Another approach to CLOWARD/PIVENS. Investors Business Daily Chicago City Council Chooses Suicide By Minimum Wage Posted 12/04/2014 06:17 PM ET Mayor Rahm Emanuel called an emergency session of the Chicago City Council to vote on the citys minimum wage hike. AP Fiscal Policy: A city teetering on the brink of insolvency passes a minimum wage that would reach $13 by 2019, higher than the minimum elsewhere in a state that just elected a Republican governor. What could go wrong? Ignoring the first rule of holes (when youre in one, stop digging), the Chicago City Council, in a Tuesday emergency session called by Mayor and former White House chief of staff Rahm Emanuel, voted 44-5 to raise the citys minimum wage from the current statewide level of $8.25 an hour to $10 on July 1, with future increases bringing it to $13 by 2019. After that, it will be pegged to inflation. Whats the emergency? Emanuel wanted to jump the gun on any minimum-wage bill that might come out of the state legislature in Springfield, particularly after the election of Republican Bruce Rauner as governor. Such legislation is said to bar cities from raising their minimums above the states. Rauner has said that any minimum-wage increases should be part of a package that promotes growth without reducing competitiveness. Raising the minimum wage doesnt help somebody (who is) unemployed, and it doesnt help somebody whos employed and who could get unemployed because of the lack of competitiveness that raising the minimum wage could engender, Rauner said. The Chicagoland Chamber of Commerce, Illinois Hotel and Lodging Association and Illinois Restaurant Association all lobbied against the Chicago-only increase, arguing that it would give suburban business a 57% labor-cost advantage. Competitiveness isnt found in the leftist lexicon, but the concept of a living wage is. This notion says that employees should be paid based not on the value of their work but on the demands of their lifestyles. Street protests and the lobbying of pandering policymakers have replaced a good education and an improved skill set. One alderman who opposed the Chicago-only increase and whose ward borders on nine Chicago suburbs, Mary OConnor, rightly predicted unintended consequences, ranging from more vacant storefronts to fewer jobs and shorter hours for those having or seeking a job. Companies are neither charities nor pipelines for income redistribution. Increased labor costs either force them to move to friendlier business climes, hire fewer workers, cut worker pay, pass costs on to customers, replace employees with technology, or all of the above. Moodys Investors Service has downgraded Chicagos credit rating by three notches, partly the result of $19 billion in unfunded pension debt. In the first decade of this century, the city lost 7.1% of its jobs. Its famous Loop, the second-largest business district in the nation, has reportedly lost 18.6% of its private-sector positions. Raising the minimum wage will not reverse these setbacks. Time to stop digging, Mr. Mayor. Read More At Investors Business Daily: news.investors/ibd-editorials/120414-729166-chicago-raises-minimum-wage-to-13.htm#ixzz3L0smjeNR Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook
Posted on: Fri, 05 Dec 2014 09:19:18 +0000
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