Now that Democrats control Congress, they are pushing forward with a minimum wage increase.
They cloak their arguments with appeals to compassion for those in poverty. They say that the minimum wage hasn’t kept up with inflation.
But Democrats won’t talk about the unions, which push for minimum wage increases to boost the minimum floors of their salaries.
Democrats also won’t talk about the people who will lose jobs when the minimum wage is increased. They won’t talk about the jobs that might have been created, but won’t, because low-skilled workers—mostly teenagers just getting started in the workforce—were priced out of a job.
And while serious economists have been talking for decades about the perverse economic results from raising the minimum wage, it seems most of the politicians aren’t listening. Even President Bush says he will support an increase.
Maybe he’s just reading the handwriting on the wall.
But allow us to make an alternative suggestion that would actually do some economic good: If Congress really wants to increase wages for workers, it should consider the findings of a report by the Congressional Budget Office this August.
The report’s suggestion? Lower corporate tax rates.
The study’s author, William Randolph, found that workers bear about 70 percent of the burden of corporate taxes, while the holders of capital—owners and investors—pay the rest.
In the words of most Democrats, then, the fat cats are getting fatter at the expense of the working man.
But do you think a cut in corporate taxes is on the Democrats’ agenda? Hardly.
Demanding a corporate tax cut should be President Bush’s price for signing the minimum wage increase. At least then the legislation might actually help low-income workers.
You might call it a low price to pay for a minimum wage increase.