First, let’s look at the fiscal policies of ANC party in South Africa. (H/T Eleanor via Mary)
If the government has its way, private companies will no longer be able to hire employees without first considering people listed on a government database of unemployed South Africans.
Failure to do so could result in heavy fines for companies.
This is according to the Employment Services Bill gazetted in December last year.
According to the proposed bill, the government intends to establish a public employment service, whose task will be to create a database of all unemployed people in the country. The employment service will then link job seekers to companies that have vacancies.
The bill, one of four tabled last year, also stipulates that employers will have to register all their vacancies with the service in 14 days.
The government will then provide the companies with the names of possible candidates to fill those posts.
According to the proposed bill, if companies fail to appoint candidates from the database who meet the requirements, they will need to provide written reasons for their actions.
The bill also proposes conditional employment of foreigners. If a company employs a foreigner, it will have to prove to the employment service that it was unable to find a suitable local candidate, including those provided by the government.
The government has also vowed to deal with recruitment agencies that charge job seekers fees. It has proposed that all agencies be registered or face punitive measures.
The bill proposes that the agencies must charge employers the fees instead.
In addition, the bill provides for temporary workers to be paid at the same rate as permanent workers.
This may be the most anti-jobs policy I have EVER heard of. If Satan himself wanted to design a policy to destroy jobs and stop businesses from hiring, then he could not do more to raise the unemployment rate than this evil, evil job-killing policy.
Let’s take a closer look:
- first, government has no money of its own – it must steal money from productive businesses. Businesses who create products and services that consumers actually want. That means that the money that is used for this database and the government employees will take money away from businesses. When businesses have less money, they hire fewer workers. Therefore, this policy will raise the unemployment rate.
- second, government will fine companies who do not waste time and money complying with this new regulation. Complying with the regulation not only requires time to query the database, but also to interview candidates who match the job requirements, and then to provide written reasons why they did not hire those candidates. The time spent complying with these regulations will cost the company money, reducing the amount of money that is available to hire workers. Therefore, this policy will raise the unemployment rate.
- Third, the fee for hiring foreign workers will cause companies to settle for a local employee, who may not be as skilled as the foreign worker. The extra paperwork to hire a better-qualified foreign worker will cost the company money, reducing the amount of money that is available to hire workers. Therefore, this policy will raise the unemployment rate.
- Fourth, in the case where the employer has to pay an extra fee to hire a worker who has been found by a headhunter, it just raises the cost of hiring this person and may cause the company NOT to hire this worker. Whereas before, a company would have to pay X to hire a worker P, now they will have to pay X + some fee in order to hire worker P. This extra fee will cost the company money, reducing the amount of money that is available to hire workers. Therefore, this policy will raise the unemployment rate.
Since the stated “good intention” of this bill is to reduce unemployment, I can only conclude that the ANC is a party of diabolical liars, or that they are not competent enough to run a lemonade stand. When you raise the cost of employees, either through fees or through fines or through paperwork, then you get fewer employees hired. What will happen is that more South African businesses will ship their jobs overseas. This is where outsourcing comes from – from stupid anti-business policies.
But wait! What about Obama? Isn’t he economically illiterate, too?
Consider this story from the Wall Street Journal. (H/T Michelle Malkin)
President Barack Obama’s budget proposal is expected to give states a way to collect more payroll taxes from businesses, in an effort to replenish the unemployment-insurance program. The plan could cause controversy at a time when the administration is seeking to mend fences with corporate America.
The proposal would aim to restock strained state unemployment-insurance trust funds by raising the amount of wages on which companies must pay unemployment taxes to $15,000, more than double the $7,000 in place since 1983.
The plan, which would take effect in 2014, could increase payroll taxes by as much as $100 billion over a decade, according to a person involved in its construction.
By proposing to enlarge the pool of wages subject to unemployment taxes, the White House appears to be offering states a more politically palatable way to raise revenues than to boost tax rates. States could keep the tax rates they have, or even lower them somewhat, and still raise considerably more revenue than they are raising now.
…To avoid hitting businesses with a tax increase during the economic recovery, the proposal would delay the new rules until 2014. The plan is expected to be included in Mr. Obama’s budget proposal for fiscal 2012, to be released Monday.
Any proposal would need congressional approval.
Michelle Malkin explains:
Just remember: There is no such thing as a “free” government benefit. Who pays? Dentists, tavern owners, maid services, mom-and-pop shops — small businesses that are the backbone of the American economy. And the businesses that have the lowest claims histories are getting punished the most to make up the jobless benefits fund deficit.
So much for Do No Harm.
This policy will basically raise the cost of hiring an employee. It is nothing but a new tax on businesses who hire employees. Businesses will have to pay the government more money for every employee they hire. Their only way out is to not hire anyone (here), but to move their businesses abroad, away from Obama and his anti-business regulations and taxes.
Remember what happened to the unemployment rate since the Democrats took over Congress in 2007:
Labor Force Participation Rate
Click the graph for a larger image. When you tax something, you get less of it.
Filed under: News, Barack Obama, Business, Corporation, Employee, Employer, Employment, Incentive, Jacob Zuma, Jobs, Obama, South Africa, Unemployment