Most college students in this great country often deal with personal finances that do not give way to a lavish lifestyle. The more Top Ramen we eat and the more Ice House we drink, the easier it is for us to dream of larger paychecks. One seemingly obvious step towards our bountiful future is through increased paychecks from our beloved jobs. Every election year my brain is subjected to an onslaught of liberal agenda geared towards increasing minimum wage to help the “working class.”
Colorado recently passed Amendment 42, which has came into effect Jan. 1. The federal minimum wage (which every state must use as a base salary) is $5.15 per hour. Amendment 42 raises this base to $6.85 per hour and $3.02 per hour for employees who receive tips. The Colorado Legislative Council’s Web site announced it would adjust annually in accordance with the consumer price index. It sounds great. Right? Who doesn’t want more money?
This plan is yet another trap employed by strategists to draw uneducated voters. They claim justice for the “Average American” who is stomped on by the big bad corporate elephants they call the Republican Party. While this idealist stance does seem to have great intentions, anyone who has taken a high school level economics class should recognize blatant flaws.
Before I go any further, I must point out that my viewpoint is coming from someone who gets paid minimum wage and has been affected by the recent increase in Colorado’s minimum rate increase. The extra $10 a week is great! Now I can blow more money on posters for my room or on the surcharge for guacamole at local Mexican restaurants. Thanks Colorado! The extra buffalo nickels could also go toward a new pogs collection. Who knows? Meanwhile, people are losing their jobs because some employers cannot afford the increased labor costs while adjusting to the additional rising cost of supplies.
Inflation is on the horizon and employee benefits are shrinking to meet the new price of human capital. What demographic will this increase in wages hurt the most? You guessed it – the people who are supposed to be benefiting from this amazing breakthrough brought to our bank accounts by the people’s people – Democrats. When this impact is felt by American companies, they do not absorb the brunt of this money crunch. Instead, they pass it directly to the consumer.
Much of the money that companies are being required to pay their workers could be invested in skill training that would improve productivity. Free market economics dictates that people will get paid what they are worth in monetary value. The point of intersection between supply and demand is called the natural equilibrium point. At this point, price is a direct reflection of satisfaction for both employer and worker. Any higher deviation from this point is an artificial wage floor that unfairly impacts businesses.
Artificially raising minimum wage is a burden that undoubtedly harms the bottom line and tax revenues for the government who needs money for welfare. If the government wants higher compensation for its citizens, then it should subsidize the difference it establishes. I am not implying that families that walk the poverty line do not deserve financial support. However, it is unclear to me why business owners are dealt the hefty tab.
The U.S. of A is the country where each person has the opportunity to work his or her way to the top of any chosen field. Plenty of government funding is directed towards aiding the less fortunate. If your minimum wage job is not cutting it, then go work for the gazillionaires at Comcast who have all of my paychecks. They must pay great.