Friday, March 17, 2006

Minimum Wage Redux

Back in 2004, I posted a letter I wrote to a journalist about minimum wage a while back. I never did receive a response from her, not that I expected one. Some of that material, or at least the general ideas may be recycled in this post.

Yesterday, I read an article in The City Paper about a bill being debated in the House that proposes a $1 hike in the state minimum wage. Articles like this always piss me off, because it makes me realize that our elected representatives are ignorant. Politicians don't give a damn what is right or logical, all they care about is doing the thing that gets them the most votes in the next election.

This article was no different from hundreds of other newspaper articles about minimum wage increases. The article split the politicians into their two camps and the Democrats are for the increase, of course. And the Republicans are against it, of course. Both of them for the wrong reasons, of course.

I will quote the article and add my thoughts…

Democrats think raising the minimum wage will help lower-income, under-skilled Tennesseans.

It will help lower-income, under-skilled Tennesseans temporarily. It will help them until the prices rise because of the increased cost brought about by the minimum wage increase.

Republicans think raising the minimum wage will actually hurt lower-income, under-skilled Tennesseans in the long run.

Actually, it hurts everyone in the long run, because it results in higher prices.

“This is just trying to help the little guy out a little bit,” Rep. Mike Turner (D-Old Hickory), the sponsor of the minimum wage increase, told the House Government Operations Committee.

I love quotes like this. How do you argue with the guy and not seem like a heartless bastard? He actually says nothing factual or logical, he's just trying to help the little guy out. What, are you against the little guy? This type of phrase ranks right up there with "It's for the children." Okay, back to the subject at hand; as I stated before, it won't help the little guy because prices will rise. Then the little guy is right back in the same boat as he's in now.

Republicans on the panel disagreed with Turner’s arguments that lower-skilled employees will benefit, saying raising the minimum wage actually hurts the “little guy.”

I have to admit, I got a little excited when I read this. I thought someone actually got it, but then I read the next paragraph and realized they are actually clueless.

Rep. Susan Lynn (R-Mt. Juliet) said increasing the minimum wage would motivate more people to want to work because of the increased salary. As a result, competition for minimum wage jobs would increase and lower-skilled workers currently earning $5.15 an hour could be pushed out of jobs.

“It will attract people into the market who were previously happy and content to not have those jobs,” Lynn said. “These [lower-skilled people] simply won’t be hired.”

Ha! There are several idiotic statements here. 1) Motivating more people to want to work is a bad thing? Huh?

2) I don't believe that $1 an hour will actually result in a sudden rush of people trying to get jobs. These people that she seems to think are currently sitting on the couch watching Jerry Springer scoffing at $5.15 an hour while the rest of us toil away aren't going to say "Hey, now I can make $6.15 an hour at McDonald's. Screw this couch potato stuff, I'm going to work!"

3) Let me get this straight, there are apparently two groups out there, one is lower-skilled, but they currently have jobs and the other is slightly higher-skilled, but they don't currently have jobs. When the minimum wage goes up $1, these higher-skilled slackers are going to jump back in the workforce and steal jobs from the lower-skilled responsible workers. Right. If I'm hiring someone and I look at their application and see that Person A just dropped out of the workforce a year ago and hasn't done anything and Person B has been shoveling shit for the last 3 years for $5/hour, guess who I'm going to hire? I'm going for the guy who's going to work his butt off.

“This is a modest increase to help the [poorest] amongst us, like the good Lord said,” Turner testified to the Republicans.

Raising the minimum wage is just a temporary fix! Why can't these people understand that? It is a false economy.

Oh, and Turner better watch it, the DNC will be sending him a warning about the separation of church and state.

But Rep. David Davis (R-Johnson City) replied, quoting a Bible verse in support of his argument, and saying that the people Turner wants to help would actually be hurt “the most” with an increase.

I wish they had provided the verse. I'm curious, I've never come across mention of minimum wage in the Bible. He is correct about who would be hurt the most.

Turner said raising the minimum wage would not hurt businesses, adding that even if it did, government for years has been helping corporations through tax breaks and not doing enough to assist lower-income workers.

It won't hurt businesses, they will just pass the expense on to the consumer who, surprise, surprise, is the little guy who just got a $1 an hour raise.

And it's true that the gov't helps corporations through tax breaks. But the way to end state supported welfare is not to give more money to a different group! Cut the welfare out, period. I realize the state is not giving money directly to lower-income workers via the minimum wage, but it's still welfare. The gov't is just forcing businesses to pay an artificially higher wage. The government's job is to protect the rights of all its citizens. That does not include making sure they bring home a certain amount of money each week.

“The gap between the rich and the poor gets wider and wider each year,” Turner said. “All I’m trying to do is level the playing field.”

Keeping the playing field level actually precludes setting a minimum wage. That is rigging the game. By setting an artificial floor to the market, you raise production costs, which results in higher prices. The "rich" are able to absorb these higher prices, but it truly affects the poor.

Also, does he honestly believe that $1/hr ($40/week, $173/month, $2080/year) is going to make that gap any smaller?

House Republican Leader Bill Dunn (R-Knoxville) told Turner that leveling that playing field regulates businesses.

I would be more supportive of Republicans when they say something like this if they didn't turn around and try to regulate my personal life.

Another bill being debated in the legislature would raise the minimum wage to $7.15 an hour.

How about $10.15 an hour? I propose we set the minimum wage at $50,000 per year. If raising it $1 an hour is going to help so much and have no harmful effects, why not?

Listening: Minimum Wage by They Might Be Giants (of course!)

1 comment:

... said...

Dear Jeff,

I was pretty frustrated by the article too. Please remember, articles omit a lot of other comments.

Actually, I wrote a guest column in the Nashville City Paper. You can see that article on my blog:

The article is called: Public Policy & Raising the Minimum Wage

Thank you for allowing me to respond.

Rep. Susan Lynn