MPA

Fuzzy Math In Push For Raising The Minimum Wage

April 15, 2016 Posted by Nathan Strout - No Comments

As I watch the campaign to raise the minimum wage to $12 an hour unfold, one question comes to mind: Why $12?

My first thought was that the number had been arrived at through rigorous economic research. Perhaps, I told myself, they have data that shows that $12 an hour was as high as they could raise the minimum wage without having a negative impact on employment. I searched the Mainers for Fair Wages website, but was unable to find any such data. If they had such data, surely they’d display it prominently.

So how did they arrive at $12 an hour? Did they hold a lottery? Did they roll dice? Why $12 an hour, and not $15, or even $20? I decided to take a look at their reasons for raising the minimum wage. What economic reasoning did they rely on to raise the minimum wage? Absolutely none.

The campaign argues that the minimum wage needs to be raised because workers need higher wages. That’s it. There’s no discussion of the impact on jobs or small business in Maine, and one is left with the sneaking suspicion that the Maine People’s Alliance isn’t really concerned about that. Underlying this campaign is a dearth of research and a complete disregard for its economic impact. No matter the cost to employment or small businesses, they intend to raise the minimum wage. This really is startling. The fact that The Maine People’s Alliance has done no work to see how a massive minimum wage increase would effect the state’s economy is downright negligent, especially considering how much a shock to labor costs can affect a small business.

The one interesting tidbit that can be found on the Maine People’s Alliance website is what they think the minimum wage should be. If you think that $12 an hour is the ultimate goal of Maine’s professional Left, you’re dead wrong. By navigating through several links, I was able to find a flyer about their minimum wage campaign…but $12 an hour doesn’t appear anywhere on the page.

Instead, the flyer points to what it calls a “living wage” of $15.85 an hour. You might notice that that’s $4 an hour more than what they’re currently campaigning for. Oddly enough, the citation links to an Alliance for a Just Society report that doesn’t list $15.85 anywhere. With a little sleuthing, I found the report they meant to link to: Pay Up!, or at least I think that’s the report they meant to link to.

The Pay Up! report, which was published just last October, actually recommends raising Maine’s minimum wage to a living wage of $15.77. A separate report from January of last year from the same group listed the livable wage as $15.82. So while I can’t find where The Maine People’s Alliance found $15.85 an hour, it’s clear that they’re looking to raise Maine’s minimum wage to a livable wage of over $15 an hour.

So it’s foolish to think that they’ll stop trying to raise the minimum wage if their $12 an hour ballot initiative passes. $12 an hour is just a stepping stone to their real goal: a so-called livable wage of over $15 an hour. Don’t be surprised when you see The Maine People’s Alliance pushing for yet another minimum wage increase only days after they pass their ballot initiative.

Yet even their $15 an hour “livable wage” should be subject to scrutiny. A Living Wage Calculator set up by MIT puts a livable wage in Maine at $10.61 an hour. A keen observer would notice that’s $5 less than the far left advocacy group Alliance for a Just Society’s estimation. A 2011 report from the Maine Department of Labor similarly estimated a livable wage to be $11.02 in 2010.

Mainers need to be wary of this attempt to raise the minimum wage. While the people behind the ballot initiative publicly champion an increase to $12 an hour, they clearly intend to raise it by far more in the future. Business groups that think they can appease the professional Left in Maine with small, incremental increases are falling right into their hands.

The Maine People’s Alliance intends to ensure that the minimum wage equals what they determine to be a livable wage, even if other group’s calculate Maine’s livable wage to be far less than their claims. Mainers should also be aware that the people behind this initiative have done no research on how this minimum wage increase will effect employment and small businesses in Maine.

Ultimately, this minimum wage initiative is based on nothing but wishful thinking and arbitrary numbers.