Show 5 if THE VOICE OF BUSINESS The Humphrey-Hawkins Humphrey dill bill is a turkey My lIy Richard L I. L. L Lesher Pres Chamber of 01 Commerce of 01 the United Sta States tes One of the endlessly fascinating variations of the legislative game is to take a bill that Is symbolically Important but bad remove the stuffing and pass the shell Thus the Ule symbol is preserved the harm that might be done is minimized and those grou groups that supported the original bill can devote themselves to putting the stuffing back a piece at a time through future legislation The revl revived ved Humphrey Humphrey- Hawkins bill Is a a perfect illustration of this process The original Humphrey Humphrey- Hawkins bill would have frightened even the agency responsible for mismanaging the entire Russian economy It contemplated contemplated contemplated con con- central economic planning wage-price wage controls an Impossible meet impossible meet to-meet level of 3 percent unemployment and public service jobs for all who need one at rates of pay above that available in private in in- Those goals sound public public- spirited enough But no one knows how to attain them and the price of trying would probably be the destruction of our economy There are certain grim tradeoffs that we haven't learned how to avoid Among them Lowering unemployment below its normal level now believed to be about 55 per per- cent tends to increase inflation inflation in In- because wages are bid up by employers competing for scarce labor Expensive new government programs such as public service jobs either increase inflation or raise tax taxes s. s And tax Increases tend to cause unemployment because less money is left in private hands to create new jobs Attempts to fight inflation by wage-price wage controls tend to cause shortages Eventually shortages cause unemployment and All of this and more was the promise of the original Humphrey-Hawkins Humphrey bill But now there is a new Hawkins Humphrey-Hawkins bill It is guaranteed to be milder than any other leading brand get teeth whiter than white leave no dulling soap film and go 30 percent farther on a gallon of gas Its unemployment target is 4 percent rather than 3 percent Its timetable for reaching that level is five years rather than 18 months It disavows economic planning and directs the President to draw up an economic plan it orders him t to increase employment and lower inflation simultaneously but doesn't say how it favors removing obstacles to capital formation but does not remove any At best it wont won't solve the unemployment problem At worst it might push inflation into the 20 10 percent range and require tax increases of at least per family The outcome would depend on two factors 1 How seriously the President tries to achieve its goal of 4 percent unemployment and by what means 2 How successful successful successful suc suc- its proponents are arc at putting the stuffing back in Our unemployment problem is aggravated by three factors The first is the unprecedented surge of women into the workforce workforce workforce work work- force the second is a very high rate of joblessness among black teenagers and the third is a series of welfare programs that reduce incentives to be productively employed Underlying Underlying Underlying Un Un- these superficial factors is a bewildering array of government tax and regulatory policies that inhibit capital formation and investment the ultimate source of all new jobs Given a little enlightened help or even the absence of government interference the private economy will generate jobs for all who are capable of filling them Seven million new jobs have been created in the thelast thelast last two half years alone For those who are not capable or not willing the answer is job training and welfare reform It would also help if we didn't increase the minimum wage to levels that price the unskilled out of the market As the Washington Post puts it The remedy for unemployment is the slow tedious process of lifting the pace of economic growth That's doing it the hard way but there isn't any other way |