Raising The Minimum Wage Hurts America's Youth

If you listen to President Obama, raising the minimum wage is nothing but a win-win situation.  It will pull people out of poverty and strengthen the middle class.  But, whenever the Federal government injects itself into business activities, there are many more losers than there are winners in the process.  And, when it comes to raising the minimum wage, one of the biggest losers is youth employment.

The reason for this is simple.  A higher minimum wage results in unemployed adults (those age 24 and above) being more willing to compete with unemployed youths (those16 to 24 years of age) for entry-level job openings. In turn, employers are more likely to hire adults with proven work records versus young people with little or no work experience.

To prove my point, you need only look at a couple of charts.  The first chart is that of the Civilian Unemployment rate for the years 2007 through and including all of 2011. (Note: the chart and its data are extracted from FRED - the Federal Reserve's economic database. The red notations are mine.).

In the world of economics,  the measurement of unemployment rates is considered a "lagging" indicator.  This means that, when there is an economic downturn, like a recession, it takes a few months into the recession before employers actually realize that their businesses are being hurt and they need to start laying people off.  Then, when a recession ends, there is a similar lag before employers start rehiring again and the unemployment rate declines. On this chart, I have noted these "lags" in red.  But, there's something odd about this chart.  In May of 2007, the unemployment rate uncharacteristically rose prior to the recession; moving from a low of 4.4% to 5% before leveling off in late 2007. 

To understand what was happening in 2007, you need to look at a similar chart of youth unemployment; which is a subset of the above chart.

Now, unlike the prior chart, I've included 2006 data to show just how flat the Youth Unemployment Rate was in the year prior to 2007.  But, in 2007, there was a dramatic increase; months before the recession hit.  The sole reason behind this was the passage and implementation of the Fair Minimum Wage Act of 2007 where the minimum wage went from $5.15 an hour to $5.85 in 2007; upped again to $6.55 an hour in 2008; and, again, in 2009 to the current rate of $7.25/hour.

Further proof that adults have been literally "stealing" entry-level jobs away from our nation's youth comes from how slow youth unemployment has recovered in comparison to overall unemployment.  In 2010, both youth unemployment and overall unemployment rates topped out.  Since then, general unemployment has been lowered to a 7% rate from its high of 10.1%; a 31% improvement.  On the other hand, youth unemployment has only moved downward from a height of 18.4% to the current rate of 16.5%; a mere 10.3% improvement. 

The problem with sustained high youth unemployment is the fact that society, in general, is jeopardized.  For one, idle youths due to high unemployment rates have resulted in a 40% rise in gang membership in the period 2009 to 2012; as reported by the FBI.  And, I'm quite sure that trend didn't abate in 2013.

Additionally, social programs like Social Security and Medicare are highly dependent on a broad base of younger workers paying into these systems in order to support the high cost of retiring workers.  Without younger workers in the workforce, the two programs could go bankrupt a lot earlier than projected.  More importantly, the increase in the minimum wage and, the sustained high rate of youth unemployment, may be creating a permanent underclass of marginally employable workers or totally unemployable workers who will be stuck in poverty for their whole lives.  Just the opposite of Obama's belief that raising the minimum wage will pull people out of poverty.  To that point, the high youth unemployment rate may be one of the primary reasons why the record high number of people in poverty, 46.5 million, hasn't come down one iota since 2010.  This at a time when general unemployment has improved by more than 30%:

Besides what I've shown above, there have been dozens of research studies that have proven that raising the minimum wage costs jobs and hurts the economy; but, liberals like the President, and other activists, continue to ignore the truth.

Obama's Predictions On The Sequester Never Came True

Back in February, our big-government and big-spending President predicted dire consequences if the $85.4 billion in Sequester spending cuts went into effect on March 1.  He said it would cost jobs and could harm our fragile economy.  Despite his warnings, the Sequester automatically kicked in because Congress could not come up with an alternative budget agreement.

So, the President, in order to prove how right he was, decided to make the cuts as obvious and painful to Americans as possible while completely laying the blame at the feet of the Republicans.   He shut down the White House tours.  He closed federal parks. The Blue Angels and Thunderbirds were grounded.  Even tax refund checks were delayed; and, the list goes on.

But what has really happened since sequestration?

Well, the economy has grown at the fastest pace in 2 years with Gross Domestic Product (GDP) moving from a snail's pace of 1.8% in the first quarter of 2013; to 2.5% in the 2nd quarter; then, galloped to 4.1% in the 3rd quarter.  In another measure of economic growth, Federal tax revenues hit a record high of $2.47 trillion this year; up $285 billion from the prior year.  Then, contrary to the Obama prediction, the unemployment rate fell from 7.7% in February to 7% in November.  This was the lowest rate since March of 2009.

Lastly, the very same President who condemned the Sequester spending cuts back in February, has now decided to take credit for those same spending reductions and the resulting deficit reduction.  On July 24th, in front of an adoring crowd at Knoxville College in Illinois, he proudly proclaimed: "Our deficits are falling at the fastest rate in 60 years."

You see, with Barack Obama, everything is either a shading of the truth, a half-truth, or an out-and-out lie.  The fact is that the Sequester cuts were a mere pin-prick against the massive spending levels that  he has created.  They were not going to have some enormous impact on the economy or on unemployment.  Also, the idea of the Sequester, itself, originated out of Obama's White House. No way could the Republicans be blamed for it.  And, to take credit for the reduction in the deficit is just plain hypocrisy.

Losing Your Doctor Is The Real Plan In ObamaCare

As Reported by NBC, the Obama Administration knew as of March 2010 that approximately 93 million Americans would lose their existing health insurance plans once ObamaCare was fully implemented.  In fact, they published that very fact in the Federal Register. But, who of us actually reads the thousands of pages of the Federal Register that are published each year?

Because ObamaCare hasn't been fully implemented with the Employer, Corporate, and Small Business mandates yet to come, only about 5.9 million have actually lost their insurance and have been forced to seek coverage through the ObamaCare exchanges.  Of those 5.9 million who have navigated the website and found a plan, the most recurring comment that you hear is that they lost their doctor or doctors or even their hospital or hospitals.  This is intentional.

Actually, the architects of ObamaCare are less interested in whether or not you lose your doctor and more interested in your doctor losing you.  In their scheme of things, if enough doctors lose their patients, they will be forced to change their operational business models to treat more patients at a lower cost or, they will be forced out of business for lack of not having enough patients to cover their operating expenses.  Medical specialists, for the same reason, could also be forced back into being general practitioners.

The push here is not quality of care.  It's all about lowering costs by instituting "cattle-car" health care for Americans.  In essence, the kind of care that people are buying into in these ObamaCare exchanges is literally a form of Medicaid in the private sector, and, like Medicaid, probably only about 56% of the doctors in the U.S. will take patients in the Exchange.  But, more importantly, your life could be at risk.  The University of Virginia reviewed nearly 900,000 surgical records of Medicaid patients and compared the results with both insured and uninsured patients.  They found Medicaid patients were nearly twice as likely to die either during surgery or in recovery than people with insurance.  Their stay in the hospital, due to complications, was typically 42% longer and the overall costs were 26% higher than that of insured patients.

Lastly, in trying to sidestep the lie that "if you like your insurance, you can keep your insurance", Obama is now saying that people were losing their insurance because those plans were "substandard".   Well, I would rather keep my substandard insurance plan and receive quality healthcare than have Mr. Obama's more expansive but more expensive health plans that few doctors and hospitals will accept.

Will The Kelly File Dethrone The O'Reilly Factor?

Megyn Kelly debuted her new evening show, The Kelly File, on the Fox News Channel on October 7th of this year.

That night, the O'Reilly Factor, at the 8PM time slot, attracted 2.589 million viewers. With the the size of O'Reilly audience being a potential lead-in to Megyn's show at the 9PM slot, Kelly only managed to hold 2.066 million.  The following night, Megyn managed to hold 2.767 million of the 2.978 million watching O'Reilly; a difference of only 211,000 viewers.  But, every night since, Megyn's audience has grown slowly.  For example, look at last Thursday's ratings from the ZAP2it website:

The gap is now down to 146,000, with Megyn actually beating O'Reilly in the 35-64 year-old demo.

I think O'Reilly will at some-point lose his prime-time title.  I personally don't watch the show anymore because I can't take the constant "set-up" of confrontations and his overall arrogance.  Having followed his ratings in the past, O'Reilly's 8PM slot used to consistently attract 3 to 3.4 million viewers on a regular basis.  But now, more often than not, his viewership is under 3 million; as noted in the second paragraph above.

Pajama Boy To The Rescue!

Obama and company know that if they don't attract a bunch of healthy young people under the age of 35 into the health exchanges, the premiums for ObamaCare's insurance policies will literally go through the roof.  So, to attract the youth-class of America into their health care scheme, they decided to create a "face" of ObamaCare that every person under the age of 35 could relate to.  Enter "Pajama Boy:

Looking like a barely post pubescent Woody Allen,  Pajama Boy is all warm in cozy in his favorite footy, flap-back and zippered-up PJ's that he's owned since he was 16.  His mom has taken such good care of all of his clothes!  Now 27, jobless, still living with mommy and daddy, he's been booted off their health insurance plan and has to man-up and find some of his own.  Luckily, there is the ObamaCare website. So, after awaking just after noon on the day that this picture was taken, mommy fixed him his favorite breakfast: OJ and Cap'n Crunch.

He then spent the next two hours trying to navigate the ObamaCare website and eventually found out that, because he was unemployed, he was automatically enrolled in Medicaid.  WOW!  Free, taxpayer-paid healthcare!  So excited, he ran and told mom and, in celebration, she whipped up a batch of hot cocoa (as seen in the picture).  Life was good again. On finishing his cocoa, he was so exhausted  he literally had to go back to bed.  In a world according to Pajama Boy, PJ's have to work double time.

Of course, what Pajama Boy doesn't understand is that the doctors and hospitals who typically serve Medicaid patients are primarily located in the most economically depressed areas of our cities.  Looking at his leather-strapped wrist watch and leather couch, my guess is that, in order to get his healthcare,  he's going to have to drag his lily-white, upper-suburban-class ass to some pretty seedy areas of whatever urban area he lives in.  But, even if he didn't get signed up for Medicaid, it appears that the same doctors who are willing to accept underpayment for their services from Medicaid are those also willing to participate in the ObamaCare exchanges.  That's why so many people, who have been forced to sign up, can't keep their doctors or their hospitals.

The reality is that most young, healthy people are not going to sign up for ObamaCare if they have to pay any substantial amount for their premiums.  They'll just pay the penalty (Oh, sorry, its not a penalty, its a tax.).   That's because they know that, even if they do get sick, they can just sign up for insurance that same day because no insurer can deny them insurance for any pre-existing condition.  Also, no hospital that takes Medicare can refuse to treat them regardless of whether or not they have the ability to pay or are even covered by any insurance.  That's been the case since 1986 when Reagan signed into law the Emergency Medical Treatment and Active Labor Act.  In fact, the law goes on to state that no one, whether a U.S. citizen or not, can be denied treatment.  That's why our emergency rooms are so clogged up with illegal aliens needing medical care.

"Cutting Through The Fog" Returns

Just about a year ago, I stopped writing any entries to this blog.  I did so because, as a conservative blogger, I saw a dramatic drop-off in traffic data following Obama's win in November.  But, a lot has changed in the last year with Obama being exposed as a liar and his approval ratings tanking.  Even though I hadn't written a single entry in the last year, my previous blog entries regarding Obama's deceptions are again seeing interest.  So, I've decided to start writing again to expose the falsehoods that I see, everyday, coming out of the current Administration and the Democrats of Congress.