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ICYMI: The Economy Was Just Restructured

ICYMI: The Economy Was Just Restructured
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In recent years the iconic Capitol building has been draped in scaffolding due to a needed restoration, the first improvements since 1959-1960 to the symbol of American democracy. From afar the dome has always appeared to be a brilliant beacon conveying American exceptionalism. On a closer look, behind the countless coats of paint and patchwork, the age and weather have taken its toll. The repairs to preserve the dome will allow the Capitol to continue to shine for future generations.

For denizens of and visitors to Washington, DC, or news junkies who see the scaffolding in the digital backgrounds of daily newscasts, it’s a stark visual reminder that America itself is under reconstruction. The national “restoration” project is now in its seventh year. The steward of America’s reconstruction is perhaps the most successful President we’ve seen in our lifetimes, if you define success as achieving an agenda.

Historically, the final two years of a two-term Presidency have been the least effective time, filled with scandals and voter apathy. The “lame duck” is simply a placeholder while the country moves its attention to his replacement in the oval office. For this reason, lame ducks can be dangerous. They are old news. The press focuses on shinier, red-hat covered wayward tresses.

Meanwhile, barely reported new business changes were quickly swept under the rug by the Trump-obsessed media: This week the Obama-stacked National Labor Relations Board passed what may be the most significant change to private business we have ever seen.

The Obama administration is redefining what it means to be an employer.

The National Labor Relations Board (NLRB) on Thursday handed down one of its biggest decisions of President Obama’s tenure, ruling that companies can be held responsible for labor violations committed by their contractors.

While the ruling from the independent agency specifically deals with the waste management firm Browning-Ferris, the so-called “joint employer” decision could have broad repercussions for the business world, particularly for franchise companies.

Opponents of the action warn the ruling could hurt businesses as diverse as restaurants, retailers, manufacturers and construction firms, as well as hotels, cleaning services and staffing agencies.

“This decision has broad implications, as it appears to upend decades of settled law defining who the employer is under the National Labor Relations Act,” said Randy Johnson, a senior vice president at the U.S. Chamber of Commerce.

Restaurants could see the biggest changes. Fast food chains such as McDonald’s and Burger King will likely assert more authority over — or even cut ties altogether with — local franchise owners, business advocates say.

The implications of this decision cannot be underestimated. If you run or plan on owning a franchise your employees may ultimately have collective bargaining rights with every other employee of other private franchises under the same name. Instead of running a business with 15 employees, which allows you to dictate pay and benefits, you are now under the thumb of the unions who see you as a large corporation which should run as such.

The small-business friendly NFIB (who sued the administration over Obamacare) stated:

A decision this afternoon by the National Labor Relations Board (NLRB) could wipe out thousands of subcontractors and franchise businesses by treating their employees as direct employees, said the country’s leading small business advocate today.

“If this decision stands the economic rationale for hiring a subcontractor vanishes,” said Beth Milito, Sr. Legal Counsel for the National Federation of Independent Business (NFIB). “It will make it much harder for self-employed subcontractors to get jobs and of course it will drive up operating expenses for the companies that hire them.”

Forgetting for a moment the significant disincentive for entrepreneurs to invest their capital and resources into new business start-ups, the restructuring of what it means to be a small business is chilling.

The decision will most likely be fought in court and hopefully overturned.

Meanwhile, the West Wing is exhilarated to see another one of their methods of fundamental transformation become a reality. Next time you are feasting on Trumpisms, look on page E-12 … or you will probably miss the closing of Guantanamo.