ABOLISH THE FEDERAL MINIMUM WAGE

California Shows Why

Any woman struggling to get into a one-size-fits-all item knows that one-size-fits-all solutions rarely work. For governments, this kind of solution is an easy and quick “fix,” but it isn’t often that those architecting this kind of plan go back and see how well the “solution” worked to fix a problem.

The federal minimum wage was established in 1938 by FDR at $.25/hour. Since then, it has been raised 22 times, now at $7.25/hour. The idea, which might have made sense at the time, was to ensure that companies didn’t collaborate to keep wages low when people were desperate for work. Although it is taken as a given that this is a “good idea,” most economists believe the time has passed. Based on data they analyzed, it was found that raising the minimum wage to a much higher level ($20-$25/hour as proposed by Bernie Sanders), would price poor people out of work. This is even more true in a time where machines, technology and AI can replace low-end workers.

Even back in 1987, the New York Times stated that, “The right minimum wage is $0.00.” They’ve since recanted on that position, but the economics didn’t change. The editors at the paper later stated, “A higher minimum wage would undoubtedly raise the living standard of the majority of low-wage workers who could keep their jobs. That gain, it is argued, would justify the sacrifice of the minority who would become unemployable.” But if you’re one of those people who has few skills, it is a disaster. What happens to them? Help many and destroy the lives of the rest? This is why we are a representative republic, not a democracy. We don’t want two wolves and a chicken voting on what to have for dinner.

At the Federal level, a fixed income makes little sense, as it is expensive to live in California or New York, but much cheaper in the Midwest. What is the right number for the entire US, given that costs are so variable. How many people would lose their jobs? How many companies and businesses would fold because of this edict?

California – An Example

Just like the nation, California residents have widely varying costs of living. If you live in the Central Valley, or in far North California, you have lower living costs than San Francisco or LA. When California decided to raise the fast-food minimum wage to $20/hour, a 25% increase, they were focused on people who were no longer young, had families and had somehow not found a way to move up in the work world. Of course, they can’t live on lower wages. But for almost of all of us, the idea that you can keep working your high school or college job flipping burgers for the rest of your life makes no sense.

Even without a college degree, there are many ways to make a good, even great living by learning a trade. California is badly in need of great electricians, builders, plumbers, etc. These are jobs with a great future. The quote “failing to plan is planning to fail” applies here. You should not expect to support yourself and a family with a low-end job.

What has been the result of our over-generous minimum wage? Since the wage increase was implemented in 2023, thousands of people have lost jobs. Fast food restaurants lost 10,700 jobs between June 2023 and June 2024. Since September 2023, food prices at restaurants have increased by 14.5%, and many places have invested in automation. Even at nice places, you increasingly see that you have to order at the counter and sometimes, even pick up your own food, because that lessens the necessity to have more people to serve you. Many have reported seeing weird added costs, including mandatory tips, on top of the increased wages. This leads to people deciding to avoid eating out as much as they might have.

Sadly, despite evidence to the contrary, the Fast-Food Council’s Planning Subcommittee plans to meet this year to decide on another increase in the minimum wage. Meanwhile, not just older workers, but the many teens who started their work life in the fast-food industry are finding it impossible to land a job.

The question I raise is “do the Democrats behind these increases actually want many of us to be idle, depending on government handouts? Too many parents today have older children lolling in their basements because they can’t find a job. Maybe, if every teen had a chance to work at these traditional starter jobs, we’d see a lot less of it. You learn a lot about work from the jobs you start with. How many more people will be rendered jobless in the future because the Democrats want to force businesses to comply? It’s pretty scary.