That the IRS would target right-leaning organizations is appalling, but not shocking. The scandalous effort to deny GOP Super-PACS tax-exempt status is part of a broader crusade. Simply put: Democrats want to shut down pro-business Republican messaging.

Why? Because the emergence of Super-PACs allows corporations to compete more effectively with unions, which have historically influenced elections through donations, but also by mobilizing hundreds of thousands of volunteers to ring doorbells and man phone banks. Threatened with a loss of influence, Big Labor supporters and their Democrat colleagues are working overtime to stifle these potent GOP voices – and not just through the IRS.

Democrats are trying to neuter the Supreme Court’s Citizens United decision by demanding broader disclosure of political contributions from corporations. They’re betting companies would think twice before making public gifts to interest groups, fearing that the Internet makes it easy for opponents to instigate boycotts or other protests. Retailer Target became the poster child for this tactic when they donated money to a pro-business but anti-gay candidate for governor in their home state of Minnesota. The contribution fueled protests and boycotts, and led ultimately to an apology from the chastened CEO.
   
Democrats are fighting this battle on numerous fronts –with legislation, through petitioning the SEC for a new rule and also by rallying shareholder groups to demand that companies disclose their political contributions.

In this context, an apparatchik leaning on the IRS to squash the proliferation of right-wing Super-PACs is not so surprising. You have to wonder—what is it exactly that Republicans have to say that Democrats find so frightening? The truth about Obamacare? The outlook for our government’s finances? The deplorable state of public education? Since references to government spending, taxes and American values proved triggers for IRS scrutiny, it’s fair to conclude – all of the above. 

Business groups outspend unions in elections by a wide margin. But, an analysis last year from the Wall Street Journal shows union clout roughly four times greater than previously thought when filings on a wider range of political activism are included, narrowing the gap.  According to the WSJ, “labor could be a stronger counterweight than commonly realized to “super PACs.” 

The irony, of course, is that President Obama himself has recently set up a tax-exempt Super PAC - Organizing for Action - to get his message out. The group has raised over five million dollars to push the president’s agenda, even though Mr. Obama can reliably depend on The New York Times, the Washington Post and the major TV networks to spread the word.

Labor groups across the country are also adopting the Super PAC model. New Jersey’s largest teachers union has a new group called Garden State Forward. The monies collected will help the union battle Governor Christie’s reelection. In 2011, the union spent $10.8 million running an ad called “Millionaires for Christie,” denouncing the governor’s attempts to rein in teacher benefits.

It is also ironic that after all the alarums about how the new fund-raising groups would end our political process as we knew it, Democrats out-spent Republicans in the last election. President Obama was so upset about the Citizens United decision that he pushed for a constitutional amendment limiting corporate donations, saying “they fundamentally threaten to overwhelm the political process over the long run and drown out the voices of ordinary citizens.” 

Outlays by Super Pacs amounted to $609 million in 2012, according to Open Secrets, with $261 million spent on behalf of Democrats and $347 million for Republicans. And yet, the Obama campaign ended up raising and spending $1.1 billion more than the GOP, which spent $990 million, in the last election. 

That, however, did not diminish efforts to muzzle the Super PACs.  After attempts to pass legislation failed in 2010 and 2012, Oregon Senator Ron Wyden and Alaska’s Republican Lisa Murkowski recently unveiled the “Follow the Money” bill aimed at transparency. Murkowski, who in the past has voted against such legislation, saw the light when she was knocked out in her last primary by a Tea Party group funded largely by Super PACs.  (She won reelection as a write-in candidate.) So far, Murkowski is the only GOP member of the Senate to sign on, suggesting the bill is likely to go nowhere.

Separately, busy Democrats and labor groups are pushing the SEC to require that companies disclose all political contributions. The left has flooded the agency with a record number of comments on the proposal, which is opposed by business groups such as the Business Roundtable. The SEC has not indicated whether it will initiate the controversial measure.

While awaiting an SEC move, proponents of disclosure are rallying investor groups to press their case. In New York, Comptroller Thomas DiNapoli has used the state’s pension investments to browbeat companies into revealing political contributions. Last month DiNapoli added five more Fortune 500 companies, among them Southwest Airlines, and Plum Creek Timber Company, to the list of those agreeing to release the information.

Democrats are determined to squash corporate spending. They protest that Super PACs   allow unsavory anonymous campaigning. In reality, they don’t like what the business community has to say: that pandering to organized labor threatens our ability to compete and undermines the fiscal integrity of our cities and states, that Obamacare has restrained hiring and that our workers are not graduating from our public schools prepared to work.

Democrats should be worried that voters might just pay attention.

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Don’t shoot the messenger! The Heritage Foundation is under attack for delivering sobering news.

They say granting amnesty to 11 million illegal immigrants could cost the U.S. a staggering $6.3 trillion – or more. The conservative think tank has been widely criticized for the new study by Robert Rector and Jason Richwine, which details the fiscal toll of the immigration reform bill rolling through the Senate. Their analysis, though, is straightforward.

The scholars point out that most illegals are under-educated and poor, and therefore receive more from the government than they contribute. The authors point out that the financial burden imposed by such households, once they can access our myriad welfare programs, is no different from that levied by similarly positioned citizens.

There is no value judgment here. If anything, the report is an indictment of the welfare state – not of hardworking immigrants. As the report points out, “The governmental system is highly redistributive.” Still, the report erects a giant speedbump for the immigration bandwagon.

Heritage describes the typical illegal as 34 years old and holding only a 10th-grade education. In 2010, this person’s household took in benefits valued at roughly $24,721 and paid about $10,334 in taxes. Hence, such individuals were a net $14,387 drain on the Treasury.

Under the plan being devised by the bipartisan Gang of Eight, such households would over the course of 13 years work their way towards citizenship. During that period, these individuals would gain legal status, allowing them to work and pay taxes. But they would not become eligible for means-tested welfare programs or Obamacare. Hence, during this period, it is likely the cost of such families would decline, to an estimated $11,455 annually, as they creep out of the shadows and pay more in taxes.

During the next phase, however, when they tap into Social Security, Medicare, Obamacare and all manner of other benefits, the net cost of these households skyrockets to $28,000. Assuming that the 34-year-old lives to 84, the aggregate cost of amnesty soars to $6.3 trillion.

The report raises a question: can we afford to grant illegals citizenship?

Heretofore, opposition to immigration reform has focused mainly on border security or possible deflation of labor rates as millions more compete for work. Heritage has arguably redrawn the argument, just as numerous interest groups had jumped onto the reform movement.

Democrats are keen to admit millions of new party supporters; unions covet new members; Republicans want rapprochement with Hispanics; the Chamber of Commerce targets highly skilled workers, farmers need field laborers – and most Americans see our current system as unsustainable and inhumane.

No one wants millions living in the country under the threat of deportation. Further, the recent terror attacks remind us of how poorly we monitor those coming in and out of the country. Most people agree, the status quo is unacceptable.

But, it is affordable. According to Robert Rector, if we do nothing about our illegal population, the cost of those households will total about $1 trillion over the next 50 years, rather than $6.3 trillion. He reasons that as those who live illegally in the U.S. approach retirement age, they will tend to go home if they do not have access to Social Security and Medicare. (This assumption seems questionable to me, as it assumes more generous treatment elsewhere.) It is the aging of this population that is so costly, just as it is for the country as a whole.

Criticism of the report from CATO and other organizations centers on the so-called “static” nature of the Heritage analysis. They argue that a large increase in the number of people working and paying taxes in the U.S. will have ancillary benefits, boosting GDP and tax revenues.

Indeed, one study concluded that men who become legal citizens saw their earnings rise by 14 percent to 24 percent. Others show that legalization leads to higher educational status, increased home ownership and reduced poverty.

Senator Marco Rubio (R-FL), a champion of the reform effort, notes rightly that immigrants can help their children move up the educational and earnings ladders, as his parents did, a prospect the study minimizes. The Heritage folks may well have underestimated the upside of legalization and further study of “next generation” outcomes may be warranted. Still, most reports highlighting the great contributions immigrants have made to the country support a greater influx of highly skilled and trained workers, not high-school dropouts.

The Congressional Budget Office has yet to analyze the Senate bill, but it will use dynamic scoring, incorporating prospective changes to the economy overall from an increase in the labor pool.

Their study in 2006, which used the same approach, concluded that the immediate cost of the proposed reforms would be $37 billion over ten years; however, taking into account the bill’s possible impact on economic growth, they deemed the measure to be a net contributor—of as much as $120 billion—over the same time frame.

Robert Rector points out that Congress fashions legislation so as to secure a green light from the CBO. Like Obamacare, which was crafted to show the least possible budget impact by collecting taxes and fees up front while shoving costs into the out-years, the immigration bill wreaks the most fiscal damage only after the 13-year interim period. This is when those 11 million new citizens gain access to the 80-odd means-tested government programs like food stamps, unemployment insurance, Social Security and Medicare that are available to our low-income families.

The Heritage authors caution that their estimates are at the low end of what is likely. How can that be? Because, among other reasons, they imagine that it is extremely unlikely that our legislators will withhold medical care for 11 million near-citizens over that interim 13-year period. I would agree.

The Heritage Foundation has done us a service by bringing the cost of immigration reform to light. Their numbers may prove too high, but their analysis demands that our legislators apply more than wishful thinking – or weigh more than prospective campaign donations from special interest groups – in assessing the viability of reform. That doesn’t mean we should not fix our broken immigration system; it just means we should do so with our eyes open.

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Critics charge that President Obama’s budget and tax policies target wealth redistribution – social engineering – rather than boosting the economy. His proposal to limit contributions to tax-deferred savings accounts strengthens their case.

In his budget released earlier this month, Obama proposed capping lifetime contributions to 401(k)s or Individual Retirement Accounts (IRAs) at “about $3 million for someone retiring in 2013,” in order to prevent “wealthy individuals” from accumulating “substantially more than is needed to fund reasonable levels of retirement savings.”

This is the same president who said last year, “If you work hard your whole life, you ought to have every opportunity to retire with dignity and financial security….” Obama would like to decide what constitutes dignity and financial security for you.

This particular effort to “level the playing field,” as Obama is so fond of saying, will hit those who work hard, reap the rewards, and save aggressively. It especially sends the wrong message to young people. An analysis by the Employee Benefit Research Analysis suggests that anywhere from 1 percent to 6 percent of workers age 26 to 35 might ultimately hit the cap, depending on investment returns, asset allocation decisions and other variables.

What is the point? The proposal is expected to save the government only $9 billion over the next 10 years – a drop in the budget bucket. This suggestion is not aimed at balancing our books, but at preventing the industrious from getting ahead. This, at a moment when it is clear that the nation should be promoting, and not discouraging savings, when Social Security looks likely to become another welfare program rather than a broad-based retirement account, and when the government boasts about reducing – not adding—red tape. And when, by the way, young people have been scorched by the financial crisis and are skittish about investing. Young people who live in a time that celebrates conspicuous consumption and not thrift.

The savings rate in our country fell to 2.6 percent in the first quarter of this year, the lowest rate since the end of 2007. This is not good news. Savings provide the capital we need for investment, as well as the monies that Americans need for retirement.

While President Obama was discouraging savings by high earners, he was including suggestions for a National Infrastructure Bank and “Fast Forward Bonds” aimed at leveraging private capital for repair of the nation’s outdated roads and airports.

Does anyone else see a contradiction here?

For decades, policy advisors have been concerned about our low savings rate. Economists Larry Summers and Chris Carroll wrote a paper on the topic for the Brookings Institute in the late 1980s that concluded, “Private saving would probably have been still lower during the 1980s if the federal government had not encouraged saving with new tax incentives.” Incentives such as those Mr. Obama would like to jettison.

Last year, team Obama, noting that 78 million Americans does not have retirement accounts at work—or roughly half the workforce—proposed expanding opportunities for enrollment in 401(k)s and other tax-preferred accounts. They also pushed “making it easier” to save all or some of peoples’ tax refunds and converting unused vacation into retirement savings. In other words – boost savings!

The president’s Council of Economic Advisers last year referenced a study claiming that the share of households at risk of not saving enough for retirement had grown from 31 percent in 1983 to 51 percent in 2009. The increase partly reflects people living longer—that is especially true for women.

The paper also noted that as more retirement assets gravitate to defined contribution plans, as opposed to traditional pension schemes, workers have assumed greater risks. If your IRA or 401k is invested poorly, you will be hurt. Obama’s clamp down on how much can be put away in such plans ignores that increased risk factor.

For successful workers, add to the market risk of IRAs and 401(k)s the prospect that they will likely be stripped of their Social Security benefits. With the Social Security Trust Fund expected to run out of money in 2033, changes are inevitable.

The notion of means-testing Social Security was not original to the Simpson Bowles proposals, but was included therein as one approach to securing the future of the program. Few doubt that ultimately a higher portion of high earners’ income will be taxed and that that group will eventually receive a lower share of benefits.

Since 401(k)s and IRAs are tax-deferred accounts, capping contributions will simply front-end tax payments for high earners and related receipts for the government. If Obama and his colleagues get their way, tax rates will rise over time, especially on our most successful workers. If that happens, the president’s approach could actually end up costing the government.

President Obama is offended by the growing gap between rich and poor, a worrisome trend. His remedy – and seemingly lone economic goal—is to raise taxes on the wealthy, which this year will be the highest since 1979, when the Tax Policy Center started keeping track.

Taxes on top earners will be even higher yet next year, thanks to Obamacare. Instead of building up middle class wealth through growing jobs and the economy, Obama wants to slash income at the top. This proposal for a first-ever cap on tax-deferred savings accounts is more of the same – meager policy and a bad idea.

Politically, too, the bombings take a toll. For President Obama, a renewed focus on terrorism further distracts the country from the bold liberal agenda proposed in his State of the Union Address earlier this year.

As he struggles to lead the country through this most recent assault, the president must be wondering how he can regain his post-election momentum. It won’t be easy.

The White House has been drained by numerous defections and legislative defeats, sapping the momentum of Mr. Obama’s second term.

 Whispers suggest the unthinkable: President Obama is already on the shelf.

Barely two months into his second term, President Obama’s approval ratings have tumbled into negative territory, with 48% of the country disapproving of his performance compared to 47% who give him a thumbs-up. While it is not uncommon for an incumbent to see his polls nosedive after reelection, Mr. Obama’s downturn is worse than that suffered by George W. Bush or Bill Clinton, who was famously embroiled in the Monica Lewinsky affair.

Events beyond Mr. Obama’s control have sidetracked him from his to-do list, and from the issues that matter most to voters.

The terrible slaughter at Newtown thrust him into fiercely advocating gun control, which appealed to many voters but proved politically toxic.

The bipartisan defeat of proposed gun safety legislation in the Senate incensed the president, who delivered a withering critique of the failed vote. Not only did the legislation go down in flames; Mr. Obama’s leadership credentials surely suffered as well.

Meanwhile, the Supreme Court hearings vaulted same-sex marriage onto the front page, and Mr. Obama has “evolved,” but few will credit the tardy president with having led the equality chorus.

Immigration reform looms larger in the country’s psyche – some 70% of the country favors resolution of this national embarrassment—but the president has been sidelined as Congress has led the crucial debate. Like the senior without a prom date, Mr. Obama awaits the call.

Meanwhile, in coming months voters will begin to realize the ill effects of ObamaCare, now rumbling menacingly forward.

The popular aspects of the bill (like being able to keep children on your policy) are in place, but have largely failed to impress voters. A recent poll from the Kaiser Family Foundation found that 42% of those surveyed oppose the bill, compared to only 36% that supports it. Even Democrats have soured on the measure; last November 72% embraced the legislation; today only 57% have a favorable view.

This is not unexpected.

The Obama White House did an excellent job of keeping bad news about ObamaCare off the front page in the run-up to the election. These days, the soaring costs of private insurance (in California Blue Cross is proposing a premium hike of 26% and elsewhere companies are being warned that costs could double in coming years), the imposition of hefty new taxes to cover the cost of expanding our health care safety net, the likelihood that your policy will have to be rewritten to comply with top-down rules, the rising cost of insurance exchanges, worsening news on the bill’s overall expense – in short, the inevitable consequences of trying to corral one sixth of the economy are coming home to roost.

As Americans discover the mess their president has visited upon them, they will come to view ObamaCare as the ultimate act of hubris. Even one of the bill’s architects, Senator Jay Rockefeller, recently described the healthcare law as “beyond comprehension.”

Only an academic with no real world experience could imagine that bureaucrats could successfully manage such a giant part of our economy; only an academic who never studied the rise and fall of the Soviet Union.

Republicans will be quick to remind voters as we approach the midterm elections that President Obama spent his political capital pushing this legacy-building law, instead of adopting measures that might have rebooted our economy. Even today, he is focused on anything and everything but the issue which still matters most – jobs.

Instead, he continues to push an agenda primarily focused on wealth redistribution, which is the unifying theme behind his recently unveiled budget.

The president calls for higher taxes – again – completely indifferent to the notion that tax hikes penalize growth. Unfortunately (and unexpectedly) for the president, the back and forth about the Sequester seriously undermined his credibility on federal budgets.

Thanks to the efforts of Senator Tom Coburn, among others, Americans were introduced to the inexhaustible lunacies supported by our bloated federal spending.

The president’s argument that outlays could not be reeled in without starving our young and closing down our airports was exposed for the drivel it is.

Meanwhile, President Obama has adopted a novel approach – talking to the opposition. After four years of “I won” hauteur, the president has actually dined with Republicans. In a follow-up gesture, he even incorporated into his budget a modest change in Social Security benefits that was widely endorsed by anyone with a calculator and a hope of keeping our entitlement programs from sinking the nation.

That minor gesture towards fiscal sanity has set the left howling. A recent article in the New York Times envisions a liberal challenger emerging in time for the 2016 race. Republicans would rejoice to see harmonious Democrats revert to their fractious mean, but it won’t do Obama’s standing any good.

Had Mr. Obama followed President Clinton by tacking right earlier – after his bruising midterm “comeuppance”—and had he adopted proposals designed to beef up demand, the economy might be pulling free and putting millions back to work. With that wind at his back, the president would have enjoyed smoother sailing in his second term.

He had a shot. Instead, he may soon be tagged as lame duck. If it quacks like a lame duck…

Lean in, lean back, stand up, sit down – everyone has advice for women wanting to get ahead. How about: Get a job?

 

One tiny problem may be holding women back: They are leaving the workforce in record numbers. The number of women age 20 and older not in the labor pool, according to the Bureau of Labor Statistics, has soared from 40 million in 2000 to nearly 49 million today; another 315,000 called it quits last month. The participation rate of women in the workplace has dropped from a high of 60.7 percent in 1999 to 58.8 percent today. By contrast, some 72.5 percent of men are either working or looking for a job.

What’s going on here? With all the focus on equal pay for equal work, and with opportunities continuing to expand for female employees, the exodus of women from our labor pool is surprising. And, possibly, a tad inconvenient for those charging that businesses still discriminate against women.

There are numerous explanations put forth to explain this trend. Most tend to identify two categories of workplace drop-outs: The first includes young mothers who are not highly educated and therefore not likely to earn enough to pay for childcare. Economically, these women are better off staying home.

The second (and more problematic) group consists of highly educated women who drop out (or “opt-out”) when they have children, even though they have the skills and income necessary to hire childcare. This latter bunch has economists and feminists alarmed for different reasons.

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Economists consider the defections costly for the country; we need highly talented and trained workers. For feminists, the drop-out trend undermines their argument that women – even our most accomplished and best educated – are victims of discrimination. If the women most likely to enter the C-suite marathon increasingly choose to hang up their running shoes, why should we expect more finishers?

A recent study by Joni Hersch, professor at Vanderbilt Law School, makes that case. She looks at female graduates of our top universities – those presumably who have the best shot at shattering the glass ceiling – and finds that once they have children, they are more likely to quit their jobs than are women who graduated from less selective schools.

“Although elite graduates are more likely to earn advanced degrees, marry at later ages, and have higher expected earnings, there is little difference in labor market activity by college selectivity among women without children and women who are not married. But the presence of children is associated with far lower labor market activity among married elite graduates. Most women eventually marry and have children, and the net effect is that labor market activity is on average lower among elite graduates than among those from less selective institutions.”

The numbers tell the story. Overall, Hersch reports that 60 percent of women who graduated from our top schools are working full time, compared to 68 percent who made it through less prestigious institutions. Married women without children from top schools are 20 percentage points more likely to work full time than those with children; the difference for graduates of lesser schools is 13.5 points.

Perhaps most astonishing is that only 35 percent of women who have earned MBAs after getting a bachelor’s degree from a top school are working full time, compared to 66 percent from second-tier schools.

So, as Hersch argues, if only a little more than one third of the best C-suite candidates continue to work after they have children, it is not surprising that women are not showing up more often in corporations’ top ranks.

This is not the only study that indicates our best and brightest females are voluntarily bowing out of the workplace. Stefania Albanesi, economist with the Federal Reserve, published a paper last year showing that college-educated women often leave the workforce when their husbands’ earnings surpass their own, allowing them to retire without the family taking a big financial hit.

Between 1993 and 2006, the number of college-educated women in the labor pool declined by 0.1 percent per year after growing at 2.4 percent per year from 1976 to 1992. The result was a loss of 1.6 million skilled workers. Albanesi attributes the change to sharply rising compensation for educated workers – particularly for men.

In 1975, college graduates were paid 43 percent more than those without a degree; in 2008 that premium had soared to 92 percent for men and 70 percent for women. Albanesi concludes that these women simply do not need to work, as their income has become less important to the family. She says the decision to retire has little to do with children since many women bow out long past the baby-stage.

Sarah Glynn, analyst for the Center for American Progress, takes “Pay Equity Day,” April 9 this year, to argue that the “wage gap” – women are paid on average only 77 percent as much as men – causes women to leave the workforce. (One could argue that it is because women enter and leave the workforce more often than their male counterparts that they are paid less. Few studies have been able to isolate the effect of tenure on the job.)

Glynn writes, “It often makes the most economic sense for the parent with the lower salary to be the one to take time off…” Though the wage gap has been shrinking, Ms. Glynn, among others, would like to see more laws passed to make the penalties harsher for discrimination and to demand more accessible childcare for workers.

Such measures might help low earners juggle the demands of parenting and work, but it won’t do much to keep our highest achievers on the job. At some point, those frustrated by C-suite male dominance may have to face reality: Many women enjoy life beyond the office.

————————————————————————————————————————
Lean in, lean back, stand up, sit down – everyone has advice for women wanting to get ahead. How about: Get a job?

One tiny problem may be holding women back: They are leaving the workforce in record numbers. The number of women age 20 and older not in the labor pool, according to the Bureau of Labor Statistics, has soared from 40 million in 2000 to nearly 49 million today; another 315,000 called it quits last month. The participation rate of women in the workplace has dropped from a high of 60.7 percent in 1999 to 58.8 percent today. By contrast, some 72.5 percent of men are either working or looking for a job.

What’s going on here? With all the focus on equal pay for equal work, and with opportunities continuing to expand for female employees, the exodus of women from our labor pool is surprising. And, possibly, a tad inconvenient for those charging that businesses still discriminate against women.

There are numerous explanations put forth to explain this trend. Most tend to identify two categories of workplace drop-outs: The first includes young mothers who are not highly educated and therefore not likely to earn enough to pay for childcare. Economically, these women are better off staying home.

The second (and more problematic) group consists of highly educated women who drop out (or “opt-out”) when they have children, even though they have the skills and income necessary to hire childcare. This latter bunch has economists and feminists alarmed for different reasons.

 
Economists consider the defections costly for the country; we need highly talented and trained workers. For feminists, the drop-out trend undermines their argument that women – even our most accomplished and best educated – are victims of discrimination. If the women most likely to enter the C-suite marathon increasingly choose to hang up their running shoes, why should we expect more finishers?

A recent study by Joni Hersch, professor at Vanderbilt Law School, makes that case. She looks at female graduates of our top universities – those presumably who have the best shot at shattering the glass ceiling – and finds that once they have children, they are more likely to quit their jobs than are women who graduated from less selective schools.

“Although elite graduates are more likely to earn advanced degrees, marry at later ages, and have higher expected earnings, there is little difference in labor market activity by college selectivity among women without children and women who are not married. But the presence of children is associated with far lower labor market activity among married elite graduates. Most women eventually marry and have children, and the net effect is that labor market activity is on average lower among elite graduates than among those from less selective institutions.”

The numbers tell the story. Overall, Hersch reports that 60 percent of women who graduated from our top schools are working full time, compared to 68 percent who made it through less prestigious institutions. Married women without children from top schools are 20 percentage points more likely to work full time than those with children; the difference for graduates of lesser schools is 13.5 points.

Perhaps most astonishing is that only 35 percent of women who have earned MBAs after getting a bachelor’s degree from a top school are working full time, compared to 66 percent from second-tier schools.

So, as Hersch argues, if only a little more than one third of the best C-suite candidates continue to work after they have children, it is not surprising that women are not showing up more often in corporations’ top ranks.

This is not the only study that indicates our best and brightest females are voluntarily bowing out of the workplace. Stefania Albanesi, economist with the Federal Reserve, published a paper last year showing that college-educated women often leave the workforce when their husbands’ earnings surpass their own, allowing them to retire without the family taking a big financial hit.

Between 1993 and 2006, the number of college-educated women in the labor pool declined by 0.1 percent per year after growing at 2.4 percent per year from 1976 to 1992. The result was a loss of 1.6 million skilled workers. Albanesi attributes the change to sharply rising compensation for educated workers – particularly for men.

In 1975, college graduates were paid 43 percent more than those without a degree; in 2008 that premium had soared to 92 percent for men and 70 percent for women. Albanesi concludes that these women simply do not need to work, as their income has become less important to the family. She says the decision to retire has little to do with children since many women bow out long past the baby-stage.

Sarah Glynn, analyst for the Center for American Progress, takes “Pay Equity Day,” April 9 this year, to argue that the “wage gap” – women are paid on average only 77 percent as much as men – causes women to leave the workforce. (One could argue that it is because women enter and leave the workforce more often than their male counterparts that they are paid less. Few studies have been able to isolate the effect of tenure on the job.)

Glynn writes, “It often makes the most economic sense for the parent with the lower salary to be the one to take time off…” Though the wage gap has been shrinking, Ms. Glynn, among others, would like to see more laws passed to make the penalties harsher for discrimination and to demand more accessible childcare for workers.

Such measures might help low earners juggle the demands of parenting and work, but it won’t do much to keep our highest achievers on the job. At some point, those frustrated by C-suite male dominance may have to face reality: Many women enjoy life beyond the office.

“The Bitch is Dead,” read the banner paraded through the streets of London yesterday – proof that hatred of Margaret Thatcher lives on, even in death.

Of all the extraordinary accomplishments of Britain’s only female prime minister, surely her outsized and continuing impact on the nation’s psyche is one of the most remarkable. Hardly a contemporary British story is written or West End play produced – witness Billy Elliott or even the comic One Man, Two Guvnors – that doesn’t slam the former leader. “Thatcherism” in some quarters is as loathed as “McCarthyism” in the U.S.

Why this animus? Because Mrs. Thatcher dared to take on what we call today the “special interests” that threatened England’s very survival – the trade unions and their allies. She convinced voters that the country would prosper only through the utter defeat of those who undermined England’s competitiveness and success and then went on to defeat them. For this, she will never be forgiven.

RELATED: Thatcher Inspired Conservatives Around the Globe

The courage to confront the unions and their big government enablers, to stem Britain’s decline into socialism, took guts – the kind that’s rare in the United States today. Our country is slip sliding towards mediocrity in much the same way Britain did in the 1970s.

More and more of our policy decisions are driven not by what’s best for the U.S. but rather what’s best for politicians who chase after voting blocks like hounds on the scent and whose favors are often for sale to the highest bidder. The efficiency of markets has been sidelined for the inefficiencies of K Street loyalties and central planning.

We have a president who believes that private enterprise is like a puppy – to be patted reassuringly on the head – but not allowed full run of the house. His most notable achievement to date was to place the boot-heel of government effectively on the neck of healthcare, one sixth of our economy.

President Obama does not believe in the capacity of the marketplace to sort out the bewildering challenges of lower-cost healthcare—or efficient energy policy, or common sense immigration reform or sluggish growth—he believes in bureaucrats.

Mrs. Thatcher knew better, as did her ally Ronald Reagan. For both, the stranglehold of labor unions and a bloated government-infested economy were out-of-control beasts to be tamed. In 1979, the year she took office, the U.K. suffered 29 million workdays lost to strikes. The disruptions not only cost the country dearly in forgone output, but discouraged those who might invest and build in the U.K.

Today, the number of days lost to work disputes is negligible.When Thatcher became prime minister, marginal tax rates were 83 percent on earned income and 98 percent on unearned income; ambitious Britons were fleeing the country. Seeking to attract and keep those who might help rebuild the nation, Thatcher lowered rates to 40 percent. Under Thatcher, the deficit dropped from 5.8 percent of output to 1.8 percent; state-run industries accounted for 2 percent of GDP at the end of her term, down from 10 percent at the start.

While the measures she pushed through were tough on coal miners and others who could only succeed under the cosseting regime of government ownership, for the nation as a whole, her policies led to a revival of growth and opportunity.

Not everyone shared Mrs. Thatcher’s vision. But her goals were clear and unwavering—as unwavering as her admiration of thrift, ambition and hard work. She embraced competition and rewarding those who were productive – a philosophy not too popular in the U.S. these days.

Instead, we have conceived and nurtured a society increasingly reliant on government support. Consider the shocking shrinkage of our workforce. Last week’s report that we created only 88,000 jobs in March was dismal across the board, but most unnerving was that another 496,000 decided against looking for a job. Workforce participation has plunged to 63.3 percent, the lowest since 1979 – a time when fewer women earned money outside the home.

Numerous analysts have pointed to burgeoning disability rolls to explain our disappearing labor ranks. The Social Security Administration reports that there are now 8.8 million people collecting disability payments averaging $1,130 per month, up from 3.5 million twenty years ago who received a $625 monthly stipend. Including spouses and children, the number swells to 10.9 million. The number receiving disability has increased much faster than the workforce overall. At the end of 1968, there were roughly 51 Americans working for every one collecting disability. Ten years ago the ratio was 24 to 1. Today that ratio has plummeted to 13 workers for every one on disability.

Many charge it is simply too easy to sign up for disability benefits and too difficult to jump off. The list of maladies for which one can claim disability benefits has expanded over the years and now includes many categories that are as hard to disprove as to prove. Hearings requesting payments are one-sided; the applicant’s case is argued by a lawyer who stands to harvest fees while the government (and the taxpayer) often has no representation at all. Meanwhile, annual payments run only $2,000 less than a minimum wage job. Why work?

Only if you can envision a better future for you and your family. Only if you are optimistic that you will be rewarded for your success. That’s the formula that Maggie Thatcher understood.

A dependent society is a failed society. Those advocating increasingly generous handouts to the old, the poor, the sick, the unlucky, the illiterate, the unemployed, the uncompetitive – the list goes on and on – ultimately jeopardize our ability to care for those who truly need help. Pushing back against the insidious welfare tide engenders hatred and resentment; it takes courage. Actually, it may take a bitch.

Why in the world is the government still forcing ethanol down the gas tanks of American consumers? Ethanol was meant to help clean up the air and to keep gasoline prices in check. It does neither. Instead, it degrades the environment and is currently boosting gas prices. Talk about a teachable moment. No program could better explain why so many Americans oppose Big Government.

Most Americans probably assume that corn-based ethanol is “green”—it is not. Numerous studies have shown that ethanol use does not significantly lower emissions, but instead actually harms the environment. That conclusion has led numerous green groups to abandon their earlier support for ethanol.

In 2011, Greenpeace and the Clean Air Task Force (in conjunction with several business and farm organizations) requested hearings on the Renewable Fuel Standard that mandated ethanol use. In a letter to Senators Inhofe and Boxer, they cite a study by The National Academy of Sciences, which found “that using corn ethanol in engine fuel is increasing air pollutants, exacerbating global warming, degrading water sources, and damaging biodiversity.”

Production of ethanol requires enormous amounts of (sometimes scarce) water. A Salon piece last year reported, “The World Policy Institute has calculated…that it takes 32 gallons of water to produce enough oil to drive from New York to D.C. and back again. The production of enough corn-based biofuel to fuel the same drive requires more than 35,000 gallons of water”.

Another problem is that the fertilizers spread on corn-growing acreage pollute streams feeding the Mississippi watershed and the Gulf of Mexico. On their website, Friends of the Earth reports, “Chemical runoff from corn fields is a primary cause of the “dead zone” in the Gulf of Mexico — an aquatic area the size of Massachusetts so polluted that nothing can survive in it.” Further, the nitrogen in fertilizer also releases nitrous oxide, a more toxic substance than CO2, into the atmosphere. So much for ethanol as a clean fuel.

Meanwhile, instead of helping to drive down gasoline prices, the mandate is doing exactly the reverse. Crude prices today of $96 a barrel (WTI) are 8.5 percent below year-ago levels, and demand for gasoline has dwindled steadily since 2007 – both factors which should be pressing prices lower. But, because refiners are struggling to comply with ethanol rules built for a different age, gasoline prices are stuck at sky-high levels.

In 2005, when the government first required refiners to incorporate ethanol into gasoline sold in the U.S., and when they upped that demand by enacting the Energy Independence and Security Act of 2007, the presumption was that the U.S. was running out of oil. Demand for gasoline had hit an all-time high in 2007 and oil imports were rising. In the aftermath of 9/11 and the Iraq war, legislators searching for a way to lessen our dependence on Mideast oil not only raised fuel efficiency standards for autos and light trucks for the first time in 22 years, but also mandated that refiners blend 10 percent ethanol into the nation’s fuel mix. Environmentalists were delighted, as were the nation’s farmers.

As it has turned out, nearly all the assumptions behind the ethanol mandate were wrong. The biggest surprise, of course, is that the U.S. is not running out of oil. After two decades during which oil prices rarely topped $25 per barrel, and following many years of decline, U.S. production fell below 4 million barrels per day in September 2005. War worries, soaring demand from China, as well as declining production here and elsewhere, finally reversed the downtrend and prices began to climb.

Crude was $21 in January 2002; in July 2008 the price peaked at $145 before crashing as the financial crisis roared through every marketplace. (Some economists have argued that the recession was actually precipitated, like other downdrafts, by that sudden ascent in oil prices.) In any event, the run-up in prices sent drillers scurrying for prospects; U.S. production rebounded and last month topped 7 million barrels per day.

That’s great news, except that consumers have yet to enjoy the benefits. The 2007 law mandated that refiners blend 13.8 billion gallons of ethanol into the fuel they sell this year. However, since consumption has fallen short of forecasts, refiners do not need the targeted amount; as a result, they are forced to buy credits called Renewable Identification Numbers, or RINs. At an investor conference last month, Valero Energy reported that these credits were in such short supply that the price had soared from 3 cents a gallon last year to more than $1. More recently the price has drifted down to 66 cents – a cost which is being passed onto motorists.

The company pointed out that the law encourages refiners to ship product overseas where the ethanol mandate does not apply and discourages imports – raising prices in the U.S. Some say that jump in RIN prices has added as much as ten cents per gallon to the cost of gasoline.

According to a 2010 piece by Craig and Andrew Hug for the Environmental Working Group, “Between 2005 and 2009, taxpayers spent a whopping $17 billion to subsidize ethanol. In return, they got a reduction in overall oil consumption equal to an unimpressive 1.1 mile-per-gallon increase in overall fuel economy.” Now Americans are paying above-market prices for gasoline. Will the Obama administration and Congress confront the powerful ethanol lobby and undo this albatross? Not likely. Our central planners are hard at work trying to increase the ethanol in our tank. As said earlier, a teachable moment.

Maybe our undisciplined government spending isn’t the problem; maybe it’s our stultifying legal system. That has been the message of Philip Howard for years. The author of “The Death of Common Sense: How Law is Suffocating America” and founder of bipartisan reform coalition Common Good wants to banish out-of-date regulations that drive up costs and perpetuate senseless programs. Today, with legislators scrambling for ways to bring order to our financial house, perhaps his call for legal reform will pierce the cacophony of squabbling interest groups and taxpayers.

The sequester has focused the nation’s attention on how we spend our tax dollars. The Obama administration has portrayed every dollar spent as crucial; one penny less and planes will fall from the skies. At the same time, GOP Senator Tom Coburn and others have publicized an endless stream of moronic programs that give taxpayers heartburn.

The truth, of course, lies somewhere in between. There are crucial programs and there are many examples of waste. The latter often spring from laws and regulations written to address past problems but which remain on the books far beyond their useful lives. A recent Wall Street Journal editorial said that the Supreme Court is reviewing a Great Depression program aimed at stabilizing raisin prices. The law mandates that regulators set prices by governing supply, forcing growers to sell to the government at a steep discount – even today. How much are we spending to maintain the Raisin Administrative Committee? Do growers need price supports? Nobody knows; that’s the point.

 

According to recent polling commissioned by Common Good, 78 percent of Americans think that budget deficits “could be reduced substantially if we simplified government rules, bureaucracies and programs.” Nine out of ten people think it makes sense to review all government regulations at least every ten years to make sure they still work. That effort to simplify our government (and our lives) is rated a “high national priority” by 85 percent of the country.

Even President Obama has from time to time championed cutting the web of rules and regulations that enslaves our lives. In his 2011 State of the Union address, the president drew laughs from noting, “The Interior Department is in charge of salmon while they’re in freshwater, but the Commerce Department handles them when they’re in saltwater. I hear it gets even more complicated once they’re smoked.” He promised to “give [voters] a government that’s more competent and more efficient.”

What did his efforts produce? His 2013 budget did indeed include proposed discretionary cuts amounting to $7.9 billion, consolidations of agency functions yielding $395 million and savings of $159 million. Total discretionary savings? $8.5 billion. Including mandated cuts, the total swells to $24 billion – less than one percent of outlays. Not enough to move the needle.

Cleaning up the government is hard not just because it is vast, but because it is tangled up in layer upon layer of antiquated laws – laws that should be periodically reviewed and simplified. Howard is working on a new book in which he calls for a constitutional requirement that all regulations with budgetary consequences contain a sunset provision.

He notes that we are the only developed country that does not have a system to clean up laws. “We’ve become like crazy hoarders,” he says – the Collier Brothers of obsolete legislation. The discipline to review and reinvent our laws and rules simply does not exist. “The abdication of responsibility by Congress is a national scandal,” he fumes.

He has a point. Michael Walsh recently reported in the New York Post that the government is paying survivor benefits to two descendants of Civil War vets, and 10 relatives of Spanish-American War participants. Taxpayers are still supporting the 1,000 employees and $578 million budget of the Rural Utilities Service, originally founded to make sure Americans living in the sticks had access to electricity.

These are shocking souvenirs of bygone times – that are still wasting taxpayer money – and that should have been scrubbed from the books decades ago. Mr. Howard cites other examples, such as the farm subsidies that sprang out of the terrible drought of the 1930s, when so many farmers went bust – but that are now paying millions to millionaires. Or, the Davis Bacon Act of 1931, enacted to boost depressed wages during the Great Depression. Today, according to the Heritage Foundation, requirements of that bill force our beleaguered federal government to systematically overpay contractors.

“Look at the Special Ed bill,” says Howard. “No one ever intended when that bill passed in the 1970s for special ed to consume over 20 percent of our K-12 budgets for the tiny percentage that needs special help.” Don’t get him started on ethanol subsidies.

Americans hopeful of real progress in tackling our country’s budget issues bemoan that instead of dismantling our burdensome outdated laws, Congress and President Obama are adding to the mess. Obamacare alone, now weighing in at 20,000 pages of new regulations, has spawned a cottage industry of companies promising to guide small businesses through the thicket.

Americans looking for budget sanity were earlier let down by the failure of the Simpson-Bowles Commission, which endorsed strong measures to balance our country’s books. That the commission’s suggestions came to naught was no surprise to Mr. Howard. As he points out, the forming of an advisory body is determined by the 1972 Federal Advisory Committee Act, which mandates representation by all interested parties – guaranteeing failure. Seriously, you can’t make this stuff up.

Maybe our undisciplined government spending isn’t the problem; maybe it’s our stultifying legal system. That has been the message of Philip Howard for years. The author of “The Death of Common Sense: How Law is Suffocating America” and founder of bipartisan reform coalition Common Good wants to banish out-of-date regulations that drive up costs and perpetuate senseless programs. Today, with legislators scrambling for ways to bring order to our financial house, perhaps his call for legal reform will pierce the cacophony of squabbling interest groups and taxpayers.
The sequester has focused the nation’s attention on how we spend our tax dollars. The Obama administration has portrayed every dollar spent as crucial; one penny less and planes will fall from the skies. At the same time, GOP Senator Tom Coburn and others have publicized an endless stream of moronic programs that give taxpayers heartburn.

The truth, of course, lies somewhere in between. There are crucial programs and there are many examples of waste. The latter often spring from laws and regulations written to address past problems but which remain on the books far beyond their useful lives. A recent Wall Street Journal editorial said that the Supreme Court is reviewing a Great Depression program aimed at stabilizing raisin prices. The law mandates that regulators set prices by governing supply, forcing growers to sell to the government at a steep discount – even today. How much are we spending to maintain the Raisin Administrative Committee? Do growers need price supports? Nobody knows; that’s the point.

   
According to recent polling commissioned by Common Good, 78 percent of Americans think that budget deficits “could be reduced substantially if we simplified government rules, bureaucracies and programs.” Nine out of ten people think it makes sense to review all government regulations at least every ten years to make sure they still work. That effort to simplify our government (and our lives) is rated a “high national priority” by 85 percent of the country.

Even President Obama has from time to time championed cutting the web of rules and regulations that enslaves our lives. In his 2011 State of the Union address, the president drew laughs from noting, “The Interior Department is in charge of salmon while they’re in freshwater, but the Commerce Department handles them when they’re in saltwater. I hear it gets even more complicated once they’re smoked.” He promised to “give [voters] a government that’s more competent and more efficient.”

What did his efforts produce? His 2013 budget did indeed include proposed discretionary cuts amounting to $7.9 billion, consolidations of agency functions yielding $395 million and savings of $159 million. Total discretionary savings? $8.5 billion. Including mandated cuts, the total swells to $24 billion – less than one percent of outlays. Not enough to move the needle.

Cleaning up the government is hard not just because it is vast, but because it is tangled up in layer upon layer of antiquated laws – laws that should be periodically reviewed and simplified. Howard is working on a new book in which he calls for a constitutional requirement that all regulations with budgetary consequences contain a sunset provision.

He notes that we are the only developed country that does not have a system to clean up laws. “We’ve become like crazy hoarders,” he says – the Collier Brothers of obsolete legislation. The discipline to review and reinvent our laws and rules simply does not exist. “The abdication of responsibility by Congress is a national scandal,” he fumes.

He has a point. Michael Walsh recently reported in the New York Post that the government is paying survivor benefits to two descendants of Civil War vets, and 10 relatives of Spanish-American War participants. Taxpayers are still supporting the 1,000 employees and $578 million budget of the Rural Utilities Service, originally founded to make sure Americans living in the sticks had access to electricity.

These are shocking souvenirs of bygone times – that are still wasting taxpayer money – and that should have been scrubbed from the books decades ago. Mr. Howard cites other examples, such as the farm subsidies that sprang out of the terrible drought of the 1930s, when so many farmers went bust – but that are now paying millions to millionaires. Or, the Davis Bacon Act of 1931, enacted to boost depressed wages during the Great Depression. Today, according to the Heritage Foundation, requirements of that bill force our beleaguered federal government to systematically overpay contractors.

“Look at the Special Ed bill,” says Howard. “No one ever intended when that bill passed in the 1970s for special ed to consume over 20 percent of our K-12 budgets for the tiny percentage that needs special help.” Don’t get him started on ethanol subsidies.

Americans hopeful of real progress in tackling our country’s budget issues bemoan that instead of dismantling our burdensome outdated laws, Congress and President Obama are adding to the mess. Obamacare alone, now weighing in at 20,000 pages of new regulations, has spawned a cottage industry of companies promising to guide small businesses through the thicket.

Americans looking for budget sanity were earlier let down by the failure of the Simpson-Bowles Commission, which endorsed strong measures to balance our country’s books. That the commission’s suggestions came to naught was no surprise to Mr. Howard. As he points out, the forming of an advisory body is determined by the 1972 Federal Advisory Committee Act, which mandates representation by all interested parties – guaranteeing failure. Seriously, you can’t make this stuff up.

 

---

With 23 million Americans still needing full-time jobs, you would think the Obama administration would be doing everything possible to encourage hiring. At the least, you might expect them to tone down activities that would discourage hiring—that is not the case.

From Obamacare’s extra fees holding back workforce expansion to efforts to hike the minimum wage, this White House has repeatedly raised the cost of adding personnel. Less visible has been how the Obama administration has increased the risks assumed by any entity that hires new workers – such as the risks ladled on by an increasingly aggressive EEOC.

The Equal Employment Opportunity Commission is responsible for enforcing federal anti-discrimination laws. Under the Obama administration, the EEOC has ramped up its investigations of businesses large and small. In its 2012 annual review, the agency reports “The EEOC’s private sector administrative enforcement activities secured more than $365.4 million in monetary benefits in FY 2012, the highest level of monetary relief ever obtained by the Commission through the administrative process…”

The Fiscal Times FREE Newsletter

Recently, it has especially focused on so-called “systemic” discrimination. That is, instead of dealing with individual accusations of mistreatment, the EEOC now pursues one-off complaints as possible clues to ongoing bias, putting firms through the wringer as they attempt to cooperate with vast demands for past records and other subpoenaed materials.

In the past such investigations have focused mainly on large enterprises. For instance, in July 2011 the agency announced a $20 million agreement with Verizon in settlement of the country’s largest-ever disability lawsuit. The company was accused of using strict attendance policies that “systemically” discriminated against persons with disabilities. Though successful in that case, the EEOC has more recently been rebuffed numerous times for its free-range pursuits. Last yeara federal judge tossed its subpoena demanding nationwide employment data in a case involving just two complaints – both from Colorado workers - against employer Burlington Northern.

Today, such investigations can target small companies as well. Last year in Massachusetts, a coffee chain endured a year of investigators quizzing their baristas about the gender, body type and race of their co-workers, even though, according to the restaurant owner, the firm had never had any complaint of discrimination. A local politician railed that the EEOC was a “meddlesome, overblown, intrusive federal agency.”

In Tucker, Georgia, the EEOC brought charges of sexual harassment against the owners of Sangria’s Mexican Café in Tucker, Georgia, even after they had agreed to post notices and offer training to ward against future violations. A jury awarded four employees $51,700 in damages, monies the 22-employee restaurant claimed might put them out of business. Chad Schultz, the lawyer defending the owners said, “This is a perfect example of the EEOC gone wild. It pursued this small business, with no previous dealings with the EEOC, like it was a Fortune 500 Company…Heaven help the small business that becomes the target of the EEOC.”

Heaven help them indeed. Or perhaps the federal courts will rein in the agency. Just recently, a judge sanctioned the EEOC for making the defendant’s discovery more excessively “time consuming, laborious and adversarial than it should have been” while pursuing a sexual harassment claim against The Original Honeybaked Ham. In another case last year against a warehousing and pallets supplier, Propak Logistics, a judge ruled against the EEOC, charging it had engaged in unreasonable delay, which constituted prejudice against the defendant. Other cases dismissed in 2011 included one involving a corporate events and convention planner, the Freeman Companies—the court ruled against the EEOC’s position that it can disregard the statute of limitations in bringing discrimination charges.

For many small businesses, simply keeping up to speed with changing regulations is challenging. Elizabeth Milito, Senior Executive Counsel of the NFIB, says, “Our members want to comply with the law. They don’t want to discriminate against applicants or employees, but they struggle to decipher confusing and sometimes contradictory laws.” She points out that small firms typically don’t have HR execs or in-house counsels available to wade through the legalese.

In the past year, one of the more vexing issues has been conflicting signals on the use of background checks and the hiring of criminals. A year ago, the EEOC determined that policies that preclude hiring people with criminal records have a “disparate racial impact,” since African American men are seven times more likely than whites to have been in jail. The agency urged employers, instead of ruling out such hires, to take into account the “nature of the crime, the time elapsed, and the nature of the job” in deciding whether or not to take on an individual.

In other words, firms will be required to perform extensive research, which could prove costly. (As some have pointed out, there could be no faster way to discourage hiring blacks.) Worse, some businesses are prohibited to hire ex-cons by law; complying with the EEOC mandate could expose them to prosecution elsewhere. As Newsmax reports, this problem was exposed when the EEOC “took action against G4S Secure Solutions, which provides guards for nuclear power plants…for refusing to hire a twice-convicted thief as a security guard – even though Pennsylvania state law forbids hiring people with felony convictions…”

The small business community still faces tough times. A recent poll conducted by the National Federation of Independent Businesses shows optimism of that group at 2008 levels, and below the depths recorded during the 1991-1992 and 2001-2002 recessions. Worse, far more business owners reported declining sales and profits that logged in with an increase. Since everyone, including President Obama, has noted the importance of small companies in creating jobs, it seems an especially poor time to further burden struggling businesses with more regulatory uncertainty and expense. No one condones workplace discrimination, but neither does the EEOC’s aggressive overreach seem warranted.

————————————————————————————————————————
With 23 million Americans still needing full-time jobs, you would think the Obama administration would be doing everything possible to encourage hiring. At the least, you might expect them to tone down activities that would discourage hiring—that is not the case.

From Obamacare’s extra fees holding back workforce expansion to efforts to hike the minimum wage, this White House has repeatedly raised the cost of adding personnel. Less visible has been how the Obama administration has increased the risks assumed by any entity that hires new workers – such as the risks ladled on by an increasingly aggressive EEOC.

The Equal Employment Opportunity Commission is responsible for enforcing federal anti-discrimination laws. Under the Obama administration, the EEOC has ramped up its investigations of businesses large and small. In its 2012 annual review, the agency reports “The EEOC’s private sector administrative enforcement activities secured more than $365.4 million in monetary benefits in FY 2012, the highest level of monetary relief ever obtained by the Commission through the administrative process…”

 
The Fiscal Times FREE Newsletter
 
Recently, it has especially focused on so-called “systemic” discrimination. That is, instead of dealing with individual accusations of mistreatment, the EEOC now pursues one-off complaints as possible clues to ongoing bias, putting firms through the wringer as they attempt to cooperate with vast demands for past records and other subpoenaed materials.

In the past such investigations have focused mainly on large enterprises. For instance, in July 2011 the agency announced a $20 million agreement with Verizon in settlement of the country’s largest-ever disability lawsuit. The company was accused of using strict attendance policies that “systemically” discriminated against persons with disabilities. Though successful in that case, the EEOC has more recently been rebuffed numerous times for its free-range pursuits. Last yeara federal judge tossed its subpoena demanding nationwide employment data in a case involving just two complaints – both from Colorado workers - against employer Burlington Northern.

Today, such investigations can target small companies as well. Last year in Massachusetts, a coffee chain endured a year of investigators quizzing their baristas about the gender, body type and race of their co-workers, even though, according to the restaurant owner, the firm had never had any complaint of discrimination. A local politician railed that the EEOC was a “meddlesome, overblown, intrusive federal agency.”

In Tucker, Georgia, the EEOC brought charges of sexual harassment against the owners of Sangria’s Mexican Café in Tucker, Georgia, even after they had agreed to post notices and offer training to ward against future violations. A jury awarded four employees $51,700 in damages, monies the 22-employee restaurant claimed might put them out of business. Chad Schultz, the lawyer defending the owners said, “This is a perfect example of the EEOC gone wild. It pursued this small business, with no previous dealings with the EEOC, like it was a Fortune 500 Company…Heaven help the small business that becomes the target of the EEOC.”

Heaven help them indeed. Or perhaps the federal courts will rein in the agency. Just recently, a judge sanctioned the EEOC for making the defendant’s discovery more excessively “time consuming, laborious and adversarial than it should have been” while pursuing a sexual harassment claim against The Original Honeybaked Ham. In another case last year against a warehousing and pallets supplier, Propak Logistics, a judge ruled against the EEOC, charging it had engaged in unreasonable delay, which constituted prejudice against the defendant. Other cases dismissed in 2011 included one involving a corporate events and convention planner, the Freeman Companies—the court ruled against the EEOC’s position that it can disregard the statute of limitations in bringing discrimination charges.

For many small businesses, simply keeping up to speed with changing regulations is challenging. Elizabeth Milito, Senior Executive Counsel of the NFIB, says, “Our members want to comply with the law. They don’t want to discriminate against applicants or employees, but they struggle to decipher confusing and sometimes contradictory laws.” She points out that small firms typically don’t have HR execs or in-house counsels available to wade through the legalese.

In the past year, one of the more vexing issues has been conflicting signals on the use of background checks and the hiring of criminals. A year ago, the EEOC determined that policies that preclude hiring people with criminal records have a “disparate racial impact,” since African American men are seven times more likely than whites to have been in jail. The agency urged employers, instead of ruling out such hires, to take into account the “nature of the crime, the time elapsed, and the nature of the job” in deciding whether or not to take on an individual.

In other words, firms will be required to perform extensive research, which could prove costly. (As some have pointed out, there could be no faster way to discourage hiring blacks.) Worse, some businesses are prohibited to hire ex-cons by law; complying with the EEOC mandate could expose them to prosecution elsewhere. As Newsmax reports, this problem was exposed when the EEOC “took action against G4S Secure Solutions, which provides guards for nuclear power plants…for refusing to hire a twice-convicted thief as a security guard – even though Pennsylvania state law forbids hiring people with felony convictions…”

The small business community still faces tough times. A recent poll conducted by the National Federation of Independent Businesses shows optimism of that group at 2008 levels, and below the depths recorded during the 1991-1992 and 2001-2002 recessions. Worse, far more business owners reported declining sales and profits that logged in with an increase. Since everyone, including President Obama, has noted the importance of small companies in creating jobs, it seems an especially poor time to further burden struggling businesses with more regulatory uncertainty and expense. No one condones workplace discrimination, but neither does the EEOC’s aggressive overreach seem warranted.