Good Morning Gentle Readers,
Governor Schwarzengroper will get his wish and likely sign Californicate's new minimum wage bill on Labor Day. TWC isn't sure that this will play politically the way Arnie envisions. We'll see.
The new law bumps the minimum to $7.50 per hour in January 2007 and another $.50 an hour in January 2008 (that's a new rate of $8.00 per hour for you LAUSD grads).
Tom McClintock, who finished a distant fourth in the melee that elected Arnie last time said.....
I can't imagine a more destructive government policy than to wantonly destroy entry-level jobs for people who need it the most. If your labor is worth $6.75 an hour and the minimum wage is $8.00 an hour, you become unemployable. I've never understood why it's better to not have a job paying $8 an hour than it is to have one at $6.75.
A little hyberbole there, Tom. TWC can imagine and identify far more destructive government policies, but it is clear that absent correlating productivity gains, the primary effect of raising the minimum wage artificially is to increase unemployment.
No Productivity Gains + Higher Labor Costs = Unemployment. That's a no-brainer.
Of course, students in public school aren't taught economics and therein lies the problem.