One of my favorite things about writing, is trying to come up with different ways to take a complex issue and simplify it for others to understand. I find the Minimum Wage to be one of the most frustrating topics in politics, because the most basic and important law of Economic Science–the law of Supply and Demand–already tells us exactly why setting a minimum price on labor is a bad idea.
But Economics isn’t as interesting to most as it is to me, so I wanted to come up with an example to illustrate the unintended consequences of minimum wage laws, without having to talk about supply and demand. I thought it’d be worthwhile to take a look at what the consequences would be if we were to apply minimum price laws to something we’re all familiar with. Continue reading →
Minimum wage laws are one of the best examples of the negative unintended consequences that often result from good-intention laws that end up hurting the very people they are meant to help. For those who lack the most basic understanding of economics, it may seem like common sense. If there are people who don’t make enough money, why not just pass a law requiring that they be paid more?
Labor as a good
The problem with this approach becomes obvious once we start thinking of labor as just another good that is sold on the market. When we work for an employer we are essentially selling that employer a service. Economic laws apply to this good just as well as they apply to goods like milk, meat, etc, and yet many would agree that there is no need for government intervention when it comes to the price of these other goods. Continue reading →
College tuition costs have been skyrocketing and the more they go up, the more the government tries to help make college more affordable. Americans owe $1 trillion in student loans, even more than they owe in credit card debt. The federal government has been involved in student loans since 1958, either by guaranteeing loans made by private banks or by giving out loans themselves. Tuition rates have been increasing at about twice the rate of inflation, and still, proponents of federal student loans have yet to connect the dots.
Their intentions are good, but the government’s involvement is precisely what has resulted in the rise of tuition costs. Why do schools continue to increase their prices every year? Because they can. The government gives the schools whatever money they ask for, because “we must help everyone get a college degree.” If the government were to give everyone money to buy computers, the price of computers would also skyrocket.
Many on the left defend their support for big government and high taxes by saying that as long as the government is helping society as a whole, they have no problem with it. This position is often used to imply that those that do not hold this belief are heartless, and just plain do not care about helping those who are less fortunate.
While pushing for more government programs and more laws, liberals speak of evil corporations and corrupt businessmen. There is no doubt there are evil people in this world, and that power does corrupt individuals. There certainly are a lot of people out there always trying to get ahead by stepping on others’ rights and by breaking the rules.
My question is this: If businessmen can be corrupt, can not a government official? I mean, we are all people after all. Businessmen are not a different type of species. People, in general, can be evil. Why are liberals not as concerned about the corruption that can erupt from giving those in government, more power? Powerful corporations are bad, but not powerful government officials? Continue reading →
Obama ran on a platform of higher taxes and got re-elected because he was able to convince voters that only ‘other’ people would be affected by his tax increases; that he was the candidate of the poor and middle class, and Romney, the out-of-touch candidate of the rich. The voters bought it. When the most basic economic concepts were presented, Obama called it “trickle down Economics,” convincing voters that the idea that raising taxes on businesses actually hurts the middle class, was some sort of myth.
It’s going to be interesting to see the voters actually feel the effect of their decision. Here is a short list of some of the companies that have announced their plans for layoffs as a result of the ObamaCare provisions that were conveniently set to take effect after the election:
“No matter what some agency may say, we have always been and always will be a triple-A country,” Obama said in a speech recently.
This statement really does say a lot about what Obama thinks actually fixes problems. He might as well be saying “we have always been and always will be immune to the laws of Economic Science.” Is he serious?
This is what you get when a person is right-brain dominant and severely lacks left brain functions. The right side of the brain is the emotional side. It is responsible for feelings, fantasy, and deals with the subjective. The left side of the brain is objective, and is responsible for math and science. It is the logical part of the brain.
Does Obama believe the United States became the greatest country on earth because of its location, or maybe the confidence of its citizens? Does he believe he can follow the same policies as the previous president and end up with a different result, as long as he instills confidence? It’s almost as if he thinks his job is to make people feel good. That is how he got elected in the first place; using vague terms to allow the emotional to construct in their mind whatever image they were in need for. Continue reading →
I came across this video by Jacob Spinney. It does an excellent job of explaining all the different factors that contributed to the economic crisis and completely destroys the myth that the free market was responsible. How can something that does not exist be blamed for what is happening?