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Dear Friends,

It seems to me, regulators are waging war on workers. With the perfect paradigm of perverse incentives… in the name of protecting the worker, the environment, and the public. Regulators have made hiring Americans unprofitable. That’s why so many employers hire aliens and especially illegal aliens. So they can skirt the wage laws, social security payments, fair hiring practices, etc… and fire the lazy at will. This results in a lower PPI, Producer Price Index. The true elegance of this system is that when an American is hired, he or she has to pay taxes sufficient to subsidize the illegal alien vying for the same job, raising PPI. So the American has their wages garnished to pay for the welfare, phone, and car of the illegal alien. Could there be a more perfect paradigm of perverse incentives?

Think about it rationally and pragmatically. A business owner has to balance a multitude of factors. They have to follow the regulations and tax regimes of government. Unless they are a multinational corporation. But most firms aren’t huge unaccountable mercantilists. So every employee is a big investment. An investment made more dangerous by regulations, social security, and income taxes. All of which are costs to the business not just in cost but accounting for that cost. A business isn’t like the government, that can have computers printing checks that draw from nowhere. Hiring an illegal alien, on the other hand, allows the firm to bypass all those costs. As a result, it doesn’t make business sense to hire an American for any job an illegal can do. Because of pernicious regulations.

The Federal Reserve has been balking at lowering interest rates because of predicted inflation from tariffs. That’s the narrative. I have to wonder if the real reason is that they are worried about wage increases, driving up PPI… due to Americans replacing illegal aliens in the workforce. But they don’t want that narrative to get out. If low skilled Americans had opportunity, prosperity would touch the bottom, the weak might become strong, and the fentanyl trade would collapse. Opportunity has a way of instilling hope in people. Those who see no future have no incentive to try. So they don’t try… fulfilling the prophesy. Moreover, the elite took industrial arts out of the high schools and promised everyone a college degree… then gave those jobs to H1-B visas instead.

I have to wonder if the interest rates are being held high to counter the positive effects of Trump’s lower taxes and less regulation? This could be a way to discredit Trump and free markets. Nevertheless, I think it would be hilarious if the Fed’s dilly dallying leads to deflation. I don’t see deflation as a bad thing. I see it as a wage increase for the worker instead of the perpetual grinding wage diminishment of inflation. Many economists, especially Keynesians, believe that if we think that prices will go down, that knowledge will hinder people from buying, thus lowering aggregate demand and creating a recession. I think they’re ignoring our animal spirits. When our purchasing power is increasing, we feel richer and when we feel richer, we’re more willing to buy… not less.

When the federal government itself abets an invasion of illegal aliens and puts them immediately on welfare, then turns a blind eye to anyone who hires them… it’s waging war on workers. The jobs they couldn’t export they imported workers to fill. Then created incentives to make sure illegal aliens would fill them. You can’t blame the business owner for hiring the more economically efficient for the job. Their livelihood depends on it. You can’t blame the illegal alien who just wants a better life. We have to blame the regulators that are waging war on workers. Their reasons are their own but their actions speak louder than words. Perpetual inflation, perverse incentives, and forcing American workers to subsidize illegal alien competitors is proof enough. So ignore the propaganda and support deregulation.

Sincerely,

John Pepin