As we already discussed here, President Obama signed an executive order this Thursday, "instructing the Department of Labor to update and expand overtime regulations to cover more employees," and so naturally heads are exploding everywhere on the right. Fox's Bill O'Reilly made it the subject of his Talking Points Memo tonight and despite his feigned concern for American workers, who he claims are going to be harmed by the order, I don't think it's the workers' interests he's got at heart here.
O'REILLY: President Obama and your paycheck, that is the subject of this evening's Talking Points Memo. This afternoon the president signed an executive order, raising the overtime pay level for working Americans.
The president did this to combat what he calls income inequality. So here's the deal, right? Right now American companies are not required to pay overtime if a worker on salary makes more than $24,000 a year.
Now that threshold could rise to $50,000 with the president's action today. So if you're earning less than $50K, your employer has to pay you time and a half if you work more than 40 hours.
Liberal Americans see this as a great thing. Today The New York Times editorialized “By reasserting a meaningful right to overtime, [the order] could lift pay for an estimated five million workers a week and, in the process, help to mitigate the wage stagnation and income inequality that increasingly plague the American economy.”
Well, that's not true. As the Wall Street Journal points out today, the likely outcome of the federal mandate on overtime pay is a cutback of hours and a loss of jobs. Companies have three options if they want to sustain their current profits.
1) Hire fewer employees on salary.
2) Cut back on their hours so they don't work overtime.
3) Pass the overtime costs to consumers in the form of higher prices.
So while in theory the president is helping workers, he may actually be hurting them. Talking Points does support an increase in the minimum wage. If we want to get people off welfare, we should pay them ten bucks an hour. That's an incentive. It's good policy. Of course there would be exceptions for teenagers and restaurant workers who get tips.↓ Story continues below ↓
But on the overtime deal, the president is once again trying to manage the private economy. As everybody knows, that effort has failed over the past five years. The economy is stuck. Many corporations are not hiring. Companies are hoarding money overseas to avoid taxes, and the social justice taxation system in general means consumers have less money to spend.
But President Obama is a theoretician, a man who looks at the world through the lens of what should be. And so the unintended consequences of his economic policies have held the American economy back, big time.
Talking Points wants American workers to make as much money as possible and the way to do that is job creation by the private sector. The more good paying jobs, the more competition for good workers. You've got to fill them so salaries rise. That's how you overcome income inequality.
Bill-O apparently doesn't believe that putting more money into consumers' hands does anything to create jobs or improve the economy. Those "job creators" are going to do that out of the goodness of their hearts.
h/t Media Matters