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Big Minimum Wage Hikes Harm Those They Are Intended to Help. Make These Reforms Instead.

By Peter CoveRealClear Policy

In 2017, Target announced it would raise its minimum wage to $15 an hour by the end of 2020, drawing praise from labor advocates who have called for other retailers to pay their employees a “living wage.”

But the new wage hike isn’t all it cracked up to be. Harry Holzer, in a 2016 Time Magazine article argued that “most minimum wage earners are not poor adults. They are, instead, young people (ages 16 to 24) or second earners in families where a spouse has a higher-wage job. So minimum wage increases help some poor heads of households, but are not well-targeted on them.”

Then there is this. A  new report by CNN BUSINESS, found the big-box retailer has been slashing employees’ hours since the announced wage hike. So have TJMAXX, Marshalls, The Gap and Old Navy, and fast food chains such as Burger King. Nearly half of D.C. employers said they have laid off workers, and reduced hours due to a minimum wage hike

Heidi Shierholz, who was the chief economist at the Labor Department during the Obama Administration, said the wage hike is being counter-attacked by the company slashing employees’ hours, “Most workers aren’t getting any more of what they really need.”

Since the wage increase, Whole Food employees have told reporters that they have experienced widespread cuts that have reduced schedule shifts across many stores, often negating wage gains for employees. Further, companies often move to a nearby city or state to avoid the increase.

And that’s not all. A recent study suggests minimum wage hikes lead to automation replacing low-skill workers’ jobs. In New York City, the rise had people in a panic fearing the loss of other government subsidies, such as section 8 housing due to the added income.  

Few would argue that finding a way to create living wages is a bad idea. But the unintended consequences of large raises in the minimum wage are clearly not worth the price. Here is a better way.

We now have a successful, if limited, device to raise wages without interfering in the marketplace. It is the Earned Income Tax Credit (EITC).  It is a refundable tax credit for low- to moderate-income working individuals and couples, particularly those with children. Many states already have state EITC’s, which further expand total income for a household. Critically, the EITC encourages work since the credit is only available to those with earned income.

  • The EITC reached 28.5 million tax filers in 2014. Under the 2015 tax rules, a single taxpayer is eligible for an EITC if he or she has an annual income up to $39,131 and if they claim one child as a dependent, up to $44,454 with two children, and $47,747 with three or more children. The refund available from the EITC can be as much as 45 percent of a family’s pre-tax income;
  • The benefits of the EITC have been shown to extend to maternal and children’s health, as well as to children’s development.

What needs to be done is to expand the EITC for single and childless couple workers. Also the 2009 changes in the EITC that reduced the marriage penalty and increased the credit for households with three or more children should be made permanent. These changes combined with a refundable child tax credit could be the basis of a broad wage supplement program. Finally, a reform should be instituted so that the EITC comes on a weekly or bi weekly basis, not the following year.

Holzer wrote that “when the minimum wage increases are moderate in size — up to, say, $10 an hour — such employment losses are very small, so the likely tradeoff between higher wage levels and lower employment becomes worthwhile.”

But when the minimum rises so dramatically, we will likely see much larger employment losses among young or low-income workers. The hard truth is that too many of them have too few skills to merit such high wages, at least in the eyes of prospective employers. Some (particularly immigrants) might instead be hired off the books, and paid in cash, while many more will lose employment entirely”.

Proposals such as those suggested by Isabel Sawhill and Quentin Karpilow along with Holzer combine a modest increase in minimum wage with revisions to the EITC.  This may be the best alternative to large increases in the minimum wage. 

The tsunami of minimum wage hikes comes from a well intentioned benevolence. Its results have been disastrous for the very people they were intended. A small increase in minimum wage combined with smart revisions to the EITC will benefit low wage earners without marketplace disruption and harm to the working poor.


Justice Reform: A Surprisingly Hot Topic

By MICHAEL TANNERNational Review

While we should expect the upcoming presidential campaign to focus on traditional issues of the economy, taxes, foreign policy, trade, and immigration — as well as the elephant in the room that is Donald Trump — criminal-justice reform has become a surprisingly hot topic on the campaign trail.

At one point, every presidential candidate pretended he was running for sheriff. “Tough on crime” was considered the ultimate badge of honor — in both parties. Bill Clinton even rushed home during his campaign to execute a mentally disabled murderer. Times have clearly changed.

This is in part due to the growing evidence of racial and class inequities within the criminal-justice system. Studies also show that failures within our criminal-justice system contribute to poverty and dependence. A recent YouGov poll conducted on behalf of the Cato Institute found that 22 percent of the unemployed and 23 percent of people on welfare had been unable to find a job because of a criminal record. Scholars at Villanova have concluded that mass incarceration increases the U.S. poverty rate by as much as 20 percent. It has also become clear that overcriminalization and mass incarceration have not necessarily made us safer. Support for criminal-justice reform now cuts across party lines.

But there is also a large degree of politics behind the sudden importance of criminal-justice reform on the campaign trail. Most important, Democratic front runner Joe Biden is perceived as being vulnerable on the issue. Biden’s supported and partially wrote the 1994 Violent Crime Control and Law Enforcement Act, which led to an increase in incarceration — especially among African Americans. He also supported and sponsored several pieces of legislation that enhanced sentencing for drug-related crimes, once again contributing to the mass incarceration of minorities.

Even President Trump has taken the opportunity to tweak Biden on the issue, tweeting, “Anyone associated with the 1994 Crime Bill will not have a chance of being elected. In particular, African Americans will not be able [sic] to vote for you. I, on the other hand, was responsible for Criminal Justice Reform, which had tremendous support, and helped fix the bad 1994 Bill!” And in a second tweet, Trump noted that “Super Predator was the term associated with the 1994 Crime Bill that Sleepy Joe Biden was so heavily involved in passing. That was a dark period in American History, but has Sleepy Joe apologized? No!”

Trump is not exactly the best messenger on this front, given his at least implied support for police abuses. But he is correct that he signed the FIRST STEP Act, the first important federal prison and criminal-justice reform in many years. As a policy, it was modest stuff, but it symbolically highlighted the changing politics of the issue.

Biden is not the only one with vulnerabilities on criminal justice. During her time as a prosecutor, Kamala Harris vigorously enforced California’s three-strikes law, actively pursued drug users and sex workers, and even prosecuted the parents of truant children. She was also an outspoken supporter of asset forfeiture and the use of solitary confinement in prisons. She backed capital punishment and resisted calls to investigate some police shootings.

So far, she has responded by apologizing for her past positions, now saying, “Too many black and brown Americans are locked up. From mass incarceration to cash bail to policing, our criminal-justice system needs drastic repair.” She has also sponsored the Equal Defense Act, which increases funding for public defenders. Still, criminal-justice activists have remained critical, complaining that she has ducked specific reform proposals.

Other Democrats also have hurdles to overcome. Bernie Sanders, for instance, voted for the 1994 crime bill, although he had a much lower profile than Biden. And, like Harris, Senator Amy Klobuchar also has a background as a prosecutor. Her low poll standing has kept it from becoming an issue yet, but she may eventually face some tough questions about her actions in that office. Even South Bend mayor Pete Buttigieg has faced scrutiny over his handling of police-abuse complaints during his tenure as mayor.

On the other hand, candidates such as Cory Booker, Elizabeth Warren, and Beto O’Rourke are better positioned on the issue. Booker, in particular, has championed justice reform. He has introduced the Next Step Act, which would expand upon the FIRST STEP Act. Booker is also calling for cutting minimum drug sentencing in half, legalizing marijuana, removing barriers to entry in the job market for those with felony records, and reinstating the right of felons to vote in federal elections.

Beto pushed for criminal-justice reform during his Texas Senate campaign and has reiterated his support during his presidential campaign. During his Texas campaign, he stated that he would like Texas to lead the way on criminal-justice reform. He supports ending cash bail at the state level, making for-profit prisons illegal, ending mandatory-minimum sentencing for nonviolent drug offenses, and legalizing marijuana.

Warren has been far less specific, mostly limiting herself to rhetoric about the “racist” criminal-justice system. For a candidate whose claim to fame is “I have a plan for that,” she is remarkably vague on this issue. Still, she carries far less past baggage than others, leaving her an opening.

With more than two dozen candidates in the Democratic primary and a general election that is looking extremely close, even secondary issues could play an outsized role in deciding the outcome. Keep your eyes on criminal-justice reform.


Congress must head off pension plan crisis

By George LandrithManistee News Advocate

I am not generally a big fan of lame-duck sessions because such a large number of soon-to-be former senators and congressmen are voting on their way out the door. But Congress must do something about a looming multi-employer pension plan disaster or we could see very difficult economic times ahead.

Multi-employer pension plans have more than $600 billion of unfunded liabilities and are dangerously close to failing. Once these endangered plans fail, others will not be far behind. Additionally, state and local governments have about $6 trillion in unfunded pension promises. If these potential failures come to fruition, it could be a disaster far worse than the 2008 housing bust.

The White House understands the risks and has met with the chief players on Capitol Hill, encouraging them to work together to find a lasting solution. Continue reading


The Ground Is Shifting Under Obamacare

By Scott Rasmussen • Real Clear Politics

President Trump has perfected the art of antagonizing his opponents with provocative tweets. He demonstrated this skill recently in declaring that the tax reform act, by repealing the Obamacare mandate, had effectively repealed Obamacare.

This generated a number of stories from left-­leaning pundits pointing out that there’s a lot more to Obamacare than the mandate. Sarah Kliff, writing for Vox.com, noted that many Republican voters believed the president and hoped that would bring an end to efforts to undo the rest of Obamacare.

But many Republicans in Congress seem intent on continuing to fight for repeal of the controversial law. A skeptical report in The Hill noted that the GOP had tried and failed to accomplish that goal in 2017. In their view, “nothing significant has changed since then that would now make the path easier. In fact, the obstacles appear even greater now that Democrat Doug Jones has been elected to the Senate from Alabama.”

Continue reading


Letter to House Judiciary Committee on Reforming and Modernizing the Copyright Office

By George LandrithFrontiers of Freedom

Dear Chairman Goodlatte and Ranking Member Conyers:

We believe that it is time for the Copyright Office to be modernized. On behalf of our organization and the millions of Americans we represent, we encourage Congress to give the Copyright Office the autonomy it needs to best serve the digital economy and Congress by:
1) removing the Copyright Office from within the organizational structure of the Library of Congress, and empowering the President to nominate and the Senate to confirm the Register of Copyrights; and 2) allowing the Copyright Office to modernize its IT systems as it sees best by granting the Office authority over its own budget, personnel, and technology.

The intellectual property represented by copyrights has always been important — important enough that our Founders specifically addressed it in the Constitution in Article 1, Section 8 saying that Congress shall have the power “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” Continue reading


The conservative case for criminal justice reform

by Senator Mike Lee     •     Washington Examiner

Sen. Mike Lee, R-Utah, introduced the Sentencing Reform and Corrections Act of 2015 on Thursday. (AP Photo/Rick Bowmer)

This Thursday, after months of hard work, a bipartisan group of senators and I introduced the Sentencing Reform and Corrections Act of 2015.

Most people, including many conservatives, might think criminal justice reform is a progressive cause, not a conservative one.

But, like many pearls of conventional wisdom, this is simply untrue.

Just look at the history of criminal justice in the 20th century. The most successful reformers — whether they be academics or evangelists, policymakers or community leaders — have advocated for conservative goals: law and order built on tight-knit communities, a vibrant civil society, strong, intact families and personal responsibility. Continue reading


EPA knew of ‘blowout’ risk for tainted water at gold mine

By Michael Biesecker     •     My Way News

In this Aug. 12, 2015 file photo, water flows through a series of retention ponds built to contain and filter out heavy metals and chemicals from the Gold King mine chemical accident, in the spillway about 1/4 mile downstream from the mine, outside Silverton, Colo. Internal documents released by the U.S. Environmental Protection Agency on Friday, Aug. 21, show managers at the EPA were aware of the potential for a catastrophic “blowout” at an abandoned mine that could release “large volumes” of wastewater laced with toxic heavy metals. (AP Photo/Brennan Linsley, File)

Internal documents released late Friday show managers at the U.S. Environmental Protection Agency were aware of the potential for a catastrophic “blowout” at an abandoned mine that could release “large volumes” of wastewater laced with toxic heavy metals.

EPA released the documents following weeks of prodding from The Associated Press and other media organizations. EPA and contract workers accidentally unleashed 3 million gallons of contaminated wastewater on Aug. 5 as they inspected the idled Gold King Mine near Silverton, Colorado.

Among the documents is a June 2014 work order for a planned cleanup that noted that the old mine had not been accessible since 1995, when the entrance partially collapsed. The plan appears to have been produced by Environmental Restoration, a private contractor working for EPA.

“This condition has likely caused impounding of water behind the collapse,” the report says. “ln addition, other collapses within the workings may have occurred creating additional water impounding conditions. Conditions may exist that could result in a blowout of the blockages and cause a release of large volumes of contaminated mine waters and sediment from inside the mine, which contain concentrated heavy metals.” Continue reading


EPA threatening Wyoming man with $75K per day fine over homemade pond

By Alex Cabrero     •     Deseret News

Andy Johnson, of Fort Bridger, Wyo., built a pond on his property about five years ago. Thirty days ago, he got a letter from the EPA accusing him of violating the Clean Water Act by damming a creek and polluting the water to build the pond. The agency is threatening Johnson with a $75,000 per day fine until he gets rid of the pond. He is fighting the EPA. James Young, Deseret News

It was a dream come true several years ago when Andy Johnson built a pond on his property to stock fish, let his kids play and provide a spot where his horses could have a drink.

But now that dream has turned into a nightmare. Last month, the Environmental Protection Agency accused him of violating the Clean Water Act by damming the middle of Six Mile Creek and polluting the water to build the pond.

The agency is threatening Johnson with a $75,000 per day fine — a penalty often reserved for companies that emit toxic hazards — until he tears it all down.

“I think they’re trying to gain jurisdiction,” Johnson said. “They’re trying to see if they can run over me, and then they will get into everyone’s irrigation ditch and stock ponds throughout not only Wyoming, but the United States.” Continue reading


Industry braces for EPA regulatory ‘tidal wave’

By John Siciliano     •     Washington Examiner

The EPA estimates the total cost of the proposed methane restrictions to be $170 to $180 million in 2020 and $280 to $330 million in 2025. (AP Photo/Charles Rex Arbogast, File)

The methane restrictions for oil and gas companies proposed by the Obama administration Tuesday are just the beginning of a regulatory “tidal wave” that the industry is bracing for this fall.

The new rules for oil and gas wells proposed by the Environmental Protection Agency would limit methane from fracking sites, creating new costs that the industry says are “unnecessary.” The industry says it has reduced methane voluntarily, so why bother with regulations that would only be duplicative.

The EPA estimates the cost of the proposed rule to be $170 to $180 million in 2020 and $280 to $330 million in 2025.

Those costs are expected to amplify considerably given that some of the rules coming down the pike are considered the most expensive in history. Continue reading


Punish and Reform the EPA

by Alex B. Berezow & Todd Myers     •     RealClearScience

EPA says it focuses on environmental protection. The Animas River disaster shows that it is more concerned with protecting itself.

The accidental spill of toxic wastewater into Colorado’s Animas River is an ironic case study: The very organization meant to protect Americans from environmental catastrophes was responsible for perpetrating it. How should the Environmental Protection Agency be held accountable?

Colorado, and the states downstream of the spill, should sue the EPA. But, instead of merely recovering the cost of environmental damage, the lawsuit should focus on taming the leviathan the EPA has become.

Created in 1970 by President Richard Nixon, the EPA, at its best, has been an important part of improving air and water quality. Clear standards, enforced in a straightforward way have been successful. The fact that the American environment is cleaner and safer than it has been in a century is partially due to EPA action. Continue reading


How to Repeal and Replace Obamacare

Affordable Care Act opponents must make their goal the enactment of a better plan.

by James C. Capretta     •     National Review  Money ObamaCare

In the 2014 midterm elections, opposition to the Affordable Care Act — i.e., Obamacare — was a clear political winner. That’s obvious from the election results themselves but also from polling that consistently finds that far more of the electorate disapproves of the law than approves of it.

It is therefore to be expected that the incoming Congress, fully under the control of the GOP, will vote on a straight repeal bill, probably very early in next session. In the House, such a bill will pass easily. But in the Senate, Democrats will control at least 46 seats in the new Congress, giving them plenty of votes to filibuster most legislation they oppose. Consequently, the most likely scenario is that the repeal legislation will die in the Senate and therefore never get sent to the president for a certain veto. Continue reading


They Blew Up the Healthcare System for This?

obamacare tire mudby Byron York

The Los Angeles Times, citing studies and information the Obama administration most certainly knows about but won’t release, reports that 9.5 million previously uninsured people now have health coverage because of Obamacare. Look for that 9.5 million, or perhaps a rounded-up 10 million, to be come the talking point for Obamacare supporters in coming days.

The Times says the numbers break down like this: 4.5 million previously uninsured people are now on Medicaid; 3 million previously uninsured young people are now covered because of a provision that allows them to stay on their parents’ policies until age 26; and 2 million previously uninsured people have purchased coverage on the Obamacare exchanges. In all, it is “the largest expansion in health coverage in America in half a century,” according to the Times. Continue reading


Ex Dem Radio Talker: Enough of Obama, Supporting Romney

by Craig Silverman

I support Mitt Romney for President and Paul Ryan for Vice President. For most of my life, I have been a Democrat, and I very publicly voted (C-Span, live radio, The New York Times) for Obama-Biden in 2008.

As I studied Obama’s performance as President, I could no longer support him. Continue reading


Credit Unions Offer Alternative for Consumers and Small Businesses

Congress Must Act to Lift Restrictions on Consumer Choice and Access to Credit in the Market

by Horace Cooper

Much has been written about the over-reach of Dodd-Frank and the drag that law and its progeny will have on the financial services sector, the economic recovery, and job creation.  Evidence continues to mount that the specter of over-regulation is crowding out free market solutions and restricting credit in the markets.  Worse, the negative effects of government interference in the financial services industry extend well beyond large commercial banks deemed “too big to fail.”  A case in point is credit unions.

Credit unions serve an important source of credit for consumers and small businesses.  Historically this has been especially true during economic downturns, when the banking industry either tightened or in other ways limited credit.   Continue reading


Republicans Are Right, Fact-Checkers Wrong On Welfare

Reform Rollback:  True MeterDemocrats and “fact-checkers” claim Republicans are lying when they say that the president wants to gut work requirements. Here’s why the GOP should press on.

You heard it straight the other night from Bill Clinton — who would never lie to anyone — that Mitt Romney’s campaign is lying about welfare reform: “The claim that President Obama weakened welfare reform’s work requirement is just not true. But they keep on running the ads claiming it.”

This is the latest attempt by the Democrats to refute a charge that has become a huge headache for them because, well, it’s true. Continue reading


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