When Businesses Cry Wolf

Sep 28, 2010

By: Andrea Lindemann

"America's business owners are a resilient bunch, but let there be no doubt, HR 1 will be the demise of some. And as that occurs, the light of freedom will grow dimmer."

The above quote was from a speech in which Rep. John Boehner zealously denounced the Family Medical Leave Act (FMLA) two days before President Bill Clinton signed it into law in 1993.

Less than a decade later, a 2000 Department of Labor study showed that 90 percent of business owners said FMLA hadn't affected their profitability, or the law had buoyed their business. And 84 percent said the measure had not changed productivity or had boosted it.

Rep. Boehner and others who opposed the bill by predicting the demise of some businesses had essentially cried wolf, according to researchers Donald Cohen and Peter Drier.

Cohen heads the Center on Policy Initiatives in San Diego and Drier is a professor at Occidental College. Together they founded the Cry Wolf Project to demonstrate that so-called liberal policies such as FMLA do not yield the dire consequences that business opposition so readily predicts. They are working to expose this myth and create a uniform theme for progressives to use to combat these arguments.  The project covers a wide range of issues, but focuses on tax and public budgets; labor market standards; food, tobacco and drug health and safety; workplace safety and job quality; financial regulation; and consumer product safety.

Currently, there is a growing movement at the local, state and federal level to enact paid sick days laws. Paid sick days are a critical component of job quality for low-income workers; yet, business groups, like the U.S. Chamber of Commerce, continually oppose them, claiming such a measure would be harmful for small business.

San Francisco passed the first paid sick days ordinance in the United States in 2006. As Jake Blumgart noted in his recent article, the city's business lobby argued passionately against the initiative. As did the San Francisco Republican Party -- Mike DeNunzio, then Chairman, said, "proposition F is another job-killing attack on San Francisco's economic engine that will raise prices for all who shop in the City."

But the dire consequences they warned about did not come to pass. Instead, Senior Vice President Jim Lazarus of the San Francisco Chamber of Commerce told NPR in 2008, "I think we overreacted [to the paid sick leave ordinance], even myself. I thought it was going to be worse."  He also told the Wall Street Journal this year that the burden on business has been minimal. He is right - a recent study by the Drum Major Institute shows the employment rate in San Francisco outperforming five neighboring counties, including wealthy Santa Clara (Silicon Valley).

Nonetheless, the business opposition to paid sick leave legislation and often to any regulation of any work-family issues continues. 

If you have examples to share of businesses crying wolf, please contact Donald Cohen at dcohen@onlinecpi.org.

For additional examples of businesses crying wolf, check out Lessons from FDR: When the Right Cries Wolf, Bite Back and Peter Dreier's Huffington Post piece about unemployment insurance.

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