The truth behind minimum-wage increases
Minimum-Wage Increase FailsThe Senate yesterday rejected a Democratic plan to boost the minimum wage for the first time in nearly a decade, but Democrats vowed to campaign on the issue this fall to highlight their differences with the Republican majority.
Here is another issue I sure hope Republicans stand strong against. From what I'm hearing from the hill, some are starting to lose focus on the basic economics that drive wage increases.
For years Democrats have tried to politicize this very issue as a sign of their heart and compassion. And as you see here, the Democrats are already planning to use this as an issue for the midterm elections. You can bet you'll read countless stories about how Republicans hate poor people and only wish to help the rich. And you'll hear all this emotional talk about helping the little guy. Well let The Real Republican set this one straight for you.
I oppose a minimum wage increase because these wage controls have never been proven to work. In fact, wage controls are responsible for more job loss and job prevention to the very workers Democrats suggest they wish to help. Take countries like Germany and France, which hold some of the highest minimum wages in the world and yet some of the highest unemployment rates.
It's simple economics really. Let's say you own a restaurant and hire two dishwashers at the minimum wage. You start making some money and think you can expand your hours and hire two more dishwashers. You've just created four jobs that will help four entry-level restaurant workers. The government then comes in and raises the minimum wage. Just like that, your payroll is now way over budget and you have to cut two of those dishwashing jobs to make the difference. Sure, two of those dishwashers keep their jobs and make $1 or $2 more an hour. Yet two have just lost their jobs. And this doesn't include the other workers who could lose their jobs or the countless applicants who might be in line for a job had the wages not gone up.
As John Stossel says in his new book "Myths, Lies, and Downright Stupidity," this goes for anyone who's tried to build a business. There's the business that has to close because of the higher wages. There's the business that decides to do the job with less workers. There's the business that never expands, never gives raises and never hires new help. And ultimately, there is the business that never even open because the bottom line just won't permit it.
So what the Democrats use as a political ploy to make themselves look good actually hurts far more entry-level workers in the long run. And this is the general premise of why Republicans oppose a minimum wage increase. Competition will always keep worker wages high, not the government.
And just to clarify, Democrats act like this is increase would help a wide range of workers. But the truth is only 2% of the American workforce earns minimum wage. If the Democrats really wanted to help, they would have helped pass the Republican alternative that would have raised the wage by $1.10 but also offer incentives to small businesses to help offset the wage increases.
Don't be fooled folks, this isn't about the little guy. It's about the Democrats picking their campaign lines in hopes of making their own fat check from the taxpayer.