Real World Economy Versus The Minimum Wage

Once again, liberals have demonstrated that they just don’t get how the economy works. They are so utterly ignorant.

When purchasing an item, do you ever comparison shop? Of course. Most everyone has or does. And you want to get the most for your dollar. Again, of course – otherwise, why comparison shop? And if you see two of the same product, with different prices, all things being equal, you would choose the lower cost item.

Maybe one of the two products presents better value for the same cost. Again the obvious choice would be to choose the better product for that same cost.

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And so it is for labor. Labor is a product. Companies don’t hire people out of a sense of charity. No – even for the lowest position in the company, people come in and fill out an application, maybe submit a resume and possibly fill out an evaluation form. Then someone goes through the applications.

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And what are they doing? Why, the HR person or whomever is comparison shopping. He or she is looking for the best, most qualified candidate for that particular position at a predetermined cost. They’re looking for the biggest bang for their buck. He or she is looking for a hire who will bring at least as much value to the company as they will be paid. Otherwise, it is just charity.

And that’s what a minimum wage is. It’s forced charity. The city, state or federal government is dictating to business how much they must pay for a product. That sounds like illegal price-fixing, but it seems government can do many things that those in the private sector would go to jail for.

The latest price fixer is the city of Chicago who voted to hike their minimum wage to $13 an hour by 2019. It’s great as a soundbite, but it will have real world consequences, as minimum wage laws always do.

Take Chicago small business owner Hank Meyer, who, like other small business owners, doesn’t have a pile of cash in the back room he can just dip into. He owns two stores within the Chicago city limits. Hank has 45 employees and says 37 of them make around the minimum wage. He says he’ll have to lay employees off if “customers balk at shelling out $12 for a southern fried catfish rather than $9.99. Other Chicago store owners say they will lay off employees or be forced to relocate beyond the city limits.

But politicians either don’t understand this reality or just don’t care. They have their soundbite – they’re next campaign commercial.

And what about those employees who are making $13 an hour? Well, they’re going to demand a raise, rather than make the same amount as some new hire. Again, where are these businesses supposed to get this extra money? Printed like the feds do? Borrow it or deficit spend like the states do?

How is this going to help the population of Chicago, particularly the minority population? The facts are that right now, 92% of black teens in Chicago are unemployed. 92%! This is a sad reality.

How is a minimum wage hike going to help those who can’t find work to begin with and have no skills to offer an employer? It is, therefore, easy to predict that percentage will increase.

Maybe the Ferguson rioters should relocate to the steps of the Chicago City Hall. Someone needs to shine a light on this insanity.

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