Minimum Wage, Minimal Thinking
Many economists are minimizing the negative impact, saying that the economy can absorb the increase. But historically, such increases have led to increases in unemployment for the people that are suppose to benefit most from such a policy – young people, minorities, and the under skilled. There have always been increases in unemployment with increases in minimum wage.
Furthermore, the problems won’t end there. My wife, who is far more perceptive when it comes to economics than most Members of Congress remarked, “this is going to increase prices” and “whatever amount people get in increase wages will be eaten up with higher costs.” She understands that costs are derived by a several key factors, one of the biggest is labor. When labor costs go up, so do prices. Good-bye higher wages.
So who are the chief beneficiaries of a minimum wage increase? The first are the politicians who will likely convince voters of their compassion through passing this wage increase. The second is the government, which will probably enjoy increased revenue because of higher sales (and even income taxes) because of the higher costs that will follow.
The losers will likely be the very people this is suppose to benefit – young people, minorities, and the under skilled. Minimum wage, minimal thinking, we certainly deserve better in our land of opportunity.