Of Magical Thinking and Leftist Economics

I have often thought that Leftists must believe that unicorns or good fairies bring wealth, because their approach to economics always requires magical thinking.  Seattle has mandated a $15.00 an hour minimum wage.  Predictably businesses unable to pay the increase are going out of business.   That this takes many erst-while supporters of this exercise in prosperity through fiat by surprise is very amusing.  Ian Tuttle at National Review Online gives us a case in point:
I’m hearing from a lot of customers, ‘I voted for that, and I didn’t realize it would affect you.
Hibbs opened Comix Experience on April Fools’ Day, 1989, when he was just 21 years old. Over two-and-a-half decades, the store has become a must-visit location for premier comic-book artists and graphic novelists, and Hibbs has become a leading figure in the industry, serving as a judge for the prestigious Will Eisner Comic Industry Awards and as a member of the Comic Book Legal Defense Fund’s board of directors. He notes with pride that his store has turned a profit each year — no small task — since its very first year.
 But that may not last. Hibbs says that the $15-an-hour minimum wage will require a staggering $80,000 in extra revenue annually. “I was appalled!” he says. “My jaw dropped. Eighty-thousand a year! I didn’t know that. I thought we were talking a small amount of money, something I could absorb.” He runs a tight operation already, he says. Comix Experience is open ten hours a day, seven days a week, with usually just one employee at each store at a time. It’s not viable to cut hours, he says, because his slowest hours are in the middle of the day. And he can’t raise prices, because comic books and graphic novels have their retail prices printed on the cover. What is a small-businessman to do?

Go here to read the rest.  Kipling predicted this long ago:
In the Carboniferous Epoch we were promised abundance for all,
By robbing selected Peter to pay for collective Paul;
But, though we had plenty of money, there was nothing our money could buy,
And the Gods of the Copybook Headings said: “If you don’t work you die.”

More to explorer


  1. While a move would involve its own set of expenses, perhaps Mr. Hibbs should
    consider relocating to a saner state– he’d likely do well here in Texas.
    Once again we see the pattern of liberals spending other people’s money to
    make themselves feel good about themselves, without giving much thought to
    how their choices actually affect people. It is astonishing that they’re so out of
    touch with reality that they do not see this result coming. It’s sad that many
    mom-and-pop businesses in Seattle will be driven out of business and be
    replaced with chains that have deeper pockets and operate with more economy
    of scale. The people of Seattle were worse than fools to vote for this and
    frankly, they deserve what they get. Idiots.

  2. @Clinton: I was also going to say….Move to Texas….but Texas doesn’t need any more transplanted liberals, do they? I say he should find another state that at least hasn’t succumbed to this idiocy (yet) but stay out of Texas, please.

  3. In determining the amount of the wage, the condition of a business and of the one carrying it on must also be taken into account; for it would be unjust to demand excessive wages which a business cannot stand without its ruin and consequent calamity to the workers.


  4. This was an initiative of Mayor. The mayor’s capsule biographies do not give his employment history prior to 1990. Evidently he earned a degree in sociology from the University of Portland in 1980 (that’s a Catholic college run by the Holy Cross fathers). He’s made a public point of his homosexuality for 35 years, so you can see his schooling was decisive. He’s also a seminary dropout. All of his admitted employment since 1990 has been in the public sector or for philanthropic concerns. Big f****** surprise.

  5. The nine member city council includes a dyke and an SDS veteran (who also lived on a commune for twenty years). Three have worked as attorneys and three have worked as journalists. Two have some kind of business background (one of whom was a company GC). One was a computer programmer (but at this point in her life is some sort of commie). Big F***** surprise.

  6. Also, maybe I’m reading too much into the article (“I was appalled!” he says. “My jaw dropped. Eighty-thousand a year! I didn’t know that. I thought we were talking a small amount of money, something I could absorb.”) but I’m having a hard time feeling sorry for someone who appears to fit the definition of the useful idiot who just realized what the customer wanted the rope for.

  7. I’m not seeing how the store owner assented to this at any point, just that his initial thought was he could absorb the cost.

    You ‘create a job’ when two parties come together for a common purpose. The wage is a crucial influence on whether than agreement is worth it to the parties. Characters like those on the Seattle City Council look upon businesses as suitable objects for looting and nothing more.

  8. I recently read that Obama may return to community agitating when he finishes wrecking our country.
    Here’s how he helped de po’ people way-back-when.

    “President Barack Obama was a pioneering contributor to the national subprime real estate bubble, and roughly half of the 186 African-American clients in his landmark 1995 mortgage discrimination lawsuit against Citibank have since gone bankrupt or received foreclosure notices.

    “As few as 19 of those 186 clients still own homes with clean credit ratings, following a decade in which Obama and other progressives pushed banks to provide mortgages to poor African Americans.

    “The startling failure rate among Obama’s private sector clients was discovered during The Daily Caller’s review of previously unpublished court information from the lawsuit that a young Obama helmed as the lead plaintiff’s attorney.”


    “Magical Thinking and Leftist Economics” greatly contributed to the recent Great Recession.

  9. Obama’s a lawyer who fancies that underwriting is something banks do not know how to do so need to be told by lawyers, or he fancies that they need to be told by lawyers to eat the cost of bad business decisions because lawyers and their clients are just damn better than loan officers, or he fancies that lenders leave money on the table due to spite so routinely they need to be told by lawyers not to do that.

  10. Art: You are giving the zero (and the rest of the wrong people running the country) too much credit, both for intellect and for hionesty – both of which are totally absent.
    One doesn’t need to be Einstein to realize that the Feds still want banks to lend to “low-to-moderate” income peoples: Community Reinvestment Act (CRA). One doesn’t need to prove “discrimination.” All needed is to show “disparate impact” or what they used to call the “effects test.” As in whatever the bank did (it don’t matter what) if it had the effect of discrimination it was discrimination.
    Clinton’s appointed his late term HUD Secy. Cuomo who ordered FNMA and FHLMC to buy up to 50% of their paper volume in “low-to-moderate” income peoples’ bad paper. Bush and his country club GOP saw the profits and ractchetted it up. After 2008, the corrupt, incompetent politicians and the lying liberal media blamed the banks, say, Wells Fargo for forcing subprime loans on poor blacks and foreclosing on their homes. As if a banker ever existed that wanted to foreclose on a “low-to-moderate” income slum.


  11. When corrupt Clinton took over wrecking America, the US homeownership rate was 63%. When he left the WH, penny-less, the rate was 68%. The rate topped out at 69% under Bush, not a meaningful increase.
    By 1997, Fannie was offering to buy 97% loan-to-value mortgages. By 2001 (Bush first year and he never changed management), it was offering to buy mortgages with no down payment at all – 3% to zero (traditional down payment is 20%, plus debt payments to income ratio of say 28%) less owner’s equity is not a material factor. NB prices were inflated by the excess liquidity ($$$ chasing real estate) that the GSE’s and CRA-pushed banks pumped into the market. So, values were fairy-tale/mark-to-make-believe values based on government interference. Later, they allowed low teaser rates and negative amortization, without analyzing whether the obligor (lawyers use that noun) could pay the regularized payments. The myth was (despite the S&L crisis and several RE bubble-bursts in living memory) that RE sales prices rise forever.
    The Bush dynasty’s country club/chamber of commerce backers were as wrong about housing as they are about open borders. The idiotic libs’ “minimum wage” rants are even more ruinous/stupider.
    FYI Fed rate rises were nothing when adjusted for annual real estate price increases/inflation, resulting in negative perceived/real (nominal rate less inflation rate) interest rates for such loans.
    Will Rogers would know the problem with the wrong people running America. “The problem isn’t what people don’t know. It’s what people know that isn’t so.”

  12. Where was the bishop?

    The moral superiority of free trade was worked out by late-medieval Scholastic Catholic scholars. The immorality of coveting thy neighbor’s goods is of older knowledge and much higher authority. And it’s not as if bishops in America’s hotbeds of left wing socialist economics and Social Justice Bullying are being asked to stand up to murderous national socialists. Yet.

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