L.A.’s Minimum Wage Law Hurts Poor/Middle-Class People

Larry Elder interview Dr. Joel Strom on exactly how and whom the arbitrary raising of wage will hurt the poor and middle-class dental patient. You can read more on the minimum wage law at my site, here.

  • Dr. Strom’s website is here.
  • You can also connect with him via Twitter.
  • Also, here is a video bio of Dr. Strom.

Here is part of the article in discussion from The Daily News:

…This crunch is causing many of them to withdraw from Denti-Cal or sell their offices to the larger corporate dental conglomerates.

Those very same corporate entities are now cutting the depth and breadth of their involvement in the Denti-Cal program as well; one large chain of dental offices recently reduced their payrolls by 200 and cut the amount of new Denti-Cal patients they will accept.

At the same time, independent doctors and dentists simply can’t afford to stay enrolled in the program. Most of us need to employ a full-time employee just to manage the process of seeking reimbursement from the state government, which is a time-consuming process that can eat up more than 20 percent of an office’s costs. Yet many times, despite receiving pre-approvals, payment is delayed or sometimes denied by the state. Nor does it help that California reimbursement rates are some of the lowest in the nation.

These factors, when combined, have caused the majority of dentists to refuse to participate in Denti-Cal. Ten years ago, only a third of L.A. dentists participated in the program. Today, that number is believed to be far smaller. In fact, many dentists choose to deliver free care to a set number of patients rather than fill out paperwork, wait months to receive payments, or suffer the setback of not receiving anything at all.

[….]

And that’s where the minimum wage hike comes into play. About the only option available to these small business owners is to maintain consistent and lower payroll, including many times paying administrative staff between 20 and 30 percent less than a $15 new minimum wage. A substantial increase in wages will most certainly translate to increased business costs — costs which, thanks to state law, we can’t legally include in our pricing structure.

As a result, many low-income Angelenos now stand to lose access to the health care and dental care that they need. A $15 minimum wage may help some people, but it is undeniable that it will also harm many of them, as well. Where will the unintended consequences end?

Minimum Wage Fail ~ McDonald’s Goes Hi-Tech!

Via BizPic! See my “Minimum Wage” post, which this is partly an update to:

While it seems liberals may think that raising the minimum wage will raise living standards for poor Americans, they should have seen this coming.

With Los Angeles joining Seattle in setting a $15 minimum wage (Los Angeles by 2020, and Seattle by 2021), it stands to reason that McDonald’s would find a way around simply paying workers more, as Vox pointed out the obvious fact that “the reality is that McDonald’s just wants to make money.”

In a very real-world example of big business’ response to liberal policies, a conservative Twitter user sent Labor Day wishes from McDonald’s workers whose minimum wage never goes up.

RPT Will Not Be Pulling for Dr. Carson in the Primaries (UPDATED)

Contents:

The following is just a couple reasons I am not a fan of Dr. Benjamin Carson in the 2016 Republican primaries. Now, this is of a different tone than my rejection of Ron Paul in years past. At worst Ron Paul is an anti-Semite, even going as far as thinking we were behind 9/11. At best he surrounds his professional career with anti-Semites and 9/11 conspiracy types. A “guilt by proxy” idea, which is more powerful than “guilt by association.”

This post is different however. I like Dr. Ben Carson. I think he would do great in a position like the head of NIH (National Institute of Health), or as head of HHS (Health and Human Services). He would be very effective in an area like that to be front and center in explaining how the implementation of Obama-care is devastating the health industry as well as the patient/doctor relationship.

This post is merely me saying that Dr. Ben Carson is not Presidential material. And the reasons are economics, environment, foreign policy, and being able to respond well to cultural issues.

Let’s start with economics:

Minimum Wage

Here is a recent CATO article responding to a Robert Reich video about raising the minimum wage:

…Perhaps the most remarkable flaw in this video is Reich’s manner of addressing the bedrock economic objection to the minimum wage – namely, that minimum wage prices some low-skilled workers out of jobs.  Ignoring supply-and-demand analysis (which depicts the correct common-sense understanding that the higher the minimum wage, the lower is the quantity of unskilled workers that firms can profitably employ), Reich asserts that a higher minimum wage enables workers to spend more money on consumer goods which, in turn, prompts employers to hire more workers.  Reich apparently believes that his ability to describe and draw such a “virtuous circle” of increased spending and hiring is reason enough to dismiss the concerns of “scare-mongers” (his term) who worry that raising the price of unskilled labor makes such labor less attractive to employers.

Ignore (as Reich does) that any additional amounts paid in total to workers mean lower profits for firms or higher prices paid by consumers – and, thus, less spending elsewhere in the economy by people other than the higher-paid workers.

Ignore (as Reich does) the extraordinarily low probability that workers who are paid a higher minimum wage will spend all of their additional earnings on goods and services produced by minimum-wage workers.

Ignore (as Reich does) the impossibility of making people richer simply by having them circulate amongst themselves a larger quantity of money.  (If Reich is correct that raising the minimum wage by $7.75 per hour will do nothing but enrich all low-wage workers to the tune of $7.75 per hour because workers will spend all of their additional earnings in ways that make it profitable for their employers to pay them an additional $7.75 per hour, then it can legitimately be asked: Why not raise the minimum wage to $150 per hour?  If higher minimum wages are fully returned to employers in the form of higher spending by workers as Reich theorizes, then there is no obvious limit to the amount by which government can hike the minimum wage before risking an increase in unemployment.)

Focus instead on Reich’s apparent complete ignorance of the important concept of the elasticity of demand for labor.  This concept refers to the responsiveness of employers to changes in wage rates.  It’s true that if employers’ demand for unskilled workers is “inelastic,” then a higher minimum wage would indeed put more money into the pockets of unskilled workers as a group.  The increased pay of workers who keep their jobs more than offsets the lower pay of worker who lose their jobs.  Workers as a group could then spend more in total.  But if employers’ demand for unskilled workers is “elastic,” then raising the minimum wage reduces, rather than increases, the amount of money in the pockets of unskilled workers as a group.  When the demand for labor is elastic, the higher pay of those workers fortunate enough to keep their jobs is more than offset by the lower pay of workers who lose their jobs.  So total spending by minimum-wage workers would likely fall, not rise.

By completely ignoring elasticity, Reich assumes his conclusion.  That is, he simply assumes that raising the minimum wage raises the total pay of unskilled workers (and, thereby, raises the total spending of such workers).  Yet whether or not raising the minimum wage has this effect is among the core issues in the debate over the merits of minimum-wage legislation.  Even if (contrary to fact) increased spending by unskilled workers were sufficient to bootstrap up the employment of such workers, raising the minimum wage might well reduce the total amount of money paid to unskilled workers and, thus, lower their spending….

…read more…

Homesexuality

Dr. Carson’s positions and responses to key issues facing our Republic are lacking depth. As a medical professional he should have had a better answer when asked about homosexuality other than:

  • “Because a lot of people who go into prison go into prison straight — and when they come out, they’re gay. So, did something happen while they were in there? Ask yourself that question.”

That was a bad answer, and most people would recognize that. And a person of decency and intelligence might respond to his statement by refuting it with logic and reason, by pointing out the myriad flaws in his analogy…

(GayPatriot)

That is weak! And this non-professional conservative-Evangelical blogger can supply a better response than that one without throwing fellow conservatives [or conservatarians] who happen to be gay, under the bus in such a low-level response.

Foreign Policy

And this next section is merely an interview between Dr. Ben Carson and Hugh Hewitt (the transcript is here). And having a son in the military and knowing his peers that serve alongside him I want someone who is serious about the Middle-East.

Energy Policy

As an update to this post, I think HotAir does a great job in showing how Dr. Carson says one things about supporting the free market… and then in the next sentence refuting completely the previous position:

….Ben Carson was out talking to the Cornhuskers and the inevitable subjects of ethanol, the Renewable Fuel Standard (RFS) and subsidies for King Corn came up. The answer from the esteemed neurosurgeon was dismaying even compared to some of the other pandering we’ve seen previously.

He started out on a fairly good note:

Carson, in his first speech in the state as a candidate, was asked by a voter about the Renewable Fuel Standard (RFS), the federal mandate that fuel refiners blend a certain volume of ethanol and biodiesel into their gasoline and diesel supplies.

“I don’t particularly like the idea of government subsidies for anything because it interferes with the natural free market,” Carson said, according to The Des Moines Register.

Not bad. Subsidies in general are detrimental. If he’d only stopped there. But sadly, he didn’t.

“Therefore, I would probably be in favor of taking that $4 billion a year we spend on oil subsidies and using that in new fueling stations” for 30 percent ethanol blends, he added.

How much wrong can you package into just one sentence? First of all… thirty percent blends? We’re fighting like mad to hold the line against E-15 as it is. I don’t even need to go back over all the reasons why yet again in this article. But let’s move on to the other half of that pitch.

He’s suggesting cutting subsidies for domestic energy companies in the oil and gas industry. Not for everyone, mind you. Just them. And then reallocating that money away from fossil fuels and into ethanol processing. Just five seconds before that Carson had been claiming that he didn’t want anyone interfering with the free market, but now he’s saying to cherry pick one specific set of companies in the energy sector, remove a subsidy from them, and then redirect it to benefit the ethanol industry? It’s difficult to imagine a more egregious example of the government picking winners and losers, with the winners just happening to be in the first caucus state.

Second, calling out the “subsidies for Big Oil” is the language of the Left, and as usual it’s complete horse hockey. As anyone who follows this topic knows, the subsidies received by oil and gas companies are not specific to them. They are precisely the same as subsidies given to almost anyone who sells anything, including Apple and Microsoft among so many others. In fact, you couldn’t just cancel the subsidies to the fossil fuel segment of the energy industry without rewriting the rules entirely just to exclude them. That’s a left wing, anti-energy talking point and Carson should be embarrassed to be saying it in front of an ostensibly conservative crowd.

..read it all…

And as some may know, I do not like ethanol at all. Here is part of a larger post of mine on the subject:


It’s Final – Corn Ethanol Is of No Use

This comes by way of Gateway Pundit, and chronicle a report showing that if you hate C02, you should love fracking.

Now, here’s something you won’t here on the mainstream news. Fracking has eliminated CO2 more than more than all of the solar panels and wind turbines in the world.

John Stossel at FOX News reported:

On my TV show this week, statistician Bjorn Lomborg points out that “air pollution kills 4.3 million people each year … We need to get a sense of priority.” That deadly air pollution happens because, to keep warm, poor people burn dung in their huts.

Yet, time and again, environmentalists oppose the energy production most likely to make the world cleaner and safer. Instead, they persuade politicians to spend billions of your dollars on symbolism like “renewable” energy.

“The amazing number that most people haven’t heard is, if you take all the solar panels and all the wind turbines in the world,” says Lomborg, “they have (eliminated) less CO2 than what U.S. fracking (cracking rocks below ground to extract oil and natural gas) managed to do.”

That progress occurred despite opposition from environmentalists — and even bans in places like my stupid state, New York, where activists worry fracking will cause earthquakes or poison the water….


Liberalism = Death

Ethanol is killing children around the world… Democrats! It takes 450lbs of Corn to fill one SUV tank… that is a years worth of food for multiple children, not to mention the rise of corn-based food for the poor worldwide.

Enviro-Nuts! (4-16-08)

And while Gateway mentions is, this is actually old news. For instance, I quoted economist Walter Williams back in March of 2008 saying,

…Ethanol is 20 to 30 percent less efficient than gasoline, making it more expensive per highway mile. It takes 450 pounds of corn to produce the ethanol to fill one SUV tank. That’s enough corn to feed one person for a year. Plus, it takes more than one gallon of fossil fuel — oil and natural gas — to produce one gallon of ethanol. After all, corn must be grown, fertilized, harvested and trucked to ethanol producers — all of which are fuel-using activities. And, it takes 1,700 gallons of water to produce one gallon of ethanol. On top of all this, if our total annual corn output were put to ethanol production, it would reduce gasoline consumption by 10 or 12 percent.

Ethanol is so costly that it wouldn’t make it in a free market. That’s why Congress has enacted major ethanol subsidies, about $1.05 to $1.38 a gallon, which is no less than a tax on consumers. In fact, there’s a double tax — one in the form of ethanol subsidies and another in the form of handouts to corn farmers to the tune of $9.5 billion in 2005 alone.

There’s something else wrong with this picture. If Congress and President Bush say we need less reliance on oil and greater use of renewable fuels, then why would Congress impose a stiff tariff, 54 cents a gallon, on ethanol from Brazil? Brazilian ethanol, by the way, is produced from sugar cane and is far more energy efficient, cleaner and cheaper to produce.

Ethanol production has driven up the prices of corn-fed livestock, such as beef, chicken and dairy products, and products made from corn, such as cereals. As a result of higher demand for corn, other grain prices, such as soybean and wheat, have risen dramatically. The fact that the U.S. is the world’s largest grain producer and exporter means that the ethanol-induced higher grain prices will have a worldwide impact on food prices….

Read More

What’s Up With That comments that corn generates “more greenhouse gases than gasoline.” Further noting from the recent study that,

The researchers, led by assistant professor Adam Liska, used a supercomputer model at UNL’s Holland Computing Center to estimate the effect of residue removal on 128 million acres across 12 Corn Belt states. The team found that removing crop residue from cornfields generates an additional 50 to 70 grams of carbon dioxide per megajoule of biofuel energy produced (a joule is a measure of energy and is roughly equivalent to 1 BTU). Total annual production emissions, averaged over five years, would equal about 100 grams of carbon dioxide per megajoule — which is 7 percent greater than gasoline emissions and 62 grams above the 60 percent reduction in greenhouse gas emissions as required by the 2007 Energy Independence and Security Act.

…read it all…

Al Sharpton

Jan Morgan is the first in my updated reasons for Ben Carson not getting my enthusiasm:

Dr. Ben Carson, on Fox News tonight said he and Al Sharpton have the same goal.

Carson on Fox: “Mr. Sharpton and I have the same goal: to build a brighter, stronger America that provides equal opportunities and access to the underserved and forgotten. ” (end quote)

Only an idiot would truly believe that Al Sharpton has the goal to build a brighter, stronger America that provides equal opportunities and access to the underserved and forgotten..

Al Sharpton is about himself.. period..

He has exploited black people and race for the advancement of his own personal exposure at a great expense to our country and race relations.

Al Sharpton, Jessie Jackson, and Reverend Wright are 3 people NO ONE seeking the office of President, should have ANY association with in any fashion.

All three are enemies of our Constitutional Republic… [BAM!]

2nd Amendment

This is one that bothers me, it is when politicians speak about the Second Amendment and “semi-automtic” weapons. If Carson thinks the “life” in the Declaration is immutable, why not the 2nd Amendment as an immutable right?

Answer, because Carson does not think the Constitution provides rights, but the government does. And so the government can defines these rights… “well a baby isn’t human u-n-t-i-l-l…” ~or~ “the Constitution only meant you to have a 7-round clip…” etc.

When Government see’s itself in the place of God, slippery slopes happen often. In this case, God given rights are only applicable if you live in the suburbs:

Appearing on Glenn Beck‘s radio show this past week, Dr. Benjamin Carson took a vastly different stance from most conservatives on the issue of gun control, claiming you shouldn’t be able to own semi-automatic weapons in large cities.

Carson became a newfound conservative herolast month when he spoke at the National Prayer Breakfast and laid out a series of criticisms of ObamaCare, political correctness, and tax policy right in front of the president himself. Many called the speech “inappropriate” given the apolitical nature of the event, but many conservatives lauded Carson for his “bold” and “sensible” suggestions for policy reform.

Asked by Beck for his thoughts on the Second Amendment, Carson gave the popular pro-gun argument: “There’s a reason for the Second Amendment; people do have the right to have weapons.”

But when asked whether people should be allowed to own “semi-automatic weapons,” the doctor replied: “It depends on where you live.”…

Liberals Have Visions of Their Future ~ Jobless

See also: Businesses Forced To Hurt The Poor ~ Thanks Dems

  • “I’m hearing from a lot of customers, ‘I voted for that, and I didn’t realize it would affect you.’” (IJ-Review

Powerline has a great short article about minimum-wage laws pushed by Democrats bumping into the steel reinforced wall of reality:

Via InstaPundit, a lesson in economics for liberals. This time, it’s the minimum wage:

San Francisco’s Proposition J, which 77 percent of voters approved in November, will raise the minimum wage in the city to $15 by 2018. As of today, May 1, [Brian] Hibbs is required by law to pay his employees at Comix Experience, and its sister store, Comix Experience Outpost on Ocean Avenue, $12.25 per hour. That’s just the first of four incremental raises that threaten to put hundreds of such shops out of business. …

Hibbs says that the $15-an-hour minimum wage will require a staggering $80,000 in extra revenue annually. “I was appalled!” he says. “My jaw dropped. Eighty-thousand a year! I didn’t know that. I thought we were talking a small amount of money, something I could absorb.” He runs a tight operation already, he says. Comix Experience is open ten hours a day, seven days a week, with usually just one employee at each store at a time. It’s not viable to cut hours, he says, because his slowest hours are in the middle of the day. And he can’t raise prices, because comic books and graphic novels have their retail prices printed on the cover.

If he can’t stay in business, all of his employees will lose their jobs.

[….]

“Why,” he asks, “can’t two consenting people make arrangements for less than x dollars per hour?”

Exactly. Conservatives should oppose minimum wage laws on fairness grounds. If a person is willing to work for, say, $8 an hour, how dare liberals tell him he must remain unemployed instead? There are many, many people whose best offer of employment will be for less than the $15 an hour that San Francisco will soon mandate. Liberals are, in effect, making it illegal for these people to work, even though they are ready, willing and able to do so.

Minimum wage jobs are overwhelmingly entry level employment. They provide valuable training, experience and opportunity for advancement. Making it illegal for young people, especially, to seek employment at the wage they can command isn’t just economically stupid, it is deeply unfair.

…read more…

Businesses Forced To Hurt The Poor ~ Thanks Dems

As the #FightFor15 movement get fast food workers to strike in order to get a $15, and they watch businesses in Seattle closing because of the forced raise in wages. Automated cashier options are now an option to be weighed. Of course a business wants a human face to represent it. But the business wants to stay in business, so many are being forced to choose a cheaper, more sustainable option for its budget.

McDonald’s is buying 7,000 automated machines to replace people

Would you like some microchips with that burger? McDonald’s Europe strikes another blow against human interaction by installing 7,000 touch-screen computers to take your order and money.

[….]

McDonalds recently went on a hiring binge in the U.S., adding 62,000 employees to its roster. The hiring picture doesn’t look quite so rosy for Europe, where the fast food chain is drafting 7,000 touch-screen kiosks to handle cashiering duties.

And this real world affect of what politicians can merely raise taxes to meet budgets with (or, on the Federal level just print more money [a dumb move BTW]) is that small business go out of business, thus affecting the poor who want jobs.

But now the option through technology is to replace workers for businesses altogether:

(Washington Policy Center) Everyone is predicting what the real world impact of Seattle’s newly passed $15 minimum wage will be.  The truth is there will not be a mass exodus of businesses from the city, nor will the economy crash.

Certainly, some businesses will move or close down, consumers will pay more, some workers will receive fewer benefits and the lowest skilled workers will have a harder time finding a job because they are competing with more experienced workers. 

But many businesses will simply figure out how to employ fewer low-wage workers.  They will do that by substituting machines and technology for people.

Service industry CEOs have cautioned a higher minimum wage is “encouraging automation,” which can improve efficiency.  Even Microsoft co-founder Bill Gates warns that a higher minimum wage would “encourage labor substitution” and incentivize employers to “buy machines and automate things” and ultimately “cause job destruction.”

He’s right. When government increases the cost of labor, employers find other ways to save money. 

Just look at how McDonald’s has responded to France’s $12 an hour minimum wage.  In 2011, McDonald’s invested in 7,000 touch screen computers in France to reduce the number of workers needed.  Restaurants around the country are already exploring automation as a means to cut costs; Applebee’s is installing 100,000 tabletop tablets for ordering and payments.

Many food businesses are considering a machine that can freshly grind, shape and custom grill 360 gourmet burgers per hour, no human labor needed.   Alpha, the burger-making robot, can even slice and dice the pickles and tomatoes, put them on the burger, add condiments and wrap it up.  The manufacturer makes the point that cashiers or servers aren’t even needed: “Customers could just punch in their order, pay, and wait at a dispensing window.”  The maker says Alpha will pay for itself in a year. 

…read it all…

Bernie `Socialist` Sanders debates Michele Bachmann on Economy (CNN)

Read more at Media’ite:

The Guarding confirms the statement of Michele Bachmann (implicitly) in the emboldened portion — GM is pulling out of Australia… Toyota probably following. Minimum wage increases adding pressures to business:

…GM Holden will cease producing cars in Australia from 2017, putting 2,900 employees out of work and Australia’s remaining car and components industry and its 45,000 workers in immediate danger.

“The decision to end manufacturing in Australia reflects the perfect storm of negative influences the automotive industry faces in the country, including the sustained strength of the Australian dollar, high cost of production, small domestic market and arguably the most competitive and fragmented auto market in the world,” GM Holden’s chairman, Dan Akerson, said.

In a statement from Detroit, Holden said “approximately 2,900 positions will be impacted over the next four years. This will comprise 1,600 from the Elizabeth vehicle manufacturing plant [in South Australia] and approximately 1,300 from Holden’s Victorian workforce…

Red State Job Engine

Via NewsBusters:

The establishment press will never tell their readers, listeners and viewers that the five best-performing states in job growth through the first eleven months of this year, as well as nine of the top eleven, have relatively conservative Republicans occupying their respective governors’ mansions. If these eleven star performers had only performed as well as the rest of the nation, over 300,000 fewer people would be working, and the unemployment rate would be at least 0.2% higher.

As will be seen after the jump, the list, based on date released today by Uncle Sam’s Bureau of Labor Statistics, includes several against which the Obama administration has undertaken significant job-killing or job-deferring actions (i.e., these states have outperformed despite the handicaps, and would have done much better without them):

I wanted to say something about Rachel Maddow’s “debunking” of Texas jobs,

and that is that she skews her stats on this a bit. Firstly however, minimum wage laws (which play a part in this waxing of the numbers) play a big roll in keeping people unemployed. This isn’t my main point however, here are some points made elswhere:

But there’s no escaping it. The number is real. Which means that if you care about putting people back to work at a time when nearly 14 million in this country are unemployed, maybe Texas has something to teach us.

Unfortunately, that’s not the posture many commentators have taken. Instead, when the data from Texas emerged — touted first by Richard Fisher, president of the Federal Reserve Bank of Dallas — conservatives were quick to celebrate, embracing the jobs tally as powerful evidence of the superiority of Republican ideas as well as proof that Texas Gov. Rick Perry would make a good president. But that’s overly simplistic.

Meanwhile, those on the liberal end of the spectrum immediately set out to shoot the numbers down. MSNBC’s Rachel Maddow, for instance, held up a giant bologna and mocked the notion of a “Texas miracle.” That view, however, is too cavalier….

To be sure, Texas is not without lots of problems. And its remarkable employment growth is not without attendant concerns. But for those on the left to dismiss the state’s jobs story out of hand, just because Republicans have embraced it as a showpiece, is counterproductive and foolish.

(LA Times)

While the LA Times article struggled a bit, but ended up shining at the end, the following is what Maddow and the LA Times writer didn’t fully account for:

In her column for The Daily, Reason Foundation’s Shikha Dalmia delves into Gov. Rick Perry’s record and writes that Texas “has one of the lightest personal tax burdens in the country and a low cost of living, which are hugely attractive to out-of-work Americans. Their flocking to the state has bumped up Texas’ unemployment rate to 8 percent, prompting Rachel Maddow to jeer on the air that Perry’s jobs record is not a whole lot better than many other states. What she refuses to see is that while in those states high unemployment is due to anemic job growth, in Texas it is due to robust population growth. If anything, Texas offers proof that people prefer jobs, even low-paying ones, to lavish social benefits — repudiating the liberal tax-and-spend economic model.

Just wanted to include a quick rebuttal to Madcow’s many, many  mistakes.