Minimum wage, bad idea

Wednesday, May 21, 2008

Thoughts on the Minimum Wage

The new Congress did two things in the past two years. First they held hearings on Baseball Players taking steroids and then they passed the minimum wage bill.How does the minimum wage thing work? Lets say that newly hired workers will be paid $10.00 an hour. ( I am using a factious number for demonstration purposes). The other employees who hired last year at $9.00 an hour have worked there for a year are now making $10.00 an hour because they have received a raise for their experience and now are worth more money.
When the minimum wage is raised to $10, the one year employee says to his employer, "I have been here a year and the new guy is making the same salary as me. I want a raise".So now, the one year employee gets a raise to $11.00. Of course the two year employee says, "Hold it, I am only making $11, the same wage as the one year employee. I want a raise to $12".
This continues up the chain and soon all of the employees get a raise. Now what does the employer do? Of course he raises his prices to cover his newly incurred wage hikes. All of these price hikes cause the cost of living to go up and what does the Federal government do? Yep, they raise the minimum wage again to cover the increase in the cost of living. DUH!!And, yes, some employers can't raise their prices so they go out of business and lay off their employees.
The result is that you folks on a fixed income have to pay more for your goods and services. We consumers at the bottom of the food chain are ALWAYS the ones to pay for every government program passed. That $600 rebate from your Federal Government came out of your own back pocket. Remember, the government does not produce any product or service that they can sell. Their entire income comes from your wallet.
When I hear that the government is going to give me free health care etc. it is either from my own back pocket or from my grandchildren. Would you leave a Will for your grandchildren that said "Here are all of my bills, please pay them for me". I wouldn't.

__________________________________________