The city council in Los Angeles have approved preliminary support of rasing the minimum wage to $15 per hour by 2020. It is currently $9 per hour. Wouldn’t you like to have a 67% pay increase when you don’t have to do anything to earn it?
Currently the federal minimum wage is $7.25 and Obama is supporting raising it to $12. The business community has serious concerns and it doesn’t take a rocket scientist to understand why.
For example, take "Joe" who makes $10 per hour or $20,800 per year. At $15 per hour, he will get $31,200. Sounds great, but not so fast. Joe will move into a higher tax bracket and will end up paying taxes. And, he will no longer qualify for federal and state programs for the poor. In the end, Joe will lose ground. But, government gains twice.
The other working people that make more than minimum wage will have to have raises too. That’s called inflation. When the cost of labor goes up, the cost of materials goes up. It’s easy to see what’s going to happen to Joe’s increase. At $9 per hour, he could buy a burger and fries for less than an hours work. But, when his increase and everyone else’s raises, he just may not get that burger and fries for less than an hours work.
Government is great at giving the peon’s the illusion of helping them. For everything government gives, there are many more they take away. Like pride, dignity, and self worth.
Sadly, the trick works every time.
PMO
©2015
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