Paul Singer: Minimum wage hike would 'destroy' jobs
Billionaire hedge fund manager Paul Singer feels for the poor but thinks increasing the minimum wage is a terrible idea.
"Put bluntly, these policies would destroy jobs and cause companies and even entire industries to move elsewhere.These movements are politically motivated–a way for politicians to fake compassion," Singer wrote in a letter to investors of his $23.3 billion Elliott Management on Jan. 27.
"If they gain traction, millions more people will make the transition from gainful employment to government dependency as jobs get priced out of existence by the rise in employment costs. Such policies would inexorably lead to lower economic growth, higher unemployment and a citizenry that is less and less self-sufficient."
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Singer makes clear he feels for the poor despite his stance on the minimum wage.
"'Inequality' has become the political theme/slogan of our time in both Europe and the U.S., yet political leaders do not even bother to consider that their own policies, which put the entire burden on central bankers to print money and drive up stock, bond and other asset prices, are actually exacerbating income and wealth disparity," Singer wrote. "The most powerful corrective to inequality–a stock market and real estate crash–would not exactly be a positive for the citizens of these countries."
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Singer goes on to repeat some of his longstanding grievances with government policies and what he sees as related economic weakness.
"Widespread tax increases (and the promise of more), crushing regulation (interpreted and enforced by unaccountable regulators), policies discouraging employment and encouraging dependency, laws that are growth-suppressive (Obamacare being the worst), and punitive policies toward the financial sector that are not effective at making the system safer, have combined to suppress growth, employment, and normal lending and borrowing," Singer said.
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Singer's firm isn't suffering.
Elliott is now one of the 10 largest hedge funds in the U.S., according to industry news and data provider Absolute Return, and its flagship Elliott Associates fund gained 12.4 percent net of fees in 2013. The fund has achieved annualized returns of 14.0 percent since inception in 1977, among the best track records in the investment industry.
A spokesman for Elliott declined to comment.
(Read more: Carol Roth: Why inequality isn't a problem)
—By CNBC's Lawrence Delevingne. Follow him on Twitter