Thursday, December 22, 2005

Stop the madness, break the cycle of poverty, blah, blah, blah...

«A hurricane exposes the poverty of America's inner cities, and the champions of big government make political hay out of it. Riots lay bare the underclass in Paris's suburbs, and the French are astounded that such a thing could exist in their country.»
Patrick Chisholm writes in the Christian Science Monitor.
«Bill Clinton, John Kerry, John Edwards, and others seized on the New Orleans issue to blame the Bush administration for causing or exacerbating that city's poverty. This took an amazing amount of chutzpah, considering that New Orleans and Louisiana are longtime strongholds of their own political party.

In fact, Democrats have long controlled almost all of America's inner cities. The Brookings Institution recently ranked the 50 largest cities in the United States according to their concentrations of poverty. A quick check reveals that the 10 cities with the highest concentrations of poverty have Democratic mayors, with the exception of New York City (whose Republican mayor is something of an anomaly in a Democratic-dominated city). By contrast, the few Republican big-city mayors hail mainly from cities with the least concentration of poverty.

So why is there so much unemployment in America's inner cities and in France's suburbs? It is largely because onerous government regulations dissuade employers from offering jobs to low-skilled people.

Probably the biggest barrier to job creation for the low-skilled is the minimum wage. This problem is most pronounced in France, where the national minimum wage is about $9 per hour. It is a no-brainer why unemployment among rioting Muslim youths is so high: French employers do not consider their skills valuable enough to justify paying them $9 per hour. Not helping the situation are the country's rigid labor laws, which make businesses even more reluctant to hire.

So the solutions advocated by the champions of big government produce a pull/push effect: the poor get pulled into certain areas, and employers get pushed out. Poverty deepens.

Unless that cycle is broken, expect a continuation of poverty in America's inner cities, and additional manifestations of discontent among France's underclass.»
Regardless of anything else going on, it’s hard to say that the economic argument isn’t also valid in any event. Only ideologues who can’t cool it from time to time find a ‘single bullet’ theory to explain the world to themselves.

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