the good thing about studying macroeconomics

is that it reinforces my belief system. it's always good to find out you're on point.

Unintended Lesson

Russell Roberts

Last night, Hillary Clinton was on the Tonight Show and she gave a phenomenal example of the power of economics. Unfortunately, she did not appear to understand the example. At the 3:23 mark of this video, she tells a story (HT: Jim Colburn):

I was in Indianapolis the other day and I was shaking hands after I spoke. And there was this young boy about eleven years old and he's trying to tell me something—you know the crowd was yelling—so I leaned over and he said, "You know, my mom makes minimum wage and even though it went up, her hours were cut. So we're not making any more money. Can you help her?" You know, when somebody says something like that to you, it really does kind of energize me. I think, yeah, I can, I'm going to really try to help you, because this is wrong. And everywhere I go I hear stories like that about veterans who don't get health care, about people, who are, you know, losing their jobs, and I think we can do so much better. So for me it's just get up every day and fight on because this country's worth fighting for.

She then launched into a litany of economic disaster ("we're borrowing money from the Chinese to pay for oil from the Saudis") and finished up talking about the "deteriorating middle class."

I don't believe the story. What eleven year-old boy whispers into the ear of a big shot the details of his mother's wage/hours mix? And I like how she had to lean over--no one--not even Bill Richardson or Sinbad--can contradict her.

But let's give Hillary the benefit of the doubt. Suppose the story really did happen. She clearly thinks the story is emblematic of something important that needs to get fixed. What is it? Just when you help someone by passing a minimum wage, greedy employers ruin everything by lowering the hours. Well, we need to "fight" and fix that, too.

I wish Jay Leno had pointed out that the cut in hours was the result of passing the minimum wage--that it was as inevitable as gravity. I wish he'd said that the story showed how the minimum wage is a false promise of prosperity. I wish he'd pointed out that fighting isn't enough, caring isn't enough, that prosperity can't be legislated any more than self-interest can be made illegal. I wish Jay Leno had said that when you find yourself in a hole, the first thing to do is to stop digging.

And if that little boy really exists, I'd like to tell him that a Senator fighting for you is a losing proposition. You have to fight for yourself. If your Mom wants more money, she needs to go back to school or work a second job. And as for you, stay in school. It's the best way to avoid earning the minimum wage.

see what i'm saying? this class might not be such a pain in the ass after all...