OPINION:
Much of America, especially the black community, is being hurt by our nation’s dire economic situation. This follows the very high hopes this community had during the beginning of 2009 when President Obama took office. Black wealth has declined since 2009 while the black poverty rate has risen. Overall black unemployment is tragically high and youth unemployment is an astronomical 36.8 percent. This 36.8 percent does not count the many who have given up hope and left the labor market altogether.
Government policies are partly to blame for this problem. For too long programs were developed and implemented without checking the actual outcome. In some cases the consequences were in fact quite harmful. During the past six years these problems have worsened the situation.
A a careful examination of the actual results of new laws and regulations would bring better understanding and therefore better policy. For example, raising the minimum wage, which liberals support, is actually quite damaging to the low-income wage earners. There is a sad history that increasing the minimum wage is followed by a loss of jobs.
Regardless of income a higher salary always increases the incentive to hire fewer people. Economists often cite whether it is land, labor or capital, a rising price in any one promotes an incentive for substitution. An example can be found in my own family. My wife’s uncle was an elevator operator in a strong union in Manhattan. They kept forcing wage increases, making automation more attractive. Now few elevators are operated by people. Obamacare is a similar case whereby the result makes it more expensive to hire employees.
A major goal of the incoming Congress should be to encourage greater employment by reducing the cost of hiring people. An increase in jobs would bring many long-term unemployed into the labor market and give them a work ethic and hope for the future. While the president is certainly bright, many of his economic policies are wrong. A change in direction is needed. All Americans would benefit.
ARTHUR HORN
East Windsor, N.J.
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