Capitalism

House Democrats Push Through $15 Minimum Wage

The following was originally published as part of Dr. Mark Skousen’s regular publication, Investor Café. He is also the editor of the Forecasts & Strategies, High-Income Alert, Five Star Trader, TNT Trader and Fast Money Alert investment advisory services.

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The Democratic Party, which has exhibited such socialistic tendencies that I am nicknaming it the Democratic Socialist Party, pushed through the Raise the Wage Act in a 231-199 House vote, lifting the federal minimum wage from $7.25 to $15 an hour for “nearly all” American workers by 2025. Now it will go to the Senate.

Senator Mike Lee told me at FreedomFest last week that it has “no chance” of getting through the Republican-controlled Senate. Nevertheless, some states have already adopted the $15 an hour measure: California will reach $15 an hour in 2022, Massachusetts in 2023, New Jersey in 2024 and Illinois and Maryland in 2025.

Minimum wage legislation is one of the worst examples of bad economics, yet it appears on the surface to be good politics. It makes legislators look as if they are compassionate and concerned about the well-being of its poor and middle-class workers, but what if a $15 minimum wage ends up putting people out of work, or having them cut back their hours?

A reduction in hours is exactly what Senator Bernie Sanders did when his campaign staff complained they were earning less than $15 an hour. He responded by boosting their pay to $15 an hour but cut back their hours! It is amazing how misguided the Democrats are when it comes to understanding basic economics.

Whether it’s advocating the minimum wage, Medicare for All, or free college tuition, they fail to understand the principles of accountability (user pays), or welfare (help those who need help, but don’t help the well to do).

It is what I call the A&W principle (see my column on the A&W principle at by clicking here.)

Good investing, AEIOU,

Mark Skousen

Editor, Forecasts & Strategies

Mark Skousen

Mark Skousen, Ph. D., is a professional economist, investment expert, university professor, and author of more than 25 books. He earned his Ph. D. in monetary economics at George Washington University in 1977. He has taught economics and finance at Columbia Business School, Columbia University, Grantham University, Barnard College, Mercy College, Rollins College, and is a Presidential Fellow at Chapman University. He also has been a consultant to IBM, Hutchinson Technology, and other Fortune 500 companies. Since 1980, Skousen has been editor in chief of Forecasts & Strategies, a popular award-winning investment newsletter. He also is editor of four trading services, Skousen TNT Trader, Skousen Five Star Trader, Skousen Home Run Trader, and Skousen Fast Money Alert. He is a former analyst for the Central Intelligence Agency, a columnist to Forbes magazine (1997-2001), and past president of the Foundation for Economic Education (FEE) in New York. He has written articles for The Wall Street Journal, Liberty, Reason, Human Events, the Daily Caller, Christian Science Monitor, and The Journal of Economic Perspectives. He has appeared on ABC News, CNBC Power Lunch, CNN, Fox News, and C-SPAN Book TV. In 2008-09, he was a regular contributor to Larry Kudlow & Co. on CNBC. His economic bestsellers include “Economics on Trial” (Irwin, 1991), “Puzzles and Paradoxes on Economics” (Edward Elgar, 1997), “The Making of Modern Economics” (M. E. Sharpe, 2001, 2009), “The Big Three in Economics” (M. E. Sharpe, 2007), “EconoPower” (Wiley, 2008), and “Economic Logic” (2000, 2010). In 2009, “The Making of Modern Economics” won the Choice Book Award for Outstanding Academic Title. His financial bestsellers include “The Complete Guide to Financial Privacy” (Simon & Schuster, 1983), “High Finance on a Low Budget” (Bantam, 1981), co-authored with his wife Jo Ann, “Scrooge Investing” (Little Brown, 1995; McGraw Hill, 1999), and “Investing in One Lesson” (Regnery, 2007). In honor of his work in economics, finance, and management, Grantham University renamed its business school “The Mark Skousen School of Business.” Dr. Skousen has lived in eight nations, and has traveled and lectured throughout the United States and 70 countries. He grew up in Portland, Ore. He and his wife, Jo Ann, and five children have lived in Washington, D.C.; Nassau, the Bahamas; London, England; Orlando, Fla.; and New York. For more information about Mark’s services, go to http://www.markskousen.com/