LESSONS LEARNED #46: “Liberals say ‘do as I say not as I do’ because they can’t point to anything worthwhile they’ve done.” -Old Pithy

Posted by PITHOCRATES - December 30th, 2010

The High Compliance Costs of The American with Disabilities Act of 1990

I have a friend who worked at a company that was renovating one of their buildings.  He was in a foul mood one day.  The renovation included a high-end sales and marketing center.  Some place to impress clients.  Included in the renovation was a media room for multimedia presentations.  It was a competitive business; they were looking to woo some clients away from their competitors.  And to keep their current client base from straying to the competition.

It was an existing building.  Space was tight.  They were trying to do a lot in a small footprint.  And they did.  I saw it one day before the work was completed.  Wow.  It was gorgeous.  Especially the media room.  It looked like something you saw in a 5-star hotel.  They built the control room for the media room on a raised platform.  Equipment racks would sit on the floor.  And the cabling would leave the racks through the raised floor and out into a floor duct wiring system.  The walls and ceiling were some nice architectural finishes.  There was no drop ceiling.  No place to conceal wiring but in the walls.  And in the floor.

Well, there was a problem.  The American with Disabilities Act of 1990 (ADA) was relatively new.  This architectural firm complied with the new law in almost every place.  Drinking fountains were wheelchair accessible.  There were ramps to get up the curb so wheelchairs could enter the building.  And various other compliances.  The building complied.  Everywhere.  Everywhere, that is, but one area.  The control booth for the media room.  On the raised floor.  There was a step to enter this room.  And no space to add a ramp.  They fought the building inspectors.  The various authorities having jurisdiction.  But to no avail.  The spiffy new sales and marketing center would not be as designed.  They had to redesign it.  Rebuild it.  And delay the scheduled completion date.  Hence my friend’s foul mood.

The Government Exempts themselves from the High Compliance Costs of their own Legislation

You’d think the authorities having jurisdiction (AHJ) would have given a waiver.  But they didn’t.  It was a big office building.  And a small control room.  Less than 1% of the company’s total employees would ever enter that room.  Didn’t matter.  Some of the AHJ enjoyed their power.  Others were simply afraid someone would sue them down the road.  So they delayed the project. 

Unfortunately, they had already begun to relocate operations from the old to the new.  They suspended all presentations for a month at this facility so the old conference room could be demolished and rebuilt into something else.  And it was.  Demolished.  Now they had no place to wow their customers.  For another month or two.  That’s a whole quarter they had to reschedule around.  It did not impress their clients.  And may have cost them one or two.  All because of the silly inflexibility of the AHJ.

This is a good example of the unintended consequences of liberals’ best intentions.  It’s a microcosm of the ADA’s affect on business everywhere.  Sure, they had a noble goal.  To make a barrier-free world for all.  But the compliance costs to fully meet the letter of the law were brutal to small and medium sized businesses.  But Congress didn’t care.  It’s ‘do as I say, not as I do’.  Literally.  You see, Congress exempted themselves from the American with Disabilities Act of 1990.  Why?  Wait for it.  Because they said it would be too costly for them to comply.  And they said this publicly to justify their exemption from the act.  Unbelievable.  The height of arrogance and condescension.

The High Compliance Costs of OSHA

Well, Congress was dragged kicking and screaming into the real world.  Thanks to Newt Gingrich and the Republican Revolution of the 1994 midterm elections.  That Congress authored the Congressional Accountability Act of 1995.  Congress would no longer be above the law.  Now they, too, had to comply with the Age Discrimination in Employment Act of 1967, the Civil Rights Act of 1964, the Family and Medical Leave Act of 1993 and the Occupational Safety and Health Act of 1970.  To name a few.

I have a friend who works in construction in a metropolitan area.  He’s a project manager for a construction manager.  And you should hear some of the things he tells me.  Big construction projects often have federal money involved.  And when they do, there are some pretty restrictive rules.  Especially on the big projects.  Why?  Because big projects have deep pockets.

You would not believe some of the Occupational Safety and Health Act (OSHA) requirements on a construction project.  Well, on big projects, because no small contractor could afford the compliance costs.  Or the owner, for that matter.  A couple come to mind.  He said that a worker had to tie himself off when working on a ladder more than 6 feet off the ground (a nylon safety line tied to a body harness attached to something fixed and immovable).   Contractors had to conduct daily safety meetings with their field employees.  They had a safety trailer on site with a couple of safety officers to walk the site and police safety.  They had to get ‘hot work permits’ anytime they used a welding torch or other open flame.  You get the idea.  Workers couldn’t do anything dangerous without an inordinate investment in time and money on part of the contractor.  And yet workers still did stupid things.  Like refuse to wear a hardhat on a hot day.  Of course, when they did and OSHA happened to be on site, they’d write a pretty big fine.  And guess who had to pay it?  Not the employee.  But the employee’s boss.

But when Congress passed the Occupational Safety and Health Act of 1970, they exempted themselves.  Because it would have cost them too much to comply.

The High Compliance Costs of Affirmative Action

But there’s more.  When federal money is involved, there are other hoops to jump through.  You see, the metropolitan area had a large minority population.  And the federal government wanted minority owned businesses to share in some of that construction money.  It was affirmative action.  To help minority owned businesses.  A certain percentage of the work was set aside for these businesses.  The problem was big projects have tight schedules and high-tech building processes.  The kind of work that big and established contractors do all of the time.  And the kind that little contractors starting out who need help (the kind of contractor the government wanted to help) had little to no experience doing.  The idea was for the big guy to mentor the little guy.  Which is not easy to do when competitively bidding work.  Helping these contractors earns no revenue.  It just adds cost.  So you either include the cost up front (and not get the job because you’re not the low bidder).  Or you leave it out and try and recoup it on the back end (I believe the technical term is raping and pillaging on change orders).

Well, there are rules.  And it starts at bid time.  Your bid form asks for the percentage of these minority businesses you’ll be using.  There’s a minimum required.  But you can use more.  And the government weighted things differently.  You counted contractors at their full contract value.  But material suppliers were discounted (I don’t remember, but it might have been 50%).  Suppliers are safer to use because you can use your own highly skilled work force.  So you max these out.  Then you use some small minority contractors on some easier work you can peel off from the rest.  It’s nothing against these guys.  They do well on some of the less exotic stuff.  But some of the other stuff is just over their skill level.  Because they’re new and inexperienced.

Now, because they can use suppliers, there are minority ‘suppliers’ out there looking to exploit this set aside.  They’re not really a supplier, though.  They’re a ‘pass-through’ company.  What they do is offer their services to basically buy from a contractor’s preferred supplier and then resell to the contractor for a small markup.  This basically defeats the whole point of helping minorities, but it helps you stay on schedule.  Construction today uses just-in-time deliveries.  Especially on construction site with no storage area available for material.  And they need their well established working relationships to feed their supply pipeline.  It usual works.  But sometime a contractor’s audit will disallow a previously approved ‘pass-through’ supplier.  And when they do, look out.  If you don’t meet the percentage you included on your bid form you’re looking at some serious fines.  My friend told me the government wrote this one poor contractor of his a fine greater than the value of his contract.

Liberal Legislation:  Compliance Costs, Avoidance Costs and Unintended Consequences

The federal government has no business experience.  At least, the liberal left.  But they’re always trying to make business better.  And fairer.  This results in huge compliance costs.  And avoidance costs.  The federal government has little sympathy for the swath of destruction their legislation causes.  Especially when they were exempting themselves from much of that legislation. 

But it’s ‘do as I say, not as I do’.  Because they feel they’re above the law.  Or, at least, should be.  So they continue to tinker.  Failing more times than not.  And causing a slew of unintended consequences.  Despite their best intentions.



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FUNDAMENTAL TRUTH #44: “Liberal Democrats have to lie because there are more taxpayers than tax consumers.” -Old Pithy

Posted by PITHOCRATES - December 14th, 2010

Tax and Spend and Do as I Say

Liberal Democrats like to tax and spend.  And they are also so full of themselves that they like to tell other people how to live their lives.  Because they think they are smarter than us.  And know what’s best for us.

Funny thing.  A lot of these liberal Democrats are rich.  Like Nancy Pelosi and her San Francisco constituents (you need to be rich to live in her neighborhood).  Though they’re rich they prefer to spend other people’s money.  And spend a lot of it.  They take the concept of ‘redistribution of wealth’ to new heights.  As long it’s other people’s wealth, that is.

Not many agree with them.  Liberal Democrats make up about 20% of the electorate.  So theirs is a minority opinion.  Which can be a problem when you want to tax and spend.  Because that other 80% tend to have real jobs.  Which means they pay the taxes that liberals like to spend.  And they’re none too keen on giving up their hard-earned money so a bunch of rich liberals can assuage their guilt for being rich.

Democracy Ruined the Good Old Days for the Privileged Classes

Being a 20% minority has its problems.  Especially when you want to tell how the other 80% should live.  They lament that we live in a democracy.  Where people have the right to vote.  Unlike in the good old days.  Where your blood determined rank and privilege.  There were no questions asked.  You did what you want.  Because you could.  And there was no voting.  No silly inconvenience of elections.  No, back then the rich and privileged classes knew how to live.  And the suffering masses knew their place.

But, alas, the miserable Founding Fathers had to go and muck all of that up.  Liberty.  The biggest pain in the ass the entitled classes ever had to deal with.  Nowadays, the privileged just can’t do what they want.   You need to win elections.  They need to get others to vote their way.  They need others to agree that their living the good life is in the best interest of the country.  And how do they do that?  They lie, of course.  And make as many people as possible dependent on their generosity.  Their generosity with other people’s money, that is.

Of course, it wasn’t always other people’s money.  It used to be their food.  In the 1790s, things were getting pretty bad in France.  For the suffering masses, that is.  The ‘Third Estate’.  Things were going pretty darn well for Estates 1 & 2.  The rich nobles.  And the rich clergy.  And we know how all that ended up.  Bad.  For Estates 1 & 2.  The Third Estate (i.e., the poor suffering masses) grew tired of going hungry and suffering famine.  So they stormed the Bastille and kicked off the bloody French Revolution.  Because they were hungry.  And the rich and privileged were not.  But I digress.

Using Class Warfare to Demonize their Political Opponents

Sadly, for the rich and privileged, the American and French Revolutions changed things.  The ruling minority could no longer rule as they pleased.  They had to consider the majority.  There would now be taxation with representation.  Like in Great Britain.  People paying the taxes would have a say in how the politicians spent those taxes.

Merde.  Pardon my French.  Or so said the rich and privileged classes.  Who now had a problem.  If the rich and privileged were no longer entitled to a better life, how could they then live a better life?  I mean, let’s face it, these people aren’t exactly busting with ability.  Most couldn’t find their way out of a wet paper bag.  So what does one do with no ability?  Scheme deviously.

And one of the most devious and effective tools?  Class warfare.  You attack the people with ability who have earned their wealth.  Something that few liberal Democrats can do.  Because they have no ability.  So they demonize those that do.  Business owners.  Corporate America.  And you tell the poor masses that the only reason that they’re poor is because the rich business class is exploiting them.  And that they, the liberal Democrats, will rectify that situation.

Lying to Independents and Moderates

So they give them stuff.  They tax the rich.  And give stuff to the poor.  Which makes the poor grateful.  And dependent on the government.  Grateful and dependent, of course, equals votes.  This giving of other people’s money isn’t limited to the poor, though.  They make the not-so-poor special interests even less poor with this same generosity.  This generosity of other people’s money.

It’s a full-proof deviousness.  When the rich and privileged classes shower the poor and special interests with other people’s money, they get their votes.  And it’s a lot more than 20% of the electorate.  But it’s not quite a majority, though.  So they have to lie to another group of people to push them into the majority.  And who are these people?  Moderates and independents.

These people, though, are a problem.  They have honest jobs.  They don’t stand to prosper by voting liberal Democrat.  And they’re not likely to respond well to a campaign slogan that says we want to raise your taxes so others can live better without working as hard as you do.  People just don’t choose to pay more.  So others can have more.  While they go with less.  It’s why some people will drive 5 miles to save 2 cents per gallon of gas.  People choose to pay as little as possible.

Liberals Hate Ronald Reagan.  But they Campaign like him to Win.

So how do you get people who won’t benefit by voting for you to vote for you?  By demonizing your opponent.  The Left destroyed Newt Gingrich because he wanted senior citizens to ‘wither on the vine’.  Or so they said.  He never said that (he said Medicare would wither on the vine after enough people took proposed government subsidies to move into private insurance policies).  But all moderates and independents heard was that he wanted to kill senior citizens.  And that was enough.  His approval ratings plummeted.  To save his party, he resigned.

This is the only way liberal Democrats can win elections.  By lying.  They never run openly.  They never say they want to raise your taxes.  Far from it.  Because people don’t want to pay more taxes.  Few can even afford to.  No, when they campaign, they try to sound like the great conservative, Ronald Reagan.  Why?  Because the majority of Americans approved of his policies.  So they hide their true selves during the elections.  And hope and pray (figuratively, of course) that the moderates and Independents have short memories.

They have to do this because of one very inconvenient fact.  There are more taxpayers than tax consumers.  Which is a double-edged sword for liberal Democrats.  On one hand, more taxpayers mean more tax money.  But, on the other hand, because of Democracy, it also means more people they have to successfully lie to.  Merde.



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