This Labor Day, remember Abraham Lincoln and the importance of hard work


SAlso, as people celebrate Labor Day this year, perhaps most notable is the historically low labor force participation rate. There is a gaping gap between the jobs available and those who want to fill them.

As the the wall street journal

reported
last month, “While the U.S. economy in July recovered the 22 million jobs it lost at the start of the COVID-19 pandemic, the labor force remains smaller than it was in the beginning of 2020.” According to the latest figures from the Ministry of Labor, the labor force participation rate, or the share of the population aged 16 and over working or looking for work, fell to 62.1% in July, which is more than d a point below what it was in February 2020. .

You don’t need to rely on the latest government reports to be aware of the ’employment gap’. Walk to any downtown mall or business district. You’ll find half of the store windows covered with “Hiring in Progress” or “Employees Wanted” notices.

There are a number of reasons for this. Rachel Greszler, senior researcher at the Heritage Foundation, reported in a July 2022
study
that “economists find that a significant decline in the number of desired working hours roughly doubled the magnitude of the decline in the labor force”. Economic studies also show that the 18 months of weekly unemployment insurance premiums of $600 made available during the pandemic have significantly reduced labor supply, Greszler noted. And the continued expansion of social safety net programs such as the Supplemental Nutrition Assistance Program and Obamacare grants, neither of which have work requirements, are reducing the incentive for the unemployed to find gainful employment.

Of course, the documented decline in the participation rate, evidenced by a lot of dry numbers, is not only of interest to statisticians and academics. This has serious real-world consequences for policy makers. The employment gap reduces the rate of economic growth and lowers real personal incomes. The result is increased reliance on government support, which, in turn, necessitates higher taxes and worsens the country’s already perilous fiscal situation.

This is all bad enough. But in an insightful way
comment
just appeared in the the wall street journal, Phil Gramm and John Early discuss how the “jobs gap” relates to today’s politics – and the rise of populist sentiment. Given the increase in income transfer payments over the past half-century, they say: “It is not surprising that the percentage of working-age people in the bottom quintile who were actually working fell by 68 % in 1967 to 36% in 2017.” With transfer payments giving recipients about as much for not working as they can earn for working, Gramm and Early argue that only a compulsory work requirement with conditional government support of resources will encourage those who are not working to return to the labor market.

What they conclude goes to the heart of the matter: “Despite the efforts of Democratic politicians to incite resentment against the wealthy, when was the last time you heard working people complaining that some people in America are wealthy? workers’ hostility is increasingly focused on a system where those who don’t sweat are about as well off as they are.”

You might not think of Abraham Lincoln when you think of Labor Day, but maybe you should. For Lincoln believed, as he frequently reminded his audiences in his uniquely folksy way, that “the man who made the corn should eat the corn.”

Indeed, as early as 1847, then-Rep. Lincoln said: “I believe that every individual has a natural right to do what he pleases with himself and with the fruit of his labor, so long as it in no way interferes with the rights of a another man…” And in 1864 President Lincoln, in his “Reply to the New York Workingmen’s Democratic Republican Association,” said:

“Property is the fruit of labor … That some are rich shows that others can become rich, and is therefore only an encouragement to industry and enterprise. Let him who is homeless not tear down another’s house, but work diligently and build one for himself…”

This concept, that “property is the fruit of labor,” is an important principle derived from the vision of natural rights that the Founders embodied in our Declaration of Independence and our Constitution. It should also guide our economic policies. It’s good for the government to help those in need, but as we’ve learned during the pandemic with all the government checks, too many good things are not only ripe for abuse, but also suppress initiative and individual productivity.

Amid the last days of summer, with backyard barbecues and last trips to the beach, it’s worth reflecting on the meaning of Labor Day and Labor itself, with a state of Lincolnian spirit. This way of thinking would recognize that gainful employment confers dignity and promotes entrepreneurship. And, more fundamentally, it offers the average working man and woman the opportunity to enjoy the fruits of their labor.

Randolph May is president of the Free State Foundation, an independent think tank in Rockville, Maryland.

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