With a host of proposals to hamper economic growth, Democrats could undo all the progress made by the Trump administration. Nancy Pelosi has promised to pass a minimum wage of $15/hour, without regard to the fact that such a move could devastate America’s small businesses.
Not only that, but the future Chairwoman of the House Financial Services Committee, Maxine Waters, has said the era of regulatory reform for banks has come to an end. So much for expanding credit to America’s entrepreneurs. Watch job growth come to a screeching halt if Waters has her way.
At The Hill, Alfredo Ortiz explains the dangers of the Democrats’ plans:
Take one of the top priorities of House Democrats: passing a national $15 minimum wage. The presumptive incoming speaker, Nancy Pelosi, has vowed to pass this wage floor in the first 100 hours of the new Congress. The fact that the shopworn, discredited idea of wage controls is on the front page of the Democratic policy playbook demonstrates the intellectual bankruptcy of their agenda.
A $15 minimum wage would dramatically increase labor costs for small businesses and swamp the tiny profit margins on which most operate. Given that this proposed minimum wage increase is so big — more than double the current federal minimum wage — it’s likely that the majority of small businesses in the country would be negatively affected.
And despite what the media say, employee prospects rise and fall with small businesses. Even in wealthy Seattle, which passed a $15 minimum wage in 2014, independent researchers at the University of Washington revealed that entry-level jobs and hours worked fell as a direct consequence. As a result of reduced hours, entry-level wages actually fell by $1,500 a year, on average.
A minimum wage increase that reduces wages? Just more proof that you can’t fight economics. If the $15 fallout was this bad in Seattle, think of the consequences to Main Street and entry-level employees in poorer cities such as Shreveport, Sioux Falls and South Bend.
Of course, even economic realists recognize the hardships of living on minimum wage and want employees to earn far above it. But rather than trying to achieve this goal through a counterproductive and controversial $15 minimum wage, Democrats and Republicans should come together to advance the bipartisan cause of a fight for $50 — as in a fight for $50,000 annual salaries — the level at which Americans can solidly enter the middle class and begin to live the American Dream.
Sound far-fetched? More like farsighted. There are 7 million unfilled jobs in the country, roughly half of which pay $50,000 a year or more, according to the Labor Department. Young and less-skilled workers should aspire to fill these positions, not hold out hope that their wages will be artificially raised by fiat.
Read more here.
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