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I'm breaking my vow to no longer be controversial

Nanny State, Free market, Las Vegas, My-Sugar-Na, Reno, Restaurants, Taxes


Before I start (and get people all hosed off), My-Sugar-Na and I will be heading to New York City on Sunday for a couple of days away from the kids work.  This weekend, look for an update on what frugality I can pull off (like how the hell did I get this place for $99/night?) and what awe-inspiring sites (like Peter Luger Steakhouse) that I can see while you struggle to get your charcoal lit.


Until then, let's consider a little economics lesson, shall we?  I found this while aimlessly surfing the internet, killing time, and I am shocked with how well it made it's point.  Here is the beginning of a story from today's Reno Gazette Journal (comments in bold added by Yours Truly):

Minimum wage hike puts pressure on businesses, casinos

(Side note; Despite my enjoyment of all things casino, this story really doesn't have anything to do with casinos.  This story could very easily take place in Milwaukee, and I am sure that it has in many instances.)

Mike Powell, president of the Reno-based Port of Subs sandwich chain, must make up $60,000-a-year loss at his Nevada outlets thanks to a state-mandated minimum wage increase.

A rise in Nevada's two-tier minimum wage system goes into effect Thursday.

Employees who do not receive health benefits will see an increase from $7.55 to $8.25 per hour (Do not let Wisconsin's government leaders see this). Those who are covered will see an increase from $6.25 to $7.25 and hour. A constitutional amendment passed (The highest form of state government interference in business) in November 2006 orders the state to adjust the wage yearly, taking cost of living and federal wages (federal wages, too? Sheesh) into consideration.

While the increase will benefit low-income workers, the mandate could be too much for some small business and casino owners.

In Reno and Las Vegas alone, Port of Subs operates 18 restaurants.

"It's (total cost to the chain) going to equate to an average of $65,000 over the next 12 months," Powell said of the Nevada impact. "It adds up. It means we're going to make $65,000 less than a year ago if everything stays the same." (I can honestly say I thought it would be more, but that still does not make it right)

The wage increase could deter employers from hiring, said Elliott Parker, University of Nevada, Reno professor and chair of economics. (Nobody else seems to think of that part.  Because of a minimum wage increase that amounts to about $800 per employee after taxes, others may not even have the opportunity to make anything.  The Nanny State is trying to help the little guy, while simultaneously crushing the even littler guy)

Although alluded to, three things stand out...

First, a newspaper actually wrote an article that depicts the business end of a government mandate.  The cost of business goes up $1,200 per full time, minimum wage worker with no insurance.

Also, I can't get past the fact that people won't even be able to get jobs because others are going to make more because some lawmakers four years ago said so (Side note; I get the fact that every person residing in Nevada had a chance to advocate and vote against this, but really, how many people do that?  Wisconsin has a strong Tea Party movement, but did that help any of the tax increases, fee increases and social programs that got ramrodded through over the past year or so?  Right.)

Finally, and this tags along with the above point, if this full time, minimum wage worker is making $8.25 an hour, and I am unemployed and at a status just above panhandling, I might accept that job at $5.25 an hour.  Doesn't that make the job worth $5.25 an hour?  Why would a business pay any employee a nickel more than that position is worth? 

At my job, I make $XX,000 a year.  However, I feel that I should be making $XX,000 PLUS $50,000 per year. Because I think I am worth it, should that force my employer to pay me that?  Absolutely not.  And if my employer finds someone to perform the same quality work at $XX,000 MINUS $15,000 per year, should I be fired?  Well, I hope not, but that is up to the employer.

So why does government continue to think that because somebody that they don't know doing a job at a company they have no interest in doesn't make enough money that the employer should be penalized?

Lunacy.

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