John C. Goodman

Take the new tax on medical devices, passed as part of health reform. A study by labor economists Harold and Diana Furchtgott-Roth predicts that 43,000 American jobs will be lost to foreign countries because of the new levy. And these are good jobs, by the way. They pay well above the average wage and they are in a high tech sector — precisely the type of job opportunities we shouldn’t want to go overseas.

The administration’s policies toward labor unions are another example of its war on job creation. The so-called “card check” proposal is an administration plan to allow unions to be created without a secret ballot vote by employees. National Labor Relations Board (NLRB) proposed regulations will also change the rules in a way that makes it easier to unionize more employers.

But what is a labor union? From the days of the medieval guilds to the current era the goal has always been the same: form a monopoly and try to secure above-market wages. Yet that strategy only works so long as workers not in the union (the scabs) can be kept away from the job site. In a free labor market, scabs have just as much right to sell their services to potential employers as anyone else. To prevent that from happening, unions all too often resort to physical force to keep their competition away. This is why the history of the union movement has been such a violent one. Even in the absence of violence, the only purpose of a picket line is to intimidate. In a very real sense there’s no such thing as a peaceful picket line.

Then there is the administration’s approach to tax policy, which can be summarized in two words: tax capital. As every economics textbook teaches, capital is what makes labor more productive. The more capital there is, the more labor can produce and the higher the wage rate. If you want wages to be as high as possible, remove all taxes on capital. It’s just that simple.

Obama tax policy is the opposite of that approach. Every time the president talks about the need for higher taxes, he is talking about higher rates for dividends, interest and capital gains. Of course, he doesn’t usually word it that way. More often than not, he says he wants to tax rich people, like Warren Buffett. But under the president’s proposals Warren Buffett wouldn’t be harmed at all. He wouldn’t miss a single meal. But capital that Buffett might have provided to build factories, create new machinery and make better tools so that workers can produce more and earn more will instead be used by the federal government to fund more entitlement spending.

Barack Obama has a symbiotic relationship with union officials, who live off of union member dues. In some ways, they are cut from the same cloth. But he is no friend of the millions of people who are out of work and he is no friend of the millions of workers who have a job, but are in danger of losing it.


John C. Goodman

John C. Goodman is Senior Fellow at The Independent Institute and author of the widely acclaimed book, Priceless: Curing the Healthcare Crisis. The Wall Street Journal and National Journal, among other media, have called him the "Father of Health Savings Accounts."