Monday, February 25, 2013

Minimum Wage still kills jobs

It's stunning to me that man can rise to be President of the United States and be an economic ignoramus.

Want evidence? Here is what Barak Obama said during the State of the Union:

"Tonight, let’s declare that in the wealthiest nation on Earth, no one who works full-time should have to live in poverty, and raise the federal minimum wage to $9.00 an hour. This single step would raise the incomes of millions of working families. It could mean the difference between groceries or the food bank; rent or eviction; scraping by or finally getting ahead. For businesses across the country, it would mean customers with more money in their pockets. In fact, working folks shouldn’t have to wait year after year for the minimum wage to go up while CEO pay has never been higher. So here’s an idea that Governor Romney and I actually agreed on last year: let’s tie the minimum wage to the cost of living, so that it finally becomes a wage you can live on."

Of course the last sentence gets to the heart of one of the many causes of poverty. The government keeps printing more money, which is supposed to help "fix" the economy, yet it is just devaluing money that is already in circulation. Inflation makes everyone poorer, except those that keep getting raises like Obama's CEO reference. But that is another story.

Economics is complicated, so when a smart guy tells the people (who are also mostly economically illiterate) that raising minimum wage will solve so many problems, one has to wonder if he really believes it. He must have heard the counter arguments, so I can only infer that he is telling a bit of a lie to placate the working poor. Am I giving Obama too much credit? It doesn't really matter. What matters is that people understand what's going on, so that they can make educated decisions. So just in case you have not heard the counter arguments, do yourself a favour and watch this:






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