This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Obama's Minimum Wage Ploy Hurts the Working Poor

NEW YORK (TheStreet) -- President Obama put his political fortunes ahead of the least prosperous citizens by badgering Republicans in Congress to raise the minimum wage to $10.10 an hour.

In 1938, Congress established the federal minimum wage and has periodically raised it to accommodate inflation. Currently at $7.25 per hour, it appears woefully inadequate to fair-minded Americans, and the president feeds this sentiment by carping that it's worth 20% less than when Harry Truman was president.

What Obama doesn't tell voters is the minimum is sometimes paid to teenagers bagging groceries and college students on work-study jobs that are essentially masked financial aid. Moreover, adults earning the lowest wages have sources of income not available in Truman's days -- an earned income tax credit, food stamps and Medicaid. And employers of domestic workers now fund social security pensions and unemployment insurance -- an additional 8% in compensation generally not offered in Truman's time.

Liberal newspapers and cable networks are fond of rolling out single mothers, seemingly following the script of union-supported community activists and organizers, who recount they cannot afford to eat earning so little at McDonald's (MCD). Yet, they hardly ever appear malnourished, and correspondents never get around to asking how they use their food stamps or about child support payments they might receive.

Except for apologists for farmers that don't farm and academics hanging off the left edge of reality, economists don't like price fixing, whether perpetrated by unscrupulous businesses or politicians buying votes. After all, agricultural supports raises the price struggling mothers must pay for milk, clothing and other essentials for their families. The minimum wage makes hiring workers more expensive, eliminates jobs at the bottom of the ladder, and generally slows growth and raises unemployment.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $124.75 -1.13%
FB $80.78 -1.86%
GOOG $524.05 -1.83%
TSLA $206.79 0.04%
YHOO $44.45 -2.91%

Markets

DOW 17,826.30 -279.47 -1.54%
S&P 500 2,081.18 -23.81 -1.13%
NASDAQ 4,931.8150 -75.9760 -1.52%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs