No shortage of anything: Or, why raising the minimum wage isn't going to hurt the economy.

In this economy we have more REAL deflation than inflation. This doesn’t show up in the official numbers, of course - they always tell a tale of inflation - but the key indicator of where we are is how much money is chasing the goods that are available. In short: are we seeing a shortage of ground beef or a surplus?

We have more homes available that are vacant than we have homeless people, we have consumer electronics sitting on shelves waiting to go on sale, and food is going unsold and being wasted up the wazoo - to the tune of millions of tons per year - because no one can afford to buying it. Likewise the economy sees countless numbers of surplus cars (cars sitting on the lot but no one buying them), iPads always in stock, and so on. Speaking of ground beef, for all the input costs that are supposedly rising, you’re going to find it very hard to find an American supermarket whose meat section is in any way close to bare: a lot of that food will expire and get thrown out because no one has money to afford it. The truth is, aside from oil, almost nothing is even within sight of shortage. The only shortage America face is money in the hands of the working class.

Giving the working class more wages is going to drive them to buy up this excess stuff and actually justify its reason for being on the shelves-equivalent in the first place. We literally do not have any shortage of goods at all in this system. We waste a lot, we produce a lot that no one can afford to buy. Raising wages at this point brings us closer to equilibrium, not into imbalance. Not even close.

Do you hate labor unions? Well let's take a look at that, shall we?

Labor unions are primarily about collective bargaining.

What does this mean?

It means that when the company's stock is sky high and corporate execs decide that they need a raise and you workers - you know, the people who made the company successful - need a pay cut, you get the shaft. But wait, here comes the Union who fights back and stops your pay cut. Guess what that means? It means you get to share in the prosperity that you as a group made possible.

• Oh but you as an individual can negotiate on your own for a better salary! Uh yeah, good luck with that. It's you versus the entire corporate board. You're hilariously outnumbered from the start. And these guys would rather you work for free. Giving you a raise? That hardly even happens for working class Americans anymore. You can thank the anemic job growth during the Dubya Bush years for that. But actually you could go back even further to Reagan's years.
• Oh but if you don't like what you're getting paid, you can go elsewhere! How's that working for most Americans today? Every job out there has at least 3 people applying for it. And that doesn't even count the discouraged workers. It's more likely that if you find another job, they're paying even less. And for 10 years before Obama came along, employers were cutting back on offering benefits. So when you say you don't need a union to fight for you to get benefits, what you're saying is you'd rather pay for individual health care insurance elsewhere. This is a financial Darwin award-winning bad move. One well known fact about health insurance is that individual rates cost a LOT more than the group rates your employer can offer. So when you have a union fighting to secure health benefits for employees you could be saving hundreds or, depending on your pre-existing conditions, thousands of dollars per month. 
• Oh but you're super talented! You could always leave and start your own company. Yeah, uh huh. How many of you John Galts out there have actually done that, much less been successful? 8 out of every 10 businesses fail, even those run by geniuses just like you. Take it from a successful business owner - you're going to spend less of your time applying your talents and more time hunting for clients in the first year, and then more of your efforts will go into trying to get them to pay on time. But wait, even if you clear all those hurdles, in some industries your consulting job will mean getting familiar with terms like Net 30 or Net 60. Pray you never have to learn about that. Now you know the real reason why only 20% of businesses succeed. What makes you think you'll be one of those 2 in 10?
• Employees are expendable. CEOs are not. So, you're expendable? Ever see a lamb basting itself in front of a wolf? Yeah, that's you. Very few corporations die when their CEO leaves. Microsoft and Apple survived the departure of Bill Gates and Steve Jobs, respectively. CEOs are just as expendable as you. Shocking, huh?
• Oh but unions are corrupt! Of course, and there's no such thing as corrupt corporate leadership doing things like borrowing against an employee pension fund and then going bankrupt to avoid paying it back. And ending with a screw-you money shot like blaming the unions for the resulting mess.

The Depression, Globalization and the Smoot-Hawley Tariff Myths: Something to Think About

It has been argued that the Smoot-Hawley series of tariffs did enormous damage to the economy during the Great Depression. The pro-globalist interpretation of the historical facts is that because America imposed massive tariffs, and other nations retaliated, this led to serious damage to the economy.According to the pro-globalist story, Smoot-Hawley caused, or exacerbated, the Great Depression because it severely impaired global trade.

The problem is, factually, this is simply not true.

1) The nation’s GDP fell by almost half (46%) - and this affected international trade, not the other way around. We lost jobs, people stopped producing, and what little we produced, was being consumed here. And with other nations suffering as badly or worse than we were, they were in no position to buy anything from us. Which meant that their retaliatory tariffs were redundant when it comes to their effect upon trade. International trade was hindered because whole nations’ economies took a nosedive. Not the other way around.

2) There is another factor that pro-globalists do not consider when arguing that Smoot-Hawley caused (or exacerbated) the Depression. This factor is almost never even brought up by anti-globalists. History shows that when Smoot-Hawley was passed, the United States was not running the kind of monster $250 billion annual non-oil ($500 billion with oil imports) trade deficit that we are running today. The United States, at the time, was running a slight trade surplus for most of the Depression years. Think about it. Exporting goods generates more domestic jobs, and better-paying domestic jobs, than importing goods. If you pass massive across-the-board tariffs when you are exporting more goods than you are importing, and everyone else retaliates, you stand to lose your net export activity. You stand to suffer a net loss of jobs.IN THEORY; this did not really happen in the Great Depression because the jobs had already disappeared. Now, if you are importing far more than you export, you stand to lose imports - and you also stand to end a situation where domestic factories are closing down to move overseas.

If Smoot-Hawley was ever going to do even the slightest harm to the United States economy, the only time it would ever do so is if the United States is running a trade surplus: that means, Smoot-Hawley can only ever hurt the economy if we are exporting more than we are importing. Again, that is not the case today. We are importing more than we are exporting, and we are bleeding jobs out of the country as a result.

Ever wonder why China has succeeded so well? They slapped heavy tariffs on American products, for one. They also devalued their currency, for two. South Africa is also raising other, de facto trade barriers (“buy local”), and it’s working marvelously for them. Yet globalists say that trade barriers won’t work for America?

3) Finally, there is one last factor that the pro-globalists are wrong about: none of the anti-globalists are calling for an across the board shutdown of imports that Smoot-Hawley was aiming for. What we want is to reduce the trade deficit to zero. America runs the largest trade deficit of any country in the world, and we run a net trade deficit with almost every major country in the world. We are bleeding out more jobs than any other nation in the world. A $250 billion non-oil trade deficit is deadly, and it is most certainly unsustainable. Trade deficits like what America is running, have a direct impact on the national debt - $250 billion (much less $500 billion) annual trade deficits make the national debt grow. And you cannot stop this type of debt growth by cutting domestic spending. Moreover, trade deficits of the magnitude that America is running, also devalue the United States dollar.

Here is the ultimate reality that pro-globalists do not want to discuss.These trade deficits will end. There is getting around this. They will end. The question is whether they end with laws that act to balance out trade, or they end when the deficits destroy our economy - and all the other economies (such as China) that depend on exports to America.

There’s only so far an economy can go by bleeding another nation’s working class of their jobs.