Pricing labor out of reach

This should be mandatory reading for every member of Congress. Along with the basic tenants of the law of supply and demand. When you add a 'hidden' 33% surcharge to the cost of employing a worker, it's inevitable the demand for such workers will decrease, exacerbating unemployment.

Naturally, as Glenn Reynolds frequently points out, such consequences will be heralded as 'unexpected.'

When you add it all up, it costs $74,000 to put $44,000 in Sally's pocket and to give her $12,000 in benefits. Bottom line: Governments impose a 33% surtax on Sally's job each year.

Because my company has been conscripted by the government and forced to serve as a tax collector, we have lost control of a big chunk of our cost structure. Tax increases, whether cloaked as changes in unemployment or disability insurance, Medicare increases or in any other form can dramatically alter our financial situation. With government spending and deficits growing as fast as they have been, you know that more tax increases are coming—for my company, and even for Sally too.