Wednesday, February 13, 2013

State of the Union: Facts, Figures and Fiction


In last night's State of the Union address, President Barack Obama touched on the usual: the national deficit, gun violence, immigration, and education.

He also touched on everything he believes his administration has done right in the past four years and how those things are moving the U.S. toward a more promising future.

But the facts he presented to the public should be taken with a grain of salt. They're not false, per say, but they do have a number of caveats or timeline issues.

One of these inaccuracies was in regards to job creation. President Obama told the public, “After years of grueling recession, our businesses have created over 6 million new jobs.”

Those jobs were added, of course, but when they were added makes all the difference. According to AP, the 6 million President Obama refers to was counted beginning February 2010. Before that – during the recession – nearly 5 million jobs were lost. Since the start of his presidency a total of 1.9 million jobs were added.

Obama also praised the work the Affordable Care Act has already done to reduce the increase in the cost of health care. But the truth is, no one can ensure that reductions in the speed at which health care cost are growing actually has to do with the Act's reforms.

In fact, these costs appear to be increasing. Companies are beginning to dump the burden of costs on their employees, unable to cover them on their own. And now the average cost of annual health insurance premiums for a family with health care from an employer is $2,370. And some experts believe premiums could soon double.

President Obama also called for an increase in the minimum wage in his address – raising the wage floor to $9 an hour. The goal in this is, as Obama said, in order that “no one who works full time should have to live in poverty.”

But the GOP response, given by Senator Marco Rubio of Florida, highlights some issues with this increase in the minimum wage.

According to Rubio, this would do little to help as unemployment would be affected. And evidence shows this might be the case.

Small businesses have been strongly against an increase in minimum wage, arguing that it would limit the number of employees they are capable of hiring. Economists have agreed with this, arguing that a higher minimum wage risks increasing unemployment.

Rubio explained this in his address. From the Huffington Post:

“I want people to make a lot more than $9,” he said. “Nine dollars is not enough. The problem is that you can't do that by mandating it in the minimum wage laws. Minimum wage laws have never worked in terms of helping the middle class attain more prosperity.”

Rubio said that his proposal instead would work to foster an environment for “good-paying jobs,” noting that the minimum wage law would not create more growth.

The $9 minimum wage issue will face a battle if it moves any further than mere suggestion. And while other things will certainly take precedence, this is one more partisan issue Congress will face in the coming term.

 

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