Raising the Federal Minimum Wage Is a Bad, Bad Idea

In last night’s State of the Union address, President Obama proposed raising the federal minimum wage to $10.10 an hour. He even made some quippy comment about it being easy to remember because it’s 10-10. I’m hyucking at you, speechwriters.

Anyway, that’s a terrible, horrible, rotten, no good, very bad idea. The current federal minimum wage is $7.25, so raising it to $10.10 is quite the substantial increase. I know, $7.25 isn’t really a living wage, yada yada, it’s not fair that people have to make that little amount of money, and so on and so forth.


But you know what’s worse than making $7.25 an hour? Making nothing. What exactly do you think will happen when employers can’t afford to keep around their low-level workers? They’ll let them go, that’s what.

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My parents are small business owners. I remember one time getting a lesson in real life from my dad, because I had heard in the news that the minimum wage was going up, and being a child and therefore naïve, I thought it was swell. My father, being much older and wiser, told me that because of that mandated raise, he had to let someone go.

He’d had an entry-level employee that he paid minimum wage to keep the factory floor tidied up. He swept and cleaned spills, ran errands, you know, just basic go-fer stuff. It was worth it for the cost of his wages. The guy was happy he had a job, coworkers were happy for the help, everybody was happy with the situation.

Small businesses generally run on a very tight budget. So when the government stepped in and decided that my dad wasn’t paying that guy enough, he didn’t have the financial wiggle room to pay him more. The employee said he didn’t care, he’d keep working for the lower wage, but being an upstanding citizen, my dad wouldn’t employ him illegally.

This happens a lot. And then these entry-level workers can’t find work because the jobs aren’t there. So they go on welfare. Now business owners have even less money to hire new employees, because in addition to paying the people that do work for them, they’re now paying higher taxes to pay the people that don’t work for them.

Work is worth what someone is willing to pay for it. Most everybody starts at the bottom. If you don’t want to make $7.25 for the rest of your life, then figure out how to get promoted. Take classes, acquire new skills, do the best darn job you can at what you do, and ask for more responsibility.

That’s how you climb out of poverty. Not by raising the federal minimum wage.

Are you for or against a higher federal minimum wage?


Image via Teddy James/Flickr

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