It’s one of the most debated words in the political lexicon, and one that can be used as a euphemism to dupe unsuspecting listeners into supporting policies that hurt.
Case in point: Later this month, Idahoans for a Fair Wage, a left-wing group led by a Democratic community organizer, will launch a ballot initiative that would raise the state’s minimum wage to $12 per hour. Right now for most occupations, Idaho’s minimum wage sits at $7.25, the federal standard.
Ballot measures to raise the minimum wage have cropped up around the country in the last decade or so, and voters have passed most of them. The most notable one was enacted in the Pacific Northwest where SeaTac voters approved a plan to set the wage floor at $15 in 2013. That measure also mandates cost-of-living adjustments to the minimum wage. Reports say SeaTac businesses must pay workers at least $16 an hour, the highest rate in the nation.
Liberals say these new wage floors are only fair. Are they really fair? And who decides that?
Ideologically, conservatives rightly worry about handing more power over to the government. Wage floors further involve the state in employer/employee negotiations, and there’s simply no need for government to further interfere when two willing parties meet.
Pragmatically, all Idahoans should concern themselves with the detrimental consequences a $12 minimum wage would inflict on the state and its residents. To be sure, there would be some benefits to minimum wage hikes; researchers have routinely found this for decades. But, there are massive downsides to such hikes, too, and we’d be wise not to ignore those.
Consider the following snippet from the University of California’s David Neumark, an impartial researcher who has studied the issue extensively. “The potential benefits of higher minimum wages come from the higher wages for affected workers, some of whom are in poor or low-income families,” Neumark wrote in December. He added: “The potential downside is that a higher minimum wage may discourage firms from employing the low-wage, low-skill workers that minimum wages are intended to help.” Catch that? Yes, some low-income families benefit from higher wages required by the law, but only at the expense of workers who can’t get the jobs eliminated after wage hikes.
Neumark includes another salient point. Though progressives often tout the minimum wage as a way to move people off welfare rolls, research suggests it doesn’t occur. “In the US, most evidence does not indicate that minimum wages help poor or low-income families, or reduce most forms of public assistance,” Neumark wrote.
That’s hardly fair to taxpayers, who, in addition to paying the costs of welfare, must now pay higher prices on goods brought on by increasing the cost of doing business. Instead of using government force to mandate wage floors, Idahoans and lawmakers should enact policies to grow the economy, which will naturally increase wages as companies need more workers.
Anything else isn’t fair to anyone.