At Town Hall, Small Businessman Tells Obama He Wants a Higher Minimum Wage

PERRY: “Mr. President, I would like to thank you also for visiting. My name is Randy Perry, this young lady’s father. I do have a small manufacturing company in rural America. But how do you speak to us, small manufacturers, that want to raise the minimum wage, but we have to compete?”
OBAMA: “Well, as I said before, the first thing we need to do is to make sure that the economy as a whole is strong because, remember what I said, when the economy is strong as a whole, there is more demand for workers. That gives workers more leverage to get pay raises.

The same is true for businesses. When demand is high for whatever product you’re producing, then you can afford to charge a little bit more. And the truth of the matter is is that for a lot of small businesses, there’s going to be more pressure than large businesses when it comes to wages because you just don’t have as much margin for error.

But overall, our economy is going to do better, and small businesses do better when there is greater demand out there for products and services. And there’s greater demand for products and services if people have money in their pockets.

And one of the biggest problems we have in our economy right now — and this includes one of the biggest problems for small businesses — is that when a bigger and bigger share goes to folks at the top, a lot of that money, they just don’t spend.

I had lunch with Bill Gates the other day. Now, Bill Gates has a lot of money. And he’s doing great things with it, by the way, doing great charitable work. But the truth of the matter  is that if Bill Gates gets an extra million dollars, it’s not like he’s going to spend more money on food or go and buy an extra car, or buy a new refrigerator, because he’s already got everything he needs.

But if somebody who is a low-wage worker gets a raise, first thing they’re going to do is they’re going to spend it — maybe on a new backpack for the kids, or finally trade in that old beater for a new car.

And that drives the economy. It picks it up. It boosts it. And when that happens, then more demand exists for services and goods. And that means that all businesses are going to do better, including small businesses. And that, then, gives you the higher profits, which then allows you to pay your workers a little bit more.
You get in this virtuous cycle.

And this is part of the argument that I’ve been having with my good friends in the Republican Party for quite some time. If you look at the policies we’ve been pursuing and proposing — investing in research and development, rebuilding our infrastructure, making sure that college is more affordable, improving child care, fair pay legislation, increase the minimum wage — I can point to evidence that shows that that’s going to put more money in the pockets of middle-class families. That’s going to increase growth at a faster pace, and the economy, as a whole is going to do better.

And their main response to me typically is two things. One is they’ll say we got to get rid of regulations. Except the problem is, for example, the last big crisis we had was precisely because we didn’t have enough regulations on Wall Street, and folks were selling a bunch of junk on the market and doing reckless things that ended up costing everybody something.

And then the second argument that they make is we need more tax cuts for folks like me who make a pretty good living, folks at the top. And I’ve got to tell you, there’s no evidence that that’s going to help middle-class families.

There’s no evidence for this trickle-down theory that somehow another tax cut for folks who are already making out like bandits over the last 20 years is going to somehow improve the prospects for ordinary families. It just doesn’t exist. They keep on repeating it, but they don’t show that that’s actually going to help the economy.
That’s not going to help you. It’s not going to help you. And it’s not going to help Millennium. And it’s not going to help your business. I made a speech yesterday at Northwestern, and what I just said is just look at the facts.

Since I’ve been President, unemployment has gone from — is down from 10 percent down to now 5.9. The deficit has been cut by more than half. Our energy production is higher than it’s ever been. Our health care costs are slowing. More people have insurance. High school dropout rate has gone down. Graduation rate has gone up. College attendance rate has gone up. Our production of clean energy has doubled. Solar energy has gone up tenfold. Wind energy has gone up threefold. Exports — we export more than we ever have in history. Corporate balance sheets are doing great. Stock market, all time highs. Housing market beginning to recover.

There’s almost no economic measure by which the economy as a whole isn’t doing significantly better than it was when I came into office. (Applause)

Now, those are just facts. You can look them up. I’m not making it up. That’s one thing about being President — if I stand here and say it, all these folks are filming me so they’ll go and check. So that’s the truth.

But what is also true is that wages and incomes have continued to be flat even though the economy is growing and businesses are making more money. So what that tells me is the one thing that’s holding things back, the one thing that people are still concerned about and the one thing that if we could change would really give more confidence to the economy and boost it is if wages and incomes start going up a little bit. If all the productivity and profits, if we start sharing that a little bit more with more folks, and ordinary families start feeling like they got a little bit of a cushion, that will be good for everybody. Because that’s the one thing that really we haven’t seen as much improvement on as we need.

And so what everybody should be asking is: how do we increase wages, how do we increase incomes, because if we do that, things are going to better. And there are pretty much just a handful of ways to do it. Number one, you make the economy grow even faster so the labor market gets tighter. Number two, you pursue policies like a higher minimum wage, or making sure that families are able to get child care, you’re driving down health care costs, the kinds of things that affect people’s pocketbooks directly.

Those are the things that I’ve been pursuing since I’ve been President. And those are the things I’ll continue to pursue as long as I have this great privilege of bring President."