This past Thursday, the House approved the $15 Minimum Wage Bill, which would gradually raise the federal minimum wage to reach $15 by 2025. Although it would not go into effect unless the Senate approves it and the current president signs it into law, House Speaker Nancy Pelosi is already praising the thoughtful “progress.” Touted in the name of “fairness,” all minimum wage laws have been unconstitutional from the start, not to mention the probable alarming effects on the U.S. economy.
Digging into these effects, the non-partisan Congressional Budget Office (CBO) compiled a report
explaining the impacts on employment and family income. It concluded that the new law would bring 1.3 million workers above the poverty level, but it would also cost 1.3 million U.S. jobs. The increase would come at the expense of business owners and higher-income families, contributing to the underlying goal of this “Raise the Wage Act:” wealth distribution.
Have you ever heard the phrase “there’s no such thing as a free lunch?” Economists understand that every resource is limited compared to people’s desires; therefore raising the minimum wage for some means higher costs for others. This could be attained through higher restaurant prices, costs of living increasing, businesses closing, and even others losing their jobs. California Rep. Doug LaMalfa
(who has witnessed CA’s $15/hour), slammed the proposal to raise the federal minimum wage, saying that raising it by 107% would be very harmful:
It would force many small businesses to close their doors, some of which I’ve seen in our own district due to California’s wages, while causing larger businesses to scale back employees’ hours or eliminate many steady-paying jobs altogether. Self-checkout registers in stores and kiosks at McDonalds would become far more common across the country - this at the expense of young people looking for their very first entry level jobs or the retired looking to stay busy with a little part time work.
The increased costs would be passed on in the form of higher prices that would come out of the budget of already struggling families. It just shows the authors don’t understand economics or human behavior. Fewer jobs and higher prices – that doesn’t help working families. This bill would be harmful to those it claims to help.
Not only do the minimum wage laws violate the Constitution, they violate business’s rights
to determine wages, they undermine the free market and ultimately give the federal government more influence over your life. Because a government big enough to give you everything you want is a government big enough to take it all away, the “Raise the Wage Act” needs staunch disapproval in the Senate.
Even though it is unlikely to reach the floor for debate, higher prices will become our reality if it is passed. While it seems like a good idea on the surface, it is devastating to incomes and opportunities for others. Don’t sit on the sidelines, educate yourself and help us educate others. Share this article and the ones below with your circle of influence. Then, if you haven’t yet read the book “Economics in One Lesson,”
we encourage you to do so.