The Del Rio Diner in Brooklyn – long a hotspot for folks looking to get a good meal on the relatively cheap – is closing its doors. According to the owner, he has no other choice. Not with New York hiking the minimum wage in order to placate the Fight for $15 crowd.
To be able to pay out wages like that the Del Rio Diner would have had to raise the price of menu items 133% (for example, a sandwich normally priced at $6.75 would have to sell for $9). As yours truly and a great many other right of center commentators have noted, raising the minimum wage does little to make things more affordable, and it hurts most those it’s supposed to help. The cooks that used to work at Del Rio Diner can’t afford a sandwich now whether it sells for $9, $6.75, or 67 cents because they’ve just been priced out of the labor pool by Fight for $15 liberals.
That’s not the reason we’re getting ready to swan dive our way into a great big recession, though. It’s a second order effect sure, but it’s not the source. And granted, for a great many Americans, we’ve been in a recession for almost a decade now.
The Labor Department’s Bureau of Labor Statistics reported actual unemployment for June 2016 as 9.6% – yes, the media parroted 4.9% unemployment. They did so because the Trump and Clinton conventions were forthcoming and the media’s all in for the latter of the two candidates. 4.9% is derived from the “U-3” statistic which represents the recently unemployed, whereas 9.6% comes from the “U-6” statistic which represents the long-term unemployed. Stay on the U-3 rolls long enough and you roll over to become a U-6 statistic as far as the Labor Department counts you. Or to put it another way, all those cooks at Del Rio Diner making $0.00 and hour now because of Fight for $15 will initially be counted in the U-3 number. Then, if they are out of work long enough, they’ll become U-6 numbers the media doesn’t care about anymore. Unless Trump is elected.
If Trump becomes President, the U-6 will be miraculously rediscovered by the media just like the media’s miraculous discovery of “dark America” in Trump’s speech – as if liberals haven’t pushed an apocalyptic vision of America for decades now. Or their miraculous if fleeting discovery of WMDs in Iraq as reported by the New York Times around 2008.
In any event, it will be either Trump or Clinton that will have to address an economic downturn that’s already in the making.
Caterpillar just announced (on July 27th), poor earnings numbers. “We’re not expecting an upturn in important industries like mining, oil and gas and rail to happen this year,” Caterpillar CEO Doug Oberhelman said. While liberals might be dancing in the streets at the thought of shuttered mining and oil/gas industries (Hillary Clinton did after all promise that she would put a “whole lot of coal companies and coal miners out of business”), the sectors Oberhelman noted are structurally important to any modern economy.
Or more plainly, it’s mining, oil, gas, and the bulk transport only rail can accomplish that gets raw materials from their source to places where they become useful for the overall economy. A wad of goop mined up from Gaia’s bowels doesn’t do me or you any good until it’s turned into something. If raw materials aren’t being developed right now during the summer of 2016, that translates into a downturn that ought to hit sometime between October 2016 and the winter. Imagine driving down the highway at 65 miles per hour and then the engine quits. That is what’s getting ready to happen to our economy.
Will this represent an “October surprise” that catches one or both Presidential wannabes off guard? Or are we as a nation so drunk on Black Lives Matter, armchair activism, the Kardashians, and the weakest economy witnessed in generations, that we’re immune to feeling the effects of another major downturn?
Hopefully, we aren’t. Hopefully, we elect someone to the White House that knows a little something about dollars and common sense.