Red v. Blue: Minimum Wage
A weekly column in which Gettysburg’s College Republicans and College Democrats will engage in debate about issues in the news.
By Timothy Meads, Executive Director: Pennsylvania Federation of College Republicans
The Democrats’ promise to raise the minimum wage is nothing but political fodder that offers no real solution to the economy. Why?
A simple solution would be to create a bill that attaches minimum wage to inflation so that the wage increases, as does inflation. This “solution” would end the debate, and Republicans would suffer a big defeat. But if a law like this existed the Democrats would need a new issue to lambast Republicans. Democrats use minimum wage as a red herring for American workers and another opportunity to paint Republicans as evil capitalists. It is an effective strategy: “why wouldn’t a Republican want higher wages for Americans?”
Of course Republicans want higher wages. College Democrats’ solution kills jobs, provides a temporary solution, and favors big businesses leaving small businesses and the working class in the dust in order to ensure the Democrat political class can win another re-election. Minimum wages laws cannot increase the market value of someone’s labor, just inflate it outside the market’s natural demands.
Raising the minimum wage would kill five hundred thousand jobs according to a recent CBO report. Five-hundred thousand of the lowest skilled workers would be cut, encouraging businesses to automate or hire workers off the books.
But which employees would lose their jobs: single mothers and poor families from black projects? No. 77% of minimum wage earners are white, 50.4% are under the age of 24 and 64% of these jobs are only part time positions.
With youth unemployment at an all-time high, the last thing we should do is force companies to cut hours or cut the positions altogether. Instead of forcing companies to pay more, the government should lower taxes across the board. The company would have more money to hire, and the worker would have more money to spend.
The College Democrats clearly illustrated corporations like Wal-Mart can afford a wage hike, but this ignores small businesses. Small businesses cannot afford these hikes, and they employ most of the minimum wage earners. These companies would be forced to fire existing workers and replace them with workers off the books or automate their jobs.
Consider this: if I pay a low skilled worker $7.25 an hour and then I am mandated to pay them $14.50 an hour, I am forced to pay double for the same job being done. I would be an idiot not to seek better-educated, better- skilled workers to do the job. Small firms use the same logic and middle-aged mothers and community college grads get cut while overqualified employees take their place to do more than one job. Supply and demand works both ways in business. If a business supplies more to its workers, it will demand more from them and hire somebody else more qualified to do more work. Perhaps instead of putting a further burden on small businesses, the federal government should remove or restructure regulations that help Big Business while leaving mom- and-pop-shops in the cold.
It is time the Democrat political class stops using this policy as a crutch for their broken promises and failed stimulus packages. Perhaps people like College Democrats’ favorite Robert Reich, who has a net worth of four million dollars, should dig into their pocket and lead by example and donate more to the poor themselves. Republicans will continue to enact laws that create jobs and continue to donate more to charity than their liberal counterparts.