I've always thought this was really obvious. Benefits tied to employment will stifle entrepreneurs who aren't already well off.

This tips the scales towards the largest employers for labor, how many low paid internships could be replaced by high risk startups?

Before anyone has had a chance to accumulate to many obligations, that is the perfect time to grow by taking a risk and going after something disruptive.

That also would be the time in which many have the energy and optimism to do good rather than for greed or meeting obligations such as feeding/housing a family of four.

Wasn't it the labor movement that tied many of these benefits to employers? Pretty sure at least employer paid (and now, semi-paid) health insurance was won due to organized labor demanding it. At the time it was likely the right thing to do but now it does seem to create an extra entanglement.

>Wasn't it the labor movement that tied many of these benefits to employers?

No, it was WWII that did it.

It started during WWII due to government restrictions on what could be paid, but was extended to be an obligation under full-time employment via organized labor movement.

Not just organized labor.

> This didn’t stop President Truman from considering and promoting a national health care system in 1945. This idea had a fair amount of public support, but business, in the form of the Chamber of Commerce, opposed it. So did the American Hospital Association and American Medical Association. Even many unions did, having spent so much political capital fighting for insurance benefits for their members. Confronted by such opposition from all sides, national health insurance failed — for not the first or last time.

https://www.nytimes.com/2017/09/05/upshot/the-real-reason-th...

Probably because group plans are/were strictly better and cheaper than individual plans (especially pre-ACA).

That's why the healthcare system is what it is. You cannot do it your way without their doctors.

We have some nice evidence for this from Obamacare---a number of people were freed to quit their jobs to do more valuable things. The one that will probably be most appealing to HN:

Eddie Gonzalez-Novoa, 44, now living in Houston, last year left a full-time job in New York making $88,000 a year plus benefits to help his nephew, a cancer survivor, start a social media and video-gaming site for other teens with the disease.

https://www.denverpost.com/2014/02/10/they-quit-their-jobs-t...

>Or more to the point: how many startups never happen because the right people are unable to manage the personal risk of leaving defined employment?

I'd argue this has more to do with the low salaries expected of startup founders more than anything. Hard to stomach them unless you've got significant savings already or no dependents.

Maybe in other countries, but in the US the only real consideration is health care. Most people who want to start a business are cool eating ramen, couch surfing, and sacrificing a big salary if they have to, but don’t want to risk going completely bankrupt because they fall and break an ankle, get in a car accident, or get diagnosed with something chronic.

At least this is the only concern I or anyone I’ve talked to about doing a start up has risen. I work at a not quite FAANG company and we all have decent salaries and benefits. I’d give it up in a heart beat if I didn’t have to worry about health care costs.

COBRA allows for 18 months of coverage under your previous employer's plan. Cal-COBRA allows for 36 months of coverage. All you have to do is pay the full premiums (<$1k/month for a single person). That should be enough time to get a startup to a point where it can apply for it's own health insurance. If you have a spouse (or domestic partner in some states) then you can also go under their plan although that may have increased premiums for them. There's also the individual health plans out there which may be reasonably priced if you don't have any pre-existing conditions.

When I left my job for a year of relaxing health insurance was nowhere near a concern since I just paid the COBRA premiums.

edit: And if you're under 26 you can be on your parent's health plan.

edit2: Also, talking about couch surfing pretty much highlights my point about dependents. I'm guessing neither you nor the people you talked to are old enough to have kids.

Depends on the sector. If you’re a software engineer or white collar worker, leaving your job for a prolonged period of time is a matter of planning and frugality.

Speaking only for myself, I intentionally lived in a small apartment in order to make sure I had at least a year of income saved. I did this pretty early in my career in the bay area. I believe it’s still quite possible to do this if you are willing to forgo purchases that signal wealth (i.e, live in the smallest manageable apartment, keep driving your beater for a long time, cook instead of eating out).

Even if we accept your premise - people have limited mobility due to benefits - that is nothing at all like being a government.

Governments by definition have a monopoly on force. A government is a government because people with guns say so.

You might want to argue that employees have power, but they are nothing like a government. They don't have force, they don't have jails, they can't enter your home and give you orders. The worst thing an employer can do is to stop employing you. That's hardly coercion IMO.

Not employing you at a whim does more than just make you work at a different place the next day.

You now need to spend an undefined amount of time looking for a new job.

You need to find that new job soon, because your old job was tied to important things like health insurance, without which any accident could bankrupt you.

It was also tied to less important benefits like vacation time and seniority, which reset at youe new job. Previously had 3 weeks off available after working for years at the same shop? Back to 6 days. At some places it may also be tied to a car, computer, or phone plan which you have come to depend on.

Not to mention that getting fired is a black mark on your ability to get a new job in the future.

Employers like to structure things such that they can replace an employee with little impact. They have people whose job it is to manage that process. To an employee, even an unusually well prepared one with savings and a plan and a current resume, losing one's job is a catastrophic event that can only be easily withstood a handful of times in a career.

> The worst thing an employer can do ...

There are many other things and employer can do, such as the aforementioned non-compete "agreements", changing pension and other retirement benefits (threatening to take them away as pressure), colluding with other employers to keep your wages down (https://www.lexology.com/library/detail.aspx?g=f578d157-2b2a...), and more.

Yes but your under a social contract whos terms are completely clear. You may not like these terms but in any western country you are completely free to find a different country with different terms (exactly the same if you find yourself in a company that would like to leave). You see my libertarian friend its all purely contract law and therefore completely legitimate ;)

Again, if we accept your premise ( I definitely do not accept your social contract, but that's a different matter) that still doesn't make an employer a government. Their contractual nature is similar in that way, but there are still the fundamental differences already talked about.

By your way of thinking, any business is a government.

> Governments by definition have a monopoly on force.

I've never heard that definition of government. Also, at least in the US (and presumably everywhere else), private citizens have the right to use force under various circumstances.

This is literally the definition of government used in e.g. social science: https://en.m.wikipedia.org/wiki/Monopoly_on_violence

> private citizens have the right to use force under various circumstances.

Yup, as defined by the government. You can defend yourself in certain circumstances, but you are always subservient to the military and police. They are the ultimate power in the state. If there was a force stronger than the military or police, that power would then be the state.

> The term state refers to a form of polity that is typically characterised as a centralized organisation. There is no single, undisputed definition of what constitutes a state.[1][2] A widely-used definition is a state being a polity that, within a given territory, maintains a monopoly on the use of force, but many other widely used definitions exist.[3][4]

https://en.wikipedia.org/wiki/State_(polity)

It is probably the most common definition. As per this definition, the citizens can use force because the state grants them that right.

Is the state's army economically funded by a contract established voluntarily?

Can you start a private army to compete (not meaning fight it, but to provide the same services) with the state's army ?

If you have to pay for it (you actually pay for the army to force you to pay for it...), and you can't compete with it for the services it provides, it's not only a monopoly, it's also a tyranny.

not really. you are just too poor. if you had the means to create the right connections, you could be paid by the army, like blackwater.

>how many times have you or someone you know hesitated leaving a current employer due to benefits uncertainties?

Hopefully 0 times. Major changes in your life (like changing jobs, or moving cities, or making large purchases) always require some consideration.

>human ability is not really allocated all that well when you're bonded to an employer without cheaper switching costs.

You're overstating the case especially in market economies. If anything, the issue is more prevalent if your employer is the government, as the government tends to overpay for labour and is slow to adjust if conditions change (i.e. very hard to let people go for any reason).

Having said that, there are problems with movement being too liquid. That is, you lose institutional knowledge if your company (or government department) has a too high of a turn-over rate, which leads to lower quality products/services.

>how many startups never happen because the right people are unable to manage the personal risk of leaving defined employment?

And rightly so. Startups are an incredibly risky endeavour and they always will be. This is why founders tend to be younger, rather than older. If you have dependents and responsibilities you have to think twice about making a high risk bet. I don't know if you want to actually incentivize people to make more high-risk bets.