A new study recently circulated on Bluesky examined the impact of higher pay rates on the hiring process, and discovered that — just as you might expect — when employers raise wages, they fill open positions more quickly. Or, as the study specifically found: raising pay by 4.3% reduces the time a job remains open by 27%.

It’s always helpful to have specific numbers for stuff like this, and the researchers here did a service. But this kind of study also raises the question of why it is that common sense assumptions which benefit workers apparently need to get tested and proven, while assumptions that benefit the wealthy few so often get treated like simple realities of the world. Why is it that we continue to live in a world where the impact of  the minimum wage is a topic worth studying over and over and over again, while the impact of CEO pay is rarely even discussed?

Make it make sense.

One of the fundamental ideas of neoliberal economics is that markets are almost always right. According to Economics 101, when you aggregate millions of individual decisions to buy or sell various assets, a particular kind of predictive genius emerges. This is supposed to be a big part of what makes markets work, and why market economies are just oh-so-wonderful for everyone.

It’s a tidy theory, but if this were all true, one place you’d definitely expect to see it proven is in how markets anticipate the future direction of US interest rates. After all, this is one of the very biggest markets around, and one that has massive impacts on the valuations of almost every other asset out there. So it’s striking to see the chart below, which shows both the changing levels of interest rates in recent years, and a series of whiskers that show how the markets anticipated future rates would turn out to be. What stands out here immediately is how wildly and consistently wrong the markets have been — at basically all points this century so far. It’s enough to make you wonder what else isn’t quite how they taught it in Econ 101. 

When the federal government issues fines for violations of securities law, the purpose is twofold. First, it’s supposed to provide restitution to anyone who lost money on account of the crime. Second, it’s supposed to penalize the lawbreaker in order to deter future violations by them or anyone else. That’s a big part of why hefty fines are often announced in major press releases: so legal consequences are highlighted, and social norms are strengthened. 

But as Dave Michaels writes in the Wall Street Journal, $10 billion of these fines have gone uncollected for years — so long, in fact, that the SEC is giving up on collecting them. In one case, they've been seeking penalties from a particular financier for 31 years — since the beginning of the Clinton presidency! They even charged him with additional violations just last year. But the lawbreaker simply hasn’t responded. Instead, he turned the tax haven of St Kitts into his own personal haven from American authorities. Not only does the US Treasury take a financial hit as a result, but the entire premise of SEC enforcement is undermined. Because if this guy can brazenly get away with stuff like this, why should anyone else even pretend securities laws matter in the first place?

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