Best of the Week
Most Popular
1.London House Prices Bubble, Debt Slavery, Crimea 2.0 - Russia Ukraine Annexation - Nadeem_Walayat
2. Gold And Silver – 2014 Coud Be A Yawner; Be Prepared For A Surprise - Michael_Noonan
3.Sheffield, Rotherham Roma Benefits Plague, Ch5 Documentary Gypsies on Benefits & Proud - Nadeem_Walayat
4.Glaring Q.E. Failure Spotted - Money Velocity Is Falling Rapidly - Jim_Willie_CB
5.Don't Miss the Boat on Big Biotech Catalysts: Keith Markey - Keith Markey
6.Gold Prices 2014: Do What Goldman Does, Not What It Says - David Zeiler
7.Bitcoin Price Strong Appreciation to Be Followed by Declines? - Mike_McAra
8.Gold Preparing to Launch as U.S. Dollar Drops to Key Support - Jason_Hamlin
9.Doctor Doom on the Fiat Money Empire Coming Financial Crisis - Andrew_McKillop
10.The Real Purpose Of QE - It’s Not Employment - Darryl_R_Schoon
Last 72 Hrs
The Big, Bad Market: A French Psychosis? - 25th Apr 14
The Great American Giveaway - 25th Apr 14
Has the Stock Market S&P Topped At Exactly The Same Price As Gold? - 25th Apr 14
Bond Market Investing - Not All Debt Is Created Equal - 25th Apr 14
This is the Next “Big Thing” in Energy - 24th Apr 14
Rome Wasn't Burnt In A Day - 24th Apr 14
When Does Government Policy Become Criminal Behavior? - 24th Apr 14
The Great Recession Grinds On - Measuring Misery around the World - 24th Apr 14
Apple, Facebook Beat Expectations - Stock Markets Long-term Recap - 24th Apr 14
Broad Stock Market Situation on the Remains Tense as Companies Release Quarterly Earnings - 24th Apr 14
How High-Frequency Traders Use Dark Pools to Cheat Investors - 24th Apr 14
Stock Market Bears Wrong Again, Apple to Push Dow to New All time High - 24th Apr 14
Gold Prepared for the Attack of the Short Sellers - 24th Apr 14
Weak U.S. Housing Data Supports Euro - 24th Apr 14
Killing the Maximum-Wage Myth - 23rd Apr 14
U.S. Quarterly Economic Review - Optimism at the Fed - 23rd Apr 14
Why Mohamed El-Erian Left Pimco - Video - 23rd Apr 14
QE Is A Fraud Perpetrated By Made Men - 23rd Apr 14
Gold and Miners Outperform Once Again - 23rd Apr 14
G-20 and the US Tell the Bank of Japan to End Quantitative Easing - 23rd Apr 14
How to Get in the Trading Game and Profit - 23rd Apr 14
Fed Follies, U.S. Housing Market Fiasco - 23rd Apr 14
What Will December 31, 2014 Financial Headlines Look Like? - 23rd Apr 14
Why Gasoline Prices are Surging Again - 22nd Apr 14
Cold War 2.0 - 22nd Apr 14
The JIS – Junk Ideology Syndrome - 22nd Apr 14
How to Avoid Losing All Your Money - 22nd Apr 14
Silver Up, Stocks S&P Down - 22nd Apr 14
U.S. Mainstream Media Propaganda Setting the Stage for War With Pakistan - 22nd Apr 14
U.S. Interest Rates are NOT Rising! - 22nd Apr 14
A Crisis vs. the REAL Crisis: Keep Your Eye on the Debt Ball - 22nd Apr 14
Bitcoin Implications of Lack of Price Action - 22nd Apr 14
Japan - The Twilight Of The Rising Sun - 22nd Apr 14
Is This What a Credit Bubble Looks Like? - 22nd Apr 14
The Dark Side Of The Silver Mining Industry - 21st Apr 14
Strong U.S. Dollar Rally Could Pull Rug From Under Gold and Silver - 21st Apr 14
Silver Feeble Rally Fails to Hold Breakout, Falling Back Towards Support - 21st Apr 14
Stock Market Smart Money – All Out or More to Go? - 21st Apr 14
Fast Rising Pump Prices Counterattack - 21st Apr 14
Extreme Climate Change And Life On This Planet - 21st Apr 14
Gold and Silver Stocks Sitting Tight - 21st Apr 14
Stock Market Minor Correction Imminent - 21st Apr 14

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Obama's New Minimum Wage Will Eliminate At Least 467,000 Jobs

Politics / Unemployment Feb 15, 2013 - 03:06 PM GMT

By: Money_Morning

Politics

Ben Gersten writes: In his State of the Union address Tuesday night, President Barack Obama urged Congress to raise the minimum wage from $7.25 to $9, saying the move would reduce poverty and stimulate the economy.

"Tonight, let's declare that in the wealthiest nation on Earth, no one who works full-time should have to live in poverty, and raise the federal minimum wage to $9 an hour," President Obama said. "This single step would raise the incomes of millions of working families. It could mean the difference between groceries or the food bank, rent or eviction, scraping by or finally getting ahead.


"For businesses across the country, it would mean customers with more money in their pockets. And a whole lot of folks out there would probably need less help from government."

Unions and labor advocates are among the chief supporters of an increase in the federally mandated minimum wage.

"The president said he was putting jobs and the economy front and center tonight, and that's exactly what he did by calling for a minimum wage increase," Christine Owens, executive director of the National Employment Law Project, said in a statement.

"A higher minimum wage is key to getting the economy back on track for working people and the middle class. The president's remarks also cement the growing consensus on the left and right that one of the best ways to get the economy going again is to put money in the pockets of people who work."

But opponents of raising the federally mandated minimum wage have a decidedly different view of the president's proposal.

Would Raising Minimum Wage Cost Jobs?
Critics argue increasing the minimum wage would raise businesses' costs and, in turn, reduce the number of employees they could hire.

"I've been dealing with the minimum wage issue for the last 28 years that I've been in elected office," House Speaker John Boehner, R-OH, told reporters. "And when you raise the price of employment, guess what happens? You get less of it."

The minimum wage increase proposed by President Obama would eliminate at least 467,000 jobs at a time when the country already has a 7.9% unemployment rate, according to research by economists at Cornell and American Universities published in the Southern Economic Journal.

The Employment Policies Institute, a fiscally conservative organization that tracks entry-level employment, has found in multiple studies minimum wage increases have led to job losses and failed to reduce poverty or stimulate the economy, Michael Saltsman, research director at the Employment Policies Institute, told Fox Business.

Saltsman said President Obama's proposed minimum wage hike would have the same effects.

"Using a minimum wage increase to create jobs is like using an oven to create ice cubes - it just doesn't work," Saltsman said, adding that President Obama "needs to lower barriers to hiring, not raise them."

And Federal Reserve Vice Chairwoman Janet Yellen, an Obama supporter who opposes the minimum wage increase, said the proposal "wouldn't address one of the big problems holding back the economy, which is tepid spending and investment by households and businesses."

In the past, raising the minimum wage has not helped reduce unemployment.

Raising the minimum wage in 1980 and again in 1981, for instance, did not prevent the unemployment rate from increasing to 10.4% by the start of 1984.

And not increasing the minimum wage doesn't appear to have affected the unemployment rate.

From 1997 to 2007, there was no increase in the minimum wage and overall unemployment stayed below 5% while youth unemployment (ages 16-24) remained around 10%.

Now critics worry raising the minimum wage again will slow down our fragile economy.

"A minimum wage hike right now would be one more factor driving up costs for employers and creating headwinds for job creation, especially among the small businesses that create most of our nation's new jobs," David French, senior vice president for

government relations at the National Retail Federation, said in a statement.

Source :http://moneymorning.com/2013/02/14/minimum-wage-increase-obamas-proposal-and-realities/

Money Morning/The Money Map Report

©2013 Monument Street Publishing. All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Monument Street Publishing. 105 West Monument Street, Baltimore MD 21201, Email: customerservice@moneymorning.com

Disclaimer: Nothing published by Money Morning should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investent advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication, or after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Money Morning should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Money Morning Archive

© 2005-2014 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Free Report - Financial Markets 2014