Labor Regulations Take Aim at the Economy and Free Speech

Alongside evidence of weak job growth, there are also signs of recovery. What may be recovering, however, is the recession. New orders for manufactured goods declined 13.2% in August, the steepest decline since January 2009. Real average hourly earnings declined 0.6% in August and 0.3% more in September. And the number of persons working only part-time because full-time work was unavailable increased from 7.9 million in August to 8.5 million in September.

Overall, the state of the economy is somewhere between retrogressive and woeful. Detailing the policies and initiatives of the Obama administration that have kept the economy down as it struggled to recover is an immense task, but it needs to be done.

A good place to start is the regulatory burden that has given businesses reasons to think twice about hiring more people. In his last State of the Union Address, Obama claimed, “I’ve approved fewer regulations in the last three years of my presidency than my Republican predecessor did in his.” The Heritage Foundation pointed out that Obama was counting all regulations no matter their size or cost as the same. Many Bush-era regulations eased compliance costs. The Heritage Foundation calculated that in its first three years the Obama administration adopted 106 major regulations that increased costs on private-sector activity compared to 28 such regulations in the first three years of the Bush administration. The regulations of the first three years of the Obama administration imposed $46 billion in annual costs while those of the Bush administration imposed $8.1 billion in annual costs.

Proposed regulations of the Obama administration also have to be added to the toll. Businessmen—as well as farmers—have also had to be concerned about mischievous regulations that, so far, they have been able to fend off. For example, a pair of proposed labor regulations combine Obama’s antipathy for employers with his antipathy for the Constitution. One regulation coerces speech, and the other restrains speech.

The regulation that would coerce speech was adopted by the National Labor Relations Board in August 2011. Observing that union organizing efforts were badly in need of some publicity, the NLRB adopted a regulation requiring employers to post a notice with a rather slanted list of rights. The notice states that employees have a right to join a union, negotiate with an employer through the union, bargain collectively, strike, picket, and lastly choose to do none of those things. The notice does not inform employees of their right to decertify a union, refuse to pay union dues in a right-to-work state, and refuse to pay dues greater than what is required for representational purposes. The rule makes failure to hang up the notice an unfair labor practice.

The NLRB’s statutory authority for this command is dubious. Board member Brian Hayes wrote a withering dissent that opened with Justice Scalia’s observation that “agencies may play the sorcerer’s apprentice but not the sorcerer himself” and concluded that the regulation is “both unauthorized and arbitrary and capricious.”

Lawsuits were filed against the rule in federal courts in South Carolina and the District of Columbia. The lawsuits argued that the National Labor Relations Act did not authorize the National Labor Relations Board to require a poster and that the regulation compelled employers to present a pro-union message on their property and was therefore unconstitutional, like the New Hampshire law that had required “Live Free or Die” to be on every license plate. During the litigation, the NLRB repeatedly postponed implementing the rule.

The courts split on whether the NLRB exceeded its authority. The South Carolina district court said there are many federal statutes that call for the posting of notices, and the National Labor Relations Act is not one of them. Nonetheless, the D.C. district court held that the rule was somewhere within the NLRB’s rulemaking powers. Regarding the constitutional issue, the D.C. district court said the rule does not compel employers to say anything. The notice is the government’s speech, the government’s message.

Both cases are on appeal. The D.C. district court enjoined enforcement of the rule during the appeals.

The U.S. Department of Labor Unions proposed the regulation that would restrain free speech. That regulation would constrict an exemption from a reporting requirement under the Labor-Management Reporting and Disclosure Act of 1959. The Act requires employers to report in detail any agreements with or payments to a consultant who undertakes activities to persuade employees on whether or not to organize and bargain collectively. The Act has an exemption providing that reports are not required on account of advice to an employer. For years the Labor Department had interpreted the exemption to cover activities that involved both advice to the employer and persuasion of employees. In June 2011 the Department proposed a regulation, known as “the persuader rule,” changing its interpretation of the exemption so that it covers only services related exclusively to advice. If any part of the service is to persuade employees, directly or indirectly, then the exemption is lost.

The Department received hostile comments on the proposal not only from the Chamber of Commerce, as you might expect, but also from the American Bar Association. The Chamber and the Bar Association said the persuader rule’s new subjective test made the advice exemption meaningless. The Bar Association said that the persuader rule would thwart the will of Congress, conflict with the ABA Model Rule on confidentiality, and undermine both the confidential lawyer-client relationship and employers’ right to counsel.

Faced with that opposition, the Labor Department has taken no further action on the persuader rule. The Department may be waiting until after the election. The rule could be part of the unknown, unspoken agenda for a second term.

If the persuader rule ever is adopted, it too should be challenged on constitutional grounds. The Supreme Court has not yet directly addressed whether attorney advice is protected speech and, if so, what level of scrutiny should be given to regulation of it. Renee Knake argues in a recent law review article that attorney advice is protected speech and restraints on attorney advice should be given strict scrutiny. That is, they are unconstitutional unless they are necessary to further a compelling governmental interest and are narrowly tailored to do so using the least restrictive means.

These two latent regulations of the NLRB and the Department of Labor are not “regulations on Wall Street,” as Obama likes to refer to all of his regulations. Wall Street firms, not being labor intensive, would be among the enterprises least burdened by these rules.

The rules are far from the administration’s worst insult to the First Amendment (that prize goes to the suppression of the free exercise of religion by the Department of Health and Human Services), but they are part of a pattern of not allowing the First Amendment, the Recess Clause, the Presentment Clause, the Commerce Clause, or anything else get in the way of the task of suppressing the economy.

With mischief like these regulations in mind, Mitt Romney said at the second debate, “I talk to small business across the country. They say, ‘We feel like we’re under attack from our own government.’” Denying that Obama is hostile to business, Democrats insist that his infamous taunt “You didn’t build that” has to be taken in context. I agree. The context is his presidency.

The Tea Party will win in the end

Frank Rich, a furious and frantic left wing writer, formerly writing for the NY Times, has concluded that liberalism will not be successful in transforming American society because the American public “loathes government and always has.” His essay in New York magazine is interesting although it drifts into his usual hostile rhetoric in the end.

Were the 2012 campaign a Hitchcock movie, Mitt Romney would be the MacGuffin—a device that drives a lot of plot gyrations but proves inconsequential in itself. Then again, Barack Obama could be, too. Our down-to-the-wire presidential contest is arguably just a narrative speed bump in the scenario that has been gathering steam throughout the Obama presidency: the resurgence of the American right, the most determined and coherent political force in America. No matter who is elected president, what Romney calls severe conservatism will continue to consolidate its hold over one of our two major parties. And that party is hardly destined for oblivion. There’s a case to be made that a tea-party-infused GOP will have a serious shot at winning future national elections despite the widespread liberal belief (which I have shared) that any party as white, old, and male as the Republicans is doomed to near or complete extinction by the emerging demographics of 21st- ­century America.

Here, Rich cannot resist dismissing Romney as an “inconsequential plot device” but he does recognize that conservatism is more in tune with American values than the political left, of which he is an enthusiastic member.

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Global Warming ended 15 years ago

There is still considerable talk about global warming, or as it is now termed, “climate change.” California is about to destroy a large part of what is left of its economy by initiating a new “Cap and Trade” program that will spike energy costs and drive more employers from the state. New reports are casting more doubt on the reality of “climate change” and now there is more information that warming ended in 1997. The past two years have shown a definite cooling trend.

The world stopped getting warmer almost 16 years ago, according to new data released last week.

The figures, which have triggered debate among climate scientists, reveal that from the beginning of 1997 until August 2012, there was no discernible rise in aggregate global temperatures.

This means that the ‘plateau’ or ‘pause’ in global warming has now lasted for about the same time as the previous period when temperatures rose, 1980 to 1996. Before that, temperatures had been stable or declining for about 40 years.

There is even new debate among climate scientists.

Some climate scientists, such as Professor Phil Jones, director of the Climatic Research Unit at the University of East Anglia, last week dismissed the significance of the plateau, saying that 15 or 16 years is too short a period from which to draw conclusions.

Others disagreed. Professor Judith Curry, who is the head of the climate science department at America’s prestigious Georgia Tech university, told The Mail on Sunday that it was clear that the computer models used to predict future warming were ‘deeply flawed’.

Even Prof Jones admitted that he and his colleagues did not understand the impact of ‘natural variability’ factors such as long-term ocean temperature cycles and changes in the output of the sun. However, he said he was still convinced that the current decade would end up significantly warmer than the previous two.

California, of course, is not going to wait to see if the trend continues with cooling.

Oct 2 (Reuters Point Carbon) – California Governor Jerry Brown has signed two bills related to the use of revenue raised through the sale of carbon allowances, although details of how the money will be spent won’t be determined until next year.

The bills are the first to address the estimated $660 million and $3 billion in revenue that will be generated during the first year of California’s carbon cap-and-trade scheme, which begins in January.

The first bill creates a new account for the revenue to be deposited into, and directs the Department of Finance and the California Air Resources Board (ARB) to develop an investment plan for the funds.

That plan, expected to be released in the spring of 2013, will be submitted for approval to the legislature as part of the governor’s budget and will be reviewed and updated on an annual basis.

It doesn’t matter that the state is going broke. Left wing pieties still rule California.

The Romney tax cut.

Today, the Sunday morning TV shows on politics demonstrated the response of the Obama campaign to Romney’s debate win last week. Paul Krugman, who looks more and more like a political cheerleader and less like an economist, led the charge. The topic was the “five trillion dollar tax cut.”

The Obama campaign is already backing away from this claim, but let’s consider it.

This “five trillion dollar tax cut” figure is arrived at by taking his statement that he will cut rates by 20% and limit deductions. Multiple the total tax revenue per year by 20% and you get five trillion. This same reform was done in 1986 and the result was a 15 year economic boom. The results are discussed here.

Twenty years ago today (2006), President Ronald Reagan signed into law the broadest revision of the federal income tax in history. The Tax Reform Act of 1986 — the biggest and most controversial legislative story of its time — had lawmakers, lobbyists and journalists in Washington in an uproar for two years. Despite nearly dying several times, the measure eventually passed, producing a simpler code with fewer tax breaks and significantly lower rates. The changes affected every family and business in the nation.

Of course the Congress undid it over the ensuing years. We all expected that. What about Romney’s plan ?

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RuiNation

So a little over six weeks to go until Election Day; I guess we can call this the final heat. Texas is pretty much a red state stronghold, although there are pockets of blue adherents throughout. Yes, even in my neighborhood, there are a handful of defiant Obama-Biden yard signs visible, although outnumbered at least two to one by Romney-Ryan signs. It amounts to about a dozen, all told; I think that most of my neighbors prefer keeping their political preferences this time around strictly to themselves.

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