The Poverty of Progressivism
4th August 2016
It is now possible to see how the progressive agenda thwarts the engine for growth in ways that private ingenuity finds it difficult to overcome. The initial observation is that virtually every progressive reform undermines free markets and tends to establish monopolies in labor, agriculture, and other industries. These rules frustrate the free entry into new markets. It is therefore inexcusable that the first impulse of the determined progressive is to impose restraints on voluntary exchange. These new taxes and regulations are always described benevolently as restrictions on the bad parties—on landlords, on employers, on insurers, on health care providers. But in practice they always operate as devastating constraint on both sides of the market. The labor law regime of collective bargaining that “protects” some employees also snuffs out opportunities for their nonunion competitors. Yet the Obama administration continues to place new obstacles that block access to marginal and teenage workers. It has sought to force franchisors like McDonald’s to be subject to liability for the alleged unfair labor practices of their franchisees; its Department of Labor works incessantly to subject ever larger segments of the economy, including the gig economy, to more serious regulations. These added regulations drive down employment opportunities and net wages, which keeps the next generation out of the middle class. When government raises the price of labor relative to capital, firms will be able to diversify in ways that workers cannot. Hence the greatest blows are landed on the intended beneficiaries of this misguided legislation.