H 23°, L 4° | Tomorrow: 
H 21°, L 6°As Madison prepares to hike its minimum wage from the national standard of $5.15 per hour to a new local rate of $7.75 per hour — a full 50 percent leap — we remain deeply concerned about the potentially devastating effect this may have on both the student body and local economy.
While the utopian concept of universally higher wages is surely agreeable, the reality is that isolated implementation of such a Marxist notion can lead a horrifically destructive impact on not just low wage earners but also small business owners. The non-elastic nature of an already balanced economy is such that government-enforced wage hikes become part of a sum-zero scenario where money doesn’t simply materialize but is rather forcefully displaced.
State Street is a haven not of large corporations with comfortable profit margins but rather of predominately small businesses where nearly every employee — including the owner — receives a delicately sliced portion of cash flow such that after-tax profits are a rarity. As such, should employees currently making less than $7.75 per hour be handed a mandatory raise, the money will likely come at the expense of jobs. (The other possible source of added payroll funds would be an increase in pricing, but since this wage hike is limited to Madison and does not cover overlapping markets such as Middleton and Fitchburg, most business owners realize that to hike prices would be to lend competitors a lethal edge in sales.)
Moreover, the jobs that will be first to see pink slips in lieu of larger paychecks are doubtlessly those positions deemed most expendable. These are not the full-time employees critical to a business’ operation, but rather those many students who opt to work part-time as a means of aiding their way through college.
To be sure, a wage hike is not altogether a bad idea, and one explored on a national level so as to alleviate competitive concerns would be most welcome. Also, a local wage is not a bad idea per se, but the radical nature of this 50 percent hike is simply too damning to not result in a net-negative outcome for the Madison community.
That local lawmakers lack this macroscopic economic appreciation is simply tragic for the University of Wisconsin community.
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The minimum wage isn’t going to $7.75 overnight, dolts. It’s going to all of $5.70 come January 1st. I agree that it would be best to do on a national and state level, but at least Madison lawmakers got off their duffs and did something about it. With the current administration, congress, and state legislature, do you really think there will be any increases in the forseeable future? Nobody deserves to live on $5.15, nobody. And, seriously, no one is going to lose their job because the minimum wage went up 55 cents in one year. To make that argument is pretty foolish. What are you complaining about?
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“The minimum wage isn’t going to $7.75 overnight, dolts. It’s going to all of $5.70 come January 1st…”
That’s a great point. It would be irresponsible to raise the minimum wage to $7.75 an hour immediately, but the city council didn’t do that. They instituted a graduated increase so that the minimum wage will increase a little at a time until int hits that target in a few years.
The people who complain that raising the minimum wage will put them out of business are the same people who complained 7 or 8 years ago that raising the minimum wage to $5.15 an hour from $4.75 would put them out of business. In the ensuing several years, I doubt any local business went out of business because of that measly increase, which over the course of the 7 or 8 years actually decreased in value in terms of buying power. What the government really ought to do is tie the minimum wage to legislators’ salaries. That way, every time the legislators vote to raise their own salaries by a certain percentage, the minimum wage would also rise by that same percentage. Everyone would get a cost of living increase, not just the already overpaid state officials.