Friday, July 28, 2006

House to raise minimum wage?

Market realities be damned...this is an election year! From the AP:
House Republican leaders, giving in to political reality, plan a vote to raise the $5.15 minimum wage before leaving Washington this weekend for a five-week recess.

"Whether people like it or not, we need to go ahead with it," said Rep. Mike Castle, R-Del., who supports the idea. "There's a general agreement among Republicans (opposing the raise) that `maybe we don't like it much, but we need to move forward with it just for political reasons.'"
You just have to admire the core convictions of our elected officials, huh? "We think it sucks, but we can just see our Democrat opponents running campaign commercials right now! (Shudders)." Continuing:
The chairman of the House Education and the Workforce Committee said the GOP would embrace the increase to $7.25 per hour and probably attach a proposal passed last year that would make it easier for small business to band together and buy health insurance plans for employees at a lower cost. Rep. Howard McKeon (news, bio, voting record), R-Calif., said the minimum wage bill probably will not include tax cuts such as a repeal of the estate tax.
House Democrats cried foul on Thursday, saying Republicans planned to add "poison pills" for their business allies. Many Democrats oppose the small business health insurance legislation because it would overrule state laws requiring coverage for procedures such as diabetes care and cancer screenings.

House Democratic leader Nancy Pelosi of California demanded a vote on a bill that would just increase the minimum wage. She spoke out against "the usual Republican poison pills of attaching tax cuts for the wealthy or other so-called sweeteners for the Republican special interests."
Oh, bovine feces! Dems oppose the small business health insurance legislation for completely different reasons:

1. They want government-run socialized medicine! How in the hell are they supposed to get that if the GOP allows businesses to use the (gasp) market place to get the most bang for their buck with health care?

2. They want to keep beating the drum of "not enough health care", and such a proposal would blunt that criticism. As we all know, Dems care nothing about solving problems...only bitching about them. You can always spot a leftist that way: bitching is caring, but solutions are for the people who want to work hard...and that constituency is clearly not made up of Democrats!

3. Anything that makes businesses unhappy makes Democrats happy, and vice versa. This bill does both. It makes businesses unhappy because their labor costs increase with the minimum wage increase, thus making Democrats giddier than pre-pubescent girls at a Justin Timberlake concert. However, the businesses are happy by being able to buy better and less expensive health insurance, and this makes Democrats angrier than Ted Kennedy with an empty bottle of Chivas Regal.

This part ticks me off:
"It is time for Congress to take responsible action to raise the minimum wage and ensure our hardworking constituents can provide for their families," said the letter, drafted by Reps. Steven LaTourette, R-Ohio, and Frank LoBiondo, R-N.J.
Let's get one thing straight, people. Only a small handful of people in this country are trying to support a family off of minimum wage. For those handful of people, allow me to offer some advice (free of charge):

Get a better paying job! Brilliant, huh? That's what a college education will get you, folks: a deep, nuanced, economically sharp mind like mine! :-D

Seriously, why are you downloading kids and getting married if you have no marketable skills? Why should I, as a business owner, be forced to pay you more than your skills are worth to me? By God (insert politically correct deity name here), you are doing a grave disservice to yourself and your family if all you're doing is a minimum wage job. Don't get me wrong: if I got laid off today, I'd be slinging burgers tonight while looking for a better job!

Really, there are only a couple of groups that benefit from an increase in the minimum wage: high school / college kids working part-time jobs, and unions! The latter group is the one that is fighting like hell for a wage increase, and thusly explains why Democrats are screaming louder than Florida condo commandos after the 2000 election. Why do unions care about an increase in the minimum wage? In a word, "indexing."

See, unions have contracts with companies they've shaken down employers that state the union "workers" must be paid no less than X times the national minimum wage. After all, no unions allow their workers to be paid minimum wage, right? However, if the contracts say that employees have to be paid three times the wage, then an increase in the minimum wage from $5.25 to $7.25 means that the floor for the union workers' pay goes from $15.75 to $21.75. That's a $6/hr de facto raise for the union "workers", which also means that the union gets to collect more dues money, too! Now do you see why unions want minimum wage increases?

Some Republicans seem to understand the ramifications:
"Quickly increased labor costs unrelated to business conditions will encourage or force employers to fire employees, reduce working hours for existing employees, and/or postpone plans to hire additional employees," they wrote.
I can tell you that I, as a business owner, will look to reduce my costs as much as I can, especially in the face of unchanging revenue. Think about it: if I have ten people working for me, and my average profit is $5,000 per month, and my labor costs just increased by $3,200 per month (that's the $2 increase per hour, times 40 hours per week, times four weeks in a month, times 10 employees), my profit just dropped from $5,000 down to $1,800! I can tell you right now that somebody is getting laid off unless/until my profit margin climbs back up! So tell me again how this minimum wage increase is helping me and the poor Joes/Janes whom I had to release?

My friends, this isn't about helping poor people support their families. This is about helping unions continue their support for Democrats, and about helping to immunize the GOP from accusations of screwing the poor. Economic reality gets thrown out the window whenever a campaign rolls around. This is political pandering, and nothing more.