CNN's John King and Wall Street Journal Senior Economy Writer Stephen Moore explain Herman Cain's 9-9-9 plan.
john. a big hurdle in economics is that the market is not clearing excess labour caused by the minimum wage laws (this artificial floor in economic terms enables chinese firms to outcompete in labour costs). by removing this floor (min. wage). businesses would be able to compete against chinese and mexican firms. labour mobility would enable US and mexican workers to fill the void, increase tax revenue and balance the budget. the issue is political... will CAW allow this? if their membership increases they have more money in their pockets, more membership and a stratified labour union (at all wage levels) so it should also be good for unions. instead of looking at currency pegs, which is artificial at best (Canadian dollar reaching parity because of exports of a 32 MM population vs 350 MM US population seems odd), working directly at jobs vs currency seems a better approach to productivity and utility (non-economic externalities/metrics vs a simple Balance of Payments (BoP) accounting) of success/leadership in the world.
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