Raising the Minimum Wage

I’m an old guy now, and while I don’t remember everything, I remember a lot.  For example, I remember how I started working at a grocery store when I was 16, for which I received the minimum wage of $2.65 per hour.  I remember how when it went up to $2.90 and then $3.10 the next year, I felt like I was rolling in dough.  (OK, that may have been from helping out the ladies in the bakery.) 

But hey, I was a teenager with low overhead.  I’d bank three-quarters of my check for college tuition and still have plenty of money left over for gas, (which was $1.20 a gallon) beer ($3.49 a 6-pack) and pizza (Little Caesars pizza-pizza for $10.00).

I remember that the minimum wage has gone up incrementally ever since.  And what’s germane to this post is that I remember how every single time a raise in minimum wage was proposed, the business community loudly protested about how such a raise would make them fire staff, decrease service and eventually put them out of business.

Then the minimum wage raise would pass, and none of that would happen. 

Every. Single. Time.

It’s happening again, both at the federal level and here in Maryland.  People are talking about raising the minimum wage from the federal mandate of at least $7.25, by phasing in increases to about $10.00 an hour. 

How will the “job providers” ever manage to survive if we raise the minimum wage? [/sarcasm]

Naturally, anything that helps the poor, the young or women (read: “Democrats”), will be opposed by Republicans whose constituency runs far more affluent, middle-aged, white and male.  They’re trotting out the same arguments that raising the minimum wage will actually harm the poor because employers will be more hesitant to hire people for whom they have to pay more.  It’s almost as if they’re counting on us to forget that this effect was negligible after past wage hikes.

Now, I’m certainly no economist, but there’s a certain logic at work here.  People who make minimum wage are not usually people who are socking that money into their mattresses, or the stock market.  They’re spending that money on food, gas, clothes and other necessities.  The money is going right back into the market.

I also think that the threats of business services being curtailed are over-blown.  What happens if a restaurant cuts staff?  People don’t get served quickly.  If people aren’t getting served quickly, they’ll go somewhere else.  If people go somewhere else, that first business dies.  (Geez, this sounds like that Direct TV commercial.)

So, are the people who run these establishments going to intentionally sabotage their own businesses just to make a point?  I don’t think so.  They’re going to do what they have to do to stay in business.   Perhaps their profits get pinched.  They’ll probably raise prices to offset it.  So what else is new?  Prices go up eternally.  But, as more money gets spent in the market, the economy rises, and more people go out to eat.  The business is sustained.

Plus, as people are pulled out of poverty, there is less of a demand for food stamps, welfare and other public assistance.  You’d think that would make conservatives very happy.

But conservatives are never happy when it comes to profit margin.  Why else did they run for office featuring campaigns to lower taxes, after enjoying a long run of the lowest taxes in the history of the country?  Because the only thing better than lower taxes are taxes lowered even further.

Granted, the minimum wage issue isn’t a tax, but it’s the same principle: outgoing money that lowers profit margin.  Next thing you know, someone’s calling it a “handout,” regardless of the fact that people work their ass off for it.

When I worked for minimum wage, those dollars had a lot more buying power.  It’s a different story now.  The cost of living has far outpaced the past increases in the minimum wage.  Raising it now would bring the two back into better balance.

My $2.90 went a hell of a lot further in 1978.

I hate it when rich people go on TV and talk about how poor people just need to work harder and stretch their dollars.  What nerve.  Anyone that thinks minimum wage is high enough should try living on it for a week. 

But that would require empathy, and the only people for whom conservatives have empathy are those fighting financial regulations, environmental laws, higher business taxes and reverse discrimination.