The Unlivable Living Wage

For every action there is an equal and opposite reaction — this is an understood and unquestionable law of physics. It’s also in many aspects a law of human nature and political science. For every policy we chose to impose, for every war we fight, for every law we make there are inevitable reactions and aftershocks to our decisions. The people that are affected are not merely the target demographic which the policy was aimed at helping or hurting, but also the people that share a relationship of someone within that key demographic.

There are many instances in which legislation is proposed and policy is enacted without truly taking the time to understand what the long term impact of that policy or piece of legislation will be. A policy becomes nothing more than a knee-jerk reaction to a problem in a community which ultimately leads to larger problems than originally existed.

One of the best examples of this is the desire to raise the minimum wage. The argument of those in favor of such a policy is that the cost of living has been raised over the years, and as such it is harder for individuals living on a minimum wage to survive. It is a simple argument, and on the surface it sounds like a nice thought. After all, if you were living on minimum wage and someone told you that that they were going to force your employer to pay you more, you would probably be pretty pleased; and you would most likely support the candidate with that plan.

The honest truth of the matter is that raising the minimum wage is a hollow promise that would ultimately harm the citizens that the policy was intended to help. We have to understand that the “living wage” of the left is quite frankly unlivable. The policy, if it ever were enacted on a national level, would raise the cost of labor, thus leading to a decrease in hiring and most likely an increase in the cost of merchandise made domestically.

This would only make life tougher on those individuals who the original policy was supposed to help. They would be susceptible to these furloughs and cutbacks would be unskilled and unspecialized laborers. As these laborers are faced with furloughs and cutbacks, the cost of living would only continue to rise until Americans of all classes felt the pinch. Meanwhile, the legislation would have no effect on merchandise produced overseas meaning that it would serve as yet another opportunity for developing economies to compete and undermine American based industry.

This is not merely speculation or hearsay, but this principle can actually be seen in the United States today. According to the United States Department of Labor seven out of the ten states that have the highest unemployment rates in the country have higher minimum wage laws. For example, in Los Angeles, California, minimum wage is $8.00 an hour, and unemployment is at 11.3%.

When it comes to the cost of living, in most circumstances the cost of living in a city with a higher minimum wage is higher than the cost of living in a city with normal or lower minimum wage. If you compare the cost of living and working in a city like Atlanta, GA, where minimum wage is $5.15 an hour, with the cost of living in a city like Seattle, WA, where minimum wage $9.32, the cost of living goes through the roof. For the citizens of Seattle utilities cost 5% more, groceries cost 10% more, transportation costs 14%, Healthcare costs 16% , and housing costs a whopping 61% more than their counterparts in Atlanta. Do you honestly believe that an extra $5.17 an hour makes a difference when you have to pay more for practically everything you need to survive?

Time and again we have seen many industries either leave the United States or the state it was founded in because the cost of doing business became too high. In the end it is not the industry or the business that gets saddled with the cost of having to pay higher wages, but rather it is you the consumer and you the unemployed laborer that ends up paying for this policy.

The policy may benefit a few workers only very briefly. In the long run; however, the policy will only insure that business will have to shift around their business model to make up for lost profit. Raising the minimum wage would weaken the economy and it would succeed in making our population further impoverished.

Every action has a reaction, and while that reaction may not come back to haunt our political leaders, it will come back to haunt the average citizen and worker.

Content published on the Young Americans for Liberty blog is only representative of the opinions and research of the individual authors. It does not necessarily reflect the views, goals, or membership of YAL.

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