The battle over the federal minimum wage has morphed into a propaganda war waged by President Obama and his Democrat cronies. Armed with deception, urban fables and distortions they have marched into the arena of public opinion to promulgate a counterfeit argument for increasing pay.
To hear Obama and his puppets tell it, there are millions of poor single mothers with two or more kids toiling in minimum wages jobs, unable to put food on the family's table. This image has been nurtured to promote the idea of raising the federal minimum wage from $7.25 an hour to $10 or more.
However beguiling the illustration, it has been fabricated to deceive average Americans. The duplicity is easily exposed by facts. But the mainstream media has invested itself in substantiating Obama's agenda, even if it means sacrificing what little journalistic scruples remain.
Few Americans are actually working for the federal minimum wage. According to the Bureau of Labor Statistics, about four percent of hourly-paid employees earn $7.25. If you include both hourly and salaried employees, just 2.9 percent of Americans make the federal minimum.
Last year, a total of 1.6 million workers were paid the federal minimum wage. Ninety-seven percent of American workers earn more than the minimum wage.
Nearly two-thirds of minimum wage earners receive a raise within 1-to-12 months on the job. The notion that minimum wagers earners are a permanent underclass is simply false. Part-time workers are more likely to earn the minimum wage than full-time employees.
The majority of minimum-wage workers are between the ages of 16 and 24. Many are students or part-timers just starting their working careers. Three-fourths of workers 25 and older in a minimum wage jobs live above the federal poverty line.
A recent study at American University found that among families where one adult was earning minimum wage, 94 percent had a spouse who brought home more money. In fact, the average household income of a majority of minimum-wage workers is more than $53,000 a year.
The mythical single mom with kids working for minimum wage is more fiction rather than fact. That doesn't mean there are not some that fit this description, but it is a rarity and not the rule. Single parents making minimum wage are just four percent of the workforce.
The mantra of the Obama apostles has been to clamor for a "living wage." It is an elusive concept. For example, a minimum wage worker in New York City would need to earn nearly $30 an hour to match the buying power of a entry level employee making $7.25 hourly in Harlingen, Texas.
Many cities and states already have minimum wage rates that are above the federal level. Oregon hiked its minimum to $8.30 an hour. Washington state trumped that by raising its minimum to $9.04. California's legislature recently passed a bill to shove the rate to $10. San Francisco has extorted a $10.24 hourly minimum from businesses.
So why are Obama and Democrats hell bent on bumping up the federal minimum wage?
The answer is two-fold. First, it is good politics because the issue resonates with most Americans. Everyone can rally around the idea of a decent wage. Since more than 9 out of 10 Americans already earn more than federal minimum, it is hard for them to be against the idea.
Secondarily, the issue has the backing of powerful unions. Many union contracts peg wage rates to the federal hourly minimum. For instance, an agreement might have provisions for automatic adjustments if the hourly minimum increases. The unions are not interested in single moms unless they pay dues.
Even supporters of jacking up the minimum wage surely understand the economic reality that an hourly wage boost will suppress job growth. Studies have repeatedly shown that businesses hire fewer workers, or reduce hours or layoff employees in the face of sharp increases in wages.
There has been no empirical evidence to date to buttress Obama's case for bumping up the federal minimum wage. Until there is something more than emotional exaggerations and dishonest information, the minimum should remain exactly where it is today.
Monday, October 21, 2013
Tuesday, October 15, 2013
A Debt Ceiling Primer
"America has a debt problem and a failure of leadership. America deserves better." Those two sentences frame the plight of a nation witnessing a vitriolic political tug-of-war in Washington over raising the debt ceiling.
The summary of the country's quandary was offered by then Senator Barrack Obama. He made the comments in March of 2006 before he voted against increasing the nation's debt ceiling. Obama turned thumbs down on another debt request in 2007, ignoring warnings of a financial apocalypse.
That's why it is ironic that President Obama has resorted to trashing Republicans who stand in the way of his attempt to hike the U.S. debt ceiling, which now teeters at $16.7 trillion. Those who oppose the president are labeled hostage takers, extortionists and extremists.
No one can remember any politician spewing such bilge about Senator Obama for his defiant stance on the debt ceiling less than seven years ago.
The current debt limit hysteria, fueled by the president and his slavish media, has drowned out all reasoned debate over the question of whether the nation will benefit by raising the limit on the government credit card.
This toxic atmosphere in Washington has contributed to obfuscation, deception and dishonesty that does nothing to promote a negotiated settlement. Here are some facts to put the battle over the debt limit in perspective:
1. President Obama has forewarned that default is likely if Congress fails to act on the debt ceiling. However, the tax receipts for the current year are expected to top $3 trillion, more than enough to cover the annual interest payment of $237 billion. The president and the Treasury secretary should have no problem figuring out how to avoid default on the debt. They alone will make the call on whether to default. As proof, read about what another president did in the next paragraph.
2. President Obama has chided legislators for contemplating something no other Congress has done. In 1953, Republican President Dwight Eisenhower's request for a modest lift in the debt ceiling was rebuffed by Senate Democrats, who argued the existing cap would impede runaway federal spending. In order to meet debt obligations, the president ordered drastic cuts in government expenditures. A full year after Eisenhower's request, the Congress finally approved an increase in the debt ceiling.
3. President Obama continually harps about Congress paying the bills for its spending. This borders on hypocrisy because the president has presided over the largest increase in the nation's debt in the history of the country. Since Obama assumed the Oval Office, debt has skyrocketed $4.939 trillion, a 51 percent increase since 2009. Gargantuan federal deficits run up under Obama have created the ticking debt bomb.
4. President Obama contends raising the debt ceiling will not add to the nation's borrowing. That is like a credit card holder asking for an increase in his or her borrowing limit while promising not to add more debt. Then why do it? Every time the debt ceiling has been raised by Obama, the nation has quickly bumped up against the cap. Deficits create the need for borrowing and Obama's federal budget sent to Congress last month projects the ballooning debt to stretch into another financial galaxy.
5. President Obama deserves the lion's share of the blame for the deficits. Obama has steadfastly rejected any Republican efforts to scale back entitlements which are growing at an alarming rate. Federal spending for major health care programs and Social Security are expected to increase at twice the average of the past 40 years, according to the Congressional Budget Office's recent report on the budget outlook. Increasing debt to cover the spending will result in "negative consequences for both the economy and the federal budget," the CBO cautioned.
A healthy debate over the debt ceiling is necessary for the country to come to terms with galloping federal spending that threatens the nation's future. Instead of stonewalling and haranguing, President Obama should lead the discussion.
By refusing to indulge in serious dialogue, Obama has abdicated his leadership role and polluted the environment for an agreement to end the crisis.
The summary of the country's quandary was offered by then Senator Barrack Obama. He made the comments in March of 2006 before he voted against increasing the nation's debt ceiling. Obama turned thumbs down on another debt request in 2007, ignoring warnings of a financial apocalypse.
That's why it is ironic that President Obama has resorted to trashing Republicans who stand in the way of his attempt to hike the U.S. debt ceiling, which now teeters at $16.7 trillion. Those who oppose the president are labeled hostage takers, extortionists and extremists.
No one can remember any politician spewing such bilge about Senator Obama for his defiant stance on the debt ceiling less than seven years ago.
The current debt limit hysteria, fueled by the president and his slavish media, has drowned out all reasoned debate over the question of whether the nation will benefit by raising the limit on the government credit card.
This toxic atmosphere in Washington has contributed to obfuscation, deception and dishonesty that does nothing to promote a negotiated settlement. Here are some facts to put the battle over the debt limit in perspective:
1. President Obama has forewarned that default is likely if Congress fails to act on the debt ceiling. However, the tax receipts for the current year are expected to top $3 trillion, more than enough to cover the annual interest payment of $237 billion. The president and the Treasury secretary should have no problem figuring out how to avoid default on the debt. They alone will make the call on whether to default. As proof, read about what another president did in the next paragraph.
2. President Obama has chided legislators for contemplating something no other Congress has done. In 1953, Republican President Dwight Eisenhower's request for a modest lift in the debt ceiling was rebuffed by Senate Democrats, who argued the existing cap would impede runaway federal spending. In order to meet debt obligations, the president ordered drastic cuts in government expenditures. A full year after Eisenhower's request, the Congress finally approved an increase in the debt ceiling.
3. President Obama continually harps about Congress paying the bills for its spending. This borders on hypocrisy because the president has presided over the largest increase in the nation's debt in the history of the country. Since Obama assumed the Oval Office, debt has skyrocketed $4.939 trillion, a 51 percent increase since 2009. Gargantuan federal deficits run up under Obama have created the ticking debt bomb.
4. President Obama contends raising the debt ceiling will not add to the nation's borrowing. That is like a credit card holder asking for an increase in his or her borrowing limit while promising not to add more debt. Then why do it? Every time the debt ceiling has been raised by Obama, the nation has quickly bumped up against the cap. Deficits create the need for borrowing and Obama's federal budget sent to Congress last month projects the ballooning debt to stretch into another financial galaxy.
5. President Obama deserves the lion's share of the blame for the deficits. Obama has steadfastly rejected any Republican efforts to scale back entitlements which are growing at an alarming rate. Federal spending for major health care programs and Social Security are expected to increase at twice the average of the past 40 years, according to the Congressional Budget Office's recent report on the budget outlook. Increasing debt to cover the spending will result in "negative consequences for both the economy and the federal budget," the CBO cautioned.
A healthy debate over the debt ceiling is necessary for the country to come to terms with galloping federal spending that threatens the nation's future. Instead of stonewalling and haranguing, President Obama should lead the discussion.
By refusing to indulge in serious dialogue, Obama has abdicated his leadership role and polluted the environment for an agreement to end the crisis.
Monday, October 7, 2013
America's Poor: The Numbers & The Myth
The coiffed news readers at the nation's television stations have been practically apoplectic in reporting that the world's richest country is awash in poverty. Some 46.4 million Americans are now entombed in beggary, the highest figure in the nation's history, they have gleefully recited from their teleprompter.
Those figures, compiled by the U.S. Census Bureau, were recently released just as Congress began wrestling with the federal budget. The news was timed to arm Democrats with data to justify fattened funding for a host of federal programs, most notably food stamps.
As has been the case so often, the Democrat footmen in the media omitted a few salient facts that would cast a different light on the Census data.
For instance, the federal poverty level is adjusted annually. The threshold is established by using metrics developed by the Office of Management and Budget (OMB). The official yardstick measures inflation, size of a family, ages of the members, total family income and a few other benchmarks.
The household income includes only earned wages. It does not take into account any federal aid, such as food stamps, housing assistance, Medicaid and other non-cash state or federal benefits. Likewise, there is no accounting for the discrepancies in living costs between geographic regions.
Different federal agencies that administer aid programs employ different poverty guidelines. That fuels confusion about the exact income point for poverty in the U.S.
Currently, the official federal poverty level for an average family of four is $23,550. However, a family of eight can earn up to $39,630 and still be counted as poor. In many industrialized countries, an income of $40,000 would be considered upper middle class.
Most Americans are surprised by the federal income delineation between poor and middle class. Surveys show that the majority imagine the poor are lacking food, shelter, clothing and transportation. They consider poverty to connote that a family is destitute.
But many of America's poor live in luxury compared to their brethren in other parts of the world.
According to Census data, 80.9 percent of the households below the poverty level have cell phones. Nearly 6 in 10 (58.2%) own computers. Practically all (96.1%) have televisions. Almost 80 percent have satellite or cable TV service. Ninety-seven percent have refrigerators. Nine in 10 have microwaves. Most of the world's poor have none of these conveniences.
Those facts were missing from the media's newscasts, but the most glaring omission of all is the spike in unemployment under President Obama's stewardship.
Since Obama assumed office, poverty in the United States has zoomed 16.73 percent. Median income has fallen every year of Obama's reign. Twenty-even percent of African-Americans live at or below the poverty line, the highest since the civil rights movement.
The president gets a pass from the media because he always points the finger at his predecessor, George W. Bush. But his blame-shifting rings hollow after nearly five years in office, billions in stimulus spending and record funding for federal poverty programs.
There is no escaping the fact that poverty has grown worse under President Obama. His own government's measurements prove it. Obama needs to point the finger at himself for a change.
Those figures, compiled by the U.S. Census Bureau, were recently released just as Congress began wrestling with the federal budget. The news was timed to arm Democrats with data to justify fattened funding for a host of federal programs, most notably food stamps.
As has been the case so often, the Democrat footmen in the media omitted a few salient facts that would cast a different light on the Census data.
For instance, the federal poverty level is adjusted annually. The threshold is established by using metrics developed by the Office of Management and Budget (OMB). The official yardstick measures inflation, size of a family, ages of the members, total family income and a few other benchmarks.
The household income includes only earned wages. It does not take into account any federal aid, such as food stamps, housing assistance, Medicaid and other non-cash state or federal benefits. Likewise, there is no accounting for the discrepancies in living costs between geographic regions.
Different federal agencies that administer aid programs employ different poverty guidelines. That fuels confusion about the exact income point for poverty in the U.S.
Currently, the official federal poverty level for an average family of four is $23,550. However, a family of eight can earn up to $39,630 and still be counted as poor. In many industrialized countries, an income of $40,000 would be considered upper middle class.
Most Americans are surprised by the federal income delineation between poor and middle class. Surveys show that the majority imagine the poor are lacking food, shelter, clothing and transportation. They consider poverty to connote that a family is destitute.
But many of America's poor live in luxury compared to their brethren in other parts of the world.
According to Census data, 80.9 percent of the households below the poverty level have cell phones. Nearly 6 in 10 (58.2%) own computers. Practically all (96.1%) have televisions. Almost 80 percent have satellite or cable TV service. Ninety-seven percent have refrigerators. Nine in 10 have microwaves. Most of the world's poor have none of these conveniences.
Those facts were missing from the media's newscasts, but the most glaring omission of all is the spike in unemployment under President Obama's stewardship.
Since Obama assumed office, poverty in the United States has zoomed 16.73 percent. Median income has fallen every year of Obama's reign. Twenty-even percent of African-Americans live at or below the poverty line, the highest since the civil rights movement.
The president gets a pass from the media because he always points the finger at his predecessor, George W. Bush. But his blame-shifting rings hollow after nearly five years in office, billions in stimulus spending and record funding for federal poverty programs.
There is no escaping the fact that poverty has grown worse under President Obama. His own government's measurements prove it. Obama needs to point the finger at himself for a change.
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