Saturday, January 20, 2007

The new minimum wage law - more job opportunities destroyed by Democrats

I know it is almost sacrilegious to be against raising the minimum wage in America, but I am and here’s why:

Emotionally, it sounds great to be for higher pay for the lowest paid workers - that no one can raise a family on minimum wages - that those wealthy (and greedy) companies should be able to pay their lowliest workers more. It’s what politics runs on—pure emotion. A rational thought rarely comes from the lips of any politician. It’s always: "kissing babies" or "helping seniors" or "providing a living wage" or "fighting those greedy big companies" or a thousand other emotional appeals to class envy and class hatred.

As is almost always the case, the emotional appeal of political rhetoric is long on passion and short on reality, reason or logic. Of course, if there is enough political capital (or donations to the party) to be had to making exceptions that defy the logic of the main course, those exceptions will be made. The latest minimum is a classic example of both such a law and such an exception.

First of all, in September of 2005 I proposed a change in the minimum wage law to make it more suitable for a nation with regions of highly variable living costs. Read my article at the end of this BLOG. It applies even more today than then with the proposed change to $7.25 an hour. There is no question that this increase will move many more jobs from low economic areas to more affluent ones. More thousands will leave rural areas and move to cities as jobs worth less than $7.25 an hour will disappear. Many in depressed areas will simply have no jobs at all.

Now about the exception I mentioned: how is it that our compassionate legislators can specify an exception in Samoa where, for the benefit of tuna canneries, the minimum wage was set at $3.25 an hour, four dollars less than elsewhere in America? Could it be that the tuna canners donated a little money to the Democratic cause? Tell us about it Nancy? Why? How about making an exception to say, South Dakota, or Mississippi, or Indiana?

The cost of living as shown by household expenditures in the rural areas of these states is about $20,000, a fraction of the $70,000 that it is in Boston, for instance. Anyone with half an ounce of brains can see that disparity and understand the damage the "one size fits all" minimum wage does to those rural areas. Of course, who ever accused politicians of having more than half an ounce of brains. Lots of rhetoric, lots of brass, lots of crocodile tears, (how about it Teddy?) but brains???? Only in the "I want power and money" sense do any politicians have brain power. If you think about it, they usually create more problems than they solve. The latest minimum wage law is a classic example. It will do great damage to those in the poorest areas and nothing to those in the wealthiest. Read my proposal - the third post in this BLOG for a real answer that would make the minimum wage law an effective tool that would help rather than damage the poorer areas of our nation.

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