Opinion: Mandatory minimum wage hikes hurt the working poor

By MARK BALLARD
Guest columnist

MARK BALLARD

Monday, Nov. 18, 2013, 10:30 a.m. — There is a new push in Congress for the minimum wage to be increased to $10.10 per hour under the guise that people making minimum wage should be able to afford a house payment, car payment, etc. Minimum wage jobs are not there for a family of four to live on or for a family to be able to purchase a home on. Minimum wage jobs are for students working through school, spouses bringing in a few extra dollars into the household, and people supplementing their retirement.

Let me try to explain to you what actually happens to the economy and the poverty level as a domino effect of implementing such a bad idea. Using fast food as the example here, since a lot of the minimum wage jobs are in the fast food business, let’s look at a burger meal and the effects of a wage increase on that meal.

You can currently get a burger, fries, and a drink for about $5.00. The government forces employers to increase the minimum wage by 40%. Will the employer pay the new wage? NO! You, as a consumer, will pay the wage difference by being charged more for the food you want. So, in this example, the burger meal will now be $7.00.

To begin with, all the minimum wage earners are happy little clams in their shell of life but, after a few months and after the market has adjusted its prices to cover the new mandatory wage, the minimum wage earner finds himself having the same disposable income as he previously had. He is no better off and becomes disgruntled again.

Here, now, is where the harm comes in. Anyone making $10.11 an hour or more, have a 0% increase in anything for them except the cost of products in the marketplace. Their disposable income drops as a result of the mandatory wage increase driving prices up. So, they are worse off than before. The result of the entire façade is that the poverty level increases and the middle class shrinks.

After learning how it doesn’t work, you may ask, “This would be the same result each time, so why do they want to raise it?” That is an excellent question. The answer to that is … they know what the result will be. Their actual goal is to shrink the middle class and it has done just that with each increase.

There is only one way to be able to afford these things for yourself as a family. You have got to work to better yourself. Through schooling or on-the-job training, you have to grow your skills and earn your wage increases. Anyone who sits around waiting for the government to mandate a wage increase for them will never get ahead and never be truly happy in life.

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