The Greedy Goose that Laid Golden Eggs: A Fable

greylagIn a kingdom long ago, a Greylag goose, after eating certain flowers and grasses, laid a golden egg in her nest. She lived on an island in the middle of a lake, and built her nest in the reeds.

Every day the goose ate the same flowers and grasses, and every day she laid a golden egg until she had a clutch of five eggs. She sat on them all day long, and whenever she left her nest to eat, she covered them with sticks.

On the sixth day, a young man rowed his boat to the island. As he walked through the reeds, he saw the goose sitting in her nest.

“Get out of here!” the young man yelled. “I’m taking your eggs.”

The goose stretched out her neck. “No, you’re not!” she cried. “I made them, and they’re mine. I’m not leaving.”

The young man drew his sword. “Then I’ll have eggs and goose for dinner.”

“Oh my!” the goose sighed.

The young man started waving his sword, and the goose, fearing for her life, flew away.

The goose was so upset at being robbed, she flew straight to the king’s castle. But when the guard took her to the throne room, the king was asleep. So she honked until the old man woke up.

“A young thug stole my eggs!” the goose said sadly, bowing before the throne.

The king, whose name was John, shrugged his shoulders. “My people are poor and need to eat.”

“But these aren’t eggs you can eat. They are golden eggs.”

King John’s eyes opened wide, and he ran his fingers through his long grey hair. “Real gold you say?”

“Yes; if I eat certain grasses and flowers, I can lay an egg made of pure gold.”

King John thought for a moment; then he ran his fingers through his long grey beard. “I will help you if you help me.”

“You can get my eggs back for me?” the goose asked.

“Probably not,” King John admitted. “But I can protect you from thieves. You can build a nest in the turret of my castle, and my guards will bring you grass and flowers to eat.”

The goose looked at the guard; then she looked at the king. “What do you want in return?”

King John smiled. “Only one out of every ten eggs that you lay.”

The goose looked into the king’s eyes. They were dark, swollen, and half-open, and she didn’t know if she could trust him. She thought long and hard; then finally she said, “Okay. One tenth sounds fair to me.”

And so, King John let the goose live in the turret of his castle where she built the largest nest a goose has ever made. (It was five feet wide and two feet deep.) The guards brought her flowers and grass to eat, and every day she laid a golden egg. She sat on them, stared at them, and sometimes, when no one was looking, she kissed them with her beak.

When summer came to an end, the goose had laid one hundred golden eggs, and she gave ten to King John.

The following spring, when the goose started to lay eggs again, she was summoned to see the king. A guard escorted her to the throne room, and when he opened the double doors for her, she bowed her head and walked to the throne.

“My dear goose,” King John said with a smile, “my people are poor, and I need you to give a little bit more to help me provide for them.”

The goose raised her head. “But we agreed to one tenth.”

“That was last year. Times have changed, and I need you to give a little bit more.”

“How much?” the goose asked.

“One fifth.”

The goose looked at the guard; then she looked at King John. “What if I say no?”

“Then you can go back to your island and take your chances with thieves.”

The goose loved her eggs, and didn’t want to lose them, so she agreed to the king’s terms.

The following spring, the goose was summoned again before the king, and he asked her for one fourth. And the year after that, one third.

The fifth year, a guard came to turret and took the goose to see King John. But when she entered the throne room, she did not bow her head.

“Let me guess,” the goose said. “You want more of my eggs.”

“Yes, goose,” King John said sternly. “You have much more gold than you need. My people are poor, and I need you to serve the greater good.”

“How much do you want now?” the goose asked.

“Half.”

The goose thought for a moment. “No; that’s too much. I’ve spoken to another king, and he will let me live in his castle for much less.”

“You greedy goose!” King John shouted, his face red with anger.

The goose stretched out her neck. “I made my eggs, not you!” she said defiantly. “And I’ll do whatever I want with them.”

King John turned to the guard. “Seize her and lock her up!”

The guard chased the goose around the throne room, but he couldn’t catch her. Then he drew his sword, but she flew over him, escaped the castle and fled to another kingdom.

With the goose gone, King John took all the eggs that the goose left behind, kept a dozen for himself, and used the rest to provide for his people. However, when the gold ran out, the people were just as poor as they were before.

Why a Woman Won’t Marry an Idle Man: Hands Across the Table (1935)

hands-across-the-tableIdleness is “an inclination not to do work…”1 Synonyms include laziness, indolence, and sloth.In Mitchell Leisen’s Hands Across the Table (1935), Theodore Drew III (Fred MacMurray) is an idle man who has never worked to earn a living. An important theme in the film is that a woman will not marry a man who refuses to get a job.

One reason why Theodore doesn’t want to work is he is a man-child. When Regi Allen (Carole Lombard) first meets him, he is playing hopscotch in the hallway. Later, when she lets him stay in her apartment, he asks to be tucked into bed. Years earlier, he joined the navy, but his father pulled him out. Theodore is a man-child because his father never taught him to be responsible for his own financial needs.

Theodore’s refusal to work forces him to choose between marrying for money or marrying for love. Before he met Regi, he planned to marry Vivian Snowden (Astrid Allwyn) and live off of her wealth. However, when he falls in love with Regi, he wants to break off his engagement, and be with her, but she refuses.

There are two unstated reasons why Regi sends Theodore away. As a manicurist, she is a low-income earner, and doesn’t want to remain poor by marrying a man with limited job prospects. She tells him he’ll have to “scratch for a living.” Secondly, she may fear that she will have to support him financially.

In the end, Regi agrees to marry Theodore because she realizes how much she loves him, and he promises her that he will find work. The film suggests that a man must take financial responsibility for his own life if he wants to attract a wife. This was true in 1935 and is still true today.

According to a 2011 survey by ForbesWoman and YourTango, 75% of female respondents said they would never marry a man who was unemployed.3 Women today may not want a man to financially provide for them, but they are reluctant to marry a man they will have to provide for, especially if he is healthy and able to work.

While there are valid reasons for a man being unemployed including health issues, raising children, and the need to retrain for a career, if a healthy, able-bodied man refuses to work, he may ruin his chances of getting married. Women (on average) earn less money than men do,4 and hence are less likely to want to financially support a husband. Therefore, if an idle man wants a wife, he should start looking for a job.

Notes

  1. Merriam Webster, s.v. “Idleness,” accessed February 12, 2017, https://www.merriam-webster.com/thesaurus/idleness
  2. Ibid.
  3. Megan Gibson, “Study: 75% of Women Wouldn’t Marry A Man Who Was Unemployed,” Time, June 23, 2011, http://newsfeed.time.com/2011/06/23/study-75-of-women-wouldnt-marry-a-man-who-was-unemployed/
  4. “Women’s earnings 83 percent of men’s, but vary by occupation,” Bureau of Labor Statistics, January 15, 2016, https://www.bls.gov/opub/ted/2016/womens-earnings-83-percent-of-mens-but-vary-by-occupation.htm

Why a Higher Minimum Wage Can Result in a Lower Unemployment Rate

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Those who argue in favor of raising the minimum wage often point to examples of when the unemployment rate fell after the government increased it. One reason why this can happen is the unemployment rate only includes people who are actively looking for work. As a result, the more people who give up looking for work, the lower the unemployment rate will be.

One of the most popular statistics reported by the government is the unemployment rate: “the percentage of the total labor force that is unemployed.”1 However, this statistic is not an accurate measure of unemployment. If a person has not searched for a job in the past four weeks, they are no longer counted as a member of the labor force.2 The U.S. government classifies them as a discouraged worker: someone “who is eligible for employment and is able to work, but is currently unemployed and has not attempted to find employment.”3 If a higher minimum wage results in companies laying off employees or hiring fewer new ones, then more people will become discouraged workers. Although increasing the minimum wage is supposed to help reduce income inequality, it can have the unintended consequence of driving more people out of the labor force due to a lack of job opportunities. Ironically, this can cause the unemployment rate to go down.

To measure the true economic impact of a minimum wage increase, the labor force participation rate is a better statistic than the unemployment rate. The labor force participation rate is “the percentage of the population that is either … working or actively seeking work.”4 For example, in June 2015, the U.S. added 223,000 jobs, and the unemployment rate fell to 5.3% from 5.5% in May.5 However, the size of the labor force decreased by 432,000 as the labor force participation rate fell to 62.6% from 62.9%.6 The unemployment rate fell by .2%, but the labor force decreased by .3%. The unemployment rate went down because of the sharp increase in the number of discouraged workers.

While a higher minimum wage can sometimes result in a lower unemployment rate, forcing companies to pay a higher price for labor will not benefit all workers. According to the law of demand, “all other factors being equal … the higher the price, the lower the quantity demanded.”7 If all other factors remain the same, the higher the price of minimum wage labor, the less hourly units of labor a company will purchase from workers. Raising the minimum wage is an economic policy that is motivated by good intentions, but it will not produce good results for everyone who wants a job.

Notes

  1. Investopedia, s.v. “Unemployment Rate,” accessed May 10, 2016, http://www.investopedia.com/terms/u/unemploymentrate.asp
  2. “Labor Force Characteristics,” U.S. Bureau of Labor Statistics, accessed May 10, 2016, http://www.bls.gov/cps/lfcharacteristics.htm#discouraged
  3. Investopedia,v. “Discouraged Worker,” accessed May 10, 2016, http://www.investopedia.com/terms/d/discouraged_worker.asp
  4. “Labor Force Participation,” U.S. Bureau of Labor Statistics, accessed May 10, 2016, http://www.bls.gov/bls/cps_fact_sheets/lfp_mock.htm
  5. Claire Zillman, “U.S. economy adds 223K jobs in June as unemployment dips to 5.3%,” Fortune, July 2, 2015, http://fortune.com/2015/07/02/june-2015-jobs-report-unemployment/
  6. Ibid.
  7. Investopedia, s.v. “Law of Demand,” accessed May 11, 2016, http://www.investopedia.com/terms/l/lawofdemand.asp

How a $15 Minimum Wage Creates Winners and Losers

15 dollar

In the United States and Canada, many municipal, state, and provincial governments are raising the minimum wage to $15 in the hope of reducing poverty and income inequality. Unfortunately, good intentions do not always produce good results. Raising the minimum wage to $15 will create winners and losers in the job market because of a basic economic principle: the law of demand.

According to the law of demand, “all other factors being equal … the higher the price, the lower the quantity demanded.”1 For example, if the cost of an airplane flight to Hawaii increases by 25%, consumers will demand less plane tickets. Minimum wage labour is not immune from the law of demand because labour is a service purchased by companies. If all other factors remain equal, the higher the price of labour, the less hourly units of labour a company will purchase from workers.

The central problem with raising the minimum wage is the government can control the wage, but companies control the number of hours that they buy. The consequence of increasing the minimum wage to $15 is some workers will receive a wage increase with little or no reduction in hours, while other workers will have their hours reduced or be laid-off.

When the government increases the minimum wage, a company has numerous options to reduce labour costs. These include

  • Reducing its hours of operation.
  • Reducing the number of staff working per hour.
  • Hiring part-time employees instead of full-time and no longer paying benefits.
  • Relocating to another state, city, or country where wages are lower.
  • Investing in labour-saving technology.

Advocates of a $15 minimum wage believe that companies can simply pay for the increased labour costs out of their profits. While many large, successful corporations might be able to afford to pay some (or all) of their workers $15 per hour, this does not mean that all companies can do so and remain profitable, especially smaller businesses. More importantly, if a company cannot make a profit due to increased labour costs, it will go out of business, and workers will earn $0 per hour.

While advocates of a $15 minimum wage believe it is about achieving fairness for workers, forcing companies to pay more for labour has unintended consequences. The most experienced and productive workers might earn more, but inexperienced and less productive workers will earn less. At $15 an hour, there are many workers that companies will no longer employ (or hire) because they can’t make a profit from their labour. In the private sector, making a profit is more important than what is “fair” for workers. Profits are to a company what blood is to the human body. Without profits, a company cannot exist.

Notes

  1. Investopedia, s.v. “Law of Demand,” accessed April 10, 2016, http://www.investopedia.com/terms/l/lawofdemand.asp