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Monday, June 26, 2017

Funny Thing About Economics....

It's a funny thing about economics:  certain rules always apply no matter what the politicians and the ideologues say.  For example, if you raise the price charged for something, people and businesses will try to use less of it in order to save money.  This is basic economics, and nothing and no one is immune to the rule's effect.

I was reminded of this tonight when I read about a study done regarding the effect of the new $15 per hour minimum wage in Seattle.  The study was done by a local college professor who is quite liberal in his politics.  His findings were that after Seattle raised the minimum wage to fifteen bucks per hour, businesses responded by cutting hours for employees, automating certain jobs, and (in small businesses) having the owners do more work themselves.  The hourly wage went up for those on the minimum wage, but as a group their weekly incomes went down substantially.  The new minimum wage made labor more expensive, so employers found ways to use less of it.

Think about that.  For the last five years, the only proposal that Democrats have had regarding how to deal with income inequality and a stagnant economy has been to raise the minimum wage.  Seattle, which is part of the liberal Democrat homeland, went all in and raised the minimum wage by a lot.  And what did it do?  It caused greater income inequality as the poor saw their incomes DECLINE.  It had no effect on the Seattle economy.

The real truth is that no matter what lie the Democrats push, the basic rules of economics still apply to life.  These are rules that cannot be dismissed or reversed with legislation.  Hopefully, some day the Democrats will realize this.

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