Stories
Slash Boxes
Comments

SoylentNews is people

posted by martyb on Friday January 19 2018, @12:06PM   Printer-friendly
from the Invisible-hand dept.

Found this interesting, you may too.

A new research paper that may help unlock the mystery of why Americans can't seem to get a decent raise. Economists have struggled over that question for years now, as wage growth has stagnated and more of the nation's income has shifted from the pockets of workers into the bank accounts of business owners. Since 1979, inflation-adjusted hourly pay is up just 3.41 percent for the middle 20 percent of Americans while labor's overall share of national income has declined sharply since the early 2000s. There are lots of possible explanations for why this is, from long-term factors like the rise of automation and decline of organized labor, to short-term ones, such as the lingering weakness in the job market left over from the great recession. But a recent study by a group of labor economists introduces an interesting theory into the mix: Workers' pay may be lagging because the U.S. is suffering from a shortage of employers.

[...] argues that, across different cities and different fields, hiring is concentrated among a relatively small number of businesses, which may have given managers the ability to keep wages lower than if there were more companies vying for talent. This is not the same as saying there are simply too many job hunters chasing too few openings—the paper, which is still in an early draft form, is designed to rule out that possibility. Instead, its authors argue that the labor market may be plagued by what economists call a monopsony problem, where a lack of competition among employers gives businesses outsize power over workers, including the ability to tamp down on pay. If the researchers are right, it could have important implications for how we think about antitrust, unions, and the minimum wage.

Monopsony is essentially monopoly's quieter, less appreciated twin sibling. A monopolist can fix prices because it's the only seller in the market. The one hospital in a sprawling rural county can charge insurers whatever it likes for emergency room services, for instance, because patients can't go elsewhere. A monopsonist, on the other hand, can pay whatever it likes for labor or supplies, because it's the only company buying or hiring. That remote hospital I just mentioned? It can probably get away with lowballing its nurses on salary, because nobody is out there trying to poach them.

[...] Harvard University labor economist Lawrence Katz told me that he suspected the findings about market concentration and wages were directionally correct but that they may be a bit "overstated," because it's simply hard to control for the health of the labor market.

"They are getting at what is an important and underexplored topic ... using a creative approach of using really rich data," he said. "I don't know if I would take perfectly seriously the exact quantitative estimates."

Still, even if the study is only gesturing in the direction of a real problem, it's a deeply worrisome one. We're living in an era of industry consolidation. That's not going away in the foreseeable future. And workers can't ask for fair pay if there aren't enough businesses out there competing to hire.

Article summarizing study:
Why Is It So Hard for Americans to Get a Decent Raise?

Actual study (limited access): http://www.nber.org/papers/w24147

FYI: Number of companies on America's stock exchanges has decreased by 50% since 1998


Original Submission

 
This discussion has been archived. No new comments can be posted.
Display Options Threshold/Breakthrough Mark All as Read Mark All as Unread
The Fine Print: The following comments are owned by whoever posted them. We are not responsible for them in any way.
  • (Score: 5, Insightful) by GreatAuntAnesthesia on Friday January 19 2018, @12:30PM (47 children)

    by GreatAuntAnesthesia (3275) on Friday January 19 2018, @12:30PM (#624656) Journal

    Clearly, what this demonstrates is the need to further enable the Job Creators to create more jobs. Less corporate taxes! More mergers and buyouts! Less environmental controls! More regulatory capture! Less worker rights! Lower wages! Higher corporate bonuses! More no-compete clauses! It's the only answer.

    Starting Score:    1  point
    Moderation   +4  
       Insightful=4, Total=4
    Extra 'Insightful' Modifier   0  
    Karma-Bonus Modifier   +1  

    Total Score:   5  
  • (Score: -1, Spam) by Anonymous Coward on Friday January 19 2018, @12:36PM (3 children)

    by Anonymous Coward on Friday January 19 2018, @12:36PM (#624657)

    I... saw a vision. A vision about the future. A vision about the future of a particular thing. Yes, that's right: I can see the future of your ass. I'm the Assteller.

    You can't stop chuckling. "What a bunch of idiots they were to fall for such an obvious scam!" you think to yourself. Just remembering what you did makes you laugh uncontrollably. You scammed innumerable cabbage patch kids out of their billion buck bills by trading envelopes supposedly containing more than one billion buck bill for their billion buck bills. Of course, the envelopes were completely empty. Now you're rich and those suckers are poor. All you have to do is figure out how to use the money.

    All of a sudden, you sense countless entities in the room with you. You look around and notice that you're surrounded by the various cabbage patch kids you scammed, and all of them are furious. You begin laughing at them, and then you turn your bootysnap into a spaghetti noodle of colossal proportions and suck every last one of the of those foolish toys right up your butt. Once again, you're the number one winner. You begin celebrating your victory, but then notice that something is amiss.

    What is this feeling? You find a mirror and use it to look at your bare ass. "What is that thing!?" you shout. "It's an abomination!" An abomination had replaced your ass! The thing that was now where your snap used to be shared absolutely zero similarities with your previous ass. Where did it come from, and who stole your real ass? Just then, it hit you.

    Knowledge entered your brain. Ancient knowledge. The thing where your ass used to be is, in fact, your ass! However, the cabbage patch kids you sucked up turned it into a rumblehouse and are about to use it as a bouncehouse. Though you cannot fathom what it would be like for your ass to be used as a bouncehouse, every fiber of your being is stricken by a sense of imminent danger. But even that sense of extreme danger pales in comparison to what you feel next: Tickle! Your ass... it tickles! This is the sort of tickle that would render any being a mere shadow of its former self. You scream. Oh, yes, you scream. If you weren't trapped in an enigmatic alternate dimension, your scream is such that it could be heard in every corner of the world. The cabbage patch kids, however, continue to mercilessly bounce off of every molecule in the mazes of your ass...

    • (Score: 2, Insightful) by GreatAuntAnesthesia on Friday January 19 2018, @12:50PM (2 children)

      by GreatAuntAnesthesia (3275) on Friday January 19 2018, @12:50PM (#624662) Journal

      I thought Jenkem was just an urban myth, but this latest shitposter is making me question that.

      • (Score: -1, Offtopic) by Anonymous Coward on Friday January 19 2018, @03:24PM (1 child)

        by Anonymous Coward on Friday January 19 2018, @03:24PM (#624710)

        Every time I see it, I get more and more curious to know just WTF he's on about. Is it copypasta from somewhere? Original work? Is there a hidden meaning? Sexual fetish? Stenography or some other form of code? Does he know de wae?

        • (Score: 2) by Azuma Hazuki on Friday January 19 2018, @09:22PM

          by Azuma Hazuki (5086) on Friday January 19 2018, @09:22PM (#624912) Journal

          Probably just one guy, maybe a few, who wrote some basic template and just play with it every iteration for laughs. They're probably proxying too, so the forum's software can't just go "Nope, this IP sends nothing but shit."

          --
          I am "that girl" your mother warned you about...
  • (Score: -1, Spam) by Anonymous Coward on Friday January 19 2018, @12:39PM

    by Anonymous Coward on Friday January 19 2018, @12:39PM (#624659)

    What? A face...? Why is a small face sticking out of my asshole...? And... why does that face wear such a malicious grin...? It looks just like an ENO! IT TICKLES! STOP! NO! DON'T TWIST YOUR NECK LIKE THAT! NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!

  • (Score: 2) by realDonaldTrump on Friday January 19 2018, @01:03PM (22 children)

    by realDonaldTrump (6614) on Friday January 19 2018, @01:03PM (#624665) Homepage Journal

    Lower taxes for American businesses means higher wages for American workers! Wells Fargo, Visa, Aflac, Bank of America, U.S. Bank, Nationwide Insurance, Comcast, JetBlue, AT&T, Walmart, Target, American Airlines all announcing wage increases or bonuses!!!!

    Jobs coming back to America, big announcement from Apple. Chrysler is coming back to the USA, from Mexico and many others will follow. Tax cut money to employees is pouring into our economy with many more companies announcing. American business is hot again! 🔥

    • (Score: 2, Interesting) by Anonymous Coward on Friday January 19 2018, @01:26PM (20 children)

      by Anonymous Coward on Friday January 19 2018, @01:26PM (#624670)

      > Chrysler is coming back to the USA

      Sorry, wrong answer. FIAT/FCA is going to take Chrysler apart at the first opportunity, and sell Jeep to the highest bidder. Hyundai is the latest rumored buyer. RAM trucks might be worth something and the rest (cars) will be scrapped. Maybe the hot rod group will survive as a niche player, making Dodge Demons and the like for rich customers.

      • (Score: 2) by realDonaldTrump on Friday January 19 2018, @02:04PM (16 children)

        by realDonaldTrump (6614) on Friday January 19 2018, @02:04PM (#624681) Homepage Journal

        RAM truck factory coming back from Mexico! 🏭

        • (Score: 1, Interesting) by Anonymous Coward on Friday January 19 2018, @03:09PM (14 children)

          by Anonymous Coward on Friday January 19 2018, @03:09PM (#624700)

          > RAM truck factory coming back from Mexico

          Sure, a short term win for the old Warren plant. But Chrysler is going to be taken apart and sold piecemeal in the near future. Who knows where the new owner(s) will move production. One thing for sure, any profits will not be coming to USA, FCA is Italian owned and the new owners of Jeep and/or RAM will not be Ford or GM.

          Also, there are no layoffs in Mexico, those plants will keep right on humming with a different product mix. In response to possible increased tariffs for vehicles entering the USA, the trucks made in the Mexican plants will be shipped to other markets, likely S. America.

          • (Score: 2) by GreatAuntAnesthesia on Friday January 19 2018, @03:52PM (13 children)

            by GreatAuntAnesthesia (3275) on Friday January 19 2018, @03:52PM (#624731) Journal

            Dude, look who you are arguing with: This guy has been channelling Donald Trump on this forum for months either because (a) performance art (b) he really believes he's Trump (c) some kind of advanced new trolling technique too subtle for my ken (d) he's practising for a real life career as an orange turd impersonating.

            Any which way, he copies Don very well. That means any reasoned, logical arguments you present are going to get farted away by irrelevant, truthless twatter. You are wasting your pixels.

            • (Score: 0) by Anonymous Coward on Friday January 19 2018, @04:19PM (6 children)

              by Anonymous Coward on Friday January 19 2018, @04:19PM (#624756)

              > This guy ...
              Wouldn't you be surprised if the fake-Trump was female...?

              • (Score: 3, Informative) by GreatAuntAnesthesia on Friday January 19 2018, @04:23PM (5 children)

                by GreatAuntAnesthesia (3275) on Friday January 19 2018, @04:23PM (#624758) Journal

                No, not really. I was just using the masculine as a shorthand for "this unknown person of indeterminate gender".

                • (Score: 3, Informative) by realDonaldTrump on Friday January 19 2018, @08:22PM

                  by realDonaldTrump (6614) on Friday January 19 2018, @08:22PM (#624878) Homepage Journal

                  I guarantee you there’s no problem there. I have four beautiful children: Barron, Ivanka, Donald Jr. and Eric. And Tiffany.

                • (Score: 1, Insightful) by Anonymous Coward on Friday January 19 2018, @08:51PM (3 children)

                  by Anonymous Coward on Friday January 19 2018, @08:51PM (#624893)

                  I've taken to saying "they" which is a little imprecise when talking about a single person, but is common enough that I feel comfortable using it for genderless discussions.

                  • (Score: 0) by Anonymous Coward on Friday January 19 2018, @09:47PM (2 children)

                    by Anonymous Coward on Friday January 19 2018, @09:47PM (#624933)

                    I says dude in like the dude has a nice dress and the other dude a nice pickup dude !!

                    • (Score: 0) by Anonymous Coward on Friday January 19 2018, @10:12PM (1 child)

                      by Anonymous Coward on Friday January 19 2018, @10:12PM (#624954)

                      How does it feel being uncomfortable with reality 24/7? Do you get urges to hit random people? Are bar fights something you consider "normal"?

                      • (Score: 1, Funny) by Anonymous Coward on Saturday January 20 2018, @01:27AM

                        by Anonymous Coward on Saturday January 20 2018, @01:27AM (#624999)

                        Duuude, why the hate dude?

            • (Score: 3, Interesting) by All Your Lawn Are Belong To Us on Friday January 19 2018, @08:50PM (4 children)

              by All Your Lawn Are Belong To Us (6553) on Friday January 19 2018, @08:50PM (#624892) Journal

              Or.... he's real. :O :O

              No, I don't really believe that, but it is an alternative.

              --
              This sig for rent.
              • (Score: 2) by Azuma Hazuki on Friday January 19 2018, @09:23PM (3 children)

                by Azuma Hazuki (5086) on Friday January 19 2018, @09:23PM (#624913) Journal

                There is no way in Hell that is the real Trump. Much too coherent, for one thing. The real deal doesn't speak at such a high vocabulary level either. It's a very good attempt, and darkly amusing to read, but it can't possibly be him.

                --
                I am "that girl" your mother warned you about...
                • (Score: 3, Insightful) by GreatAuntAnesthesia on Saturday January 20 2018, @01:57AM (2 children)

                  by GreatAuntAnesthesia (3275) on Saturday January 20 2018, @01:57AM (#625004) Journal

                  You're almost certainly right. But you know what? Just in case... just on the one in a billion chance that we are in fact blessed by the presence of the Pussygrabber-in-chief himself, I'm going to leave this here.

                  DONALD TRUMP DONALD TRUMP DONALD TRUMP DONALD TRUMP DONALD TRUMP 1

                  Donald, if you're reading, I wrote this specially for you:

                  Hey Don!

                  Your wife won't touch you,
                  Your kids are just using you,
                  Your party barely tolerates you,
                  Your country is ashamed of you,
                  The world thinks you're a joke.

                  And all your wealth and power,
                  So cruelly won,
                  offers you less comfort than a two dollar cheeseburger.

                  Tell me Don,
                  Does it feel like winning yet?

                  DONALD TRUMP DONALD TRUMP DONALD TRUMP DONALD TRUMP DONALD TRUMP

                  1 Apparently he rarely reads anything unless he sees his own name written prominently all over it.

                  • (Score: 2) by realDonaldTrump on Saturday January 20 2018, @04:46AM (1 child)

                    by realDonaldTrump (6614) on Saturday January 20 2018, @04:46AM (#625041) Homepage Journal

                    Are you tired of winning yet? Brexit is going beautifully, the pound is at RECORD LEVELS, @BorisJohnson [twitter.com] is building that beautiful bridge to France, my nuclear guys are working on baby nukes for your Trident missiles. To go into your missiles. Very soon. And if you call your stock broker, I think he'll have some very nice news for you. But it sounds like you're getting tired of winning. Like it's too much winning for you. I’m sorry, but we’re going to keep winning, winning, WINNING. Except in the last election, not a great one for UKIP. Let me tell you, Nigel is a terrific guy. He shouldn't have quit. I love him to death, but it was the wrong time. They lost very badly. But they also WON. Because they made Brexit happen. And it's going much better than anyone expected. Believe me, UKIP can come back. If the Tories break their promises, if you need to TAKE BACK YOUR COUNTRY just like we're doing in the USA, you'll bring back UKIP in a big way. I always say, never give up. I turned my biggest challenges into success.

                    Let me tell you, the Japs make a mean cheeseburger. They made me one with Colby Jack, it only cost $11. 🍔 When I had lunch with @AbeShinzo [twitter.com]. It was delicious. Better than sex. The best part, there's no tipping in Japan. pic.twitter.com/9RiaibqNLO [t.co] 🇯🇵

            • (Score: 0) by Anonymous Coward on Friday January 19 2018, @09:12PM

              by Anonymous Coward on Friday January 19 2018, @09:12PM (#624904)

              You forgot:
              (e) obsessed with writing first-person fan fiction.

        • (Score: 3, Funny) by fido_dogstoyevsky on Friday January 19 2018, @10:05PM

          by fido_dogstoyevsky (131) <axehandleNO@SPAMgmail.com> on Friday January 19 2018, @10:05PM (#624949)

          RAM truck factory coming back from Mexico!

          Better write a memo to put a REALLY BIG gate in the wall...

          --
          It's NOT a conspiracy... it's a plot.
      • (Score: 0) by Anonymous Coward on Friday January 19 2018, @02:59PM (1 child)

        by Anonymous Coward on Friday January 19 2018, @02:59PM (#624696)

        RAM trucks might be worth something

        SRAM or DRAM? :-)

        • (Score: 1, Touché) by Anonymous Coward on Friday January 19 2018, @03:09PM

          by Anonymous Coward on Friday January 19 2018, @03:09PM (#624702)

          SRAM makes bicycle components...

      • (Score: 3, Informative) by Sulla on Friday January 19 2018, @05:46PM

        by Sulla (5173) on Friday January 19 2018, @05:46PM (#624789) Journal

        Really kind of a shame. Ford wanted to buy Jeep when Chrysler collapsed but wasn't allowed to, now they will have to buy it from Fiat as the middle man.

        --
        Ceterum censeo Sinae esse delendam
    • (Score: 0) by Anonymous Coward on Saturday January 20 2018, @09:56AM

      by Anonymous Coward on Saturday January 20 2018, @09:56AM (#625110)

      Lower taxes for American businesses means higher wages for American workers

      That's been the Repug mantra for decades.
      The fact is that Trickle Down doesn't.

      Radio/TV presenter Thom Hartmann has been pounding on this exact topic lately.
      MP3 [kpfk.org] available until late February.
      14MB for the whole hour; The stuff I'm pointing to is in the first 6MB (16:15).
      His setup explanation starts at ~1:00.
      If you're impatient, the part that directly addresses tax cuts begins at ~9:20, after the break.

      Text version. [alternet.org]

      wage increases or bonuses

      I haven't seen anybody getting raises.
      There have been some 1-time bonuses.

      Walmart gave 1 of those.
      ...but if you haven't been there for 20 years, you get squat.

      Oh, and right after that, they closed dozens and dozens and dozens of Sam's Club stores.
      There was zero notice to the workers.
      Some showed up to work to find the place shuttered.
      Federal law says they have to give 60 days notice.
      Walmart is run by criminals.

      -- OriginalOwner_ [soylentnews.org]

  • (Score: 5, Insightful) by crafoo on Friday January 19 2018, @02:46PM (16 children)

    by crafoo (6639) on Friday January 19 2018, @02:46PM (#624689)

    I know you are being sarcastic and I agree with your sentiment. However, the barriers to starting a small 1 to 5 person company and competing are huge, almost insurmountable. Regulatory capture is a real issue (bribing to write the laws to benefit large corps). But yes, we have also taken our local and federal laws too far. Unnecessary paperwork and bureaucratic oversight is a serious issue. Most of this is just welfare for non-productive people who can't cut it on their own, so they must leach off of everyone else getting paid as a government bureaucrat. Also, yes, let's talk about tax law. It's insane. It's crushing for small businesses. I wouldn't be so quick to scoff at the article. I think they are on to something.

    • (Score: 1, Interesting) by Anonymous Coward on Friday January 19 2018, @03:32PM (2 children)

      by Anonymous Coward on Friday January 19 2018, @03:32PM (#624716)

      This was pretty much my first thought. We've got huge regulatory burdens that the big companies love because it makes it so hard to start up any competitor. Most of the US regulatory structure is set up this way (and see TBTF banks for a terminal version of the issue) and there's not much being done about it. Even Trumps "two regulations out for every one added" is barely in the ballpark, since it's easy to game that system by making fewer but much longer and more detailed regulations.

      Wonder if these researchers bothered to plot their data against the length of the Federal Register...

      • (Score: 1, Insightful) by Anonymous Coward on Friday January 19 2018, @05:34PM (1 child)

        by Anonymous Coward on Friday January 19 2018, @05:34PM (#624786)

        It's an arms race. If big business was not mercilessly and ruthlessly gaining from edge cases and loopholes, then govt would not have to add more rules.

        I mean, in what universe is it common sense to funnel money through the Camen Islands via the Netherlands and into Ireland to avoid taxation in the USA? It's the equivalent of hacking computers to encrypt your hard disk. If you didn't want that, then surely you wouldn't have allowed it to happen right?

        • (Score: 1, Insightful) by Anonymous Coward on Friday January 19 2018, @08:16PM

          by Anonymous Coward on Friday January 19 2018, @08:16PM (#624873)

          Well, it is currently an arms race, but it doesn't have to be. The bigger and more complex the rule-set, the easier it is to game. Slimming it down to more basic rules would help, but the entrenched bureaucracy doesn't function well in those kind of situations. The prefer tons of bright-line laws they can auto-pilot to rather than need to think about and evaluate.

    • (Score: 5, Insightful) by GreatAuntAnesthesia on Friday January 19 2018, @03:58PM (1 child)

      by GreatAuntAnesthesia (3275) on Friday January 19 2018, @03:58PM (#624738) Journal

      I wasn't scoffing at the article, I was scoffing at the idiots who genuinely think that what I posted is the correct response to the article.

      Also, if you look closely that I mentioned "regulations" and "regulatory capture" separately. I did this because while I acknowledge that regulatory capture is bad, I don't see it as a reason to get rid of ALL regulations. There is a sweet-spot between "can't tie your laces without filling in an environmental impact assessment" and "zero rules corporate cagefight to the death".
      Baby, bathwater.

      • (Score: 4, Insightful) by Azuma Hazuki on Friday January 19 2018, @09:25PM

        by Azuma Hazuki (5086) on Friday January 19 2018, @09:25PM (#624915) Journal

        Most of the people who can say "regulatory burdens harm big corporations" with a straight face are too stupid or too evil to handle that kind of nuance. It's frustrating as hell, isn't it?

        --
        I am "that girl" your mother warned you about...
    • (Score: 5, Insightful) by Gaaark on Friday January 19 2018, @04:06PM (5 children)

      by Gaaark (41) on Friday January 19 2018, @04:06PM (#624744) Journal

      Only thing is: they're just realising this now?

      They couldn't see that the disappearance of the small mom and pop joints in favour of mea-corps was bad? Let's INCREASE COMPETITION!!...between these 2-3 big corps who, by the way, have colluded to keep prices artificially high. WE'RE GREAT!!

      Dismantle big corps, increase competition and take corporate donations out of politics and keep personal donations to, say, $100.

      Bring politics back TO the people, FOR the people! (And no, corporations are not people).

      --
      --- Please remind me if I haven't been civil to you: I'm channeling MDC. ---Gaaark 2.0 ---
      • (Score: 1, Insightful) by Anonymous Coward on Friday January 19 2018, @05:37PM (2 children)

        by Anonymous Coward on Friday January 19 2018, @05:37PM (#624788)

        I can't believe I agree with one of the resident wingnuts. You're a fucking dick for ruining my 100% record of disagreeing with everything you say.

        • (Score: 2) by Gaaark on Friday January 19 2018, @05:48PM

          by Gaaark (41) on Friday January 19 2018, @05:48PM (#624791) Journal

          And YOU get ONE Internet Insightful! for realizing a dick is not always a dick. Yay! :)

          --
          --- Please remind me if I haven't been civil to you: I'm channeling MDC. ---Gaaark 2.0 ---
        • (Score: 3, Insightful) by Azuma Hazuki on Friday January 19 2018, @09:26PM

          by Azuma Hazuki (5086) on Friday January 19 2018, @09:26PM (#624916) Journal

          The truth is the truth, no matter who says it. Genetic fallacy may be the biggest problem for most Americans' ability to process information.

          --
          I am "that girl" your mother warned you about...
      • (Score: 1) by Gault.Drakkor on Friday January 19 2018, @08:45PM

        by Gault.Drakkor (1079) on Friday January 19 2018, @08:45PM (#624889)

        Mere price collusion should be remedied by new players. If there are no new players, then what is stopping them?
        Pretty sure its mostly caused by high barriers to entry. ( natural monopolies, regulatory capture, monopoly extension to other sectors)

        So the answer is not to indiscriminately dismantle the corps.(Look how well that worked for the case of Ma Bell.)
        The answer is to identify the barrier(s) to entry and remove those.

        In the case of telecoms it's the hardware network, the frequency allocations. Pull all that into utility companies that are state/public owned. Mandate that service provision, infrastructure must be handled by separate independent entities.

        With that separation then there are lower barriers to entry for service providers, and thus much easier to have meaningful competition.

      • (Score: 2) by Joe Desertrat on Sunday January 21 2018, @10:54PM

        by Joe Desertrat (2454) on Sunday January 21 2018, @10:54PM (#625854)

        Dismantle big corps, increase competition and take corporate donations out of politics and keep personal donations to, say, $100.

        This would require government regulation.

    • (Score: 3, Insightful) by Thexalon on Friday January 19 2018, @05:23PM (3 children)

      by Thexalon (636) on Friday January 19 2018, @05:23PM (#624780)

      However, the barriers to starting a small 1 to 5 person company and competing are huge, almost insurmountable.

      It varies a great deal depending on what kind of business you're trying to start.

      For example, in a relatively unregulated business like, say, software development or floral arranging, all you need to do to start a company is hang out the proverbial shingle and start selling services, and you're officially a sole proprietorship. You can get bank accounts and such as a sole proprietor if you like. If you want to formalize things a bit and limit your liability, fill out the forms from your state government and pay a fairly small fee (in my state, it's somewhere around $50) and become an LLC. And at that point, you're a business owner, congratulations. The main limits on your growth at that point are (a) acquiring customers, and (b) keeping them happy, which I'll admit are challenges but not because of anything the government did.

      If, on the other hand, you're trying to get into a tightly regulated business, like restaurants and heavy industry, then yes, you need to jump through more hoops. Some of those hoops are due to regulatory capture, but some of them exist for very good reasons, like preventing thousands of people sick from food-poisoned sushi or workers getting killed due to unsafe work environments.

      --
      The only thing that stops a bad guy with a compiler is a good guy with a compiler.
      • (Score: 2) by sjames on Friday January 19 2018, @06:17PM (1 child)

        by sjames (2882) on Friday January 19 2018, @06:17PM (#624810) Journal

        You forgot the business license. If you actually hire an employee, you'll need to withold taxes and issue a W-2. You'll need to collect and submit sales tax and make sure to keep a record of sales if you're audited. Even if you have a calculator and aren't afraid to use it, you may need a CPA to make sure you don't have tax trouble.

        • (Score: 3, Insightful) by Thexalon on Friday January 19 2018, @07:31PM

          by Thexalon (636) on Friday January 19 2018, @07:31PM (#624848)

          You forgot the business license.

          Again, there are many businesses that don't need a license.

          If you actually hire an employee, you'll need to withold taxes and issue a W-2. You'll need to collect and submit sales tax and make sure to keep a record of sales if you're audited. Even if you have a calculator and aren't afraid to use it, you may need a CPA to make sure you don't have tax trouble.

          Yes, you either need to keep track of your income and expenses, or hire somebody else to do it. And you need to pay taxes on that income or expense as well - nothing new there. My experience is that this is far from the biggest hurdle to being in business. Ditto for my step-brother, who owns a pet supply/services store: The government is not his biggest problem, not by a long shot.

          --
          The only thing that stops a bad guy with a compiler is a good guy with a compiler.
      • (Score: 0) by Anonymous Coward on Friday January 19 2018, @08:24PM

        by Anonymous Coward on Friday January 19 2018, @08:24PM (#624879)
    • (Score: 5, Insightful) by JoeMerchant on Friday January 19 2018, @06:01PM

      by JoeMerchant (3937) on Friday January 19 2018, @06:01PM (#624801)

      I had a friend who drove big trucks and excavators for a living. He summed up the free market from his perspective very succinctly: "Truck drivers are idiots. They're all out there undercutting each other just to get a job and they cut their profit margins so thin that they end up losing money when anything out of the ordinary costs them extra, and even sometimes when everything goes right." I believe Uber has honed in on this failing in common persons' business sense to take advantage of people who drive their own vehicles for the service. It's all well and good to say "the market will prevail, eventually enough truck/Uber drivers will bankrupt that supply decreases and prices will rise to a sustainable level," but... is it really guaranteed that rates will rise, or will these self-managed businesses continue to create a continuous stream of idiots in default on their debts / bankruptcy? And, who foots the bill for bankruptcies? Everyone else who isn't declaring bankruptcy, that's who.

      So, we've got small businesses trying to compete with big businesses on a slanted playing field, and we've also got big businesses taking advantage of independent contractors who don't know any better than to work for free (long term.) It's not surprising at all that the bigger businesses, with surplus manpower and funds, can lobby the legislatures to slant the competitive landscape in their favor.

      --
      🌻🌻 [google.com]
  • (Score: 4, Interesting) by Anonymous Coward on Friday January 19 2018, @04:02PM (1 child)

    by Anonymous Coward on Friday January 19 2018, @04:02PM (#624740)

    LOL.

    Anyways, a large part of the problem is that he classifications for employer size are ridiculous. I own a small business, I'm the owner/employee, and since I just started it, I had a top line of less than a thousand. But, a small business having over a thousand employees and top line of millions is also classified as a small business.

    It's been my belief for some time that here in Seattle we should have learned our lesson after Boeing went through it's part of the downturn back in the '70s and stopped chasing large companies. I'd even go so far as to chase them as far away as possible. We're much better off with small and medium size employers where the city isn't beholden to just one or two firms or industries for maintaining a healthy economy.

    As it stands, not only is pay only going up for folks because of minimum wage hikes, but the cost of living is soaring as a small handful of firms grossly overpay employees to come and to make up for the miserable work conditions. They overpay for housing because they can afford it and know that when the leave they'll likely find another sucker to pay at least as much for what they overpaid for in the first place.

    Doing similarly at the national level would likely also be a great idea as the customers that create jobs would have more options and likely options that are closer to what they want/need than the current situation and it would be harder for the government to wind up held hostage to a single corporation.

    • (Score: 4, Insightful) by Thexalon on Friday January 19 2018, @05:28PM

      by Thexalon (636) on Friday January 19 2018, @05:28PM (#624782)

      Anyways, a large part of the problem is that he classifications for employer size are ridiculous.

      The reason for this is very simple:
      1. Politicians create programs designed to make things easier for the mom&pop small businesses out there. For instance, the federal Small Business Administration, which makes it easier for smaller businesses to get government contracts. Republicans in particular like that sort of thing, because they claim to represent small business owners, and they can do it with nice fanfare that makes everyone happy that the local pizzaria will be able to stay afloat.

      2. Businesses that almost but don't quite fit the definition of "small business" bribelobby the relevant lobbyists & politicians to change the definition of who qualifies for all those small business programs to include them. The politicians on both sides of the aisle obviously do that with as little attention paid as possible.

      --
      The only thing that stops a bad guy with a compiler is a good guy with a compiler.