In addition to being in favor of more spending, increased regulation, bailouts, and protectionism, President Bush also saddled the economy with a big minimum wage increase. A new study shows that this pernicious policy has destroyed more than 500,000 part-time jobs. One of the most interesting insights in the report is that the economy (prior to Bush’s awful law) had reached a point where the minimum wage wasn’t doing much damage because the competitive wage for entry-level work had risen about the government-mandated minimum. But by boosting the required wage by 14, 12, and 11 percent over three years, that is no longer the case. As a result, hundreds of thousand of people have been priced out of the job market.
Economic theory is clear in its understanding of the minimum wage – it unambiguously reduces the demand for labor, but only if the minimum wage is above the market wage for unskilled entry level labor. In practice, the minimum wage has been far beneath the going wage for unskilled, entry level workers. Increasing the minimum wage at these levels would have no effect on employment or wages. As a consequence, research findings have ranged from zero to modest job losses as the minimum wage increases. Unfortunately, the latest round of minimum wage increases, which occurred in late July 2007, 2008 and 2009, occurred from the peak through the trough of the recession. These increases were, at 14, 12 and 11 percent respectively, the largest since 1978 and the largest three-year percentage change since 1950. …the minimum wage increase accounts for roughly 550,000 fewer part-time jobs now than would otherwise be the case without the most recent three minimum wage increases. …Abandoning the minimum wage would have little or no adverse economic effects. Indeed, it would most likely boost employment.
[…] Yet, at the risk of being repetitive, I periodically share evidence showing that higher minimum wages lead to more unemployment (see here, here, here, here, here, here, here, here, here, and here). […]
[…] to Mr. Sajak. Too bad there are so many politicians (including many Republicans) who don’t understand that higher minimum wages mean fewer jobs for the less […]
[…] making it unprofitable to hire people with low work skills and/or poor work histories. And I’ve attacked Republicans for going along with these job-killing policies, and also pointed out the racist impact of such […]
[…] it’s my mission to promote economic liberty, so I’ve written on why And I’ve attacked Republicans for going along with these job-killing policies, and also pointed out the racist impact of such […]
[…] it unprofitable to hire people with low work skills and/or poor work histories. And I’ve attacked Republicans for going along with these job-killing policies, and also pointed out the racist impact of such […]
[…] making it unprofitable to hire people with low work skills and/or poor work histories. And I’ve attacked Republicans for going along with these job-killing policies, and also pointed out the racist impact of such […]
[…] I’m not making a partisan point. Mitt Romney and George W. Bush had the same […]
[…] the underlying economics of the minimum wage. We also have plenty of evidence (see here and here) that unemployment rose following the most recent hike in the minimum […]
[…] -Minimum wage increases are associated with reduced part-time employment. […]
[…] it unprofitable to hire people with low work skills and/or poor work histories. And I’ve attacked Republicans for going along with these job-killing policies, and also pointed out the racist impact of such […]
[…] making it unprofitable to hire people with low work skills and/or poor work histories. And I’ve attacked Republicans for going along with these job-killing policies, and also pointed out the racist impact of such […]
[…] making it unprofitable to hire people with low work skills and/or poor work histories. And I’ve attacked Republicans for going along with these job-killing policies, and also pointed out the racist impact of such […]
[…] -Increases in the minimum wage have an adverse effect on unskilled entry-level labor. […]
I noticed in your other article you compared Clinton’s record to bush. Did you take into account that bush had two wars and Katrina and a lot more to deal with. Plus Clinton chose to ignore bin laden so that fell on bush. Clinton is overrated big time. Don’t just look at the records take things into account. Fannie Mae and Freddie Mac were also started by Clinton. I wish people would look beyond the numbers. Yes, Clinton was more fiscally responsible and the economy was better under him, but what huge thing did he have on his shoulders? Plus Clinton lied to the American people, bush didn’t
[…] the underlying economics of the minimum wage. We also have plenty of evidence (see here and here) that unemployment rose following the most recent hike in the minimum […]
[…] the underlying economics of the minimum wage. We also have plenty of evidence (see here and here) that unemployment rose following the most recent hike in the minimum […]
Wow. Not a single one of you morons pointed out that the minimum wage hike was the “brainchild” of the Pelosi/Reed Congress – as part of their 100 days of “Progress.”
[…] do the right thing. Sadly, the recent minimum wage increases that have done so much damage were signed into law by President Bush. It’s worth noting that President Obama’s hands also are dirty on this issue, since he […]
BIG PICTURE mainly in manufacturing:
Minimum wage did not make companies leave this country… The US corporate taxes right now set at 35% at high levels of regulation is what made them leave.
While the larger companies are able to afford move overseas to cut their cost of taxes and regulations, the small businesses that once supplied “widgets” to those companies lose major sales accounts.
When this happens, the smaller company may chose to close.
On the other hand, they might try to raise the prices of those widgets to make up the differences.
When their costs go up, they have to pass the cost on to their consumers.
Consumers are looking at their bottom line so they look for better prices.
Most often, widgets are less expensive to purchase outside the USA.
Therefore, if the US would get smart… they could do two little things to get our economy going… and Barack Obama does not get it!
Cut corporate Tax Rate (I think some states that are creating jobs have taken this path)
Cut Regulations that cost the companies
If this were to happen, companies would come back to the United States of America!
Republicans and Conservatives are not all RICH, as the left would like you to believe.
So many Democrats share the same values as conservatives.
What is lacking is “Education” Government is destroying that and it is going to cost us.
BTW….
I predict that the next big bubble will be “SALLY MAE” (https://www.salliemae.com) who like Freddie/Fannie have guaranteed by the taxpayer student loans.
Sadly, more & more students are graduating with a degree but not able to find a job. So now… It is starting already http://www.collegeanswer.com/paying/content/pay_loan_forgive.jsp
[…] In other words, Romney is willing to condemn lower-skilled workers to unemployment, in hopes that he will gain some sort of short-term political advantage. In this regard, he will be just like Bush. […]
[…] In other words, Romney is willing to condemn lower-skilled workers to unemployment, in hopes that he will gain some sort of short-term political advantage. In this regard, he will be just like Bush. […]
[…] In other words, Romney is willing to condemn lower-skilled workers to unemployment, in hopes that he will gain some sort of short-term political advantage. In this regard, he will be just like Bush. […]
[…] do the right thing. Sadly, the recent minimum wage increases that have done so much damage were signed into law by President Bush. It’s worth noting that President Obama’s hands also are dirty on this issue, since he […]
[…] making it unprofitable to hire people with low work skills and/or poor work histories. And I’ve attacked Republicans for going along with these job-killing policies, and also pointed out the racist impact of such intervention. Read more and watch the […]
[…] it unprofitable to hire people with low work skills and/or poor work histories. And I’ve attacked Republicans for going along with these job-killing policies, and also pointed out the racist impact of such […]
[…] do the right thing. Sadly, the recent minimum wage increases that have done so much damage were signed into law by President Bush. It’s worth noting that President Obama’s hands also are dirty on this issue, since he […]
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[…] do the right thing. Sadly, the recent minimum wage increases that have done so much damage were signed into law by President Bush. It’s worth noting that President Obama’s hands also are dirty on this issue, since he […]