Is McMegan Jealous?

by Brien Jackson

Because she sure seems to be doing her best to mimic Amity Shlaes.

So that I don’t get accused of being “churlish,” I’ll go ahead and take a second to point out the obvious stupidity at work here:

What does this mean for the stimulus?  Union labor is more expensive.  Every project that uses a PLA will cost more, and many of those jobs will use as much capital equipment as possible to minimize the demand for labor.  That means that we will get a lot less employment for every dollar of stimulus spent than we would without the PLA.

But, of course, firms are always trying to minimize labor costs, and every other kind of cost for that matter. There isn’t a firm anywhere in the world who is trying to incur more costs than they have to. And one assumes that McArdle, who holds an MBA (and an English degree for that matter), is familiar with that concept.

Also it’s worth pointing out that the impression McMegan is trying to give, that non-union labor will mean more jobs, is just silly. In keeping with the cost minimizing model, no firm is going to hire more people than they need. So with that in mind, non-union labor doesn’t mean more jobs, it means lower wages. And lower wages means lower aggregate demand, which means a less effective means of fighting the recession.

At this point the only question left about McMegan is whether or not she actually believes the nonsense she publishes daily.