By Skip Chatterson - January 28, 2014
Tonight President Obama will announce that he will make the minimum wage for a federal contracts $10.10/hour. This is nearly $3 more than the current minimum wage throughout the US.
While this sounds goodhearted it will come out of your pocketbook. What will happen now, is all companies bidding federal contracts will raise their bids to make up for the difference. The lowest of a higher bid is the winner, but the taxpayer is the loser.
Honestly it’s not that simple. Most workers in most companies that bid for federal contracts do not hire people at minimum wage. Most workers are actually skilled to some degree and make more than the minimum wage. Possibly just above the $10.10/per hour dictated minimum wage. My son who is 16 is paid $9.25/hr as an unskilled retail worker, $2 more than minimum. So what of those workers that are making just more than the new minimum wage of $10.10? Will they be happy when an unskilled worker is making nearly as much as they are? Probably not. This will push all wages up, thus pushing bids up. Not a problem for the government, they just take more from us, who have not had a pay increase since Obama has been president. That’s fair, right?
Admittedly, raising the minimum wage is probably fair, only because the cost of living has increased dramatically in the last 5 years (notice how much more you are spending for groceries?). Doing that will only raise the cost of living more though, as workers are paid more and cost per product increases. Economics 101, but every liberal has failed that course.
If Obama really wants to help the poor and middle class, cut federal spending!! It would also be helpful to reverse many of the regulations Obama has enacted. The deficit has been hurting the poor and the middle class by driving up inflation. As our debt increases the fed creates more money out of fairy dust, thus devaluing the dollar. If Obama stops or decreases the fed debt and reverses his regulations the economy will pick up, hiring will pick up and the cost of living will drop. Unfortunately, Obama will not do that, because that would be putting faith in the free market and socialists like him only worship at the altar of Big Government.