Tuesday, June 16, 2015

Hillary Clinton and the Minimum Wage - A Flashback

Hillary Clinton, on her second annual presidential announcement speech, reiterated the same tired liberal arguments about raising the minimum wage. It seems that Hillary has not learned the lesson she ought to have, when she was running in 2008. There's a very telling story Hillary told on the campaign trail in 2008, about a child whose waitress mother got a raise in the minimum wage, but got her hours cut back, so she wasn't any better off. I've posted this before, but it doesn't sound as if Hillary has learned anything since then (other than how to wipe a server!):

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On April 3rd 2008, Hillary Clinton was on the Tonight Show with Jay Leno, where she told this anecdote: (Cafe Hayek still has the transcript)

I was in Indianapolis the other day and I was shaking hands after I spoke. And there was this young boy about eleven years old and he’s trying to tell me something—you know the crowd was yelling—so I leaned over and he said, "You know, my mom makes minimum wage and even though it went up, her hours were cut. So we’re not making any more money. Can you help her?"

At which point Hillary launched into platitudes and bromides about fixing the economy, 'we can do better', etc., but she overlooked a very important lesson: When the cost of anything goes up, you tend to buy less of it. The employer of this little boy's mother did not have a bottomless stash of cash to dip into every time the government decrees that his employees are worth more than the market warrants. To hold expenses in check, the employer reduced the number of hours worked at the new inflated wage.

Liberals presuppose (and deceptively preach to the low information voter), that if the minimum wage is raised, those making minimum raise will automatically receive more money, which translates into more buying power, when in reality, not only will they be receiving dollars made less valuable through inflation (and perhaps taxed at a higher rate), but there is absolutely no guarantee that their hours will not be reduced, as happened with this woman, or eliminated entirely through layoffs.

Others (unions come to mind) will compare what they were making above minimum wage and insist that their wages be ratcheted up, too, or they will see themselves as taking a de facto pay cut.

Of course, when this happens, and it will, liberals will blame greedy business owners and corporations for the sin of wanting to make enough profit to remain competitive and keep the employees that they have on the payroll.

Paying more for the same goods or services is by definition inflationary. After the minimum wage increases ripple through the rest of the economy, poor people making minimum wage will be no better off than they were before, and possibly worse. 

Compassion, don'tcha know?

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