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Posts Tagged ‘Discrimination’

I realize it’s tax week and I should be condemning our convoluted tax code and oppressive IRS.

But I can’t resist getting diverted to another topic. It’s time to debunk the notion that there is rampant sexism in the private economy that causes women to by systematically underpaid.

I addressed the issue back in 2010, citing the solid work of Christina Hoff Summers. And I cited more of her work, as well as some analysis by Steve Chapman, when writing about the topic in 2012. The bottom line is that rigorous analysis finds that the so-called gender gap largely disappears once you consider factors such as occupational choice, hours worked, and education.

I’ll add my two cents to the discussion. For decades, I’ve been dealing with leftists who repeatedly tell me that business owners are consumed by greed and put profit above everything. Yet if women truly were making less money than men for doing equal work, then why aren’t these greed-filled business owners firing all their male employees and hiring women who will work for 80 percent of what it costs to employ men? Or 85 percent? Or 90 percent?

When I pose this question, my statist friends begin to mumble and stumble, but the clever ones eventually asset that business owners are not only soulless profiteers but also malign sexists. And the sexism apparently trumps the greed because they’re willing to employ men when equally competent women would work for less.

At that point, I usually ask them why entrepreneurs (presumably women and perhaps financed by rich leftists) don’t take advantage of a huge competitive opportunity by setting up rival businesses that could hire women for less money and lure customers away from the greedy sexist firms by charging lower prices.

I still haven’t received an answer to that question.

And that may explain why even one of President Obama’s top economic advisers basically admitted that equal-pay propaganda from the left is completely bogus.

Let’s dig into the data. Mark Perry of the American Enterprise Institute does a very good job of explaining why Equal Pay Day is based on nonsensical numbers.

…the bogus feminist holiday event known as Equal Pay Day…is a statistical fairy tale because it’s based on the false assumption that women get paid 23% less than men for doing exactly the same work in the exact same occupations and careers, working side-by-side with men on the same job for the same organization, working the same number of hours per week, traveling the same amount of time for work obligations, with the same exact work experience and education, with exactly the same level of productivity, etc. …The reality is that you can only find a 23% gender pay gap by comparing raw, aggregate, unadjusted full-time median salaries, i.e. when you control for NOTHING that would help explain gender differences in salaries… Most economic studies that control for all of those variables conclude that gender discrimination accounts for only a very small fraction of gender pay differences, and may not even be a statistically significant factor at all. …As the Department of Labor concluded in 2009, “The differences in raw wages may be almost entirely the result of the individual choices being made by both male and female workers.” They also concluded that “the raw wage gap should not be used as the basis to justify corrective action.”

By the way, all this data and research doesn’t mean sexism doesn’t exist. I’m sure it does, and it probably goes both ways.

I’m simply saying that unjustified discrimination in a competitive market economy is expensive. People who put prejudice above profits suffer. Which is why there’s so little actual evidence to support the feminist position.

Now let’s enjoy a bit of fun. It’s always amusing to expose statist hypocrisy.

The Obama White House claims to believe in so-called equal pay for equal work. But apparently that’s only a rule for us peasants.

And Hillary Clinton doubtlessly will regale us with speeches about equal pay over the next several months. Yet she didn’t practice what she preaches.

Yes, I realize we’re all shocked that politicians like Hillary prevaricate and dissemble.

P.S. Since this is tax season, I suppose I should close with a couple of relevant items.

First, we have an update to the infamous chart on the number of pages in the tax code.

Second, we have a new video from Reason TV about the “best tax code.”

Sadly, I don’t think my tax videos will ever be that entertaining.

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When describing their view of government and public policy, libertarians and constitutional conservatives sometimes use a variation of this phrase: “Not everything that’s illegal is immoral, and not everything that’s immoral should be illegal.”

To put this in tangible terms, consider the fact that the EPA has penalized people who build ponds on their own property. Yet the property owners obviously haven’t engaged in any behavior that’s wrong. Indeed, it would be far more accurate to accuse the bureaucrats of behaving immorally. And Walter Williams, among others, has argued that “decent people should not obey immoral laws.”

By contrast, there are many things that we should consider immoral, such as cheating on a significant other by patronizing a prostitute, but we would argue that it’s not a proper role for government to criminalize caddish actions or victimless behavior.

This distinction between immoral and illegal is appropriate as we consider the nationwide controversy about what’s happened in Indiana.

Joining the federal government and many other states, politicians in Indiana recently passed a “Religious Freedom Restoration Act” that’s based on the notion that there should be some limits to government actions that hinder the free exercise of religion.

But “some limits” is not the same as “no limits.” These laws all allow government to interfere if there is a “compelling state interest.” To cite an obvious example, a crazy environmentalist couple couldn’t sacrifice their child to appease Gaia.

Since all this sounds very reasonable, why has the adoption of the Indiana law turned into a huge kerfuffle?

The answer is simple. The Hoosier statute has become a proxy for the fight over freedom of association, which also implies a right to engage in private discrimination.

Here’s some of what my colleague Roger Pilon wrote on the topic.

We find those principles in the nation’s founding document, the Declaration of Independence…: freedom and equality. Rightly understood, they hold that we’re all born free, with equal rights to remain free. That means—to cut to the chase—that we may associate with anyone who wishes to associate with us; but we are equally free to decline to associate with others, for any reason, good or bad, or no reason at all. That right to discriminate is the very essence of freedom.

He then points out that the CEO of Apple, Tim Cook, errs in a Washington Post column by seeking to use coercion to criminalize private immorality.

Cook turns those principles on their head. He says religious freedom bills “rationalize injustice” by, for example, allowing a baker to decline to bake a cake for a same-sex wedding. He would compel the baker to accept that request, by force of law. That’s the very opposite of the freedom of association—the right to be left alone—that the nation was founded on. …I’m as offended as Cook is by that kind of discrimination. But I’m even more offended by the belief that we can force people to conform to our values when they’re asking simply to be left alone to enjoy their right to pursue their values. And precisely there is the source of Cook’s confusion, his conflation of rights and values, two very different moral notions.

Roger’s key point is that some types of discrimination are wrong, in some cases grossly immoral, but that doesn’t justify intervention by the state.

Which means a baker or florist who doesn’t want to cater a gay wedding should have the freedom to reject that business. That business owner may be doing something immoral and intolerant, just as a bigot who doesn’t want to do business with minorities is behaving reprehensibly, but people making their own decision with their own property shouldn’t be forced to adhere to other people’s values.

Writing for National Review, Deroy Murdock asks whether there are any limits to government coercion of private behavior.

The only identifiable victim of Indiana’s new Religious Freedom Restoration Act is the First Amendment’s Freedom of Association clause. Like Joan of Arc, it has been burned at the stake. …What if you are an atheist who really objects to gay marriage? Must you still bake cakes for gay weddings, or will pro-shariah Muslim bakers be the only ones who can walk into court and ask to be excused from doing so? …Do we respect the Junior League’s right to choose to remain a female-only group, as it has been since 1901, or must they now accept male members? … Do we respect a gay baker’s right to choose not to bake a cake for the Westboro Baptist Church with icing that reads God Hates Fags? …Do we respect a black jazz band’s choice not to perform at a Ku Klux Klan chapter’s “Negro Minstrel Show”?

Deroy poses these questions, because there are big implications depending on how people answer.

…it is crucial to remember that behind each of these scenarios lies something deadly serious: a gun. Government equals force. Its ultimate authority stems from its ability to use coercion or blunt force to deprive lawbreakers of their freedom. …So, the real question in each of these cases is: Do you support the government’s use of coercive police power — up to and including fines, arrest by armed police officers, and imprisonment — because you reject a woman’s right to choose not to bake a cake for a gay couple?

Here’s his bottom line.

In the public sector, the government must administer equal justice under the law and treat all Americans equally. …The private sector, such as it is, is something different. Private individuals on private property should be free to associate with whom and without whom they wish. Just because someone runs a business or is part of a private group or organization does not mean that she surrenders her rights or becomes a mere appendage of government. At least that’s what the First Amendment says — such as it is. Freed of most restraints against government action and populated by citizens increasingly oblivious to this nation’s founding principles, America is slouching into tyranny. Little by little. Day by day. This is incredibly depressing. And to see gay people lead this charge into bondage may be the saddest sight of all.

What’s both ironic and confusing about this issue is that government generally has been the source of discrimination and oppression against disfavored groups.

For a long time, government criminalized gay relationships. Heck, such laws are still on the books in some places, though thankfully they’re no longer enforced (though the thugs in Iran and similar places obviously haven’t taken this step in societal evolution).

And don’t forget that the infamous Jim Crow laws were government-imposed mandates, as Nick Gillespie explains for Reason.

From a libertarian perspective, belief in the freedom of association generally trumps belief in anti-discrimination actions by the state. …it’s typically the state (whether at the local, state, or federal) that historically was doing most of the discriminating. Jim Crow was ushered in by the Supreme Court’s vile “separate but equal” decision in Plessy v. Ferguson, which upheld a Louisiana state law barring railroad companies from selling first-class tickets to black customers. When businesses in the segregated South attempted to treat customers equally (often a good business strategy), they were typically hemmed in by specific laws preventing such things or by de facto laws enforced through brute force by various “citizen’s councils” and terror groups such as the Ku Klux Klan (which often included politicians and law enforcement). It was government at all levels, not local businesses, that disenfranchised blacks for decades.

Tim Carney of the Washington Examiner addresses the issue, pointing out that the cultural left now wants to coerce the traditional right.

On one side is the CEO of the world’s largest company, the president of the United States and a growing chunk of the Fortune 500. On the other side is a solo wedding photographer in New Mexico, a 70-year-old grandma florist in Washington and a few bakers. One side wants the state to conscript the religious businesswomen and men into participating in ceremonies that violate their beliefs. The other side wants to make it possible for religious people to live their own lives according to their consciences. …an emboldened and litigious cultural Left, unsated by its recent culture war victories, [is] trying now to conscript the defeated soldiers at gunpoint. …Tolerance isn’t the goal. Religious conservatives must atone for their heretical views with acts of contrition: Bake me a cake, photograph my wedding, pay for my abortion and my contraception. In Georgia, a Catholic school employed a gay teacher. When he announced he was marrying a man, the school said this violated the expectations of public behavior they demand of their teachers. They fired him. Now the Obama administration is coming after the school.

All of this is very frustrating for principled libertarians.

There are many gay libertarians, but they don’t want to coerce others into baking cakes or taking photos. They just want to live freely without excessive government coercion.

And there also are many libertarians who are traditional Christians, but they have no desire to oppress other people or to obtain coerced approval. They just want to live freely without excessive government coercion.

Unfortunately, libertarians are the exception. There are lots of other people in the world who think they should be able to impose their values on others. Oh, well, I never claimed it was easy to be libertarian.

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Although I play basketball (poorly), I’m not a fan of the NBA. As such, I don’t pretend to have much interest in the Donald Sterling controversy.

Some people have wondered whether his rights to free speech are being infringed, but I disagree. He obviously has the right to say whatever he wants, even if he makes himself look like an idiot.

But the National Basketball Association is an organization that has certain rules, and it presumably has the right – by virtue of the contract among team owners – to impose disciplinary measures.

In other words, Sterling has free speech, but that doesn’t mean he is free from consequences if he says something dumb. Just as I have free speech at the Cato Institute, but also would suffer consequences if I said something offensive about a particular group (or, for that matter, if I started supporting tax hikes, bigger government, and statism).

And that’s a good thing. As a libertarian, I don’t want the government policing speech, but there’s nothing wrong with private sector penalties on racists.

And that’s the topic of today’s column. The free market is a powerful and under-appreciated tool for punishing racism and rewarding color-blind behavior.

Here’s some of what Walter Williams wrote on the topic for the Washington Examiner. wew2010He starts by pointing out that Sterling certainly wasn’t racist when making decisions about what basketball players to employ.

Though Sterling might be a racist, there’s an important “so what?” Does he act in ways commonly attributed to racists? Let’s look at his employment policy. This season, Sterling paid his top three players salaries totaling over $46 million. His 20-person roster payroll totaled over $73 million. Here are a couple of questions for you: What race are the players whom racist Sterling paid the highest salaries? What race dominated the 20-man roster? The fact of business is that Sterling’s highest-paid players are black, and 85 percent of Clippers players are black.

Walter draws the obvious conclusions, and he cites the path-breaking research of the late Gary Becker on the economics of discrimination.

How does one explain this? …Let’s use a bit of simple economics… First, professional basketball is featured by considerable market competition. …There’s open competition in joining both high-school and college teams. You just sign up for tryouts in high school and get noticed by college scouts. Then there’s considerable competition among the NBA teams in the acquisition of the best college players. Minorities and less preferred people always do better when there are open markets instead of regulated markets. Recently deceased Nobel Prize-winning economist Gary Becker pointed this phenomenon out some years ago in his path-breaking study “The Economics of Discrimination.” Many people think that it takes government to eliminate racial discrimination, but economic theory predicts the opposite. Market competition imposes inescapable profit penalties on for-profit enterprises when they make employment decisions on any basis other than worker productivity.

In other words, the free market pushes people to make decisions on the basis of ability rather than race.

The takeaway from the Sterling affair is that we should mount not a moral crusade but an economic liberty crusade. In other words, eliminate union restrictions, wage controls, occupational and business licensure, and other anti-free market restrictions. Make opportunity depend on one’s productivity.

And as you can imagine, Walter speaks with authority on these issues. And he’s right that the free market is a weapon against racism.

By contrast, when government gets involved with race issues, you often get nonsensical results, such as EEOC penalties against companies trying to weed out criminals, or legal harassment of financial institutions for trying to make sensible loans.

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I’ve already suggested that subsidies for the Paris-based Organization for Economic Cooperation and Development are the most wasteful and counterproductive item in the federal budget. At least on a per-dollar-spent basis.

But what about a similar exercise for government red tape?

How would we come up with the worst regulation or the most counterproductive regulatory agency?

Thanks to the IRS, I have a strong candidate for the worst regulation, but if I had to pick the worst agency, I’d probably choose the horribly mis-named Equal Employment Opportunity Commission.

These bureaucrats are infamous for bone-headed initiatives, such as:

The EEOC making it hard for trucking companies to weed out drunk drivers.

The EEOC telling a coffee shop it had too many attractive waitresses.

The EEOC forcing companies to make special accommodations for “pee-shy” employees.

The EEOC trying to give special employment rights to crooks.

We now have another item for the list.

The bureaucrats apparently like forcing companies to hire people who are more likely to rip off customers, though sometimes they find judges that aren’t nearly so tolerant.

Let’s see what the Wall Street Journal had to say about the “hilariously caustic rebuke of the Equal Employment Opportunity Commission by the Sixth Circuit Court of Appeals.”

The EEOC had sued Kaplan, the for-profit education company, for using “the same type of background check that the EEOC itself uses,” as Judge Raymond Kethledge cheekily put it in the first sentence of his ruling in EEOC v. Kaplan. Despite its own practices, the Obama EEOC has made a cause of suing private companies because it claims that credit and criminal background checks discriminate against minorities.

But so-called disparate impact doesn’t mean discrimination.

Judge Kethledge eviscerated the EEOC like a first-day law student, writing that Kaplan had good reason to conduct credit checks… As for proving disparate racial impact, Judge Kethledge noted that “the credit-check process is racially blind; the [credit-check] vendor does not report the applicant’s race with her other information.” …The unanimous opinion was joined by Damon Keith, one of the most liberal judges on the entire federal bench. If government officials were accountable, EEOC General Counsel P. David Lopez would be fired for losing in such humiliating fashion.

But that’s just one crazy case.

The Wall Street Journal also opined about another strange example of EEOC quackery. The bureaucrats actually believe that stealing should be a protected disability.

Or, to be more technical, that stealing should be an acceptable behavior because of a supposed disability.

In September 2008, Walgreens employee Josefina Hernandez claims she had a hypoglycemia attack, grabbed a bag of potato chips off a shelf and ate them to boost her blood sugar. The drug-store company has a strict policy against “grazing” (i.e., stealing) and so a supervisor fired Ms. Hernandez, an 18-year veteran of the company. Three years later, the EEOC sued Walgreens for discrimination under Title VII of the 1964 Civil Rights Act and the 1990 Americans With Disabilities Act and asked for punitive damages. …The ADA requires employees to request an accommodation for a medical condition, which Mrs. Hernandez never did. Nor does federal law sanction illegal activity—i.e., theft—under cover of a disability, as the Supreme Court made clear in 2003’s Raytheon v. Hernandez.

A green light for thievery from the EEOC

Seems like this should be an open-and-shut case. Which raises the interesting question of why the EEOC decided that the federal government should intervene on behalf of potato chip thievery.

So why pursue such a case in the first place? The EEOC’s lawyers probably figured they had nothing to lose. If they landed a sympathetic judge, they could set a new legal precedent. If they lost, taxpayers would pay for the case anyway. And sure enough, U.S. District Judge William Orrick, an Obama appointee, ruled against the store’s motion for summary judgment last week. The question now is whether Walgreens will continue to fight for the right to fire employees who steal from company shelves, or simply settle to get the EEOC’s lawyers to go away.

I hope all companies fight meddling and stupidity by the federal government.

I do understand that sometimes it makes sense to acquiesce to extortion, at least in the short run. The long-run costs of surrender, though, are very high.

Which is why companies should fight, but they should get support from Capitol Hill. The EEOC budget should be slashed to show that there are consequences to bureaucratic insanity.

P.S. I shared some political humor last year about a make-believe Obama Administration initiative called the “Americans with no Abilities Act.”

Anybody want to guess when that becomes official EEOC policy?

I’m only partially joking. It’s sort of happened already in the United Kingdom.

P.P.S. Don’t forget that EEOC regulation is just one straw of red tape on the camel’s back.

Americans spend 8.8 billion hours every year filling out government forms.

The economy-wide cost of regulation is now $1.75 trillion.

For every bureaucrat at a regulatory agency, 100 jobs are destroyed in the economy’s productive sector.

The Obama Administration added $236 billion of red tapein 2012.

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If you had to pick the most inane, pointless, and intrusive example of government stupidity, what would you pick?

We have lots of examples of regulators running amok.

But we also have really absurd examples of wasteful spending.

We even have examples of government stupidity that can be characterized as a combination of wasteful spending and foolish regulation, such as one part of the government squandering money on research about how to encourage condom use by providing prophylactics of different sizes while another part of the government has regulations preventing the private sector from providing prophylactics of different sizes.

Today’s post, however, could win a prize for the most profound and disturbing example of government stupidity. It mixes foolish red tape with over-the-top political correctness.

Here are some jaw-dropping details of the federal government running amok in Michigan.

A set of seating is being torn down outside the Plymouth Wildcats varsity boys’ baseball field, not long before the season begins, because the fields for boys’ and girls’ athletics must be equal. A group of parents raised money for a raised seating deck by the field, as it was hard to see the games through a chain-link fence. The parents even did the installation themselves, and also paid for a new scoreboard. But, after someone complained to the U.S Education Department’s Office for Civil Rights, an investigated by the department determined the new addition was no longer equal to the girls’ softball field next door, which has old bleachers and an old scoreboard.

This is utterly absurd for several reasons, most notably that the federal government shouldn’t have any role in education, much less efforts to micro-manage high school sports facilities.

But even if one accepts that Washington bureaucrats should interfere in such matters, it’s important to understand that it is bureaucratic lunacy to interpret “Title IX requirements to offer equal athletic opportunities to both boys and girls” to somehow mean equal seating.

Sexist bleachers?!?

What happens if there are fewer people who want to watch female sports? Should there be a requirement to build bleachers that are mostly empty?

Or maybe we can blend Obamacare to Title IX and create a mandate that parents and others in the community have to attend female sporting events 50 percent of the time?

Actually, I shouldn’t even joke about such an idea, lest some bureaucrat think it’s a serious proposal.

P.S. The Keynesians will be happy. They like it when wealth and/or capital is destroyed since that supposedly forces “stimulative” rebuilding exercises.

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President Obama and many other leftist politicians are running around the nation claiming that supposedly greedy employers are deliberately choosing to reduce their profits.

They’re not actually making that specific claim, but that’s what they’re asserting, for all intents and purposes, when they claim that women are not getting equal pay for equal work.

Inaccurate, but nonetheless clever

If genuine and pervasive sexism existed, then non-discriminatory employers could dramatically reduce labor costs – and therefore dramatically increase profits – by getting rid of overpaid male workers and hiring women. Does anyone really think entrepreneurs and business owners are willing to sacrifice big profits simply because of anti-women animus?

That’s what Obama would like us to believe. And he wants the government to have the power to second-guess the decisions of private businesses. Heck, he probably would like to make America like Europe, where there are efforts to impose gender quotas.

And one of his chief economists tried to back up the President’s claims. Here’s some of what Ashe Schow wrote on the issue for the Washington Examiner.

While detailing executive actions President Obama plans to take Tuesday regarding equal pay for women, Betsey Stevenson, a member of the White House Council of Economic Advisers, said very defiantly that…women… continue to make less than men. …“They’re stuck at 77 cents on the dollar, and that gender wage gap is seen very persistently across the income distribution, within occupations, across occupations, and we see it when men and women are working side by side doing identical work.” That sounds awfully specific. Stevenson certainly sounds like she’s saying men and women doing the exact same job are earning very different pay.

Ms. Stevenson certainly was trying to be a loyal employee.

But then something very unusual happened. A journalist actually asked a real question.

And Ms. Stevenson, who obviously didn’t want to make herself a laughingstock to her colleagues in the economics profession, was forced to admit that the President is peddling nonsense.

…as soon as Stevenson was actually questioned about the statistic by McClatchy reporter Lindsay Wise, the White House adviser crumbled, admitting her earlier comments were inaccurate. “If I said 77 cents was equal pay for equal work, then I completely misspoke,” Stevenson said. “So let me just apologize and say that I certainly wouldn’t have meant to say that.” …Don’t expect Obama to admit any of this as he travels around the country continuing to claim that women don’t earn as much as men.

So why did Ms. Stevenson quickly back down? Well, perhaps she is familiar with the work of Christina Hoff Sommers, who has explained that men and women do get equal pay when you adjust for career choices, labor supply, and other factors.

There’s lots of evidence that the supposed sexist pay gap is a political weapon rather than economic reality.

Mary Perry and Andrew Biggs of the American Enterprise Institute just wrote a very thorough debunking of the pay gap myth for the Wall Street Journal. Here are some of the key passages, starting with an explanation that the pay gap largely disappears when you make apples-to-apples comparisons.

…the numbers bandied about to make the claim of widespread discrimination are fundamentally misleading and economically illogical. …Men were almost twice as likely as women to work more than 40 hours a week, and women almost twice as likely to work only 35 to 39 hours per week. Once that is taken into consideration, the pay gap begins to shrink. Women who worked a 40-hour week earned 88% of male earnings. Then there is the issue of marriage and children. The BLS reports that single women who have never married earned 96% of men’s earnings in 2012.

Wow. No wonder Steve Chapman wrote that the left’s pay-gap rhetoric is “a myth resting on a deception.”

But there’s more.

Risk is another factor. Nearly all the most dangerous occupations, such as loggers or iron workers, are majority male and 92% of work-related deaths in 2012 were to men. Dangerous jobs tend to pay higher salaries to attract workers. Also: Males are more likely to pursue occupations where compensation is risky from year to year, such as law and finance. Research shows that average pay in such jobs is higher to compensate for that risk.

Finally, Perry and Biggs seal the argument by pointing out that discrimination doesn’t make sense in a competitive market.

…gender-disparity claims are also economically illogical. If women were paid 77 cents on the dollar, a profit-oriented firm could dramatically cut labor costs by replacing male employees with females. Progressives assume that businesses nickel-and-dime suppliers, customers, consultants, anyone with whom they come into contact—yet ignore a great opportunity to reduce wages costs by 23%. They don’t ignore the opportunity because it doesn’t exist.

By the way, this does not mean that discrimination doesn’t exist.

I’m sure there are still some employers who let sex or race play a role in their decisions. But such people are not only immoral, but also stupid. They are giving up potential profits to indulge their own insecurities.

And other employers will take advantage of their foolishness.

In other words, the free market is the best way to fight discrimination, not government intervention.

P.S. Walter Williams explains that racial and sexual profiling sometimes makes sense.

P.P.S. I explain that anti-discrimination laws can boomerang against intended beneficiaries.

P.P.P.S. There is real evidence that tall people and attractive people are paid more, though I nonetheless argue that government is incapable of addressing this issue.

P.P.P.P.S. For those who are genuinely worried about discrimination, particularly against minorities, the real issues to address are Social Security and government schools.

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I recently wrote about the pinheads at the Equal Employment Opportunity Commission, who are threatening legal action against companies that are leery about hiring people with criminal records.

Now some states and cities are making it illegal to discriminate against those that have been unemployed for a long period of time.

Unlike special legal status for ex-cons, this sounds reasonable. After all, we all would like to help the long-term unemployed break free of the chains of government dependency.

But sometimes good intentions generate undesirable effects. I explain in this Fox Business News debate that companies will do their best to avoid even interviewing the long-term unemployed if they have to worry about potential legal pitfalls whenever they make a hiring decision.

I also explain that businesses have no incentive to engage in unjustified discrimination. After all, that would imply a willingness to deliberately sacrifice profit in pursuit of some irrational bias.

But as Walter Williams has succinctly argued, some forms of discrimination make sense.

And if there are two applicants who otherwise seem to have equal qualifications for a certain job, but one has been out of work for more than 12 months, it’s only logical that the employer will think that a lengthy stint of sitting on a couch does not suggest great habits.

Which is why Obama’s policy of never-ending unemployment benefits is so misguided. People get lured into long-term unemployment and there is both anecdotal evidence (check out these stories from Michigan and Ohio) and empirical evidence (here, here, and here) showing this unfortunate impact.

Heck, even Paul Krugman and Larry Summers have admitted that you get more unemployment when you subsidize joblessness.

Ramirez Unemployment CartoonSo you won’t be surprised to know that I’ve dispensed some tough love on this topic as well.

P.S. This cartoon does a very effective job of showing the consequences of paying people not to work.

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