An Amendment To Set A State Minimum Wage?

On November 5, 2013, there will be a Public Question on The New Jersey Voter Ballot, asking voters:

“Do you approve amending the State Constitution to set a State minimum wage rate of at least $8.25 per hour? The amendment also requires annual increases in that rate if there are annual increases in the cost of living.”

And, below that is the Interpretive Statement:

“This amendment to the State Constitution sets the State minimum wage at the level in effect under current law, or $8.25 per hour, whichever is more. Cost of living increases would be added each year. Also, if the federal minimum wage rate is raised above the State rate, the State rate would be raised to match the federal rate. Future cost of living increases then would be added to that raised rate.”

For many, if not most people, this may seem like a fairly reasonable question to put to the voters; after all, the price of goods and services are, without a doubt, rising in cost; but, for me, this is like watching Atlas Shrugged, by Ayn Rand, play-out in real-time!

Allow me to explain:

While, minimum wage, on the surface, may seem like a compassionate public policy, it is actually a policy that keeps the skilled, and experienced workers, working, and freezes out the less-skilled, and first-time workers, by forcing business owners to pay a salary that is higher then they are willing to pay for a certain employee or service. It not only freezes out first-time and low-skilled workers, but it could, very well, cost certain current employees their jobs, if the employer no longer feels that a particular position is worth the price that they are being forced to pay. At some point, it could even cause businesses to close up shop, and take their businesses to another State, or even overseas, should the cost of doing business get too costly.

Then, there is the cost of living:

The increase in the cost of living has nothing, whatsoever, to do with business owners, or any private citizens; inflation is caused, solely, by our Federal Government. More specifically, it is caused by the incessant printing of money by The Federal Reserve, which “devalues our currency,” and therefore, causes everyone, including business owners, to pay more money for the same goods and services. The result of these failed policies is a rise in the cost of living, for every single American.

Ayn Rand described it as such:

“Inflation is not caused by the actions of private citizens, but by the government: by an artificial expansion of the money supply required to support deficit spending. No private embezzlers or bank robbers in history have ever plundered people’s savings on a scale comparable to the plunder perpetrated by the fiscal policies of statist governments.”

We are, sadly, deluding ourselves, if we believe that a minimum wage hike is actually going to help offset the higher cost of living. A minimum wage hike, forced upon business owners, and for all intents and purposes, will have the same result that higher taxes on businesses have: The business has to remain profitable, in order to stay in business; therefore, in order to pay for the increase of doing business, there will, undoubtedly, be an increase in the price of goods and services that they sell. Therefore, while, as a worker, one may be able to look forward to an increase in salary, as a consumer, they can also look forward to the increasing prices for the goods and services that they purchase.

Unfortunately, the continued pattern, in our country, seems to be, The Government creates some program or policy, which, subsequently, creates havoc in the economy; then, comes their predictable rhetoric that, it is all the fault of the free-markets, and those greedy Capitalists. Voters, sadly, and naively, fall for it, and another BIG GOVERNMENT program or Law is created to mask the last failed policy. And, the havoc continues!

Perhaps, instead of enabling voters to, potentially, amend The State Constitution, forcing employers to pay more money, we should include a question that asks voters if they even know what the root cause of inflation is; and, why, year after year, the cost of living, continually, rises.

But, beyond the economic implications of across-the-board minimum wage hikes, there is a moral question, as well, that should be asked; and, that is: by what moral justification do Legislators have, to vote away, or enable voters to vote away, “other people’s money”?

Regardless of what side of this issue a Legislator or voter stands, this is an absolute, and utter intrusion to the sovereignty of the business owner, and their legal right to “contract,” or negotiate a salary with “their employees.”

There is no doubt that, in this current economy, a lot of people are hurting. There is, also, no doubt that, the cost of living is rising, and wages aren’t we where we would like them to be; but, it is imperative, in my humble opinion, that we seek out the real root cause of these economic hardships, and hold those truly responsible accountable rather then, continually, voting for policies that, essentially, put a mere band-aid on the problem, and, in the long-run, actually exacerbates the problem.

Posted, originally at, The Original Republican

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  1. Instead of blaming the minimum wage you should be blaming the unions. It is the unions that are the direct cause of the current high cost of living. If the public did not have to pay for their Cadillac medical plans and their guaranteed retirement on outrageous wages the cost of living would go way down. So don’t blame the government and don’t blame the public, rather place all of the blame where it rests, squarely on the shoulders of the unions. The unions should be stripped of all of their power except to bargain for a reasonable living wage as compared to the public and should not under any circumstances be guaranteed any retirement or medical other than what they plan for themselves like the rest of the public has to.

    1. Cliff, I don’t disagree with the union aspect, and the tremendous cost that they put onto businesses, and business owners, but, in all due respect, in sounds like you need to learn a little more about inflation, and how inflation is caused.

      Unions have absolutely nothing to do with [inflation] the systematic devaluation of our currency! It is wholly caused by Government, and the fact that our paper currency is backed only by thin air.

    2. Why stop at only blaming the unions? The government is doing the exact same thing when they increase a minimum wage. Costs for all go up when a business is mandated to increase costs.

      1. THAT is exactly right Thomas. The minimum wage, as I stated in the post, is tantamount to a tax hike. And, whenever the cost of doing business increases, by extension, so too will the [cost of living] goods and services that are sold by the respective businesses.

        A wage increase should be, solely, between an employer and an employee. Government has no right to interfere in that relationship – particularly when they are not the ones who are “footing the bill”!

    3. Incidentally, everything that I have read on the Minimum Wage, points to the Unions as being the force behind the first Minimum Wage laws. This should not be a shock, as those who are union-trained, due to minimum wage laws, would be guaranteed a constant pay raise, while, at the same time, freezing out those who would, otherwise, be willing to work for less, and learn on the job.

      Minimum wage laws can be directly blamed, imho, for the decline of the apprenticeship positions with companies. If you don’t come equipped with the skills, few companies, likely, would be willing to train a person from scratch, at the rate being “mandated by the State.”

  2. WA has had this dumb MW idea in place for a decade or so. And now has about the highest MW anywhere, and all the teen and young adult unemployment you’d expect from stupid ideas put into law…

    IMHO, this kind of nonsense will continue until the GOP offer a reasonable and dynamic marketplace option. For example, set the MW up or down from a baseline according to the unemployment in each district. If unemployment in Anytown goes up .1%, the MW goes down ten cents (or something like that), and if unemployment goes down .1%, the MW goes up ten cents (or something like that)…

    Areas with high unemployment and low MW will make it easier for businesses to kick start their economy, instead of being hampered by this one size fits all mentality/nonsense.

    Areas with high MW and low unemployment will do just fine. And if the economy goes south, they too will have a MW adjustment to boot strap themselves back to prosperity.

    Such a system would create a dynamic self adjusting marketbased MW that would allow folks to move on to other issues, with some education of how marketplace economics is supposed to work.

    1. Seipherd,
      We both agree that Minimum Wage laws have negative consequences on an economy, but instead of looking for politicians to come in with another BIG GOV’T fix, why don’t we start with the premise that Government should stay the hell out of it, altogether? As I said below:

      “Government has no right to interfere in that relationship – particularly when they are not the ones who are “footing the bill”!

      If there were no Minimum Wage laws at all, then, less-skilled workers, teens etc., could come in, at ground-level, and work their way up – while companies would have to “compete for the best talent” by offering the best salaries.

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