Ivory Tower Economics

Accuracy in Academia ^ | June 13, 2011 | Malcolm A. Kline

[Academiadotorg]

Academic economists find that they can make whatever prognostications they like since they don’t have to live with the results. “Official motto of the White House economic team: Those who can, do. Those who can’t, fantasize in the classroom, fail in Washington and then return to the Ivy Tower to train the next generation of egghead economic saboteurs,” columnist Michelle Malkin notes. “Life is good for left-wing academics.”

“Everyone else pays dearly.” For the past two decades, economists in the Ivory Tower have been trying to overturn decades of research that shows that raising the minimum wage leads to an increase in teenage unemployment.

At the Center for American Progress (CAP) on June 7, 2011, a couple of economists from Berkeley showcased their efforts. Previous studies, they claim, left out significant variables.

Yet and still, in their critiques, they may have missed a few variables of their own. They did acknowledge one big one.

“In the last several years, the minimum wage has gone up and teen unemployment has gone up quite a bit but is that causal?” Michael Reich, Professor of Economics and Director of the Institute for Research on Labor and Employment, University of California, Berkeley, said at CAP. “We are in a recession.”

[econjack]

...egghead economic saboteurs

This is too simplistic. I taught economics for years at several different universities and not all of us are lean-to-the-left economists. My hero was Milton Friedman and I was lucky enough to have met him several times. He was the brains behind the Reagan administration's policies and I think most will agree that was a pretty good time in terms of economic conditions, especially considering what he inherited from Jimmy Carter. True, there aren't many of us conservative economists, but some do exist. Alas, we don't get much of a voice because the MSM don't like our message.

[TruthShallSetYouFree]

economists in the Ivory Tower have been trying to overturn decades of research that shows that raising the minimum wage leads to an increase in teenage unemployment

It's obvious from the simplest microeconomic analysis that raising the minimum wage leads to an increase in teenage unemployment. Teenagers are at the bottom of the payscale, since they are the least experienced and therefore least productive employees. They will only be hired when the increase in revenue that is generated by their presence is higher than the cost to employ them. This is market driven. If a teenager brings another 7 bucks an hour to his employer's bottom line, he can afford to hire him for 6 bucks an hour, but not 8. If the government mandates 8, he will remain unemployed.

[JudgemAll]

It’s what they do, propose fundings and investments with other people’s money.

It used to be money was made and raised by people who had goods produced to back it with, but nowadays it’s the reverse, the government and fiat currency holders decide to print money and swear to you it is good money.