Minimum wage hike: Another bad Obama idea

Another of President Barack Obama's bad ideas is to force employers to pay higher wages to the lowest skilled and/or least experienced workers on the premise that by raising the take-home pay of these people, the world will be better.

Unfortunately, lots of people agree with him, including some who are usually far more sensible. They think that raising the minimum wage would put more money into the economy, and that can't be a bad thing, can it? First of all, it doesn't put money into the economy; it merely moves it around unnaturally. And, as usual, there are other repercussions that haven't been considered.

Since the number of people that earn the minimum wage is relatively small, any direct help is minimal. In January the U.S. Labor Force was 155.6 million, with about 102 million working full-time. Only 1.5 million earn the minimum wage, about nine-tenths percent. It is most often a starting wage level for teenagers with few or no skills and/or experience. And while the president didn't mention this, just because someone starts at the minimum, that doesn't mean they earn at that level for long. Research shows that nearly two-thirds of those earners get a raise from one month to a year after they begin work.

U.S. Census data shows that only 15 percent of minimum wage earners are single parents, and all are eligible for the Earned Income Tax Credit. The remaining 85 percent are teens living with their working parents or other working relatives, adults living alone, or married adults living with a working spouse. The average family wage of a minimum wage earner is more than $43,000 a year.

So, the problem the president believes he will solve by increasing the minimum wage is so small as to be no real problem at all, and there is evidence that far more harm than good will result.

Mr. Obama proposes to raise the rate from $7.25 to $9.00 an hour over two years. Something he never talks about – and may neither think about nor care about – is the question of where this money for higher wages will come from. Somehow, employers will have to find a way to pay every minimum wage worker 24 percent more over a two-year period, which works out to $3,600 in annual wage increases per worker over that time frame.

Will they reduce the number of minimum wage workers? The increase in pay for every four workers is nearly equal to the pay of one worker under the existing minimum wage. If you are a minimum wage earner, you might ask yourself: would you rather earn $7.25 an hour for 40 hours a week, or $9.00 an hour for zero hours a week?

Will they raise their prices by 24 percent, making their products more expensive for everyone, including those who earn the new minimum wage?

What about people who earn a bit more than the current minimum, but less than nine bucks? They will have to be increased to $9 per hour, which makes them minimum wage earners again after having been at a rate higher than the minimum, perhaps after having worked their way up from that level. What will employers do? Will they increase those hourly wages by $1.75 an hour to keep them where they were relative to the minimum wage; will they give them a smaller raise; or will they just pay them $9?

And what about those who earned more than $9 an hour, and are now $1.75 an hour closer to the minimum? How will they react? Shouldn't everyone get a raise; wouldn't that be the "fair" thing to do? How much additional costs to employers will this cause?

"The effects of the minimum wage are declines in employment for the very least skilled workers," according to David Neumark, a University of California, Irvine, professor who has studied the issue. He says the benefits of higher minimum wages sometimes go to teens in higher-income families taking part-time jobs. "A lot of the benefits of minimum wages leak out to families way above the poverty line," he said.

So, the minimum wage hike really helps only a relative few, sometimes helps those that don't need it, reduces hiring of minimum wage workers, and makes running businesses more expensive for employers, who would have to find a way to pay for increased wages for many more workers than just those earning the minimum.  They might have to defer expanding their business or purchasing new equipment. Or, they might have to increase the prices for their products and services. Or they might have to do some of all of those things.

All jobs and workers have economic value based upon the importance of their work to the business of which they are a component that is not related to the desires of politicians to endear themselves to a segment of the populous.

 Politicians cannot change economic reality, but they do not let that stop them from trying, and we can see all around us in the current economic malaise what happens when they try to manipulate the economic environment.

Abusing the U.S. Constitution for fun and profit

Commentary by James H. Shott

Many Americans are outraged at the element in the House health care bill that requires people to buy health insurance, even if they don’t need it, and even if they don’t want it. The authors of this legislation included this mandate so that there would be enough money from young and healthy people in the system to keep the thing from sinking faster than the Titanic.

It says a lot about this ghastly plan that its creators have to force Americans to participate in it for it to succeed.

Congress justifies this outrage with the “Commerce Clause” of the United States Constitution. Article I, Section 8, Paragraph 3 says: “(The Congress shall have power) [t]o regulate commerce with foreign nations, and among the several states, and with the Indian tribes; …”

Through liberal interpretation of the words “to regulate commerce … among the several states,” Congress has unleashed all manner of horrors on the American people, things that the Founders never intended, and in fact, things reminiscent of the sort of over-reaching government from which the Founders had won their independence several years before.

Given that the colonists finally grew tired enough of the excessive regulation and oppression of King George that they took up arms against him to win their freedom, does anyone seriously believe that the Framers of our Constitution ever intended for these few words to justify so much government control? Our elected public servants, however, continue merrily trampling on the protections the Constitution provides you and me against them.

Looking back into history, George Mason University professor Walter Williams wrote that a “key failing of the Articles of Confederation was the propensity of states to erect protectionist trade barriers. When the Framers met in Philadelphia in 1787 and wrote the constitution that governs us today, they addressed that failure through the commerce and the privileges and immunities clauses that created a national free-trade zone. Thus, the original purpose of the Commerce Clause was primarily a means to eliminate trade barriers among the states. They didn't intend for the Commerce Clause to govern so much of our lives.”

Here is one example: Using the Commerce Clause as the basis, in 1990 Congress passed the Gun-Free School Zones Act. How so? Because, legislators said, the possession of a firearm in a local school zone substantially affected interstate commerce. Huh? Well, because violent crime raises insurance costs, and those costs are spread throughout the population across state lines, voila!: interstate commerce! And if that explanation isn’t satisfying, Congress determined that crime threatens the learning environment, thereby reducing national productivity, also affecting interstate commerce.

Fortunately for the country, the U.S. Supreme Court ruled that Congress had no constitutional authority to pass this act. The Court’s reasoning held that, "If we were to accept the government's arguments, we are hard pressed to posit any activity by an individual that Congress is without power to regulate."

Indeed. If we accept the goofy idea that crime affects the learning environment and is thus a negative effect on interstate commerce, then what children eat and wear, how much they sleep, and even what they do when not in school are also fair game.

The American people have allowed this twisting of the Founders’ intentions for a variety of reasons, including ignorance, disinterest, and self-interest, as when a particular misapplication of the Commerce Clause suits their purposes. They might say, “Well, the Commerce Clause really has nothing to do with outlawing guns near schools, but we don’t want guns near schools, do we? So, let it stand.”

The U.S. Constitution was carefully crafted to achieve a specific purpose: to establish a government that would provide a suitable framework for the nation and at the same time provide maximum freedom for the citizenry, not as an instrument of social engineering, or of political expedience.

But politicians cannot be trusted to leave political ideology out of lawmaking, so it is a good thing that the judiciary can rule on whether laws comport with constitutional protections. The judiciary, however – including the U.S. Supreme Court – has also been corrupted by ideology.

Edwin Meese, U.S. Attorney General in the Reagan administration, notes that “Taking the politics out of the judiciary is a key tenet behind the concept of constitutional originalism. That's the idea that judges should issue rulings based on the original understanding of the authors and ratifiers of the Constitution and the Bill of Rights …”

The idea of the Constitution as a “living” document – as opposed to honoring the authors’ original intent – means that its meaning changes with the times, enabling outcomes that reflect legislators’ and judges' personal biases or policy preferences.

Polluting the law and the courts with broad and changing interpretations of the Constitution means that anything the federal government wants to do can be labeled "interstate commerce," and the constitutional limits on federal power vanish into thin air.

A “living” Constitution has no foundation upon which to build a stable nation. It means only what today's reader wants it to mean and will likely mean something different twenty years from now. That is not a constitution, it is quicksand.

Cross-posted from Observations

America Is Now a Socialist Nation.

America Is Now a Socialist Nation.

A Commentary by J. D. Longstreet
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“Democratic Socialists believe that both the economy and society should be run democratically—to meet public needs, not to make profits for a few. To achieve a more just society, many structures of our government and economy must be radically transformed through greater economic and social democracy so that ordinary Americans can participate in the many decisions that affect our lives.” (Taken from the website the Democratic Socialists of America at: http://www.dsausa.org/dsa.html )

Months ago, as I began to write about the dangers of socialism to America, (and how the Democratic Party has become a sort of Socialist/Democratic party) I was stunned when they, the democrats, did not refute it. I had expected democrats to deny any connection to socialism. But they didn’t.

It was then that it struck me… they don’t deny it because they can’t. They have become socialist! They have embraced socialism. Why, then, I asked myself, don’t they change the name of their parry to accurately reflect whom, exactly, they are. We suggest: “The Socialist Democrat Party of America.” There is no reason to attempt to conceal the true alignment of the so-called Democratic Party in America with the Socialist Movement any longer. They have totally embraced socialism -- with gusto!

As a soldier in the US military I was taught to fight socialism. We trained to meet the socialists on the field of battle. There was no question that Americanism and socialism could not exist on the same globe without conflict, and, we rightly assumed, armed conflict. Is that where America is headed today -- armed conflict between American citizens over whether America will remain a socialist country or revert back to its proper role as a democratic representative republic under the authority of the US Constitution?

Make no mistake about it: a coup de’tat has taken place in America. The socialists have taken over the government of the country. While the people remain democratic, the government is socialist -- from the White House to the Congress.

Here is a quote from WHERE WE STAND -- The Political Perspective of the Democratic Socialists of America:

“In the United States, we must fight for a humane public policies that will provide quality health care, education, and job training and that redirect public investment from the military to much-neglected urban housing and infrastructure. Such policies require the support of a majoritarian coalition of trade unionists, people of color, feminists, gays and lesbians and all other peoples committed to democratic change. Our greatest contribution as American socialists to global social justice is to build that coalition, which is key to transforming the power relations of global capitalism.”

We encourage you to go to their site and read the entire article. You’ll find it HERE.

Never doubt this, dear reader, socialism leads, inevitably, to communism. Socialism is the precursor for communism. Socialism is the “forerunner,” so to speak, for the advent of communism into a nation’s government. That “forerunner” is now in place in both the White House and in the Congress of the United States of America.

The Communist Manifesto is also a socialist manifesto. You need only read Frederick Engels' preface to the 1888 edition of the Communist Manifesto, which declares that the Communist Manifesto "is undoubtedly the most widespread, the most international production of all Socialist literature, the common platform acknowledged by millions of working men from Siberia to California." SOURCE

What of socialism and Christianity? The answer is they cannot co-exist.

Socialism means economic control of the people by government. In a socialist country, the state is all-powerful. Such an all-powerful state views itself — and not God — as the ultimate authority. It is not surprising, therefore, that the Communist Manifesto calls for abolishing family, marriage, countries, and religion as well as private property. Under the socialist system the state determines what is right and wrong — without any competing loyalties to God, family, or country. SOURCE

So, how does socialism gain total control over the citizens of America? Universal Healthcare – Socialized Medicine – ObamaCare, no matter what you call it, it means one thing: Total control of the lives of American citizens! And it is on the verge of becoming the law of the land.

The Congress has roughly three weeks of actual time “in session” before the end of the year. The US Senate is going to bust it’s seams during those few days to ram Socialized Medicine through the Senate and down the throats of their fellow Americans.

We have to stop them. If we have any desire, at all, to preserve America, to preserve the freedoms granted us by the constitution, Socialized Medicine must be stopped and stopped cold. Otherwise America, as a free nation, is lost.

J. D. Longstreet