There is considerable zeal in at the Minnesota Capitol this session for giving out money, and it’s important to remember that every dollar is from hard working taxpayers. The $20 million for additional heating assistance in HF 2374, was quickly passed and rushed to Gov. Dayton’s desk. It is but one example of the legislature taxing money from some Minnesotans to give to other Minnesotans. There was a time when we saw this as wrong, or at least inappropriate, but in the case of this $20 million income transfer, not a single legislator voted no.
Legislation to prohibit the employment of low wage workers is also under consideration. Some call this “minimum mage” legislation, but that’s not accurate. The “minimum wage” is, and always has been, zero. For instance, Minnesota legislative interns get that wage. Zero. Regardless of whether this “minimum wage” legislation passes, those interns will probably continue to get a wage of zero.
What this legislation does is not set a new “minimum” wage, because there will remain lots and lots of people who will receive the actual minimum wage – zero. That population includes those interns, but also those who are unemployed or retired. The CBO recently pointed out that raising the so-called “minimum wage” would increase their numbers by inducing employers to reduce hours and/or employees.
A more accurate name for this legislation is the Slam The Door Act. (STD Act) The STD Act makes illegal any employment arrangement that is between the real minimum wage (zero) and an arbitrary wage as mandated by the legislature.
As the CBO points out, many employers will adjust to that rule quite reasonably by eliminating those employees. Some portion will close their doors because they increased costs will make them unprofitable. Some will raise their employees’ wages, but even those will be under increased pressure to automate or otherwise to limit employee hours. Look for more automated kiosks, and automated ordering at fast food restaurants.
Unfortunately, politics seems immune to logic, and rather than see the STD Act as a lousy idea, negotiations are in progress as I write this to provide subsidies to certain politically connected employers so this effect can be minimized, or at least said to be minimized.
The fact is that the STD Act would in fact Slam The Door on our most vulnerable citizens, the youth, those with low skills or little education. It would shut them out from opportunities to gain a work history and income. It would narrow, rather than expand opportunity. It would shrink, rather than grow the number of jobs.
Why some think this is a good idea is beyond me.
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