OPINION:
Americans are being robbed every day of their hard-earned savings. It’s the fault of inflation — which, thanks to President Biden’s economic mismanagement, is rightly called “Bidenflation.” The policy geniuses responsible for this problem have also come up with a solution: raising the minimum wage.
Combating paycheck shrinkage for low-wage employees by boosting the earnings of some low-wage workers means robbing others of their jobs. The effect could be chalked up to the unintended consequences of income redistributionist policies if it were not so predictable.
The urge to do something — anything — to halt the relentless thievery led 22 states to supersize their minimum wage on Jan. 1, bringing to 30 the number with base hourly pay above the federal level of $7.25. Among them, seven states and the District of Columbia force employers to shell out at least $15 per hour for each worker.
Not content with allowing states to decide such things for themselves, Sen. Bernie Sanders, Vermont independent, last year introduced the Raise the Wage Act of 2023, which would extend the federal minimum wage incrementally to $17 per hour by 2029. Not to be outdone, Rep. Barbara Lee, California Democrat, upped the ante by a factor of three, recently proposing a federal minimum of a staggering $50.
To be sure, inflation is a genuine burden on U.S. workers, peaking at 9.1% in June 2022. Thankfully, this had eased to 3.1% in January, prompting the White House to declare victory. But consumer prices are still rising — just at a slower clip. Consumers are paying more than 17% extra each time they go to the store, thanks to the administration’s spendthrift policies.
The consequences of a hefty increase in the federal minimum wage would be monumental. In its advisory role on national economic matters, the Congressional Budget Office in January estimated the impact of Mr. Sanders’ bill through 2033. Among its potential salutary effects, the CBO reckoned that half a million people could be lifted above the poverty threshold, which in 2023 was defined as an annual income of $30,000 for a family of four.
On the downside, CBO calculated, raising the federal minimum by nearly $10 per hour could cost 1 million workers their jobs as businesses fired some employees to free up funds to augment the pay of others.
Creating job losses of that magnitude when millions of immigrants are crossing the border illegally and looking for work would condemn many more families to a life of poverty.
Sadly, Mr. Biden is operating the United States as if it were an armored truck speeding down the highway spewing cash from a wide-open back door. Lucrative distributions to green enterprises at home, surly adversaries abroad and migrant masses on the nation’s threshold are fast bankrupting the nation.
If federal and state officials were genuinely concerned about wages being insufficient to make ends meet, they would slam the door on this wasteful distribution of taxpayer funds. So long as the inflationary spiral persists, a higher minimum wage for some workers — whether $17 or $50 per hour — means maximum pain for others.
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