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  • billyliar66 billyliar66 Feb 13, 2013 10:51 AM Flag

    SOTU Polling: 75% to 85% Favorable to President Obama

     

    There you go again! A popular President, connecting with the vast majority of the American people.

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    • There was a lot to like in the President's speech, but also some stuff to dislike.

      I speak specifically of his proposal to raise the minimum wage. It never ceases to amaze me that otherwise intelligent people can believe that raising the minimum wage is beneficial to poor people. It isn't. It HURTS poor people. Now, before you accuse me of being some Ayn-Rand-loving right-wing crazy, take a minute to think. Econ 101 teaches that if you raise the price of something, other things being equal, you lower the demand for it. That is perhaps the most basic principle in all of economics. It applies not only to goods but also to services. And specifically, if you raise the price of labor by raising the minimum wage, you lower the demand for it. This effect has been empirically verified countless times, so much so that even a dyed-in-the-wool liberal economist like Larry Summers acknowledges it.

      Do we really want to make it harder for poor unemployed people to get jobs? That's what we will be doing if we raise the minimum wage. Now maybe, just maybe, the free market has already set a minimum wage that is above the President's $9.00 target in most employemnt categories. In that case, raising the minimum wage is largely a symbolic gesture. But I don't think that's the case. Millions of people are working at the $7.25 minimum wage; raising it to $9.00 makes them more expensive and encourages an employer to make do with fewer employeees, either by working the rest harder or by investing in labor-saving machinery.

      Memo to Congress: don't raise the minimum wage.

      • 2 Replies to w.heinlein
      • heilein,

        If a worker can't have a full time job paying a living wage, there will be trouble, from broken families, crimes, higher medicaid and welfare costs to the rest of society. I do believe that most businesses are hiring because of need, not because wage is $7 or $9 in FOUR MORE YEARS. Let them raise prices to meet the payroll. Take a look at your utility bills, your taxi fares, your plane tickets, your charge at the gas pump ... medical bills, tooth implant, phone and Cable bills.

      • They are making it harder for everyone to get jobs.....more people on foodstamps than living in Spain. There is your sate of the union and all the garbage obama spewedlast night will not change that....in fact he says his plan is working.

 
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