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Change in priorities necessary; Philip S. Dedig; Beaver County Times; August 4, 2013. At the time of this writing, this letter appeared only in the print edition of the BCT. I apologize for any transcription errors.
Mr. Dedig has written at least 22 letters since February 2008. Among those letters, Mr. Dedig supported the proposed federal gasoline tax holiday, Hillary Clinton for President, complained about “business as usual” (“Business as usual in D.C.,” 6/17/08) in Washington, DC, regarding energy, opposed offshore drilling, said Democrat voters deserve better candidates (“Local Democratic voters merit better,” 8/22/08), supported “bailing out Freddie Mac and Fannie Mae” (“Fed, Treasury had to move;” 9/30/08), told us we had “No choice but to help auto makers,” told us “College costs must be made affordable,” supported the $787 billion “stimulus” package (here and here), told us “U.S. can afford health care for all,” and claimed “U.S. Rep. Jason Altmire is a Republican in sheep’s clothing.” Mr. Dedig’s most recent letters were “States should determine gun laws,” “Obama policies working,” “Recovery on the way,” “Pipeline not good idea,” “Energy policy long overdue,” and “Obama caves in far too easily.” If it’s a leftist position, Mr. Dedig supports it.
Below is a detailed critique of the subject letter.
“Wages in the United States have not kept pace with the economic recovery and are 2.2% below post-recession levels. This is due to an oversupply of labor and a recovery that has produced mostly low wage jobs.”
[RWC] Nine months ago, Mr. Dedig told us “Obama policies working” and in July 2012 he told us “Recovery on the way.”
At no point does Mr. Dedig attempt to tell us why we have “a recovery that has produced mostly low wage jobs.”
If you care about Mr. Dedig’s factoids, which he provides without citation, I suggest you check them with credible sources.
“The higher than normal unemployment rate has reduced bargaining power for higher wages, and workers tend to feel fortunate to have a steady job.”
[RWC] No kidding.
“Low-wage jobs accounted for 21% of job losses during the recession, but 58% of the job gains during the recovery. Mid-range jobs lost 60% of their jobs during the recession, but recovered only 21% of those jobs.
“Some 7.8 million workers are holding part-time jobs because they can’t find full-time work.
“Nationally, 40% of U.S. workers make less than the 1968 minimum wage, adjusted for inflation. Low-wage jobs can be made better by raising the minimum wage. Raising the minimum wage has had little effect on the unemployment rate in the past.”
[RWC] Please read my paper “The Minimum Wage.”
The idea “raising the minimum wage has had little effect on the unemployment rate in the past” defies logic and Mr. Dedig presents no data to support his claim. The economic value of a job determines the total compensation an employer can offer an employee while providing the business with its evil <g> target profit. If the economic value of a job to an employer is less than the minimum wage, that job won’t exist. Stating the obvious, employers can’t stay in business and pay more than a job is worth. Note: The impact of an increase in the minimum wage may go unnoticed during a booming and growing cycle (not where we are now) of an economy, but it will have a negative effect on the next economic downturn.
“The nation has to change its priorities in order to create mid-weight range jobs. The country needs to greatly increase its investment in infrastructure, education and green energy, which are higher-paying jobs.”
[RWC] I’m confused. Didn’t the Obama administration declare the summer of 2010 to be “Recovery Summer?”
Seriously, though, there’s not much to say other than everything Mr. Dedig wrote about has been done already and did not work, just as the same thinking did not work for FDR. In the realm of “green energy,” we had Solyndra, A123 Systems, Ener1, Abound Solar, et cetera. As a reminder, these four companies eventually filed for bankruptcy after receiving hundreds of millions of dollars in grants/subsidies/loan guarantees paid for by local, state, and federal taxpayers. It appears Solyndra alone will cost federal taxpayers about $528 million and tax-credit sweeteners thrown in to attract private investors could cost us a few hundred million dollars more. Adding insult to injury, A123 Systems (Red Chinese) and Ener1 (Russian) went under foreign ownership as part of their bankruptcy proceedings.
© 2004-2013 Robert W. Cox, all rights reserved.