During the State of the Union address last night, President Obama declared that “It’s time to give America a raise.” From there he segued into a riff on how Henry Ford decided to give his workers a raise so they could buy cars from the Ford Motor Company.
Obama’s call last night was to raise the minimum wage. He is evidently under the mistaken impression that most of us work for minimum wage — how else could raising the minimum wage constitute “giving America a raise”?
Does Barack Obama think that we’re all out here working minimum wage jobs, just waiting on him to give us all a few more bucks? Is that how he thinks the economy works?
The fact is, only about 4.7% of American workers work for minimum wage. Most of them are high school and college students working their first jobs. The minimum wage should be a temporary condition for the vast majority of them — all of them, if they obtain their education, build their job skills and stay away from drugs and other things that hurt them and their career prospects. If they perform well on those jobs, and avoid making career-limiting decisions, they will soon get raises from the companies they work for, without any intervention from Barack Obama or Congress at all.
Henry Ford was probably not the best example for Obama to use in his illustration, either. Henry Ford was an extremely shrewd businessman. He was a member of the vilified one percent. Ford’s decision to raise wages for his workers was his own to make, and even in Obama’s telling, Ford raised wages out of self-interest. He wanted to reduce turnover to keep his trained, skilled workers around longer. He wanted to sell more cars. Raising wages of his own workers so they could buy Ford cars was one way to sell more cars and keep his best workers. Those cars Ford sold to his employees also became rolling advertisements for Ford’s products.
In Obama’s telling, maybe Lear should raise all its workers wages so that they can all buy Bombardiers*…No? Why or why not? Show your work.