Among the issues most commonly discussed are individuality, the rights of the individual, the limits of legitimate government, morality, history, economics, government policy, science, business, education, health care, energy, and man-made global warming evaluations. My posts are aimed at thinking, intelligent individuals, whose comments are very welcome.

"No matter how vast your knowledge or how modest, it is your own mind that has to acquire it." Ayn Rand

27 August 2008

Democrats Create Unemployment Before Election

As preparation for the upcoming Presidential election, the Democrats have arranged for an increase in the unemployment rate. This allows them to claim that under President Bush the economy has gone sour and unemployment has gone up. For almost the entirety of President Bush's presidency, unemployment has been remarkably low. This would have been awkward for the Democrats going into the election. They fixed the problem by increasing the minimum wage! The unemployment rate has now risen to 5.7%.

Compared to the unemployment rates in the more socialist countries of Europe, this is a very low unemployment rate still. But the average unemployment rate in 2006 was 4.6% and it was again 4.6% in 2007. Such rates were very low and the July rate of 5.7% seems high in comparison.

In 2007, the minimum wage rate was $5.15/hour. The minimum wage law passed by the Democratic Congress has already raised the minimum wage rate twice, with the rate most recently raised in July 2008 to $6.55/hour. It will rise again to $7.25/hour in January 2009. Not surprisingly, teenage unemployment has risen by 2.2% to a rate of 20.3%. The rate for workers over 20 years old has increased only very slightly and it has actually fallen for women over 20. Ed Feulner, president of the Heritage Foundation published a commentary in the Washington Times on 26 August 2008 on this subject entitled "Rolling back government."

As I have noted before, raising the minimum wage rate is a sure way to cause employers to hire fewer young people, especially those with the worst educations and the worst job ethics. These potential workers are far more likely than most to come from families whom the Democrats pose as the champions for. These young workers desperately need the experience of holding a job and obtaining on-the-job training, but the Democrats deny that opportunity to them by insisting on raising the minimum wage rate by law. Over and over they have put under-educated and often under-parented young people out of work or made it extremely difficult for them to find work. These Democrats claim to be raising the minimum wage rate for everyone's good, but it is historically and thinkably clear that what they really do is put people out of work. They are busy preventing young people from getting the on-the-job training that they desperately need.

Why do they do this? Because it is an easy way to pose as do-gooders, since few people stop to think that you cannot evade the requirement that the worker must be able to earn the money he is to be paid. The employing company must make enough more money as a result of the hire to be able to afford the worker's pay, benefits, all payroll taxes and insurance, all capital costs, and all other overhead costs. Rules of supply and demand rule even if Congress tries to intervene. This is inescapably clear by now, yet Congress persists in a minimum wage rate fraud.

There is a second reason. Most people have an exaggerated idea that whatever happens under a president's administration is due to his actions, when outside of defense and foreign policy, it is really usually the Congress which has more impact on what happened. Sometimes, neither Congress nor the President were major causal factors, but the public tends to suppose that they were. Congress plays upon the idea that the President is responsible for all things economic by causing mischief when they want a poor economy to make it easier for them to get a Democrat elected President. Causing unemployment to go up by increasing the minimum wage prior to an election works great for this purpose.

Be wary of a lack of scruples in most politicians. People in this era of big government are too often drawn to politics by a desire to enjoy the powers of ruling and the ability to do so for their own gain. But above all, do not underestimate the unscrupulous nature of Democrat politicians.

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