their most important uses through the voluntary rationing of the price system,” as “the new, higher price of the good motivates people to use less of it” (“Economics For Real People” page 199).

In summary, the price system is fluid and able to react to changes in supply and demand. Economist F.A. Hayek noted, “Fundamentally, in a system in which knowledge of the relevant facts is dispersed among many people, prices can act to coordinate the separate actions of different people” (“Economics For Real People” page 163). Prices serve to alleviate the problem of insufficient knowledge of market factors and to coordinate supply and demand.

Central planning supplants the role of the price system, but cannot allocate goods nearly as efficiently. After all, no individual or group of individuals could possibly track the changing preferences of millions of consumers and producers like the price system can. Furthermore, interferences like price controls distort the signaling function of the price system, disallowing consumers from “voting” for certain goods through their spending practices.  Murphy again notes, “When the government interferes with prices, it cripples the ability of free people to make intelligent economic decisions, just as surely as if politicians interfered with phone lines, e-mail, or other means of communication” (“The Politically Incorrect Guide to Capitalism” page 10). This behavior by the government has the negative effect of causing unnatural shortages and surpluses.

These shortages in particular lead to a rationing problem. If the government sets an artificially low price, the quantity demanded will increase, but the quantity supplied will decrease, leading to a shortage. In a free market setting the price would rise, rationing the good in question based on consumers’ willingness to pay. However, the price control disallows the price from rising, which forces the government to ration the good in question based upon some other criteria besides willingness to pay.

In conclusion, the government was never designed to direct the intricate adjustments of the market. And when it acts outside of its role, it inhibits the normal functioning of an effective societal force: the price system.

Conclusion

My intent was to briefly touch on two areas of public policy as a means of showing some of the unintended consequences of expanding the function of government. I didn’t want to go into considerable depth in terms of discussing the role of government, nor did I want to write extensively on these policy issues. Those will have to be topics for another day. However, hopefully this helped you think through the intended function of government and some of the unintended consequences of government expansion.

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If you have thoughts about how government expansion can detrimentally affect other societal institutions, feel free to leave a comment or send me an email. Additionally, if you want to specifically discuss the role of government or either of these policy issues, you’re welcome to leave a comment. Again, thank you so much for reading this blog!

 

*(You might ask why government and the church can’t work together to deal with the issue of poverty? Does government involvement in welfare necessarily supplant the role of the church? That’s a good question and I’ll try to touch on it briefly. I would say that government’s attempt to alleviate poverty through the welfare system not only have negligible positive effects, but often actually have considerable negative effects. Examples of these effects would be: incentivizing recipients to stay on welfare (a culture of dependency), incentivizing recipients to not establish marriages, and coercively taking money from individuals to fund the welfare system.  Hypothetically, if the government were able to alter this system entirely, it might be able to work with the church. But the bureaucratic, budget-maximizing nature of the government makes it difficult for me to envision an efficient government-operated welfare system. Further, the question of roles becomes important (as I’ve tried to stress throughout these posts). Is it within government’s intended function to deal with poverty?)

The Frying Pan Fable: On Asking the Wrong Questions

Frying pans are really great for cooking things, after all, that is what they are designed for. From scrambled eggs to sautéed vegetables, there are numerous types of foods that can be prepared in a frying pan. However, besides this obvious use, a frying pan can be utilized for a variety of other tasks. If someone breaks into your house, a frying pan can be used as a self-defense tool. If you are concerned about small objects falling on your head, a frying pan could be used as a helmet.

Despite these alternative uses, frying pans are generally just used for cooking. Why is that? What prevents people from seeing frying pans as multipurpose tools and using frying pans for all sorts of tasks? Well, besides the fact that frying pans are not all that good at accomplishing these other tasks, people use frying pans for cooking because they were designed for that task. I could try to use my lawn mower as a fan or my shoes as soup bowls, but these items were not designed for those jobs and would do a poor job.

Economist Gene Callahan illustrates this idea that different tools have different roles and different levels of effectiveness, “Simply because a sledgehammer does a good job breaking up stones does not mean that it’s the right tool for slicing tomatoes” (“Economics For Real People” page 35)

The majority of fabricated items in this world were created with particular purposes in mind. That’s not to say there is no place for experimenting with alternative uses or making do with limited resources. However, I think I’m correct in saying that, generally, things work best when they are put to use according to their design. If I am holding a vacuum cleaner and wondering how to use it, I should ask for what it was designed for. On a bigger scale, if I am wondering how I should live, I should attempt to find out what I was created for.

This leads into the main purpose of this blog post, which is about how to evaluate government. I spent to preceding paragraphs making the point that things in life should (generally) be utilized according to their design. Why do we not apply this same framework to government? Why do we not spend more time considering the proper role of government? From handling education to regulating the food industry clearly government is capable of many things. But, like using the frying pan for self-defense, some of these tasks might be outside of the realm of its design. To evaluate government in terms of capability, or even its propensity to act according to my personal values is to ask the wrong questions. Rather, we should step back and attempt to determine the proper role and purpose of government. From there we can evaluate aspects of government action, such as effectiveness, from a more stable foundation.

When thinking about government involvement in healthcare, for example, I could start by thinking about the effectiveness of government regulated healthcare. Additionally, I might consider my personal feelings on the matter. However, if I don’t start by considering whether or not regulation of healthcare is within the realm of government’s role, I will have missed the fundamental issue.

I would challenge everybody reading this post to think hard about government’s role. Think through why government exists and what purposes it achieves. From there try to determine if the policies that you support agree with this foundational framework. Hopefully, this exercise will enable you to have a more consistent and thoughtful view of government.

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As usual, I’d love to hear your thoughts on this topic. Feel free to leave a comment or shoot me an email. Thanks for reading!

Being Human in the Digital Age: The Relationship Between Technology and Society

(Note: the following post is based on a paper that I wrote for my Digital Culture class in Summer 2015. Specifically, it interacts with “Amusing Ourselves to Death” by Neil Postman. These are relevant issues in our current society and I hope that you will find this post to be interesting and informative.)

The invention of the wheel changed the way cultures operated. Rather than manually moving every single item that needed to be transported, individuals were able to save time and energy by moving things via carts and other wheeled vehicles. This demonstrates the effect that technology has on the way societies function. As new technologies come to life, societies adjust and adapt to the benefits of those technologies.

To disregard the effect of technology on society is inexcusable. Postman argues that “technology comes equipped with a program for social change” and as various media become further integrated into our culture, the effect grows stronger (Postman 157). Technology has the power to, not only, change the way we act but also adjust how we think. And it has become apparent that “technological changes in our modes of communication are even more ideology-laden than changes in our modes of transportation” (Postman 157). The printing press had a massive effect on society by introducing a new form of communication, as well as a new way to think about logic and argumentation. As books became more popular, thinking often became more logical and structured. Throughout its existence, the television has redefined entertainment to the point that we often find little fulfillment in the entertainment modes of the past. Where plays used to be a primary source of entertainment, now people tend to find them boring or lacking in appeal. The Internet is redefining information and what it means to be informed in a way that we would wither in a society that communicated slowly via telegram. We must be aware that technologies “are rather like metaphors, working by unobtrusive but powerful implications to enforce their special definitions of reality” (Postman 10). A major part of this awareness revolves around trying not to “make the assumption that technology is always a friend to culture” (Postman 157).

To be human in the digital age, means to question technology and change. Humans have been given an amazing ability to think and communicate about these issues that other creatures lack. Therefore, we should be willing to thoughtfully deliberate on these ideas. We need to throw away our belief in “the inevitability of progress” and discard the idea that “history is moving us toward some preordained paradise and that technology is the force behind that movement” (Postman 158). To just accept technology and assume forward progress is to abandon our responsibility. Postman encourages us that “no medium is excessively dangerous if its users understand what its dangers are” (Postman 161). If we are willing and proactive in thinking about and understanding our technology, then we can be prepared to control it, rather than let it control us. In our culture it can be tempting to put technology and its benefits on such a high pedestal that we ignore the other blessings in life. We, as humans, are responsible to consider technology and also to position in the proper place in our priorities. Technology is a formidable and exciting tool and has the power to destroy society when used poorly and improve society when used well. It is our job to discern the difference between these two alternatives.

 

For further reading, check out Postman’s book.

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I’d love to hear what you think about this post. Please leave a comment or shoot me an email with your reactions to the post. Again, thanks for reading!

The Second Amendment and the Right to… Hunt?

I was blessed to be able to travel over to England a few years ago. Among many other unique characteristics of this trip, my Father, Grandmother, and I were able to stay with a few hospitable English families during our travels.

These visits were largely pleasant and good natured but at one point a divisive topic came up. Out of nowhere, our kind, elderly host asked something along the lines of, “Why in the world do you all insist on owning automatic weapons? Couldn’t you hunt just as effectively with far less dangerous weaponry?”

We laughed the question off without really answering it, but in my head I was thinking, “If that’s what you think the Second Amendment is all about, your government has brainwashed you all very effectively.”

I kid to some degree but at the same time this is quite a serious issue. It is no secret that many tyrannical dictators have succeeded in their endeavors by disarming their subjects. Chinese dictator Mao Tze Tung blatantly admitted this fact when he said, “All political power comes from the barrel of a gun. The communist party must command all the guns, that way, no guns can ever be used to command the party.”

Nazi tyrant Adolf Hitler expressed similar ideas, “The most foolish mistake we could possibly make would be to allow the subject races to possess arms.  History shows that all conquerors who have allowed their subject races to carry arms have prepared their own downfall by so doing.  Indeed, I would go so far as to say that the supply of arms to the underdogs is a sine qua non for the overthrow of any sovereignty. So let’s not have any native militia or native police.”

This is not to say that all disarming of citizens undoubtedly leads to tyrannical behavior. However, it is far easier for dictators and tyrants to achieve their nefarious goals when they do not have to worry about resistance from their people.

This type of resistance against overreaching government was exactly why the Founding Fathers emphasized the right to bear arms. It amazes me when people say that the Second Amendment is “merely about hunting” or “was written with muskets in mind and doesn’t apply to modern guns.”

President Thomas Jefferson said, about this issue, “No free man shall ever be debarred the use of arms. The strongest reason for the people to retain the right to keep and bear arms is, as a last resort, to protect themselves against tyranny in government.” George Washington, Patrick Henry, George Mason, John Adams, James Madison, and many other Founding Fathers echoed this same sentiment repeatedly. The right to bear arms is certainly about self defense, but it also serves to dissuade government from despotic behavior.

Based on that idea and the fact that Colonial revolutionaries had weapons identical to the arms of  the British military of the day, one could make the argument that, rather than having their gun ownership limited, modern Americans should actually be allowed much greater access to military-grade weaponry?

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If you have thoughts or questions on this important issue, please leave a comment or shoot me an email. Thanks for reading!

Why the Minimum Wage is Ineffective and Costly

[Note: I was going to post about this topic later in time but given the fact that 19 states just increased their respective minimum wage amounts, I thought it would be especially relevant and interesting today.]

I don’t know about you, but every time I hear somebody praise the minimum wage or recommend that it should be increased, I inwardly (or sometimes outwardly) roll my eyes. That’s not to say I don’t understand this policy’s appeal to many individuals. However, once you look beneath the surface and see how this policy really works and some of its real but hidden consequences, it clearly possesses a host of problems. Based on this policy’s appeal to a wide variety of individuals, I want to offer a non-comprehensive summary of this policy and some of its inefficiencies and costs. I’m going to start this post with an outline of some ways that people might view and justify a minimum wage.

An Unrealistic (But Maybe Common) View of the Minimum Wage

I can’t say the ideas expressed in this section are based off of a single person’s opinion or the opinion of the majority of the minimum wage’s supporters. I do imagine, however, that these are some (potentially common) ways that people might think about and justify this policy.

  1. An increased minimum wage means that all (or most) low wage workers will benefit from a higher income.
  2. An increased minimum wage means that unemployed individuals will be more motivated to enter the job market, will obtain good jobs, and will be better off.*
  3. Companies are greedy and have reserves of money that they can and will open (if legally forced) to pay higher wages to their employees.

While there may be some degree of truth to each of these claims, these views have significant flaws, which will be expounded upon in the rest of this post.

The Reality of the Minimum Wage

What exactly is the minimum wage? The minimum wage is a wage floor or a legal minimum price for many types of labor.** It was designed to help the working poor by enforcing that companies pay a “living wage” (in other words, enough money to live on). In terms of market operations, a minimum wage increases the price of labor without any corresponding increase in the value of labor. (This is a significant disconnect which I’ll talk about more later.)

The fact is that companies (for the most part) seek to make profits and operate in a very competitive environment. Thus, it is hard to justify paying the same people a higher wage in order to do the same task. You might think that for the most part companies can and will just swallow the extra cost, but think about it from your perspective. If the price of a good that you consume increases significantly, do you continue to consume the same amount of that good as before? Unless you absolutely need that good, you likely try to cut back on your consumption and/or find alternatives. Like you, companies tend to be rational, think at the margin, and behave according to universal economic principles. So when price increases (imposition of a minimum wage), quantity demanded (desired number of employees) decreases.

Ways That Companies Respond to a Minimum Wage

Assuming that firms will not just accept these increased labor costs, how exactly do they attempt to cut costs in the face of a minimum wage?

  1. Hire less people. Whenever possible firms will try to replace workers with machines, kiosks, or just try to get more work out of a fewer number of laborers.
  2. Decrease fringe benefits for employees. Just because a company has to pay a certain hourly wage does not mean that they must continue to offer benefits such as employee discounts, paid time off, etc.
  3. Black market activity. Really desperate firms can break the law and try to hire workers at an illegally low wage rate.***
  4. Increased prices for consumers. In the face of higher operating costs companies will seek to share the burden with consumers in the form of higher prices. This will have varied results depending on particular products, markets, etc., but it leads to the potential for making a whole lot of people significantly worse off.

Some Additional Costs of the Minimum Wage

I’ve been quite negative regarding the minimum wage up to this point. I do want to be clear that this policy has at least one benefit: those low income workers who retain their jobs do indeed get to enjoy a higher wage rate. But what are some of the costs that society incurs in order to obtain this single benefit?

  1. Increased prices for consumers. As noted earlier, firms will not bear the burden of higher costs alone, and will share these costs with consumers in the form of higher product prices. Especially for those with smaller incomes (i.e. the poor), this increase in prices has the potential to cause significant harm.
  2. Disemployment of the poorest, most unskilled laborers. When firms are determining who to layoff they will likely get rid of the least skilled, most unproductive workers. Sadly, these are the exact individuals that the minimum wage seeks to help. This policy suffers from a significant disconnect between policy goals and actual outcomes.
  3. Fewer training opportunities. As noted earlier, the minimum wage creates an increase in price without a corresponding increase in value of labor. It makes sense to think that a worker earns low wages or remains unemployed because he/she is unproductive, untrained, or of little value to potential employers. Thus, the more education and training that low income workers can get, the higher wage they can demand. (It’s amazing that all of this can occur without the government intervening to adjust and distort the market… but I digress.) However, if the cost of labor is higher, and firms choose to hire less workers, then opportunities to gain work experience and training decrease significantly.
  4. Potentially fewer incentives to work. Those who remain employed at a higher wage rate might actually be incentivized to work less or not at all. Higher income leads to more taxes and less welfare, so there is a real possibility that the costs of working at a higher wage rate will outweigh the benefits to many individuals.
  5. Increased personal discrimination by employers. Whenever there is a surplus of a good, some sort of rationing mechanism must be in place in order to determine who can obtain the limited supply of said good. Without price to ration goods, employers are free to hire or not hire individuals based on personal characteristics, rather than productivity or other legitimate reasons. For a policy that seems to bear merit based on arguments of equity, this is a disturbing side effect.

Some Policy Alternatives to the Minimum Wage

At the end of the day, this policy intends to improve the lives of heads of households among the working poor.**** Having noted many of this policy’s problems, what are some better, alternative policies? After all, it would be less than productive to point out all of the problems with this policy without listing at least some potential alternatives.

  1. Lower or eliminate payroll taxes for unskilled, low income workers. FICA and state income tax withholdings can significantly decrease the incomes of the working poor. Why not give this concentrated group of hurting individuals a tax break?
  2. Expand or create policies similar to the Earned Income Tax Credit. The EIC is a remarkably effective form of welfare that provides low income, working individuals with a direct reduction in tax liability. It is a concentrated benefit (goes to individuals with an income below a certain amount) but also provides labor incentives (since you must be employed to get it).
  3. Enact contingent welfare policies. These types of programs would provide welfare to workers based on completion of training or some other achievement.
  4. Utilize wage subsidies. Government would, through these types of programs, provide employers with money to give directly to low income workers.

While it is unlikely that any of these policies would perfectly solve social employment problems in our country, they are worth at least considering. Each suggestion has its flaws, but succeeds at least in providing the target group of workers with benefits tied to labor incentives.

Conclusion

I hope you found this post to be informative and helpful. It ended up being pretty long so I hope I didn’t bore you too significantly. This post was HEAVILY influenced by my Intermediate Microeconomic Theory course taught by Dr. D. Eric Schansberg. So for further (and more eloquent) thoughts on these issues, I would point you towards his book Poor Policy: How Government Harms the Poor. Another useful reference book might be our class’ textbook: Microeconomics: Theory and Application by Browning and Zupan.

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Like always, if you have thoughts of consensus or disagreement, please leave a comment or send me an email. I’d love to hear how you’ve thought about or been impacted by these policies. Thanks for reading!

 

Additional Notes:

*This effect likely occurs to some degree but is not really beneficial for two reasons: a) Research shows that generally labor supply is quite inelastic (meaning that increased wages do not lead to significant increased amounts of willing workers). b) And just because individuals and willing and able to work does not ensure that employers will hire them. Without a simultaneous increase in demand for labor, an increase in willing workers, according to this line of thinking, would actually lead to higher unemployment.

**It’s important to note that not all jobs are even covered in minimum wage legislation. 75% of unskilled workers have jobs that are not covered by the minimum wage, such as tipped workers, seasonal workers, farm workers, etc. Clearly this policy fails to impact the lives of many individuals in the specific category (unskilled, low income) that it attempts to better.

***Economic theory would suggest that a minimum wage would create a surplus of available workers, so there would likely be individuals who would be willing to work at lower wages and would be motivated to not turn these firms in to the government.

****It’s also worth noting that the minimum wage impacts not just heads of households. Individuals like high school student seeking to make some extra gas money are impacted in the exact same way as low income, unskilled heads of households. This policy is too broad and impacts a number of individuals who are not the primary target.

Best Economics/Business/Public Policy Books of 2016

In this spirit of “end of the year lists,” here is a list of the best Economics/Business/Public Policy related books that I read this past year:

 

Turn Neither to the Right Nor to the Left: A Thinking Christian’s Guide to Politics and Public Policy by D. Eric Schansberg

Having studied under Dr. Schansberg this past semester I was especially eager to read this book. And after reading it I can honestly say that I don’t know of another book that attempts and succeeds at describing how Christians ought to think about Public Policy from a Biblical perspective. Schansberg maintains a unique level of consistency and subordination to the doctrines of scripture. While you may or may not agree with every single argument, I believe this book brings up issues that are very necessary for believers to consider.

 

Specialization and Trade: A Re-Introduction to Economics by Arnold S. Kling

Dr. Kling uniquely describes Economics as a focus on how specialization and trade impact decisions and outcomes. This book is refreshing in how it states that Economics is not a magic formula that can give correct results based on proper data. Rather, it is a process of looking at historical outcomes and realizing patterns and similarities that might continue into the future. Overall, a unique and interesting take on the study of Economics as a whole.

 

The Law by Frederic Bastiat

This book does a fantastic job of diving into the issue of the purpose of law and how law is often perverted from its proper goal. While dealing with philosophical issues at times, it also looks at a handful of real life examples of government successes and failures. I highly recommend this book for anybody interested in the issue of liberty and the role of government.

 

Financial Shenanigans: How to Detect Accounting Gimmicks & Fraud in Financial Reports by Howard Schilit

While the study of Accounting can be quite dull at times, this book is probably the most interesting and non-boring Accounting-related text that I’ve come across. It deal with common fraud schemes that individuals have used over the years and gives its readers advice on how to detect businesses that are being deceitful. This book is definitely geared towards those who are interested in Accounting or investing and it does a phenomenal job of pointing out which areas of the financial statements individuals should pay attention to.

 

The Goal: A Process of Ongoing Improvement by Eliyahu M. Goldratt

Written in the form of a novel, this book describes Goldratt’s well-known concept of the Theory of Constraints. For those interested in Operations Management or just Business in general, this book presents the Theory of Constraints in a very interesting manner, which is informative but also easy and exciting to read.

 

All Marketers are Liars: The Underground Classic That Explains How Marketing Really Works–and Why Authenticity Is the Best Marketing of All by Seth Godin

Marketing is a fascinating topic to me and this book does a good job of outlining Marketing principles in the context of story-telling. It describes marketing as telling stories that people want to hear and believe, but that do not take advantage of people. There is still a lot that I’d love to learn in this field of study, but this book was a really good start.

 

The Armchair Economist: Economics and Everyday Life by Steven E. Landsberg

This is certainly a good book to read whether or not one has formally studied Economics at all. Each chapter deals with a different real-world issue and shows how the issue at hand relates to the study of Economics. Definitely a riveting read but also very informative and beneficial.

 

Business for the Glory of God: The Bible’s Teaching on the Moral Goodness of Business by Wayne Grudem

While not really ground-breaking in the ideas it presents, this book deals with common myths and misconceptions about Business as it relates to Christianity. Using Biblical evidence it shows that Business goals can often be in accord with the goal of glorifying God. This is a helpful book if you are struggle with reconciling Scriptural evidence with the way businesses operate or if you are engaging with someone who is wrestling with these issues.

 

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As always I’d love to hear what you think about this post and/or these books. If you read other books this year, I’d love to hear about those as well. Feel free to leave a comment or send me an email. Thanks for reading!