May 4, 2016 at 2:14 p.m.
Obama's war against Main Street
Obama's war against Main Street
By Main Street, we mean the small businesses that provide the economic lifeblood in smaller communities outside major urban centers, as well as the cultural and social institutions that grow up in these little havens of America.
Taken together, a surprisingly large number of Americans still call Main Street home.
A lot of them are middle class, or used to be. A lot of them work for those small businesses, or are small business owners themselves.
Obama has constantly emphasized his disdain for that Main Street America. Most famously, he told small business owners that, when it comes to the businesses they run, "you didn't build that."
Of course, he meant it's all really the government's property, and, as such, the government has the right to tell you how to run that business.
And thus we have the latest rule being promulgated by Obama's Department of Labor, a rule to change the overtime exemption requirement, or the threshold salary at which a white-collar employee is considered exempt from being paid overtime if they work longer than standard hours.
As we report in today's edition, the new rule would increase the salary threshold by 113 percent, to $50,440 a year from the current $23,660 a year. So, a white-collar employee making $30,000 a year who does not now qualify for overtime pay would have to be paid overtime under the new rule.
It's a dramatic change that will devastate many businesses. As UW System president Ray Cross pointed out, if the threshold salary had simply been raised by the rate of inflation to prevent monetary erosion, the threshold today would stand at a little more than $29,000, or in the neighborhood of 21 percent higher.
The sudden and steeper costs would be catastrophic. As we report, in the newspaper industry alone, the added costs will be $130 million a year. Many small papers, already on the endangered species list, will not make it if the rule stands. A lot more workers will qualify for overtime pay; the only difference is, many of them won't have their jobs anymore.
This time, though, it's not just newspapers and other small businesses Obama has in his crosshairs but universities, local governments, and charities. So those who create jobs, who educate our children, who provide core local services, and who help take care of the neediest among us are about to be socked with steep cost increases that will impede their ability to carry out those missions.
In the end, the rule would cripple many of those important organizations and their programs, and hurt the very people the Obama administration claims it wants to help. It's a less-than-zero sum game, except for the government, which will have succeeded once again in weakening the private sector.
Nobody is arguing, it's important to emphasize, that the threshold salary shouldn't be adjusted, at least by the rate of inflation. That's fair, it maintains the salary standard passed by Congress, and it ensures that workers are treated fairly by maintaining an overtime standard and that businesses are not forced to make unreasonable and abrupt economic decisions, i.e., choosing to fire workers, or convert workers to hourly employment, or to go out of business.
There are other unintended consequences. For instance, it would turn millions of salaried employees into hourly workers overnight, for that will be the common-sense response many owners will be forced to make. Many employees will be stripped of their professional status and flexibility and go back to punching the time clock.
Finally, this is yet another example of Obama's executive overreach. Adjusting the threshold salary administratively would make sense if the adjustment was a cost-of-living increase, or an otherwise reasonable one. But more than doubling the threshold in a matter of months is a wholesale rewrite of the law Congress passed.
Once again, the president is defying the constitution and denying the elected representatives of the people the right to make such changes if they are warranted, or to withhold such changes if they are not.
The president must not be allowed to pass his own laws in any case, but especially when they will cost the private sector billions of dollars.
We would ask readers to contact the Obama administration to urge that the rule be rescinded, but that would be like trying to talk to the proverbial brick wall. But it is worth contacting your elected representatives and to ask them to make sure these regulatory changes are stopped. Legislation has been introduced to do just that, and to send the rule back to the drawing board. It would also establish protocols and oversight for any future changes.
The time to contact lawmakers is now, before it's too late.
President Obama may not think we actually built our businesses, or own them, but he's wrong, and it's time to show him at long last that the people not only built and own their businesses, but we built and own the government, too.
Put simply, he works for us - no overtime pay, either - and as such he needs to pursue legislation through our elected representatives, not his appointed bureaucrats.
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