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Mish's Global Economic Trend Analysis |
Posted: 20 Aug 2013 12:47 PM PDT Michael Tanner at the Cato Institute notes Welfare Pays Better than Work in 33 states. The federal government funds 126 separate programs targeted towards low-income people, 72 of which provide either cash or in-kind benefits to individuals. (The rest fund community-wide programs for low-income neighborhoods, with no direct benefits to individuals.) State and local governments operate more welfare programs.Of course, no individual or family gets benefits from all 72 programs, but many do get aid from a number of them at any point in time.People Aren't That Stupid While it's beneficial to have a job, assuming there is hope of advancement, for those with no special skills there is little to no hope of advancement. Moreover, wages are taxed, welfare benefits are not. And what about day-care costs for single mothers? What about transportation costs? What about the value of extra leisure time? Add it all up and it makes perfect sense for many to remain on welfare for as long as they can. Minimum Wage Fallacy Given welfare benefits exceed minimum wage, it should not be surprising to find socialists arguing for higher minimum wages. And they are. In Seattle, a Campaign Seeks to Push Minimum Wage to $15. How successful would that be? Not very. The higher the minimum wage, the more incentive businesses have to get rid of employees and use hardware and software robots. And with the Fed suppressing interest rates, companies can borrow with miniscule interest rates and do just that. Should minimum wages rise, the recipient workers would benefit, but at the expense of millions of others who would lose a job or not get one. Then when prices rose in response, the socialists would ask for increased welfare benefits to keep up with the rising cost of living! More Minimum Wage Nonsense The socialists are out in force. Heidi Moore on the Guardian writes How low can you get: the minimum wage scam. Wonder why benefit spending is rising? Simple: corporations get away with crappy wages, so government has to make up the rest.No Heidi, the sad state of affairs is that socialist fools have no idea what is going on. As Michael Tanner at the Cato Institute points out, it does not pay to work. So people don't. Don't blame low wages, blame high prices. The Fed, the ECB, the Bank of England, and the central bank in China are all printing money hand over fist hoping to spur job growth. Instead, they fueled another stock market bubble, a bond market bubble, and revived the property bubble. Congress enacted hundreds of affordable housing programs. The one and only thing those programs did was create a housing bubble. When prices crashed, government and the Fed stepped in with attempts to reblow the housing bubble (proving of course no one really wanted affordable housing in the first place). Rather, the Fed wanted a stock-market party and Congress wanted a vote-buying party). Is Low Minimum Wage the Problem? Perceived low wages are a symptom of the problem, not the problem. The problem is socialist fools, progressives, and war mongers sloshing other peoples' money around. For that, place the blame where it precisely belongs: on central bankers, on fractional reserve lending, and on government bureaucrats who interfere in the free market. We do not need higher wages, we need lower prices. With productivity advancements we would have just that, absent of course the socialist fools, the progressives, the war mongers, and the central bankers. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific. |
Posted: 20 Aug 2013 09:37 AM PDT If you are looking for a good laugh today, simply read Ministers set out utopian but hazy vision of a strong France France's Socialist government has set out a gleaming vision of the future marked by full employment and cutting-edge factories thanks to "a third industrial revolution"."Answers [on how Hollande will achieve his socialist utopia vision of full employment, a third industrial revolution, and tackle global warming, complete with a pleasant moment of affordable housing] will be provided by the government between now and the end of the month." I can hardly wait for for the laughs. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific. |
Surprise Awakening Awaits Merkel in September Election: No Stable Government Posted: 20 Aug 2013 08:42 AM PDT In response to my August 13 post Tale of Colours, All in Denial; Assessing Merkel's Chances reader Bernd from Germany (not AfD chairman Bernd Lucke) offered these comments ... Hello MishAfD appears unlikely to get to the 10% I thought possible a few months ago, but even 5% will prove very problematic to Merkel, even more so if FDP does not get the 5% it needs. The September election will be interesting to say the least. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific. |
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Posted: 20 Aug 2013 11:30 AM PDT |
Posts on Facebook That Will Make You Laugh Posted: 20 Aug 2013 10:51 AM PDT |
The True Cost Of A Work Related Injury [Infographic] Posted: 20 Aug 2013 09:49 AM PDT Do you know what a work related injury costs? Do you really? Most people don't understand that when someone is injured at work there are many unnoticed costs: the employee loses wages, the employer loses productivity, rates for workers' compensation insurance are increased.... See the pattern? This infographic is a visual representation of why it is so important to prevent work related injuries - the costs are very high. The prevention of workplace accidents and injuries should be a main focus of employees and employers alike. Click on Image to Enlarge. ![]() The True Cost Of Work Related Injuries - An infographic by the team at SafetyVideos.com |
The Winners of the iPhone Photography Awards Posted: 20 Aug 2013 09:26 AM PDT These amazing photographs were actually taken using an iPhone camera and are the top winners in the iPhone photography awards! Via ippawards |
Dollars and Sense [Infographic] Posted: 20 Aug 2013 08:47 AM PDT Nearly half of adults in America report their financial situation is their biggest concern, yet only about a third of people have a long-term plan for savings and investment goals. High school students in the U.S. are less able than ever to properly handle money matters, even though the average employee is working longer hours for more pay. Two-thirds of do not prepare either a written or digital household budget. Only 30% of Americans keep a long-term savings plan. Factors that influence financial planning are education, political affiliation, and overall household income. When it comes to preparing a budget, 26% of persons with an educational level of high school or less write out their spending, whereas 38% of college graduates are keeping track. Persons who identify politically as "Conservative" keep a budget in 35% of polled results; "Moderate" persons are at 33%, and 26% of "Liberal" supporters write a budget. In regards to household income, it is the earners in the middle whom are least likely to keep tabs on where their money is spent. Financial stress affects everyday life by disrupting sleep schedules, increasing irritability, and making persons more susceptible to sickness. However, the overall percentage of income spent has decreased from 57% in 2009 to 32% in 2013, and the number of adults who pay their bills late has dropped from 33% in 2012 to 26% in 2013. A majority of teens say they want to learn how to manage their money, although only three states require at least one high school course devoted to understanding personal finance. Click on Image to Enlarge. ![]() Image source: www.online-accounting-degrees.net |
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