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Wednesday, Aug. 31, 2016

A higher minimum wage is a good idea

Sunday, August 13, 2006

Gov. Matt Blunt this week came out in opposition to the Nov. 7 election proposal calling for a higher minimum wage in Missouri. The proposal would raise the minimum wage from the current $5.15 to $6.50 effective Jan. 1. Blunt based his opposition on the theory - and he may be right - that the higher wage base would keep businesses from locating in our state.

So let's say that Blunt is right and some businesses would pass over Missouri in favor of locating in states with a lower minimum wage. For starters, does our state need any more businesses who depend on minimum wage workers? I don't know the answer but I do know that the current minimum wage is without a doubt not a livable wage. A full-time worker making $5.15 an hour cannot support a family at that rate. You do the math. Even if you factor in the other benefits with lower income, like housing support, medical care, energy assistance, etc., the math just doesn't work.

If Blunt were serious about job creation he would champion a right-to-work law in the state of Missouri. Our state has lost countless more jobs to states with a right-to-work law than any potential losses because of the higher minimum wage. But politicians of all stripes fear the money and manpower of organized labor who would fight tooth and nail against any right-to-work legislation. Maybe the Blunt administration should have seen the writing on the wall and tried to link right-to-work legislation with a higher minimum wage increase. Too late now.

Blunt says that he doesn't want to recruit minimum wage businesses here but that even higher-paying companies would see this hike as a "bad business climate" with our wage rate differing from the federal wage. What businesses would see this as a bad business climate? I'd like an answer to that question.

Maybe we'll see some businesses harmed by this higher minimum wage but another study says that consumer spending will jump by nearly $22 million a year and state tax collections will increase by about $4 million a year.

I've said it before and I'll repeat it again. The down side for the minimum wage worker is this - just because those wages increase, so will there be a decrease in the level of other financial assistance. Housing subsidies for low income earners will decrease as their wages increase. Food stamps will decrease as those wages increase. The small portion of medical expenses will increase as the wages increase.

So the minimum wage hike is indeed a two-edged sword. It will put more money into the pockets of those who truly need it and it will take more money out of the very same pockets from other assistance programs. That is the trade-off.

Unlike Blunt, I'll support the high minimum wage because I think there is more benefit than liability. If a business decides not to locate here because they will have to pay their workers at the bottom of the ladder a bit more, then maybe we don't need those businesses in the first place.

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Michael Jensen
Michael Jensen