Minimum Wage, Maximum Liberal

The scheme of increasing the minimum wage is a deviously clever four-pronged pitchfork of economic failure.  First, it compels force of law to transfer arbitrarily wealth from businesses to workers.  Second, this enriches without justification the constituents of the liberal politicians who hatch such schemes.  Third, this swells payroll tax revenues from the despised “wealthy business owners.”  And forth, it buys liberal votes with other peoples money, the perfect storm of unethical economics.

 

This “take from the rich and give to the poor” theory fails to consider the unintended consequences.  Most obvious is the fact that in business, all expenses are measured against their cost of conducting that business.  All associated costs are factored into the determination of the final price of the product or service.  As any of those costs increase, so too does the final price, the expenses are simply passed along.

 

For example, imagine we are all on our own boats in a harbor.  Some boats are small, some medium, large, some really large, all shapes, sizes and conditions.  Your boat represents the current minimum wage.  Your boat is small, and your view of the sunset, the ocean, the landscape, all of it is blocked by the presence of these other, bigger boats.  The water level represents the minimum wage at low tide.  You determine that by raising the minimum wage, your boat will rise above all of the other boats, and your unfettered view will be re-established.  What this model of economic voodoo fails to consider is that the rising tide lifts all of the boats and in the end, the views remains unchanged.

 

Economics represents a complicated formula whereby every condition, every change, every action is set in a string of variables representing a complicated equation that can actually be calculated.  Like all equations, changing one variable changes everything else and then the solutions and outcomes need to be adjusted and recalculated.  You cannot make a change as dramatic as increasing the minimum wage, without addressing the affect doing so will have on the entire equation, especially the outcome.

 

What no one in support of this scheme has offered is any indication that these affected workers will all of a sudden be dramatically more productive.  In the real world, free of artificial governmental manipulation, when you ask for a 66% increase in your wage, you had better have provided proof of a 166% increase in your productivity in order to justify that request.

 

When the largest retail employer in the world, Wal-Mart, had 11000 applicants for 400 jobs that paid $10 per hour, that my friend is the actual marketplace telling you that $10 per hour was too high.  Now Wal-Mart is closing 150 stores and with them will vanish 10,000 jobs.  You do the math.

 

Liberals dream of rising tides.  Conservatives believe that people competing in a fair marketplace will find incentives to build newer, bigger and better boats.  When free market capitalism and competition merge with the American spirit, we are anything but minimum.

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