Obama's proposal to raise minimum wage won't work - the focus should be on education instead

"Human psychology contains many dualities, one of them being that even while people understand the need for change, knowing how important it is for institutions and individuals to be occasionally renewed, they are also irritated and upset by changes that affect them personally." - from the book 'The 48 Laws of Power' by Robert Greene.

I agree that change is very difficult. Change creates a vacuum that people perceive as chaos - I have experienced this recently at my job...

The problem I have with government providing social welfare is that it doesn't know where to stop. What is a 'minimum level of care'? Opinions vary significantly on this. Obama proposes raising the minimum wage to $9.50 / hr (by the way this is more money than I made during the summers while going to college). Surely if everyone in the country makes at least $9.50/hr they will have an improved standard of living. But why not take it a step farther? Why not raise the minimum wage to $100/hr? Wouldn't that make standards of living even better? Think through the effects of such a policy and you can see the danger in the government trying to create standard of living for people.

I have read several sociology books recently, including "The Working Poor" (which I thought was good). The author did a good job convincing me that many poor people may lack the foundation to understand that their situation could be different. Their reality is so strong and they lack role models to help them understand how to improve their lives. By and large, the education system is not working for a large percentage of people. Many people have suggested that funding is still not sufficient, but I disagree. The US currently spends more money per student on education than any other nation, yet ranks near the bottom in all testing categories.

The best idea I have seen on the table is to completely dismantle the federal educational program. Currently, public schools receive funding with a variety of strings attached - most notably in the content they are required to teach. Instead, I would like to allow for a completely private school system, but provide a $3000-$4000 education voucher. Allow parents to send their children to any school of their choosing. The whole debate over whether certain topics are appropriate for public schools is nonsense - let local communities decide which topics should be included and which should be withheld. We need to create an environment where teachers and institutions have incentive and are rewarded for the performance of their students. Only then do I believe we would see improvement in education quality.





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Assistance programs make people weak

The current situation feels a lot like the novel Atlas Shrugged in that the pursuit of opportunity for all ignores the basic fact that not all people are responsible. Policies were put into place to try to make home ownership available to all. It sounds nice, but its not realistic. When you start looking at something as a social good instead of a business transaction, sound judgment goes out the window.

John McCain wants to reduce taxes and trade barriers to create a more competitive environment. His energy policy will encourage our nation to pursue a variety of energy sources and let the market decide which are most viable. Competition in any free market system has led to greater variety of services offered and better value (lower price) to the consumer.

Some of Obama's energy policy ideas are just illogical. For example, he wants to tax oil companies and then hand out rebates to the American public? Doesn't he realize that nothing is created by doing this? It's simply a transfer of wealth. We'd all like to believe that the poor will take this $1,000 rebate and spend it on education for their children. The reality is that the poor will continue to spend it on televisions, McDonalds, and whatever else they currently buy. Does anyone believe that giving people more money will change their behavior?

Most people do not appreciate things they are given for free - marketers and retailers understand this concept well. A better idea is to make it easier for people to create their own wealth and then set them free. The government has never been successful at addressing social issues, and I don't believe it ever will be. The people who think up social programs make the false assumption that the recipients would use the opportunity/benefit to improve their situation. The reasons for their current situation are typically a lot more complicated than simply a lack of opportunity.




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Obama's ideas for our environment sound nice, but his implementation plan is flawed

I believe the environment is important. Where I differ from many people is that I believe the government's role is simply to place caps on harmful outputs, and then let private industry figure out how to meet that cap (allowing a trading system). You don't have to look any farther than Obama's web page to see some of his misguided implementation plans for solving our energy needs and protecting the environment. He proposes a lot of big ideas, but very little information as to how these ideas would be implemented, other than the first step of collecting more taxes.

- "Obama will enact a windfall profits tax on excessive oil company profits" [and give the money to citizens].

Huh? Oil companies aren't making any more money than any other type of business (they do more volume). Oil companies do not directly set the price of oil. They are already not investing money to explore and drill for more oil because it does not make financial sense to do so. Obama wants to tax them more? That will just make them invest even less in exploration and drilling. They'll simply deplete their reserves and then turn themselves into a trust.

- Crack down on oil speculation? Swap oil from the strategic petroleum reserve?

Its not clear what Obama plans to do but if you try to obstruct free market trading of something, then there is no real price - similarly to how the govt. is taking over Freddie/Fannie and has restricted short selling on many securities. This practice can obstruct the true value (could be $0).

- Weatherize 1 million low-income homes annually

Why would the government take on a project like this? This is supposed to reduce our dependence on foreign oil? I don't get it. Who is supposed to pay for this, I suppose individuals and businesses making over $250,000?

- Develop & deply clean coal technology

Sounds nice and I think we should pursue it but this technology is a long way from being available.

The reason I like McCain's plan better is that he doesn't promote a specific technology or have any crazy plan to insulate poor people's homes with taxpayer money. His plan is simply to enforce emissions ceilings and setup a carbon trading program. Along with that he wants to reduce the regulatory burden associated with developing new technologies.

As soon as there is a viable system in place for people to make money by reducing carbon emissions, they will do so. This is already starting to happen but a commitment to this system would catalyze developments in "green" technologies much faster than anything the government could do with any amount of money.

The government has no experience in creating things that are commercially viable. It's only goal should be to provide an environment where there is a financial reason for green technology to be developed.




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