Tom Hebert

Senate Should Reject Anti-Freelancer Julie Su for DOL Deputy Secretary

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Posted by Tom Hebert on Thursday, March 18th, 2021, 10:45 AM PERMALINK

The Senate HELP Committee held a hearing Tuesday on President Biden’s nomination of Julie Su to serve as Deputy Secretary at the Department of Labor. 

If confirmed, Su will wage war on the livelihoods of more than 57 million Americans that engage in freelance work. ATR opposes Su for Deputy Labor Secretary and urges the Senate to reject her nomination. 

Su, who has served California’s labor secretary since 2019, was one of the top architects of California’s independent contractor-crushing Assembly Bill 5 (AB5) law. 

Assembly Bill 5 (AB5) instituted an onerous and overly-broad three-stage worker classification test to prove that a worker is an independent contractor and not an employee. AB5’s work restriction is known as the “ABC” test and goes far beyond federal guidelines on independent contractor classifications.

Under the ABC test, businesses must prove that a contractor is doing duties “outside the usual course of work of the hiring entity” and that “the worker customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.” This significantly limits the ability of businesses to retain contractors who may operate within the scope of work sometimes performed by employees in similar circumstances. It’s an unnecessary distinction that prohibits most businesses from working with independent contractors.

The ABC test forced the mass reclassification of California’s independent contractors, forcing countless residents to flee the Golden State to flee the state to pay their bills and chase their dreams. More than 90 percent of California independent contractors opposed the ABC test reclassification before it was signed into law by Su’s boss, Democrat Governor Gavin Newsom.

ATR has compiled 655 personal testimonials from independent contractors who details the ways that AB5 has hurt them, which you can view here

Su has been AB5’s most aggressive enforcer. In an interview, Su bragged about her ability to use government power to crush independent contractors: 

“The other [way to enforce AB5] is just doing investigations and audits. That will be on both wages and tax because AB5 expands the ABC test that way. So we will be doing investigations and audits so that those who want to comply with the need to reclassify can do so and those who don’t will understand that’s not the kind of economy we want in California. So we can issue citations and demand both wages and taxes and other kinds of penalties.”

Freelancers offer vibrancy to the American economy, and the ability to work as an independent contractor provides Americans with the flexibility that does not come with a traditional employment relationship. Think of a single mom earning a living by selling homemade goods on Etsy, or an Uber or Lyft driver using extra cash he earns to start a business of his own. These are real Americans chasing their dreams without the need to have a boss. 

In contrast, the left wants all Americans to have a boss. If you don’t want a boss, the left will use government power to bully you into compliance and force you to have a boss. 

Julie Su’s aggressive anti-independent contractor stance disqualifies her from serving as Deputy Labor Secretary. All senators should vote against Su’s nomination.

Photo Credit: Tim Evanson


KEY VOTE: ATR Urges A NO Vote on the "PRO Act"

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Posted by Tom Hebert on Tuesday, March 9th, 2021, 4:00 AM PERMALINK

Americans for Tax Reform (ATR) urges members of the House of Representatives to vote against the Protecting the Right to Organize (PRO) Act (H.R. 842). This harmful legislation would increase the power of organized labor at the expense of American workers. 

If signed into law, some of the key provisions of the PRO Act would:

  • Violate worker privacy by forcing employers to give union organizer sensitive employee contact information, including home addresses, cell phone and landline numbers, and email addresses. This would allow union bosses to intimidate workers into joining unions at homes or workplaces. 
     
  • Nullify state Right-to-Work laws, which protect 166 million Americans in 27 states from being forced to pay union dues just to get a job. 
     
  • Change union elections to allow union bosses to collect cards from workers to demonstrate support for the union, rather than holding a secret ballot election.
     
  • Nationalizing California’s “ABC” test for independent contractors, which has forced the mass reclassification of California's independent contractors and limited freelance opportunities statewide. More than 57 million freelancers could risk losing work if the ABC test were adopted at the federal level. 
     
  • Codify the expanded joint employer standard, severely harming franchises and their employees.
     
  • Codify shortened representation election time frames, giving the unions a large advantage in these elections by shortening the time for debate over unionization.
     

In addition, the PRO Act would increase costs for employers, harming businesses and consumers. According to the American Action Forum, the independent contractor provision would impact 8.5% of GDP and cost between $3.5 billion and $12.1 billion annually. The joint employer provision would cost between $17.2 billion and $33.3 billion annually for the franchise business sector and affect 44% of private sector employees. Finally, the provision that restricts employers from replacing strikers permanently could cost employers an additional $1.9 billion every year.

The PRO Act is a return on the investment of the hundreds of millions of dollars that Big Labor poured into the Democrat party's campaigns to capture the House, Senate, and White House. Employers will be able to force workers into unions as a condition of employment, and union bosses will have access to personal information to bully workers into compliance. Tens of millions of independent contractors would face losing their jobs. 

ATR opposes the PRO Act and urges all members of Congress to vote NO. 

Photo Credit: Jason Chan


Rise of Personal Shoppers Shows Robust Competition in Same-Day Delivery Market

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Posted by Tom Hebert on Thursday, February 25th, 2021, 8:00 AM PERMALINK

Coronavirus lockdowns have fueled a massive surge in online shopping, with American e-commerce growing a staggering 44 percent in 2020 and online spending representing 21.3 percent of all sales. 

Brick-and-mortar retailers have responded to this demand by rethinking their business models and expanding the resources they dedicate to fulfilling digital orders. The resulting innovation and competition in the evolving same-day delivery market has expanded access to goods and services for American consumers and increased job opportunities for American workers. 

Walmart now has over 170,000 “personal shoppers” dedicated to fulfilling online orders. These shoppers receive online orders, pick the items off of shelves, then prepare them for delivery to customers’ homes. These jobs start at over $13 an hour, more than Walmart’s $11 minimum wage, and approximately 40 percent of personal shoppers are existing Walmart employees looking to advance in the company.

The rise of personal shoppers expands access to goods and services for American consumers. With government-mandated lockdowns forcing the entire country into self-isolation, online delivery services have been a lifeline for Americans that need groceries, prescriptions, and other household essentials delivered directly to their door. With stores like Target and Bed Bath and Beyond adding personal shoppers to their respective workforces, consumers will have more places to shop from without leaving their homes. 

Competition between companies in the same-day delivery market will also benefit consumers in the form of lower prices and greater perks. Walmart has rolled out Walmart+, a new membership service that directly competes with Amazon Prime by offering same-day delivery, as well as two-hour delivery for an additional fee. Increased competition in the same-day delivery space will only continue to benefit consumers as choices increase. 

This new market also benefits American workers, especially those who saw their jobs vanish due to the pandemic. As retailers continue to amp up their online presence, new jobs will need to be filled, and plenty of Americans will be available to fill them. 

Ultimately, competition is a rising tide that lifts all boats. The rapid expansion of the same-day delivery market will benefit American consumers through increased access to goods and services, lower prices, and better membership perks. American workers will benefit through increased job opportunities as demand for personal shoppers increases. 

As our country attempts to recover from the economic damage inflicted by COVID-19, the evolving same-day delivery market is a welcome reminder that American innovation will always adapt to new challenges. 

Photo Credit: Bev Sykes


Lawmakers Should Reject Antitrust Proposals That Undermine The Consumer Welfare Standard

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Posted by Tom Hebert on Wednesday, February 24th, 2021, 3:00 PM PERMALINK

Congress is beginning to debate reforms to antitrust law. As lawmakers consider different approaches, they should reject any proposal that weakens or undermines the consumer welfare standard. Moving away from the consumer welfare standard would cripple free enterprise, discourage innovation and competition, and harm American consumers.

The consumer welfare standard, which maximizes consumer benefits instead of protecting individual competitors, has undergirded antitrust law for over four decades. Antitrust law under the consumer welfare standard is designed to protect consumers from monopolies and the competitive process, not to protect individual companies from being out-competed by other firms. 

Importantly, the consumer welfare standard brought consistency to antitrust law by tying it to specific economic criteria. The standard emphasizes long-term innovation effects and a maximization of economic efficiency when determining if a company is engaging in anticompetitive behavior. 

Additionally, the consumer welfare standard sharpened the focus and general direction of antitrust enforcement by giving judges and regulators a coherent principle to follow. Before the consumer welfare standard was widely adopted, antitrust law was vague and unfocused, leading to inconsistent rulings and enforcement actions designed to reward political allies or punish political enemies. 

The consumer welfare standard’s objective, rule-of-law approach to antitrust enforcement ensures a level playing field for American companies and a robust competitive process with limited politicization.  

In sharp contrast, some want to dismantle the consumer welfare standard in order to use antitrust law as a tool to address broader, unrelated political and social goals. Instead of using antitrust law to protect consumers or root out truly uncompetitive behavior, some want to use it to “break up” big companies or target political enemies. 

It wouldn’t matter if breaking up a company would harm consumers, or if a company is actually engaging in uncompetitive monopolistic behavior. Overzealous regulators would target large companies no matter how much they improve American lives or compete fairly with other firms.

This activist, politicized approach to antitrust enforcement would have a chilling effect on American innovation. Successful firms under constant threat of antitrust investigation would be less likely to engage in robust competition, leading to higher prices and reduced access to goods and services for American consumers. Discouraging mergers and acquisitions would likely lead to fewer innovative start-ups, half of which say their long term goal is to be acquired by a larger firm. 

Ultimately, antitrust law is not a tool to be used lightly, and enforcement actions have the potential to reshape entire industries. A broad, arbitrary approach to antitrust enforcement would empower faceless government bureaucrats to reshape the entire economy. This interventionist approach would have a chilling effect on free enterprise, crush innovation, and harm American consumers. 

Lawmakers should reject any antitrust legislation that undermines the consumer welfare standard. 

Photo Credit: chucka_nc


ATR Supports The National Right To Work Act

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Posted by Tom Hebert on Wednesday, February 24th, 2021, 3:00 PM PERMALINK

Sen. Rand Paul (R-Ky.) and Rep. Joe Wilson (R-S.C.) have reintroduced the National Right to Work Act, legislation that ends forced union dues for American workers all across the country. 

Americans for Tax Reform supports this legislation and urges all members of Congress to co-sponsor. 

"No one should have to pay someone for the right to have a job. Forced union dues were recognized as wrong when congress passed the Taft-Hartley Act of 1947," said Grover Norquist, president of Americans for Tax Reform. "Everyone in a free country has the right to work without being asked to pay off union bosses. I applaud Senator Paul and Congressman Wilson for their leadership and urge their colleagues to support the National Right to Work Act."

Right to Work laws allow workers the freedom of employment without forced membership in a labor union or forced payment to a union boss. Existing Right to Work Laws protect 166 million Americans in 27 states, more than half the U.S. population. 

Even though the Taft-Hartley Act of 1947 authorized states to pass their own Right to Work laws, employers in some states still compel their employees to join a union as a condition of employment. 

This authority comes from the National Labor Relations Act (NLRA) and the Railway Labor Act (RLA), federal legislation passed nearly a century ago. The RLA also bans Right to Work laws from protecting workers in the railroad and airline industries, putting thousands of Americans at risk of losing their jobs if they do not wish to join a union or pay dues. 

The National Right to Work Act is a simple, one-page bill that repeals language in both the NLRA and RLA that allows employers to force their workers to join a union or pay union dues as a condition of employment. While workers are free to join a union if they choose to do so, this bill simply affirms that Americans never have to join a union just to get a job.

Expanding Right to Work at the federal level will be a massive victory for American workers. Research shows that Right to Work states experience stronger growth in the number of people employed, growth in manufacturing employment, and growth in the private sector. 

According to the National Institute for Labor Relations Research, the percentage growth in the number of people employed between 2007-2017 in Right to Work states was 8.8%, and 4.2% in forced-unionism states.

Growth in manufacturing employment between 2012-2017 in Right to Work states was 5.5%, and 1.7% in forced-unionism states.

The percentage growth in the private sector from 2007-2017 in Right to Work states was 13.0%, and 10.1% in forced-unionism states.

Additionally, states that compel workers to join a union are losing residents at a rapid rate. An analysis by Stan Greer of the National Institute for Labor Relations Research found that forced unionism states, between 2007-2017, experienced net migration of -7.4%, whereas Right to Work states experienced a 1.6% growth in number of residents. 

If implemented, the National Right To Work Act will ensure that no American will ever have to make the choice between putting food on the table or paying a greedy union boss. ATR supports this legislation and urges its swift passage.

Meanwhile Democrats are threatening to repeal Right to Work protections. As seen in this video, Joe Biden and Kamala Harris vow to ban Right to Work laws.

Harris said: "It has to be about, for example, banning Right to Work laws. That needs to happen."

Biden said: "We should change the federal law [so] that there is no Right to Work allowed anywhere in the country. For real. Not a joke. Not a joke."

Harris and Biden also documented their anti-Right to Work position in writing here and here. And both have endorsed legislation called the PRO Act which bans Right to Work laws.

The 27 Right to Work states are: Florida, Wisconsin, Michigan, Iowa, Arizona, Georgia, North Carolina, South Carolina, Virginia, Texas, Tennessee, Indiana, Kentucky, Nevada, Oklahoma, Nebraska, South Dakota, North Dakota, Wyoming, West Virginia, Mississippi, Alabama, Louisiana, Arkansas, Idaho, Utah, Kansas. Right to Work legislation is also advancing in New Hampshire and Montana.

Click here or below to watch Kamala Harris and Joe Biden vow to abolish Right to Work:

Photo Credit: Martin Brochhaus


Antitrust Burden-Shifting Would Be A Trial Lawyer Cash Cow

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Posted by Tom Hebert on Tuesday, February 16th, 2021, 12:15 PM PERMALINK

Senator Amy Klobuchar (D-Minn.) has introduced “The Competition and Antitrust Law Enforcement Reform Act,” legislation that would weaponize U.S. antitrust law and overturn decades of enforcement precedent. 

One of the legislation’s most egregious provisions flips the burden of proof for monopolization litigation from the plaintiff to the defendant. If implemented, this burden-shifting provision would drastically increase the amount of monopolization cases brought to court, allowing predatory trial lawyers to make a fortune by gaming the American legal system. 

Under current law, trial lawyers and government antitrust enforcers can sue companies for alleged anticompetitive practices. In both scenarios, the burden of proof is rightly on the plaintiff to prove that a company is engaging in exclusionary, anticompetitive conduct. 

The Klobuchar bill would flip this process on its head by requiring companies with “significant market power” to prove that their behavior does not “materially disadvantage” their competitors. In effect, this presumes that the business practices of large companies are automatically illegal unless the company can prove otherwise. 

At the same time, the Klobuchar bill dilutes the standard of exclusionary conduct, described by the U.S. Court of Appeals for the D.C. Circuit that in order “to be condemned as exclusionary, a monopolist’s act must have an ‘anticompetitive effect.’ That is, it must harm the competitive process and thereby harm consumers. In contrast, harm to one or more competitors will not suffice.” 

Instead of focusing on harm to the competitive process, Klobuchar would weaponize antitrust law to protect politically favored companies from being out-competed by rival firms. This misguided approach flies in the face of decades of antitrust precedent at the expense of American consumers. 

By shifting the burden of proof to the defendant and weakening the exclusionary conduct standard, the Klobuchar bill guarantees a dramatic increase in the number – and likely success of – monopolization cases brought against large companies. 

The new rules create a cottage industry for plaintiffs that accuse companies of anticompetitive behavior in court whether they are guilty or not. Given that the potential damages resulting from these lawsuits can be enormous, even companies who have done nothing wrong would be forced to pay large sums to avoid an adverse decision in court, opening the doors to a massive windfall for greedy trial lawyers. 

Above all else, the burden-shifting provision in the Klobuchar bill would harm American consumers. Large companies under constant threat of predatory, frivolous antitrust litigation would be less likely to innovate or engage in robust competition with rival firms. This would lead to reduced access to goods and services as well as higher prices and less choice for consumers all across the country. 

Needless to say, this is the wrong approach to antitrust policymaking. Instead of focusing on a consumer-based approach to antitrust regulation that protects the competitive process, Klobuchar would rather create opportunities for greedy trial lawyers to make a killing by taking advantage of the American legal system. 

Congress should reject The Competition and Antitrust Law Enforcement Reform Act.

Photo Credit: Gage Skidmore


DOL Nominee Marty Walsh Supports the Anti-Worker PRO Act

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Posted by Tom Hebert on Thursday, February 4th, 2021, 1:45 PM PERMALINK

In today’s Senate HELP  Committee hearing to confirm Boston Mayor Marty Walsh as Secretary of Labor, Walsh said that he “certainly” supports the job-killing, independent contractor-crushing PRO Act. 

By signaling his support of the PRO Act, Walsh confirms that he will be a champion of President Biden’s anti-worker freedom agenda. 

The PRO Act would ban Right to Work Laws that protect 166 million workers in 27 states, more than half the U.S. population. Right to Work laws allow workers the freedom of employment without forced membership in a union or forced payment to a union boss. 

Biden has explicitly called for the end of Right to Work, saying: "We should change the federal law [so] that there is no Right to Work allowed anywhere in the country. For real. Not a joke. Not a joke."

Biden’s real motivation for invalidating Right to Work laws is simple enough – Big Labor is one of Biden’s biggest backers, and unions have collectively spent hundreds of millions of dollars to get Biden elected. Forcing American workers to pay union dues that almost uniformly support Democrat candidates, whether they want to or not, is a clear return on that investment. 

Even more ominously, the PRO Act would force employers to provide the personal contact information of employees to unions during organizing efforts, including home addresses and personal phone numbers. This would give union bosses free reign to harass and bully employees into joining unions at the expense of worker privacy. 

The PRO Act would be a death blow to the gig economy, which has given millions of Americans the opportunity to pursue success on their own terms by being their own boss. The PRO Act implements California’s “ABC” test to determine whether or not a worker is an employee or an independent contractor. The ABC test, codified under California’s disastrous AB5 law, makes it harder for employers to hire independent contractors but easier for unions to unionize workers. 

Thanks to AB5, countless freelancers and independent contractors have fled California to participate in the gig economy in other states. 

ATR has collected 655 testimonials from Californians that detail how AB5 has pummeled freelancers and independent contractors. For example:

"I lost the career and relationship I was building with a content writing company." [Link]

"AB5 is why I had to pack my very ill husband with stage 4 cancer and autistic son and leave the state. There is no way I can take care of our family and work a 'traditional' type job." [Link]

"I'm a certified court interpreter. I've been very happily freelancing for 15 years. I can choose which agencies to work with, and work as much or as little as I want to spend time with my 3-year-old. AB5 is destroying my wonderful work/life combo." [Link]

If the PRO Act is implemented, expect these sad stories to come from all fifty states. 

Walsh’s eagerness to implement the PRO Act would be a death blow to worker freedom. Independent contractors and freelancers would see their livelihoods destroyed with the stroke of a pen, and workers would once again be forced to join a union and pay dues whether they want to or not. 

The Senate should reject Walsh’s nomination. 

Photo Credit: Dave Levy


Congress Should Reject Sen. Klobuchar's Antitrust Government Power Grab

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Posted by Tom Hebert on Thursday, February 4th, 2021, 12:00 PM PERMALINK

Senator Amy Klobuchar (D-Minn.) has introduced “The Competition and Antitrust Law Enforcement Reform Act,” sweeping legislation that rewrites U.S. antitrust law and overturns decades of enforcement precedent. This legislation is cosponsored by Sens. Cory Booker (D-N.J.), Richard Blumenthal (D-Conn.), and Ed Markey (D-Mass.). 

If implemented, Klobuchar’s bill would give faceless bureaucrats the ability to use antitrust law to reshape the entire U.S. economy. ATR urges all members of Congress to reject this harmful legislation. 

Klobuchar’s legislation would make it significantly more difficult for certain American companies to merge with other companies or acquire smaller competitors. Under current law, antitrust enforcers are responsible for proving that a merger or acquisition would harm competition in a court of law. 

This legislation would flip this burden of proof on its head by requiring that companies involved in certain mergers or acquisitions prove that their transaction would not hurt competition. This would broadly stack the deck against companies engaging in mergers and acquisitions and make it vastly easier for antitrust regulators to win in court. 

Shifting the burden of proof from prosecutors to companies would create a chilling effect on American innovation and entrepreneurship, harming American consumers through higher prices and reduced access to goods and services. Mergers and acquisitions streamline market inefficiencies which benefits the American consumer through lower prices and expanded access to goods and services. 

The new standard of proof would apply to companies that control a market share greater than 50 percent, so-called “mega-mergers” of greater than $5 billion, or any deals over $50 million by companies with more than $100 billion in annual revenue or market capitalization. This would impact a large number of American companies over a variety of different industries.

Klobuchar’s bill would eliminate the current requirement that prosecutors have to define a relevant market when bringing an antitrust enforcement action against companies. At the same time, companies would not be allowed to rebut the state’s market definition and provide their own. Governments are notoriously bad at defining relevant markets, whereas market participants are much more equipped to identify their competition. 

For example, Johnson and Johnson is the ninth largest American company with a market cap of $424.39 billion. Suppose they wanted to acquire a small business that produced natural, organic soaps. In this example, how would the government define soap? Do they define it based on the ingredients or target audience? Would they define detergent for washing machines and dishwashers as soap? Would they distinguish between bar soap, bath gel, and body wash that doubles as shampoo? 

Obviously, Johnson and Johnson would have a better idea of the relevant market for soap than the government. If we allowed the government to be the sole arbiter of what a relevant market for products is, it is likely that key data points would be ignored. Then government actors could game the legal system to reward favored companies and punish disfavored companies. This flies in the face of decades of antitrust enforcement precedent, which puts the consumer’s welfare first, not protecting individual competitors in a marketplace. 

Instead of focusing on harm to consumers and protecting the competitive process, Klobuchar would reorient antitrust law to make the size of any company the enemy. Big companies, no matter how much they benefit consumers or compete fairly with rival firms, would be in Klobuchar’s crosshairs. 

Ultimately, Klobuchar’s sweeping antitrust legislation would give government regulators and bureaucrats the ability to stack the deck against American companies in court, fundamentally reshaping the U.S. economy in the process. This would irrevocably damage the competitive process and use the full force of government power to punish disfavored companies.  

Congress should reject The Competition and Antitrust Law Enforcement Reform Act.

Photo Credit: Gage Skidmore


Uber-Drizly Acquisition Shows How Competition Benefits Consumers

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Posted by Tom Hebert on Wednesday, February 3rd, 2021, 5:30 PM PERMALINK

Uber has announced that it is acquiring alcohol-delivery service Drizly in a $1.1 billion deal, a massive win for free enterprise and proof that the consumer-focused competitive process continues to deliver for the American people. 

Drizly is an online delivery service that allows consumers to order a variety of alcoholic beverages from local liquor stores and have them delivered directly to their location, typically within 30-60 minutes. Drizly is available in over 1,400 American cities. 

The COVID-19 pandemic has demonstrated the value of technology companies that allow Americans to buy products and have them delivered in a timely fashion. With government-mandated lockdowns forcing the entire country into self-isolation, online delivery services have been a lifeline for Americans that need groceries, prescriptions, or other household essentials delivered safely to their door. 

Drizly has experienced 300 percent growth in the last year alone, and has consistently expanded since its founding in 2012. Drizly is a prime example of a startup that has achieved success through innovation and responding to consumer demand. 

Uber’s acquisition of Drizly is a win for both companies. Drizly’s incorporation into the UberEats app will expand the services that Uber offers and give the company access to a new, diverse customer base. As for Drizly, the company has achieved the ultimate mark of success for any startup – acquisition by a larger firm. 

Consumers are the biggest winners from Uber-Drizly acquisition. Consumers will have easier access to Drizly’s service through the UberEats app. As Uber accelerates Drizly’s expansion into new markets, consumers who didn’t have access to Drizly before the acquisition will be able to use the service. 

This is a classic example of the importance of mergers and acquisitions to a free market economy. Mergers occur when two companies consolidate into one entity. Acquisitions generally occur when a larger company takes ownership of a smaller company. Mergers and acquisitions both benefit consumers by streamlining market efficiency, lowering prices, and both improving and expanding access to goods and services. 

Mergers and acquisitions are a massive driver of American innovation and entrepreneurship. In 2019, half of American startups said that their most realistic long-term goal is to be acquired by a larger firm. Without the potential for acquisition, entrepreneurs would have a lot less incentive to incur the substantial risk that comes with starting a new company. 

Ultimately, the Uber-Drizly acquisition is a model of the competitive process at work, and consumers all across the country will benefit from this deal. 

Photo Credit: Yaletown BIA


ATR Releases Coalition Letter Opposed To $15 Federal Minimum Wage

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Posted by Tom Hebert on Tuesday, February 2nd, 2021, 8:00 AM PERMALINK

A coalition of 62 groups, activists, and legislators led by Americans for Tax Reform today released a letter in opposition to a $15 federal minimum wage. 

The letter calls on all members of Congress to reject proposals to impose a nationwide $15/hour minimum wage, a more than doubling of the current $7.25/hour wage. If implemented, a $15 minimum wage would eliminate millions of American jobs, kill thousands of small businesses, and prolong the economic misery COVID-19 has caused our country. 

You can read the full letter here or below: 

Dear Member of Congress,

On behalf of millions of taxpayers across the country, we urge you to reject proposals to increase the federal minimum wage at a time of unprecedented economic calamity, including President Joe Biden’s push to raise the minimum wage to $15/hour, more than doubling the current minimum wage of $7.25/hour.

President Biden’s recent $1.9 trillion “American Rescue Plan” calls on Congress to more than double the federal minimum wage to $15/hour and eliminate the “tipped” minimum wage for servers. The Biden proposal likely mirrors legislation passed by the House in 2019 and reintroduced in 2021, the Raise the Wage Act, which increases the minimum wage to $15 by 2025, indexes it to inflation, and repeals the tipped minimum wage for servers.

A $15 minimum wage would substantially raise the cost of labor at a time when small businesses are already struggling to keep the lights on. Small businesses with thin margins would be forced to pass the costs onto consumers, which could lead to a decline in businesses, a loss of revenue, and layoffs. Businesses that have closed temporarily due to the pandemic may decide not to reopen at all in the face of a higher minimum wage, and many employers will forgo hiring new workers because they cannot afford them.   

These concerns are not hypothetical. According to the nonpartisan Congressional Budget Office (CBO), the Raise the Wage Act would eliminate up to 1 million jobs by 2023 and up to 3.3 million jobs by 2029. A more modest estimate still shows 1.2 million lost jobs by 2026. Another CBO estimate shows that a $15 minimum wage could cost as many as 3.7 million American jobs.

Even workers who retain their jobs will be worse off under a nationwide $15 minimum wage. Some will lose non-wage benefits such as free parking or meals, and others will have their hours reduced. Workers may not earn any more money under the higher wage, but will face fewer opportunities to work and less benefits when they do.

Workers employed by small businesses and in restaurants, retail, and hospitality would be disproportionately harmed, as would younger workers beginning their careers, minorities, and those in states with lower relative costs of living. For example, a recent study found that the Raise the Wage Act would kill over 108,000 jobs in Ohio, 106,000 jobs in Georgia, and 12,000 jobs in West Virginia. States like Maine and Montana would also lose thousands of jobs.

While some workers would see higher wages due to this government mandate, the CBO estimates the number of workers losing their job could greatly exceed the number of workers that would be pulled out of poverty. CBO also estimates a $9 billion reduction in family income and an increase in prices for all consumers.

President Biden’s minimum wage hike would also harm tipped workers at a time when the restaurant industry is rapidly collapsing, with over 10,000 restaurants closing their doors in the last three months alone. In recent years, servers and bartenders in several states and localities—including Maine, Virginia, and Washington, DC—have successfully rallied against proposals to change the tipped wage system. If President Biden succeeds in eliminating the tipped wage, one in three tipped workers could lose their jobs.

The Coronavirus pandemic has caused unprecedented hardship to American businesses and workers. Government-mandated lockdowns shuttered hundreds of thousands of businesses, kicking millions of Americans out of work. Over 60 percent of business closures from the pandemic are now permanent.

Congress has taken steps to assist struggling businesses as they navigate the COVID-19 crisis and economic restrictions. As leaders continue to debate the best policies to help in economic recovery, a $15 minimum wage is one policy that should be off the table.

Imposing a drastic minimum wage hike during a pandemic-induced recession – which would kill millions of American jobs and eliminate thousands of small businesses – flies in the face of Congress’s stated goal of supporting small businesses and workers. While this drastic increase in labor costs would be disastrous in normal times, the impact would be even worse during a global pandemic.

If Congress is serious about supporting small businesses and a strong economy, lawmakers should reject any and all efforts to impose a nationwide $15 minimum wage. Doing so would eliminate millions of American jobs, kill thousands of small businesses, and prolong the economic misery that COVID-19 has caused our country.

Sincerely, 

Grover Norquist
President, Americans for Tax Reform

James L. Martin
Founder/Chairman, 60 Plus Association

Saulius “Saul” Anuzis
President, 60 Plus Association

Bethany Marcum
CEO, Alaska Policy Forum

Phil Kerpen
President, American Commitment

Brent Wm. Gardner
Chief Government Affairs Officer, Americans for Prosperity

Lisa B. Nelson
CEO, American Legislative Exchange Council

Michael Bowman
President, ALEC Action

Scot Mussi
President, Arizona Free Enterprise Club

Cindy Johansen
Chair, Aroostook County Republicans

Ryan Ellis
President, Center for a Free Economy

Andrew F. Quinlan
President, Center for Freedom and Prosperity

Jeffrey Mazzella
President, Center for Individual Freedom

Chuck Muth
President, Citizen Outreach (Nevada)

David McIntosh
President, Club for Growth

Iain Murray
Vice President, Competitive Enterprise Institute

Matthew Kandrach
President, Consumer Action for a Strong Economy

Tom Schatz
President, Council for Citizens Against Government Waste

Katie McAuliffe
Executive Director, Digital Liberty

Michael Saltsman
Managing Director, Employment Policies Institute

Adam Brandon
President, FreedomWorks

Jessica Anderson
Executive Director, Heritage Action for America

Representative Beth A. O’Connor
HD 5 Berwick and North Berwick (part)

Mario H. Lopez
President, Hispanic Leadership Fund

Ben Murrey
Fiscal Policy Center Director, Independence Institute

Carrie Lukas
President, Independent Women's Forum

Heather Higgins
CEO, Independent Women's Voice

Andrew Langer
President, Institute for Liberty

Dr. J. Robert McClure
President and CEO, The James Madison Institute

Alberto Ortiz
President and CEO, Job Creators Network

Seton Motley
President, Less Government

Michael D. LaFaive
Senior Director of the Morey Fiscal Policy Initiative, Mackinac Center for Public Policy

Paul R. LePage
Governor of Maine, 2011-2019

Mary Adams
Chair, Maine Center-Right Coalition

Laurie Belsito
Legislative Director, Massachusetts Fiscal Alliance

Jameson Taylor, Ph.D.
Senior Vice President of Policy, Mississippi Center for Public Policy

Tim Jones
Chair, Missouri Center-Right Coalition
Fmr. Speaker, Missouri House of Representatives

Sue Vinton
Majority Leader, Montana House of Representatives

Rhonda Knudsen
State Representative, Montana

Seth Berglee
State Representative, Montana

Jeremy Trebas
State Representative, Montana

Barry Usher
State Representative, Montana

Ryan Osmundson
State Senator, Montana

Greg Hertz
State Senator, Montana

Carl Glimm
State Senator, Montana

Pete Sepp
President, National Taxpayers Union

The Honorable Bill O’Brien
Co-chair, New Hampshire Center Right Coalition

State Representative Keith Erf
New Hampshire, Hillsborough District 2

Doug Kellogg
Executive Director, Ohioans for Tax Reform

Brandon Dutcher
Senior Vice President, Oklahoma Council of Public Affairs

Tom Hebert
Executive Director, Open Competition Center

Rich Holt
National Council Advisory Member, Project 21

Lorenzo Montanari
Executive Director, Property Rights Alliance

Eli Lehrer
President, R Street

Mike Stenhouse
CEO, Rhode Island Center for Freedom & Prosperity

Bette Grande
CEO, Roughrider Policy Center (North Dakota)

James Setterlund
Executive Director, Shareholder Advocacy Forum

Karen Kerrigan
President & CEO, Small Business & Entrepreneurship Council

David Miller
Southwest Ohio Center Right

David Williams
President, Taxpayers Protection Alliance

Vance Ginn
Chief Economist, Texas Public Policy Foundation

Christian N. Braunlich
President, Thomas Jefferson Institute for Public Policy

Photo Credit: Mark Fischer


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