Biden on Minimum Wage

 

 

 During the last presidential debate, moderator Kristen Welker asked Joe Biden and President Trump about raising the minimum wage to $15. This is a pure giveaway to unions in the service industry. As their employees are replaced with technology, it is a way for them to maintain their dues, about 30% of which they donate to Democrats.

Kristen Welker: “We are hearing a lot about struggling small businesses and business owners these days. Do you think this is the right time to ask them to raise the minimum wage? You of course support a $15 minimum wage.”

Biden: “I do. Because I think one of the things we’re going to have to do is we’re going to have to bail them out too. We should be bailing them out now. Those small businesses. You’ve got one in six of them going under. They are not going to be able to make it back. They passed a package that allows us to be able to give PPP. The money is supposed to go to help them do everything from organize how they can deal with their businesses being open safely, schools, how they can make classrooms smaller, how they can hire more teachers, how they can put ventilation systems in. They need the help. The businesses as well as the schools need the help. But these guys (points to President Trump) will not help them. He’s not giving them any of the money.”

The most generous interpretation of this answer is that Joe Biden believes we should use taxpayer Dollars to fund small business owners so they can pay their employees more. Or, he was answering the completely wrong question, which is possible with Joe Biden.

In either case, saddling struggling small businesses with increased wage requirements is absurd. There are actually very few jobs that start at the federal minimum wage. As of 2017, only 2.3% of workers earned the federal minimum. They tend to be young, with half under the age of 25. Many states have a higher minimum wage requirement than the federal government. Also, employees in these categories are often eligible to earn tips, which raise their income and do not report to the IRS.

President Trump asserted we cannot raise the minimum wage for small business owners in the current environment. He added, correctly, that this should be left up to the states noting Alabama is different than New York and a single solution is not reasonable. It would be legitimate this should be handled by local governments. New York City is not Buffalo, for example.

The President added that hikes in the minimum wage have caused job losses when implemented in some areas of the country. Joe Biden called this a lie, but it is true. The CBO estimates a hike to $15 an hour would cause a loss of 1.3 million jobs.  In Seattle, a hike in the minimum wage caused a reduction in hours resulting in employees earning less money, according to a study done by the University of Washington and it cost the city 5,000 jobs. This is the Democrat way of "improving the situation!"

Hikes in the minimum wage accelerate automation.. Walmart is automating checkouts and removing cashiers. McDonald’s will move to all-kiosk ordering as well. Fast-food chains are even experimenting with automating food preparation. These companies  credit minimum wage hikes for their decisions. The real cost here is a loss of entry-level and part-time jobs for young people and get experience working in teams plus earn money.

Biden then tried to tie the need to increase the minimum wage to first responders. According to Salary.com, police, firefighters, and paramedics all make over $15 per hour. Even nursing assistants, who help staff hospital floors, have a median salary that exceeds that nationally. This is about pleaseing unions in the service industry, as it is where the majority of low-wage jobs exist.

The model for the Democrats was Sweden, the country we are supposed to aspire. Sweden doesn’t have a minimum wage. The Nordic countries fought the European Union to avoid establishing one. They are more “free market” than we in that respect!

There are sure ways to raise wages and President Trump proved it pre-pandemic. Explosive job growth and controlling immigration tighten the labor market. Production and industry returning from overseas create more jobs. When the labor supply is less than the number of positions available, wages rise. It is simple economics that does not involve government and that terrifies Democrats.

Adrian Vance