Obama Takes the Credit, Workers Suffer the Consequences – Ep.91

  • One more time President Obama seeks to buy Democratic votes with a free lunch by appealing to workers
  • Promising more overtime pay, to go into effect in 2016
  • Raises the threshold for overtime pay requirements
  • Workers who earn salaries of $50,000 or less must be paid overtime for hours worked over 40 hours per week
  • This prevents workers who put in extra hours on their own time to try to advance
  • This could cause employers to reduce salaries to factor in overtime
  • It will be harder for employers to change existing work agreements
  • This will adversely affect workers on flexible schedules, such as those who work at home in 2016
  • Employers will have to seek more control over workers’ schedules
  • New law will disproportionately hurt women, the very constituency Democrats claim to protect
  • Those who have variable workloads throughout the year will be adversely affected
  • This law eliminates choice and increases costs, but it’s great politics
  • Followup on Puerto Rico: Minimum Wage
  • Puerto Rico is an example of the adverse effects of a minimum wage law that has devastated an economy
  • Puerto Rico’s has more than 20% unemployment
  • Puerto Rico labor force participation rate is 42-43%
  • The minimum wage has priced out more than half of the labor force
  • There is no entry level work in Puerto Rico
  • If the minimum wage is so good, why does it not work in Puerto Rico?
  • Puerto Rico is a real-life case study on the adverse effects of minimum wage laws
  • Puerto Rico’s only advantage is its tax law for incoming businesses which will increase demand for labor
  • Recent comments on my last podcast questioned my support for Puerto Rico
  • I never advised buying Puerto Rican debt – I knew it was a problem
  • It makes sense to move to Puerto Rico to take advantage of the new tax laws

Peter Schiff is an economist, financial broker/dealer, author, frequent guest on national news, and host of the Peter Schiff Show Podcast.



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