Minimum Wage

When Walmart workers went on strike in nine cities last November 29, demanding raises to double their minimum wage, the company did a cost analysis study and showed that if they raised the minimum wage of all their hundreds of thousands of employees to $15 an hour, it would cost more than the profit they took in 2012. The result would have led to either half of the workers being laid off, or a steep increase in the cost of their products in order to keep the stores open, followed by the average shopper being forced to go elsewhere and the beginning of the end of Walmart.

The argument is that corporate owners and CEOs take an unfair amount of their profits while single mothers with two kids have to take two or three minimum wage jobs to make ends meet. Obama continually invokes class warfare with his demands for income equality and closing the gap between the haves and the have-nots. Minimum wage sounds good to people at entry level jobs who don't understand business, or what it took their employers to build the companies they are working for, but it never works in the long run. There are obviously examples of CEOs milking their companies for ungodly personal benefits; GM for example. Capitalist systems are always wide open for corruption because money talks, but free enterprise/"trickle down economics" has made America the wealthiest, most accomplished nation on earth. The answer is not to destroy the system.

The problem is twofold; government interference through taxes and greedy unions. Unions had a purpose when they were started, but they have drifted far from fair wages and safe working conditions. Unions demanding unrealistically high wages of 70 to 80 dollars an hour plus lifelong benefits commensurate with salary at retirement is one of the things that broke GM. The union was so greedy that they preferred to let the company go under and their members lose everything before they would offer a single compromise to save their jobs. But why should they compromise? They had Obama and the government backing them up. You and I, the taxpayers, have lost 10 billion dollars propping up the company. How many GM cars do you have for your investment?

The bigger problem is government taxes and regulations. There are hundreds of thousands of pages of regulations handed down every year. Corporations are forced to hire hundreds of accountants and lawyers just to keep pace. There is part of the cost of your product. The cost of keeping up with OSHA is so great that companies have been forced to outsource to other countries just to stay in business. That's why everything in Walmart is made in China. It's cheaper to build a factory and a warehouse, hire cheap Chinese labor and ship the goods over here than it is to buy American made goods. Thousands of jobs are lost in America because of union greed and overbearing government mandates.

Then there is the ambulance-chasing legal profession that forces everybody with any money to get insurance for their own protection; the pharmaceutical companies that spend millions in advertising for experimental products that are so dangerous they take 30 seconds out of every commercial telling you the side affects to protect themselves; the health insurance debacle, which as bad as it is always made out to be, was still the best in the world, and is now falling apart with Obamacare; and on and on it goes.

The answer is for the Federal government to stop deficit spending, balance the budget, cut corporate taxes, abolish the personal income tax, close down the EPA, the DOE, OSHA, and the IRS, and let the capitalist free enterprise system, common sense, and the American entrepreneur work. The fewer taxes corporations are burdened with the more jobs they can provide. We are 17 trillion dollars in debt. If the government had put that in the bank and saved it, instead of wasting it on the socialist welfare state, they could give every American citizen, all 300 million of us, over 50,000 dollars each. For a family of three that would pay for a nice house. How is that for income equality? That would level the playing field quite well.

In his SOTU Obama pointed at the stock markets and admitted that corporate America is doing better than ever and that the gap between the wealthy and the poor is greater than ever. He used the argument to push inflicting more of his pain on the economy, but if anyone was paying attention, that was an indictment in his own words of the failures of his own policies. The gap has gotten wider under his economic program than ever before, and includes his own 12 million dollar increase in personal wealth. And no, it's not Bush's fault or Reagan's. The 1980s was not the decade of greed. That started with Clinton, grew through Bush, and exploded in 2009 when Obama took office. There will always be greedy people, but with a few exceptions, the problem is not in corporations. It is in the government.

Minimum wage increases sound good to people who don't understand economics, and to leftist, socialist politicians who see easy votes from non-thinking people. The reality, however, is that government required minimum wage increases have always caused the cost of living to go up at a faster rate than those on minimum wage can keep up with. It doesn't work. The answer is to end this goofball politically correct socialist nanny state and let the American people go back to work.