Enforced Wage Increases

In regards to the recently proposed and happily defeated minimum wage increase. A government enforced increase in wages is not going to benefit anyone. Employers have a certain budget for employing labour and when the price of that labour increases, no matter how incrementally, they have to off-set the cost in some way in order to maintain their profit. Either they'll have to charge more for their product or cut costs in producing it or both. The most likely method of which is simply to reduce labour, as it's the source of the problem.

In other words, if an employer has to pay more per employee, he'll make due with less employees. Just like when anyone finds a necessary increase in their budget and they have to do without something to cover the costs. The same holds true if you were to argue that a company should take that money out of their profits, because a company doesn't just sit on a pile of money. They use their profit to invest back into the company in research and development, invest it in general, or pay dividends to their shareholders. There isn't an unlimited supply of money and rearranging where it goes does not create more of it.

So when you applaud the wage increase consider your own job, are you a necessary asset to your company or are you expendable to pay for someone else pay raise? And if you think it's OK, your position is secure you could use the money, consider who's paycheck you're receiving by governmental mandate.

It's disgusting that the government puts us in this position, of sacrificed and sacrificee, by rearranging wealth.

Update [8.18.2006 @ 5:53 pm]: I've submitted various forms of this post [edited depending upon the space I'm allowed] as letters to the editor to Purdue's Exponent, The Journal and Courier, and The Indianapolis Star.

Update [8.22.2006 @ 1:37 am]: I've got a confirmation call from all three newspapers, and my letter was published today in The Exponent. We'll see about the others, but I'm tinkled pink about it! Of course I'm keeping print copies; I may just frame them! ^_^
After reading over it in the paper, I really wish I could have expanded a few points and made my argument more explicit, but I think it was good for this format that I remain brief. I'm not sure, since I know what I meant to argue by each statement, but did my brevity do disservice to my clarity? I'd really appreciate an outside opinion on this, since it's my first LTTE.

Update [8.23.2006 @ 5:36 pm]: The Indianapolis Star has published my letter today. I'm going to run down to town today and pick up a paper. Still waiting on The Journal and Courier to see if I'm 3 for 3!

Update [8.25.2006 @ 5:33 pm]: An here's a link to the LTTE page in The Journal and Courier where mine is printed [scroll down to "Sacrifice comes with increased wages"].

Update [8.25.2006 @ 5:33 pm]: An ARI press release.