DISCLAIMER: THE FOLLOWING "Cost of Freedom Recap" CONTAINS STRONG OPINIONS WHICH ARE NOT A REFLECTION OF THE OPINIONS OF FOX NEWS AND SHOULD NOT BE RELIED UPON AS INVESTMENT ADVICE WHEN MAKING PERSONAL INVESTMENT DECISIONS. IT IS FOX NEWS' POLICY THAT CONTRIBUTORS DISCLOSE POSITIONS THEY HOLD IN STOCKS THEY DISCUSS, THOUGH POSITIONS MAY CHANGE. READERS OF "Cost of Freedom Recap" MUST TAKE RESPONSIBILITY FOR THEIR OWN INVESTMENT DECISIONS.
WORRIES MOUNT PRESIDENT'S PRO-UNIONS APPOINTEES WILL HURT JOB MARKET
Gary B. Smith: To date, they haven't been that effective, but certainly with these new recess appointments, the NLRB has been strengthened on the pro-union side. The growth rate of unionized firms is zero. Unionization leads to higher unemployment. Unionization is basically a 30 percent tax increase on companies that have them, so we know that unionization is not good for the economy. We also know the NLRB is pro-union and they're an independent, accountable agency to no one. Put it all together, you'd have to conclude it's bad for the economy.
Tobin Smith: If this was so great, why is Indiana's first order of business to make a right-to-work state? If you take the right-to-work states where unions are not forced and dues-paying is not forced, they are killing everybody. Those businesses are great. They're attracting new people. You can't compare Germany to the United States. It's a much smaller economy and it's whole different integrated system. They also have a business mentality that many of our states don't have. If you use facts you can't support this. If this was so great, why have jobs for these industrial labors gone down for the last 35 years?
Jonas Max Ferris: We saw a pretty good jobs figure this week. The only part of the economy that's still shedding jobs is government workers, which has the highest unionized rate of the work force. There's firing going on in government workers that have more representation than private sector workers. This agency isn't that effective at this point, nor are unions in stopping hiring.
Matt McCall: This move is threatening to send unemployment back up. This move is actually helping the big business, the big unions, which really are not creating jobs. Coming out of this recession, we're really seeing small, private companies creating jobs-entrepreneurs coming out and that's what we've seen historically coming out of a recession. Appointing these three people in these positions are only going to go back to unions, big labor. What got us into this mess? Let's take a look at GM. GM is one of the big reasons we got into this mess because unions do not work in this day in age. So, in my mind, we're going right back to where we were.
Steve Murphy: The NLRB isn't able to force management and labor to make an agreement. They're not able to bring in binding arbitration as the Employee Free Choice Act called for, which would be good for the economy. There is zero correlation between a strong economy and weak labor. When our economy was the biggest part of the world economy in the 1950's it was at the peak of unionization. Today, in Germany, which is doing quite well economically, the workers have 50 percent of representation on the board of directors. They call it co-determination. Finally, in 2009 suppose we passed the Employee Free Choice Act. We would have had an increase in wages, which would have been terrific. That's when labor really matters-when you have an economic downturn. Then you don't have the drop off in consumer demand.
WHITE HOUSE CONSIDERING HIKING PAY FOR FEDERAL WORKERS
Gary B. Smith: The fairest thing of all would be if the public sector's compensation, including benefits, was linked to what you can make in the private sector. Now, it's just completely out of bounds. They're making 40 percent more than their private counterparts. The fact is, they've been two years without a raise and they're not even getting a raise that keeps up with the cost of inflation. I'm not thrilled about it. I like my proposal a bit better. With that said, I can understand it from a government employee perspective.
Tobin Smith: In the private sector, we haven't had incomes rise in 10 years. It could actually be 20 years with inflation. These guys have gone up 25 percent-40 percent. We're in an economy and an environment now where we need to cut spending and since labor is 75 percent the cost of the government, just like business, any business sense would be that we would cut it. That's the sensible thing to do. That's the right thing to do. Throwing this 5 percent is a vote thing. This has nothing to do with economics.
Jonas Max Ferris: This is another pay cut, isn't it? Social Security was adjusted even higher than this amount. If a republican president proposed a .5 percent pay hike, you'd see democrats come out and say how little and unfair it was. This was a very short end of the deal. In fact, you can't blame the current situation on the last multi decades of federal, state and local government overpay. In the last two to three years they've taken it hard. Look at the payroll from this last week. State, local, and federal workers are taking it harder than the private sector workers.
Matt McCall: How about the fact that you should be happy you have a job. There are a lot of people in the private sector that have been unemployed for two years-working their butt off trying to get a job. So, I don't want to hear about the raise. The federal employees make 40 percent more than the private employees. If you take in benefits, pensions and everything else, it's four times what the private employee makes. So, in my opinion, you should be very happy you have a job at this point, with the pension coming on top of it.
Steve Murphy: Two years freeze, a half percent increase-I think that's fine. The private sector has been creating jobs at a very decent clip now for the last six months. But it has been offset. For every two private sector jobs, we're losing one public sector job. We do have to cut spending. Some of that is because the states were irresponsible with their pensions. That's inevitable. But, it's going to be a drag on the economic recovery if it goes too fast. I completely disagree that we should be cutting pay.
TAXPAYERS TICKED OVER EPA GRANTS PROMOTING GREEN AGENDA
Gary B. Smith: I agree there is a role for the EPA. Someone has to be a landlord for the country. They're going way beyond that now. It's like the landlord of your Co-op going around to everyone saying ‘give me money because we want teens in the building to dance to keep the building clean.' It's ridiculous at this point and it's one more example of government overreach. If you're in a government agency, the only way to survive is to grow your power base. That's what the EPA is trying to do here.
Tobin Smith: I'm a little confused by the idea that this is environmental justice. Who defines justice? Obviously these are just earmarks. If we were in a great economy and we had excess money then maybe. We don't. This is insane.
Jonas Max Ferris: Isn't the job of the Environmental Protection Agency to push a green agenda? The EPA, on a good week, brings in on average how much this costs in fines. Some of this money came from a cement company in LA that got a million dollar fine. It's not all taxpayer money with the EPA. It's like the SCC, they collect money in fines, which is great.
Matt McCall: The EPA is spending taxpayers' money frivolously. From a man who's had bed bugs, I'd like to see some more studies behind it. This is the government and the President, once again, pushing the green agenda with taxpayer money.
Steve Murphy: I think these kinds of grants have a positive effect, but we can't afford them right now. The biggest threat to our economy is to budget the deficit and the debt. We're going to have to budget expenditures like this.
Gary B. Smith: Delta (DAL) up 50 percent in 2012
Tobin Smith: Caterpillar (CAT) up 25 percent in one year
Jonas Max Ferris: Corning (GLW) 35 percent gain in one year
Matt McCall: Robert Half International (RHI) Up 20 percent in the next six months