EDITORIAL: Minimum wage is bad for business

I HAVE NO SYMPATHY for poverty. You want to wallow in poverty? Suit yourself. But do it somewhere else. If I had my way, I’d stop it right at the border. I’d say to poverty: Go back wherever you came from. Good riddance.

I’m a capitalist, a media mogul wannabe. We’re trying to run a business here, and poverty is not part of the plan. It’s a distraction and it’s expensive. Think of how much it costs us to keep people poor. Plenty of people are involved when you talk about poverty, even here in Columbia County. The Census Bureau says that almost 10% of the county’s population between 2006 and 2010 lived on incomes at or below the poverty level. Do the math and you find that’s 6,000 of our neighbors who live in poverty as defined by the government.

Get a job, right? But that advice doesn’t apply to everybody, because most of the “people” living below the poverty line are children, and they just don’t make good workers in today’s knowledge industries. So let’s focus instead on a smaller group, the people in poverty who already have a job even at a time like this, when jobs are still scarce.

The minimum wage in this state is now $7.25 an hour. If you work a full-time 40-hour week at that rate, your gross wages are $290. I would like the person who makes that salary to buy our newspaper and purchase goods and services from our advertisers, but I don’t kid myself. Many of them can’t afford to do that. Some people try to raise a family on the minimum wage, but if you are a family of three at that income level, you fall 20% short of the poverty line, and you don’t have much choice about what you purchase.

For years do-gooders of all stripes have tried and failed to eliminate poverty. I hope they keep trying. In the meantime, it seems kind of shortsighted for the rest of us to support a system that makes it so hard for the people who have jobs to improve their lives. A better option is an increase in the minimum wage. A proposal for just such an increase is under discussion in Albany right now.

Democrats, who control the Assembly, have proposed boosting the state’s minimum wage to $8.50 an hour at the beginning of next year and building in future increases linked to changes in the Consumer Price Index. Republicans, who hold a majority in the state Senate, oppose the plan. The governor has yet to take a stand.

The GOP says raising the wage of the lowest paid workers will stifle job growth. That sounds reasonable to me, except for one problem; studies show jobs don’t disappear when wages rise. Then there’s the argument that if New York increases the minimum wage, neighboring states will take low-wage industries away from us. That might be true in some parts of the state, but it’s hard to make that case here. Vermont’s minimum wage is $8.46 an hour, the rate in Massachusetts is $8 and that state is considering an increase. In Connecticut, it’s $8.25. Our low hourly minimum wage in New York hasn’t attracted waves of relocations from those states to our side of the border.

I agree with Republicans in the state legislature who predict that some businesses would feel the bite from a higher minimum wage. Just as important, experience has taught me that the smaller your business the more likely you are to feel the pain of new government requirements. Our representatives in the Assembly and Senate should heed this and tie the minimum wage increase to temporary tax breaks that cushion impact on small businesses whose payroll costs are directly affected by the change. These breaks should go first and foremost to the smallest entities, not the big firms pretending they’re little.

Increasing the state’s minimum wage isn’t about charity, it’s about economic self interest. A person who earns a dollar and a quarter more an hour won’t vault out of poverty into the middle class. But if we offer greater incentives to our neighbors who work by making it just a little bit easier for the poorest of them to meet their needs, they will put more money back into the local economy.

Improving the economy and assisting small business is a winning combination. Lawmakers and the governor should enact these measures now.

 

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