Obama’s Tariff On Low-Wage Labor


George Mason Professor of Economics Donald Boudreaux asks President Obama to justify his proposal for increasing minimum wages with his policy of inflating the price of imported goods with tariffs:

Dear Mr. Obama:

In this year’s State of the Union Show you called for the hourly minimum-wage to be raised from $7.25 to $9.00. That’s an increase of more than 24 percent. Because you trumpet this proposal as one to assist low-paid workers, you, presumably, deny that such a hike in the cost of hiring low-paid workers will prompt employers to hire fewer such workers.

In last year’s State of the Union Show you bragged of your administration’s increase in the tariff rate on Chinese-made automobile tires. This tariff increase, which averages 30 percent over three years, is explicitly designed to dissuade Americans from buying Chinese-made tires – an effect that you recognize and applaud.

Question: If a government policy that artificially raises the price of Chinese-made tires reduces the quantities of such tires that are bought, why does a government policy that artificially raises the price of low-skilled labor not reduce the quantities of such labor that are hired?

I’m told that you’re a man of science. I await your response.

Donald J. Boudreaux
Professor of Economics

The whole idea behind tariffs is trade protectionism. We inflate the price of imported goods so that people buy more domestically-made goods. The price changes, and our behavior changes with it.

So why wouldn’t we assume that the same is true of inflating the price of low-wage labor by increasing the minimum wage?

Rob Port is the editor of SayAnythingBlog.com. In 2011 he was a finalist for the Watch Dog of the Year from the Sam Adams Alliance and winner of the Americans For Prosperity Award for Online Excellence. In 2013 the Washington Post named SAB one of the nation's top state-based political blogs, and named Rob one of the state's best political reporters.

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  • SigFan

    There you go again. Asking Obama or anyone on the left to apply logic is like asking your dog to solve a physics problem. Neither one has any chance of happening.

    • http://flamemeister.com flamemeister

      After trashing the Constitution, flouting the laws of economics, libs will begin targeting the laws of physics. Reality is the Enemy. I’m not joking.

  • sbark

    This is the pattern of his entire Presidency………he continuosly campaign that he is going to add jobs–while his policies destroys jobs, He states he will not add a dime to the deficit—while spending more than the sum total of 220 yrs before him. He claims transparency while closing off even his golfing, let alone Fast & Furious and Benghazi.
    He rails on lowing taxes while doing just the opposite. He makes speech after speech on bi-partisanship govt–but does everything to shut the door on it. He came into office with statements on ethics and accountability—but has run the regime like a drunken adolesant full of excuses, with the main one being–GW did it 1st. He throws out how ObamaCare will solve that problem, while its apparent now that it will compound them.
    He is of a 3rd world mentaillity, fully supported by those with a 3rd world value to freedom and rights

  • JoeMN

    Tariffs, initially brought on thanks to the vices of government, are imposed merely for political gain

    Minimum wage increases sacrifice the jobs of the unskilled for political gain.

  • Thresherman

    Barack Obama is a first rate third rate mind.

  • mickey_moussaoui

    obama…man of science…hahahaha
    good one

    touche Mr. Boudreaux

  • http://nofreelunch.areavoices.com/ Kevin Flanagan

    Obama’s vision involves forcing the (non-minority) proletariat into toiling away their lives in government broom factories.

    • two_amber_lamps

      Because you can have five broom makers for every vacuum cleaner makers. The vacuum cleaner guild is a danger to the state because it puts broom makers guild members out of work. The vacuum cleaner guild must be eradicated!

    • WOOF

      We get our brooms from Asia.

  • two_amber_lamps

    Increase minimum wage, you make entry level jobs more scarce.

    Artificially drive up inflation.

    When will the libtards learn the law of unintended consequences? All your lever-pulling doesn’t happen in a vacuum.

    No free lunch…. sorry Lefties!

  • $8194357

    I wonder when this dual citzen poser will send his
    illegal immigrant uncle packing back to Kenya?