Michael Swartz / September 30, 2016

‘Equal Pay’: Another Area for Government Meddling

Exaggerating the gap to justify more regulations.

As the presidential campaign has dragged on, it’s become more clear that Hillary Clinton is simply offering to extend the utter failure of Barack Obama’s administration. Whether coincidental or not, days after Hillary opened her debate with Donald Trump by pledging to “guarantee, finally, equal pay for women’s work,” the federal Equal Employment Opportunity Commission (EEOC) announced it would begin collecting data from businesses on that very subject in March 2018. Never mind the facts about the supposed pay gap when there’s regulation to be had.

In its announcement, the EEOC fired a warning shot across the bow of those businesses required to file, noting, “The new data will improve investigations of possible pay discrimination, which remains a contributing factor to persistent wage gaps.” EEOC Chair Jenny Yang echoed this, adding, “Collecting pay data is a significant step forward in addressing discriminatory pay practices.” This new policy will affect the thousands of businesses that have 100 or more employees as well as federal contractors and subcontractors that employ 50 or more.

These regulations are the offspring of a perennially failed congressional bill called the Paycheck Fairness Act, and as onetime Department of Labor chief economist Diana Furchtgott-Roth argued, they would put “an enormous compliance burden on businesses,” forcing them to categorize and report on 14 different gender, race and ethnicity groups in 12 pay bands and 10 occupational categories. “When the Obama administration decides to collect countless thousands of new data points, it has a purpose in mind,” adds Furchtgott-Roth. “Not much imagination is required to see that the plan here is to give Washington new powers to police the workforce.” Substitute “Clinton” for “Obama” and the result would be the same: Beltway bureaucrats browbeating business once again.

Moreover, these broad wage reporting categories could take a lot of arrangements that are convenient to working mothers off the table, contends Carrie Lukas of the Independent Women’s Forum. She points out that working moms “sometimes intentionally negotiate a lower salary with the understanding that they would have the ability to work from home, won’t have to travel, or could adjust work schedules to match their children’s school calendar.” But with this negotiated and agreed-to lower salary simply seen as an entry on a government form, the EEOC could justify the case to swoop in after a “random” check and force the company to conform to its demands.

According to one source, however, “There are a lot of reasons for the gap, including the types of work women and men typically do. Women dominate fields like teaching and clerical work, which tend to pay less than male-dominated fields. Women are also the majority of low-wage and minimum-wage workers.” Oddly enough, that nugget is from Hillary Clinton’s website. But that obvious truth has been buried for political gain, resulting in the phony “women make 77 cents for every dollar a man makes” narrative.

Meanwhile, the prospect of even more red tape and the implied threat of Uncle Sam’s heavy hand of compliance weighing down the bottom line comes at a time when the overall economy is practically stuck in neutral, with annual growth so far this year hovering around a measly 1%. And the Congressional Budget Office cautions that slow economic growth — just 2% annually — will be the norm for the next decade, blaming the anemic increase in the labor force and its productivity. But the CBO also gives the game away: “In addition to demographic factors, that [labor force] projection reflects CBO’s judgment that some people will decide to work somewhat less because of federal tax and spending policies that are set in current law.” And that doesn’t count the new regulations the Left continues to dream up. In the case of the “wage gap” regulations, for example, companies may think long and hard about hiring that 100th person or taking that federal contract if they are in the 50-to-99 category.

It used to be that a small business was free to grow and prosper indefinitely, but now these startups have to worry about compliance with burdensome measures like ObamaCare and the Family and Medical Leave Act once they reach the plateau of just 50 employees. This could prevent a marketable business from being more than a local retailer, hold back a factory from adding another shift to increase production, or discourage an energy company from investing in equipment for exploration as they’re unable to justify the overhead on the needed labor. America needs production from entrepreneurs to add the economic value that will truly boost our GDP and growth, but the only growth industry these days seems to be Big Government. The lesson: when business is good for government, it’s pretty bad for the rest of us.

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