On Layoffs

I've fired myself, and I've been laid off (along with my wife at the exact same time).

I'm sure I'll be laid off again. It is part of the modern, flexible economic system that keeps us all so stinking rich. Just keep 6 months of cash in the bank, and keep your resume up to date.

I was in major debt 3 years ago. It completely ruined my life! Thankfully I found great help and thought I'd hopefully help someone get out of the same trouble that I was in.I am so glad and thankful I did it. The website I went to was www.debtfreesolutionsinc.com. You will be so happy.

You are obviously a male, because females normally have a deeper understanding of life and what getting laid off means to putting food on the table for their family.

Speaking as a FEMALE, Trumpit, let me assure you that I have no doubt that I would fire you if you worked for me. If, as an employee, you're not pulling your weight, you are costing me money and taking food off my table for my family. So, you will be cut loose like a gangrenous limb.

John S.

Great analogy, that's the kind I like, one that can be taken to the street and understood by anyone at any educational level.

As one of the commenters there pointed out, Don was followed by a woman who totally disagreed with him, but then proceeded to make his point beautifully: she said her own financial situation was causing her to reconsider having her hair done, or having the paper delivered.

In other words, she wants to lay off the hairdresser and the paperboy, but she would not give their employers the right to do the same.

I wanted to ask that woman this question: suppose the next time she went to the beauty salon, she was presented with a contract that would obligate her to use the same hairdresser for the rest of her life -- and to pay for a monthly appointment, forever, whether she needed it or not. Would she sign?

Of course she wouldn't. And furthermore, given a choice between a hairdresser who won't work unless customers sign such a contract, and another who will work without such a contract, any woman alive would choose the latter.

Yet if a business acts in the same way, it's greedy, heartless, and cruel.

I thought Don handled himself well. It was quite instructive that the co-host repeated that Don didn't think layoffs were "good", but rather necessary. NPR fancies itself on having a listenership of intelligentsia, yet they don't trust the ears nor analytic ability of their listeners. This is my first post and I'd just like to say I love the blog and podcast. Keep up the good work.

An employee no more owns his job than a business owns its market share.

Posted by: Sam Grove | Dec 7, 2008 10:21:40 PM

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Excellent analogy!!

Thank you regular posters for motoring the posts!!! (malicious responses only feed a troll – and make sifting through a thread for something worthwhile tedious.)

There were a number of insightful remarks. Nice thread.

"Damnit now, if I could just find a way to raise the tide and only float my own boat."

Posted by: vidyohs | Dec 8, 2008 11:08:58 AM

I like that analogy vidyohs; it's almost poetic.

"Platitudes is what you so-called libertarians spout, not an original bone in your body. It's Monday, so it's back to work for the lot of you - chaining yourself to your desk. Or else you too may be looking for work on Tuesday. Slaves everyone of you! And you spent your lives making someone else rich. Haha!

Posted by: TrUmPiT | Dec 8, 2008 2:30:15 AM"

And this from a self confessed and declared socialist to the core! Tsk Tsk, TrUmPiTite, that thought process was good for Lucy and her kin on the African veldt but mankind has made some progress since then.

God forbid that in benefiting ourselves others find benefit as well.

Damnit now, if I could just find a way to raise the tide and only float my own boat.

Good job, Don, with a difficult task. You might have tried also to sketch for your hosts a picture of the extreme -- an economy where no layoffs are allowed. Doing so you might have made some headway in explaining to them and their audience why the flexibility you discussed is such a crucially important part of a growing economy.

The reality seems to be that small and flexible are needed in industry. In many ways it doesn't matter if we want to save union jobs or not, the deciding factor is what's possible in a global economy. We could go the whole route of protectionism, but in the end, reality wins and protectionism makes the situation worse. Desires, good intentions and wishful thinking are no match for economic reality. So taking sides is somewhat futile because it's not like we can really make things happen just because it's politically or morally popular to do so.

Trumpit,

"It's Monday, so it's back to work for the lot of you - chaining yourself to your desk."

I'm not chained to my desk. The relationship with my employer is completely voluntary and mutually beneficial. The only chains I wear are those placed on me by the political class - that is, by people like you.

Trumped,

I don't know how you would define freedom, but there is only one logical definition of it: the right to be let alone, to offer or withhold one's own resources, and none but one's own.

http://news.aol.com/article/laid-off-workers-occupy-chicago-factory/269873

And when they won't go quietly...

Whip them into submission?

Platitudes is what you so-called libertarians spout, not an original bone in your body. It's Monday, so it's back to work for the lot of you - chaining yourself to your desk. Or else you too may be looking for work on Tuesday. Slaves everyone of you! And you spent your lives making someone else rich. Haha!

Oh look, we have yet another name calling troll.

*sigh*

Well done Dr. Boudreaux! Too bad the masses will never understand allocative efficiency. Does the phrase "most highly valued use" matter to anyone with any understanding in business anymore?

The trauma and issue of unemployment is a monopoly of Interventionism. In a completely free market, there would be no such trauma, for there would be no such thing as chronic, massive unemployment.

Since the market tends toward equilibrium, it tends toward full employment, equilibrium between the supply of and demand for manpower.

So, when a man loses one job, he quickly finds another, and just as good.

There are losers. But they are not the workers. The only losers are the owners of the failed businesses. They lose their capital. But the workers themselves do not lose "their jobs." They simply move from some to others.

An employee no more owns his job than a business owns its market share.

Many businesses are willing to tolerate a higher employee cost when times are good.

Many marginally productive individuals managed to survive through 'charitable' employment. Many such individuals lost these opportunities when employment became highly formalized via labor law and costly mandates.

Guaranteed jobs for some means guaranteed unemployment for others.

Com'on, Vidyohs, you're being quite insensitive here. Of course someone's ability to literally survive depends on being able to earn an income working for someone else who has extended the income-earning opportunity [which, after you accept, the job becomes something you're entitled to]. No one could ever possibly learn or relearn how to hunt, fish, farm, pitch a tent, make a fire, boil water, or heat food in order to eat and take shelter.

Also, the income opportunity has to pay out a living wage -- anything less and you'd drop dead right on the spot the moment that wage dipped below the magical line-of-life-termination.

I think that I am the NPR crowd, and have learned much since I have started listening and reading Don and Russ. However, while factually correct, Don's comments did not make a dent in the opposing view.

The question is how do we get what we want? It is just as I believe Churchill said. America always does what is right after, it has tried everything else.

We all must admit we wear rose color glasses sometimes and most only take them off when faced with no other choice. It seems that most are not ready to take them completely off yet.

"The ability to fire someone is a power not to be abused because it goes to the very core of one's ability to survive in an indifferent world.

Posted by: TrUmPiT | Dec 7, 2008 12:33:33 AM

Strange, the difference in this fools post and our usually idiot, Trumpit; notice the name?

Question O' strange one TrUmPiT, the word above, one's, are you talking about the owner or the employee? It seems to me that you are talking about the employee, and since it isn't "his" job but something he has been allowed/paid to perform, his survival in an indifferent world is his problem, eh? If survival is the employee's concern, shouldn't he be saving or investing to protect that? Can, or should, an employer dictate to an employee whether he saves or not? Which side of that would you agree to, TrUmPiT?

Anyway, let's paraphrase this TrUmPiT's little statement, but make it clear we are talking about the employer and from an intelligent point of view:

"The ability to 'hire' someone is a power not to be abused because it goes to the very core of one's ability to survive in an indifferent world."

C'mon, maintain civility.

Respect the request of the host.

Liberals like Trumpit are an essential part of my strategy for not getting laid off. Thanks to my fellow employees who think and work like the job belongs to them rather than to our employer, I find there's always an ample cushion of dead weight between myself and the chopping block during the slow times.

Trumpit, I hope you work in my department. It's comforting to know they'll be letting you go so they can afford to pay me to stay.

If you find economics difficult, maybe you should go over to DUmmyland where it's a forbidden subject. You'd fit right in over there.

Certainly there is employer abuse, just as there is fellow employee abuse and employee abuse of their jobs. Works both ways.

Don't like the way you're being treated at work? Leave.

It is progressive government that has placed so many people so close to the financial edge that they feel unduly constrained from risking a change in employment.

The empire is expensive as is the system of entitlements.

OAN

It occurred to me recently that the reason we don't have our flying cars now is because it was decided to invest in an extensive highway system.

You live a sheltered life behind a dim computer screen, cpurick. You are obviously a brainwashed, juvenile male, around 15 years old, because females normally have a deeper understanding of life and what getting laid off means to putting food on the table for their family. Are you really "Chainsaw" Al Dunlap incognito? If you are, have yourself a merry little x-mas NOT. You pathetic, egotistical downsizer, loser you!

"My [obviously very limited] understanding is that the health insurance provided to union workers is one of the problems that GM faces. A single-payer healthcare plan enacted during Obama's first term will go a long way to address this part of the problem."

And how is the problem "addressed" if we simply transfer it to everyone else?

Trumpit, as far as I'm concerned, you're a total flocking idiot. Just imagine all the farm help who got laid off as we transitioned to an economy that could manufacture everything in your life that's non-agricultural. Just imagine all the horse workers who got laid off as we transitioned to automobiles, all the typewriter and mainframe people who got laid off as we transitioned to computers.

In short, layoffs were necessary for you to sit in your parents' basement in your underwear and opine on a blog about how bad layoffs are. Without layoffs, instead of spouting horses hit here, you'd either be shoveling it out of a stall or spreading it on a field for fourteen hours a day.

Do you have any idea what an idiot that makes you look like?

"...its economic life drained by non-productive and overpaid workers."

That's a normative opinion of yours that requires facts to back it up. Maybe, you are overpaid as well. Let ME decide. Yes, you are, so you're laid off as of now.

My understanding is that the health insurance provided to union workers is one of the problems that GM faces. A single-payer healthcare plan enacted during Obama's first term will go a long way to address this part of the problem.

Apparently cpurick and LowcountryJoe have little understanding of the abuse that takes place in the workplace that can lead lead to abusive firing of employees in retaliation.

At least I don't feel left out now. I may lack the understanding that you speak of -- I've never been let go because I'm pretty sure I've always brought some value to the table that was worth the cost of my employer. However, if I was your employer, i'd probably 'abuse' you and let you go

Nice job, Don! I was thinking that you could have used GM as a poster child for what happens when industry loses the layoff option. With the "Jobs Bank" ensuring that employees are paid a full salary for not working and legacy cost problems, GM has become a walking corpse rather than a living company. Without government life support, GM would simply expire, its economic life drained by non-productive and overpaid workers. Thus, GM = France.

Apparently cpurick and LowcountryJoe have little understanding of the abuse that takes place in the workplace that can lead lead to abusive firing of employees in retaliation. They need to be quickly disabused of that dangerous and idiotic notion. I'll do my best to enlighten and inform them.

"Unlawful harassment is a form of discrimination that violates Title VII of the Civil Rights Act of 1964 and other federal authority."

"Harassment that results in a tangible employment action occurs when a management official’s harassing conduct results in some significant change in an employee’s employment status (e.g., hiring, firing, promotion, failure to promote, demotion, formal discipline, such as suspension, undesirable reassignment, or a significant change in benefits, a compensation decision, or a work assignment). Only individuals with supervisory or managerial responsibility can commit this type of harassment."

http://www.fcc.gov/owd/understanding-harassment.html

You live a sheltered life behind a dim computer screen, LowcountryJoe. You are obviously a juvenile male, around 15 years old, because females normally have a deeper understanding of life and what getting laid off means to putting food on the table for their family. Are you really "Chainsaw" Al Dunlap incognito? If you are, have yourself a merry little x-mas NOT. You pathetic, egotistical downsizer, loser you!

A couple of comments here, and many over there really sum it up.

People that see the world through an emotional lens will just never understand certain tenets of basic logic.

Maybe we can try it in collectivist terms they will understand.

Layoffs save the company, and thus save more jobs in the bigger picture. If a few jobs have to be sacrificed for the greater good of the community, then so be it.

This takes care of the community - the greater good - and provides the needed impetus for acquiring more relevant skills in the work place.

Would it have been better to have saved several thousand blacksmith jobs at the cost of millions of automobile jobs?

I'm just going to skip the sarcasm, Trumpit, since you had an obvious meltdown when cpurick used it (sarcasm) in a manner to illustrate your earlier post's absurdity without without ever attacking you either directly or indirectly. You should beat it and not post here if you're going to overreact and name-call. Many times name-calling is something that is escalated from banter. There was NOTHING there from cpurick that warranted the words "sheltered", "pathetic", and "loser".

Please either give some more thought before hitting the post button or just don't bother posting here to begin with.

http://en.wikipedia.org/wiki/Albert_J._Dunlap

You live a sheltered life behind a dim computer screen, cpurick. You are obviously a male, because females normally have a deeper understanding of life and what getting laid off means to putting food on the table for their family. Are you really "Chainsaw" Al Dunlap incognito? If you are, have yourself a merry little x-mas NOT. You pathetic, egotistical downsizer, loser you!

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I found the laid off female web marketing specialist's comments to be particularly instructive -- invoking Timothy Leary. So, if you are to understand the discipline of Economics, realizing that there are trade offs, anticipating the hard to see consequences, and understanding the aggregate deeper motivations of all market participants, you're the one who must be trippin'.

Every day that goes by is another day that I realize that Bryan Caplan has it so pegged with his analysis of the biases that far too many of us have.

I'm sure the lady's bosses took great pride in laying her off. It probably hurt them because she was no doubt the best employee they had, so we can expect they're paying dearly for their error.

Maybe we'd all be better off if the company never laid anyone off, and instead went out of business altogether. Then the company would be safe because it could ask for a bailout, huh?

I especially love this part:

The ability to fire someone is a power not to be abused

And your evidence of abuse is, what, exactly???

Trumpit,

"Even President Bush, thankfully, doesn't have a lock on his job like you do."

Sure he does. It's time-limited in 4-year chunks and with a maximum of 2, but President Bush can't be "fired".

He can be impeached, but that's only in cases of "high crimes and misdemeanors". I'd say any tenured professor who commits high crimes could quite easily be fired as well.

Academic teaching and research necessarily involves going against established orthodox teaching and hence involves a serious risk of being fired based on the content of your knowledge and opinions rather than on your working ability or the financial viability of the university. Therefore professors are given tenure.

Tenure doesn't mean that if tomorrow Harvard University went out of business and shut the doors, Harvard professors will still have job there and get paid by Harvard. They too will be unemployed (for a short time only though) and the next academic job they may take at a state school may not pay them that well.

The excessive theatricality (the hesitation, stuttering) of the hosts turned me off the the podcast completely.

Kudos to Prof. Boudreaux on a well argued piece, and for bringing up the example of France for showing what guaranteed employment leads to.

BTW I went through the comments on some NPR. I was expecting the good professor to be given a pretty uniform tongue lashing but there were quite a few defenders of his idea there. There was one comment there which I liked. It said that maybe Prof. Boudreaux should have used the word "necessary" instead of "good". That would have maybe have allowed other people to understand the argument without emotion.

Okay, so no one asked, but you didn't bring up the fact that you have solid job security by virtue of tenure, which no doubt is due to your membership in a teacher's union. Even President Bush, thankfully, doesn't have a lock on his job like you do. The ability to fire someone is a power not to be abused because it goes to the very core of one's ability to survive in an indifferent world. Perhaps academia and your students would be better off if unions and tenure didn't exist for professors, but I doubt it. Why wouldn't Dr. Boudreaux seek out a lucrative position as a scummy CEO of a evil corporation or work on Wall St. advising the same overpaid bunch of scoundrels looking to make a fast buck without having to work hard? In spite of his being a nice guy, he might succumb to the temptation of promises of high pay if he had no job security. He might not even have any time left to pen this blog and write frequent letters to the editors railing against the evils of unions, tenure, the minimum wage, etc. and singing the virtues of ease of firing at-will employees at Christmas time due to poor toy sales. Crippled Tiny Tim may even have to go to bed hungry and without a new crutch if his dad gets canned by old, mean Mr. Scrooge. Who will pay for Tim's funeral? Who'll be allowed the day off so they can attend it? Who will bring flowers and shed a tear?

And Professor Boudreaux was the only one identified with an ideology.

The rest of them of course being perfectly, and objectively neutral.

I thought that, aside from Don's part in it, this episode was pretty lame. I listen to Planet Money regularly and I always hate it when something like this happens where they have a bunch of random people connected with an event give their "expert opinion". Like when they spent so much time talking to money traders during the bailout thing.

I thought it was pretty funny that that woman called Don myopic, given that she was the one who wanted to avoid any short-term pain, while Don was saying, "It sucks in the short run, but in the long run it's better for everyone involved."

The strawman at the very end about trading off "efficiency" for an economy where no one is fired somehow was really sad.

I think my favorite part was when the lady came on after you, and in an effort to refute you, said you were being myopic. Myopia, or shortsightedness, is typically what opponents of letting firms lay-off employees as circumstances necessitate suffer from. Allowing firms to make these necessary adjustments is what allows for such fantastic long-term growth in the economy.

I would compare layoffs to break ups. As the song says, breaking up is hard to do. No one likes it when a relationship ends, and it would of course be wonderful if it never had to happen. Nevertheless, most people recognize that sometimes a relationship doesn't work out, and that when this happens the best thing is for the couple to go their separate ways and try to find other, more suitable partners. A society that tried to stop the pain and heartache of break ups by placing limits on the ability of people to break off their romances would not be a better place, either practically or morally.

of course once theyre done with don, they apparently have to get the opinion of another objective expert, namely a person who just lost her job. the underlying sense of entitlement in this woman infuriates me more than her lame and uninformed attempts at economics.

unfortunately alot more people in this country will agree with her than with "libertarian" dr. boudreaux

Never mind. I hate having to "log in" just to make comments.

Yes, I have log-ins at various places, but it just bugs me to have log in everywhere I go.

Ever notice that blogs don't typically have a log-in feature, but when some old school media tries to get in on the "new" thing, they tend to regulate and try to over control it?

They're the embarrassing parents trying to be hip, and failing.

Lively bunch of comments over there.

Layoffs, according to the NPR crowd, are completely unnecessary for the survival of the company.

They don't say it as coherently as that, but they argue against the inhumane practice of layoffs. But if layoffs aren't an economic necessity, then why are the businesses laying off? For fun?

If there is an economic necessity for them, but they are too inhuman what is the alternative?

I should ask that over there, but I avoid the muirg type of trolls here; not sure I want to engage a whole room full of them over there.