02.14.2014 23

Obama’s minimum wage move: All about unions

Raise_Minimum_WageBy Nathan Mehrens

President Obama’s decision to bypass Congress and raise the minimum wage from $7.25 to $10.10 for federal contract workers is a very big deal — and not just because it will force U.S. taxpayers to shell out more money on the same inefficiently delivered, often-unnecessary government services.

First, his power grab signals a remarkable new brazenness in his already contentious dealings with the legislative branch.  Not only that, it marks a sudden and stunning reversal of his previous position on this issue.

“This has always been done legislatively,” White House spokesman Jay Carney said last month when asked about raising the wage unilaterally, “and it has been done with support from Republicans and not just Democrats in the past.”

Not anymore, apparently.

The President is doubling down on his far left economic agenda — shaking down American taxpayers in a shameless sop to organized labor (the prime beneficiary of his decision).  Why kowtow to the unions now?  Easy: The ongoing Obamacare debacle has exposed a serious, potentially debilitating political rift between the administration and union leaders — who continue to voice their “bitter disappointment” with the implementation of the new law.

Using our money, he is now effectively trying to buy Big Labor back into the fold: Knowing full well the coffers of dozens of vulnerable Democrats depend on it.

Looking at the raw numbers, the order doesn’t seem to pack much of a punch. At most, it would impact roughly 200,000 contract workers (out of an estimated workforce ranging from 2-3 million employees).  Even this small slice of the pie could be overstated, though, as it represents an upper-end estimate of federal contract workers making less than $12 per hour.

How many of these employees already make more than the minimum wage? Most of them, it would appear.  Referencing comments from contractors, National Review’s Jim Geraghty notes “a federal contractor making minimum wage is rarer than hen’s teeth.”

To the extent there are federal contract workers making $7.25 an hour, they will receive the equivalent of a 7.8 percent annual raise dating back to 2009 – the last time the minimum wage was increased.

Have your income levels gone up by 39 percent over the last five years? Not according to data from the U.S. Bureau of Labor Statistics (BLS).

Of course the real impact isn’t going to be felt by the impoverished minimum wage worker (again, to the extent such an employee exists within the sprawling federal system). Instead it will be felt up the income ladder — as labor unions peg their base-line wages to the minimum wage on either a percentage or premium basis.  And higher wages for union workers means they will pay more in dues — which means a bigger campaign account for Big Labor.

This decision clearly isn’t about those making minimum wage, it is about higher-wage union workers getting a bump because the entire scale must be adjusted upward. And most of all, it is about the financial boon this upward adjustment creates for their dues-collecting bosses.

Who gets hurt by Obama’s move? In addition to the taxpayer, smaller contractors who bid on government work will find themselves in a far less competitive position under the new wage levels.  Ultimately, that means smaller profits and fewer jobs for them — not to mention a shrinking pool of bidders for government contracts (which will drive costs even higher).

There’s simply no scenario in which this plays out to anyone’s benefit: Except union workers and their Big Labor bosses. Oh, and the President’s Congressional allies.

True limited government supporters oppose a minimum wage on principle. Wages should be paid based on what the free market will bear — and any attempt by government to manipulate that process will only create havoc on the economy.

Congress can stop this, and more importantly, they can block the broader minimum wage hike the President seeks for the private sector economy.

The author is president of Americans for Limited Government.

  • Russ

    There is nothing wrong to have the union to protect the employee’s. But having the union to raise the wages and collect the dues, is making the companies take their business overseas for cheaper wages and get away from the Govt. regulation and taxes that are killing the jobs.

  • ger823

    This is all a political show for the uninformed public…we recently did a job for a contractor for public housing and our LABORERS HAD TO BE PAID $15/hr. minimum.
    There can’t be too many people labeled less than laborer in the workforce of a federal contractor. At this rate…he’s DECREASING the pay scale!!!

  • So … if the Republicans will bow down and submit to the Democrats desires, then things will be fine …

    But … if they refuse … then Obama will step in and do it by fiat or by presidential order. Not just by passing Congress but bypassing his constitutional appointed authority as well.

    J Carney thinks this is OK, he may be Obama’s speaker but J Carney is not above the law, maybe Congress should begin taking out the Obama Administration one guy at a time.

    It may be true that Obama cannot be arrested and stand trial until after he is impeached and removed from office, but all who share a hand in complicity with Obama have no such rights.

  • Frick

    You know I wish that he would work harder at getting along better with others as he does at whipping his pen out! He has got to be the worst president EVER and it has nothing to do with color!

  • alleycat22

    The only payback not completed in the public eye is oprah. he’s paid everybody else back with our money that got him elected twice!!

  • euwe max

    It takes an idiot to join a collective that bargains for higher wages and better benefits.. especially if they deliver!

  • bobmann101

    Obama is baiting the trap so he can declare martial law and remain as our supreme ruler until his big money string pulling puppet masters are finished with him then he will somehow be eliminated!

  • WIaggie

    About time someone mentioned that union wages are based off the minimum wage. This is not about the poor guys at the bottom…it’s about getting a big raise all the way up the ladder!

  • euwe max

    So … if the Republicans will bow down and submit to the Democrats desires, then things will be fine …

    Haven’t they been doing that all along?

    I mean, wake up! The tea party outed the Republican Party already! Remember Cruz?

    How soon you all forget.

  • euwe max

    There is nothing wrong to have the union to protect the employee’s.


  • euwe max

    Obama is baiting the trap so he can declare martial law and remain as our supreme ruler until his big money string pulling puppet masters are finished with him then he will somehow be eliminated!

    Eliminated? Finished with him? He’s the first in a long line of black supreme rulers. The big money string pulling puppet masters are liberals who have a twisted sense of humor and have nothing better to do!

    Besides being black, the next leader will be a female atheist.

  • euwe max

    What does that mean to my outhouse-cleaning job? Will I get a raise too? Or only the hole diggers?

  • Florida Jim

    Unions are the death of countries wherever unions appear. Look a Europe and all heir failing countries all driven by union demands and never any elimination of poor employees they simply add one loser to another loser driving up the costs to consumers with no money to pay for anything. An economy driven by unions will always fail we are seeing that all over the world. Unions ruined the auto-industry, steel , construction, teaching, government , and everything they touch. More and more wage demands only harms their on workers ho can’t afford endless price hikes.
    Obama sold his soul; to unions and now can’t avoid their threats just like the mafia.

  • The Party has not replaced the leadership of the GOP, they have only changed a few pieces on the board.

    There are very few people who believe like the people in office, there was a time to giving in and politicking, the problem is that those on the progressive socialist left have gained ground that they were never to gain, and are unwilling to give any of it back.

    WE have a president who wants to be King, and rule by decree and a Congress and Senate who are willing to let him do so.

    They want the GOP to fold and let them have their way, and if they don’t get it then they hurt US in retaliation.

    Where do you think those trillions are really going?
    Pockets on the left are being lined daily. Favors are being repaid.

    There are not enough in office supporting the Tea Party yet to do much more than T Cruz is doing.

  • WIaggie

    Maybe not, but the union bosses will be sure to pass along your extra dues to the Dems…

  • euwe max

    Gee.. I heard that the unions paid us outhouse workers more… I guess not – just the union bosses, then? So, I should vote to get rid of the union so the non-union bosses will pass along the savings to me?

  • euwe max

    There are not enough in office supporting the Tea Party yet to do much more than T Cruz is doing.

    here’s hoping you decimate the Republican party for their traitorous support of Obama.

  • xteeth

    You are now paying the lowest taxes of any Americans all the way back to Truman. We received a pretty nicely maintained world from previous generations. The one we are leaving for our kids and their kids is in much worse condition. I believe that this makes us ingrates. As odd as it may seem to Cantservatives, it is necessary to pay for the stuff that you get.

  • bobmann101

    Hard to disagree with you, But I believe Obama will be in office for longer than most people realize. I also believe it is too late to stop the Muslims from taking over the US. There are far too many Muslim cab drivers. They know the city they are in. The so called peaceful ones are here to establish friendships and blaming the radicals. They are will reap the benefits!

  • euwe max

    People don’t seem to realize how complete their network actually *is* – the convenience store supply chain will challenge the United States Military for efficiency. New Orleans is a case in point – Homeland Security took 5 days to deliver water a few miles, while 7-11 had plenty of water, and the cabs were still running.

  • 1S-1K

    It’s all about UNION VOTES !!

  • jcgreen2

    Barry Soetoro (aka Obama) is not legally qualified to be the president. Therefore, he has no executive immunity. He should be arrested NOW for fraud and treason… and tried, convicted, and sentenced. We cannot allow this impostor to destroy our once great nation, as he is doing.

  • Death2Unions

    It is not about unions. It is about establishing America as a Marxist State. No if’s, and’s, or but’s. People have to go several layers down to get to the meat of the matter. The Puppet In Chief’s strings are fully controlled by the Puppet Master Valeri Jarrett.

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