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Thursday, February 20, 2014

The CBO exposes the fallacies of hiking the minimum wage

The CBO exposes the fallacies of hiking the minimum wage

By The Tribune-Review 
412-321-6460

Published: Wednesday, Feb. 19, 2014, 9:00 p.m.
Updated 18 hours ago

Obamanomics is a particularly pungent “progressive” economic philosophy whose devotees fervently believe that government can command the economy, much as a wizard magically makes all well in a Saturday morning cartoon. Not only are the immutable laws of economics not applicable, they are openly derided.

The doctrine is rooted in illiberal (as in uncultured) hubris that mocks the humility required to understand and respect the true nature, power and, yes, magic of markets.

We've seen what's no more than a conceited theology put into practice with everything from (but not limited to) the failed Cash for Clunkers program and the failing ObamaCare law to the contention that food stamps and unemployment benefits stimulate the economy. And just this week, the Obamanomics preachers again were exposed as little more than snake handlers.

On Tuesday, the Congressional Budget Office (CBO) stated the obvious: The Obama administration's proposal to raise the federal minimum wage by 40 percent — from $7.25 an hour to $10.10 — would lead to the elimination of 500,000 jobs and leave up to 1 million people unemployed.

The chief mouthpiece for Obamanomics, Jason Furman, chairman of the White House Council of Economic Advisers, was quick to tut-tut it all with his wacky wizard's wand, citing a mythical “consensus view of economists” in a “bulk of academic studies.” Others impugned the credibility of the CBO, never mind that this supposedly nonpartisan office often leans to the left.

The bottom line, concludes Michael Saltsman, research director of the Employment Policies Institute: The truly impoverished will not enjoy a large share of any higher earnings but they will bear the brunt of increased unemployment.

It's past time to stop entertaining the bad fictions of “progressives.”

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