On April 3rd 2008, Hillary Clinton was on the Tonight How 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.
Mr. Obama, too, presupposes that if the minimum wage is raised that those making minimum raise will automatically receive more money, when in reality, not only will they be receiving dollars made less valuable through inflation, but there is no guarantee that their hours will not be reduced, as happened with this woman, or eliminated entirely through layoffs.
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ReplyDeleteSOme of these politicians never seem to learn!
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