Obama Should Go to Business Night School

Posted: Mar 15, 2014 12:01 AM

If I had been Barrack Obama's adviser when he was young I would have led, guided, pushed or simply threatened him to go to business school instead of law school. I would have told him that it was pretty obvious he was going to be running this country in his later years, and business school might do him better than law school. I have never been to law school but have a Master’s degree in business administration, so I can understand some of the complex business models that face our leader: Keystone pipeline, raising the minimum wage and deciding that private businesses have to pay over-time to employees on a salary if they work over 40 hours a week.

The difference between law school and business school seems to be, judging by the actions of POTUS, is figuring out what will become of the economy after one the complex problems cited above goes into effect. Obviously that isn't a concern in law school; laws are passed and enacted and in the mortal words of Nancy Pelosi we need to pass the law to find out what happens from what's in it.

Let's take a look at the Keystone Pipeline problem. We are shipping oil across this country on the railroad, coincidentally owned by Warren Buffet, which at least Warren Buffet thinks is a wonderful and safe, albeit not the fastest, way to ship oil. It certainly keeps his railroad going well, which is important. Should we decide to go the other way and erect the Keystone Pipeline, we are told that we may be able to create over 20,000 new, well-paying jobs and perhaps have a faster and safer way to move the oil.

The President now has a choice which is the type of situations taught in business school. It doesn't seem to be a very hard problem, now that the feeling is no environmental problems should arise. In as much as he never went to business school and has trouble doing something without checking on what his actions would do for him politically. Could that be the deciding factor?

When sticking his nose into private companies the President relies on politics only. The raising of the minimum wage and the paying of overtime to those on salary present some unintended consequences plus some serious economic results that will hurt, not help POTUS.

The unintended consequences:

1. Raising the minimum wage changes the ratio between those on the bottom of the company and those making higher wages all the way up the company’s employment ladder. Minimum you will have workers who will be upset and that could lead to a slowdown in productivity. Maximum management would have to adjust the wages of all which would force either raising prices or cutting profits.

2. Paying overtime for salary employees brings up the need to set up a new accounting system, as salary employees do not clock in and out. Those on salary have contracts that give them vacations, sick days and other perks. Sorting out the logistics of redesigning the accounting department to make this work which includes verifying their working hours must be added to the actual cost of the overtime and force higher costs on the company. If they can sell their wares or services then this would start pushing up inflation in the country.

Inflation is not a desired outcome but the opposite of the inflation is the cutting of jobs to keep costs and prices in line. Neither of these is what the President should be pushing for, EXCEPT, if you think these artificial increases gives the President more votes! I believe it is too late for the President to go to business school but playing politics with our private industries, our work force and our economy is unbelievable. I would expect that by this time in his life he would understand "there is no such thing as a free lunch"