Schultz: No way will raising the minimum wage hurt small businesses

posted at 3:21 pm on February 14, 2013 by Erika Johnsen

Ah, but of course — despite the overwhelming evidence that minimum wage laws are a disservice both to those they’re specifically targeted to help as well as the larger economy in general, how could those wretched humanity-hating Republicans possibly oppose anything so simple and innocuous as President Obama’s proposed minimum wage hike?

Well, Boehner, Ryan, and Rubio, they have publicly rejected President Obama’s proposal, and they’re now spouting out the same old lies that we heard six years ago: That it’s gonna’ cost jobs and it’s gonna’ hurt small business. It’s just another example of Republicans denying the facts. So let’s get this whole straight, folks: Several academic studies have found that increasing minimum wage had no significant effect on employment levels in this country. Bottom line: It doesn’t kill jobs, and it won’t kill small businesses. … By raising the minimum wage, we directly address the growing levels of income inequality in this country by giving people a chance to lift themselves out of poverty and join the middle class, which is the mission — a rising tide lifts all boats. By opposing this, Republicans are just showing us once again just who exactly who they stand for.

Facts? Okay, I’ve got your academic studies right here:

The economic effects of minimum wage increases have been studied dozens and dozens of times in the past few decades. Different studies come to different conclusions, of course. But economists David Neumark and William Wascher, after conducting an exhaustive literature review, conclude that “among the papers we view as providing the most credible evidence, almost all point to negative employment effects, both for the United States as well as for many other countries.”

They continue: “The studies that focus on the least-skilled groups that are likely most directly affected by minimum wage increases provide relatively overwhelming evidence of stronger disemployment effects for these groups.”

And the 47 million low-income Americans that Schultz misleadingly cites — would a higher minimum wage do anything to help rise the tide that raises all boats?

Economists Joseph Sabia and Richard Burkhauser find that a small minority of workers who would benefit from a minimum wage increase – around ten percent – live in poor households. The White House itself states that workers who would benefit from a minimum wage increase bring home less than half of their household’s total wage and salary income.

In other words, the workers who will benefit from an increase are secondary and tertiary earners – think more of teenagers with summer jobs, of spouses earning some income on the side, or of elderly grandparents earning some retirement income, and less of primary breadwinners. In fact, Professors Sabia and Burkhauser find that around two-thirds of minimum wage workers live in households with incomes more than twice the poverty line.

President Obama and his useful lefty minions are, as ever, trying to perpetuate the old-and-tired depiction of Republicans protecting their nefarious corporate buddies’ miserly interests and ill-begotten profits that they then hoard in their unproductive fat-cat offshore bank accounts, but as President Obama has showcased time and again, he has no problem with big business. He loves big business. Many of the rules and regulations his administration have proposed are nothing short of a help to big business, as they are more equipped with the resources to deal with these compliance costs that squeeze the smaller businesses with which they compete. And increasing the cost of hiring, a.k.a. killing jobs, is somehow supposed to help out these small businesses as well as the people who work for minimum wage? Dream on.


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Steveangell on February 14, 2013 at 4:15 PM

First, if it’s only an insignificant number of jobs, then why do anything? Of course, you also fail to see that *everyone* will want their wages increased once the $7.50 folks get to $9. After all, it’s not just the $7.50 worker who will get a raise, it’s the $7.75 worker, and the $8 worker, and the $8.50 worker, and the $9 worker (he doesn’t want to work minimum wage, after all!).

Secondly, raising the price of everything by even a small margin will only put the poor further behind the curve. The increase won’t overcome that in a dynamic analysis.

Thirdly, why can’t WalMart fire people? Unless you’re contemplating even more interference in the market than even Obama is proposing at this point. They will also fail to hire new people, or open new stores. The cost just went way up for that.

I don’t fight against an increase. I think the national minimum wage should be eliminated entirely.

PastorJon on February 14, 2013 at 4:19 PM

2) Everyone who is just over $9 will want a wage increase, too. Then the folks who make $15, then the folks who make $20,……

4) Amen.

Raising the wage will actually lower Government entitlement payments perhaps more so than taxing employers a similar amount.

Steveangell on February 14, 2013 at 4:33 PM

You need to put down the crack pipe, friend. It is not enhancing your reasoning nor math skills.

GWB on February 14, 2013 at 5:01 PM

I own an aviation business in south Louisiana. During the course of the past 30 years, I have hired well over 200 young people from the local high schools for their FIRST job. In that it takes 4 to 6 months to train someone in aircraft movement, safety and refueling procedures, I must have a full-time employee monitor and instruct my new hires. In effect, I am paying 2 people to do 1 job.

It is already a financial challenge to hire unskilled and untrained personnel at the current minimum wage. If the new rate goes into effect, I will probably discountinue my hiring of first-time employees.

I really wish that politicians and commentators like Mr. Schultz would ask those of us who actually create jobs and pay employees for our input before setting policy.

Yea, like that’s going to happen!

Seaplane Driver on February 14, 2013 at 5:13 PM

I am much more concerned about the fact that a single mother can get $87,000 in benefits every year for hardly working at all. This is what we need to stop. I mean these employers are paying far more in taxes for this kind of waste than this increase in wages would cost.

Steveangell on February 14, 2013 at 4:45 PM

You really think raising the minimum wage will get this woman off welfare?!?!? HAHAHAHAHAHAHAHAHAHAHAHAHAHAHA!!!!!!!!!!!!!!!!!!

GWB on February 14, 2013 at 5:15 PM

Well ya got your idiots and then you’ve got your IDIOTS like Fat Eddie.

GarandFan on February 14, 2013 at 5:17 PM

Seaplane Driver on February 14, 2013 at 5:13 PM

It’s seems apparent that all liberal economic policy is aimed at making more people dependent on government. Liberals know damn well raising the minimum wage will drive prices up and create more unemployed. Young people, especially students are hit hardest.

Of course liberals always blame the disastrous consequences of their policies on Republicans … and low info folks usually believe them.

darwin on February 14, 2013 at 5:18 PM

Why are they attemptig to legislate wage increases for the least skilled workers in the country? The reason they are paid so little is that they are pretty much interchangeable in their current job. Paying them more to be unskilled certainly won’t inspire anyone to gain skills that may result in them actually EARNING higher pay or demand for their services.

weaselyone on February 14, 2013 at 6:00 PM

Several academic studies

Who did these? I’m guessing places like Liberal State Community College, Social State Polytechnical, and Havana University.

BobMbx on February 14, 2013 at 6:51 PM

You really think raising the minimum wage will get this woman off welfare?!?!? HAHAHAHAHAHAHAHAHAHAHAHAHAHAHA!!!!!!!!!!!!!!!!!!

GWB on February 14, 2013 at 5:15 PM

No. But one thing sure will.

The collapse of the dollar, scheduled to occur between 2030 and 2040. When entitlement benefit outlays alone exceed government revenue, that’ll do it. What that means is in that decade, the government will have to borrow every penny it spends outside of Social Security, Medicare, and Obamacare.

Complete collapse of the dollar.

BobMbx on February 14, 2013 at 6:55 PM

If, as steveangell insists, we are to give in on minimum wage increases just because it makes us look bad to poor people if we oppose it, what is to stop the Democrats for pushing for $10? $15? Should we abandon any principle that people who already prefer the party that gives them welfare won’t like us, why does the GOP exist?

Perhaps we should just be the party of “the poor” just like the Democrats. How would that work out?

Not well.

PastorJon on February 14, 2013 at 6:56 PM

If Ed is so sure, why not have Comcast, who now controls NBC & MSNBC, raise their minimum wage to $20/hour (just so we can hurry along the unintended consequences).

J_Crater on February 14, 2013 at 6:58 PM

Schultz is a flaming idiot and could only exist on the likes of NBC.

rplat on February 14, 2013 at 6:59 PM

Ed Schultz switched to being a progressive because he saw that he could make more money by towing the liberal line. Saying that “No way will raising the minimum wage will hurt small businesses” is only spouting liberal talking points.

When your business is aided by big government – you will do all you can to help big government.

While defending the Obama administration as a champion for small business owners, MSNBC host Ed Schultz revealed that his construction company more than doubled its number of employees in the past year – thanks to the stimulus bill.

Read more: http://newsbusters.org/blogs/matt-hadro/2010/06/24/did-ed-schultzs-construction-company-get-stimulus-money#ixzz2KvA9g6oO

TV and radio personality Ed Schultz has a lot to be jovial about, with an estimated net worth of approximately $11.5 million.

http://www.celebritynetworth.com/richest-celebrities/ed-schultz-net-worth/

redguy on February 14, 2013 at 7:01 PM

No wages have. If they did since the 70s, we’d all be making $37 an hour or better. In the free market today, people have either not received raises at all, and sometime been forced to take pay cuts. But it’s a bad idea right now to add a 24% increase in costs all in one shot to a small business.

Not to try giving the Left any ideas, but if they forced a much smaller amount every year or two, it wouldn’t be such a hard hit. I don’t think it’s so much a matter of the final wage itself, but the fact that an increase of $1.75 an hour in this economy is almost Draconian (for lack of a better term at the moment).

Liam on February 14, 2013 at 4:52 PM

People have had to keep up by being forced to be two income households, which actually causes a bad cycle to continue as a lot of times that means more money to spend which increases inflation . . .

Lots of factors, too many do discuss with the time I have. But suffice to say that minimum wage laws only make things worse, as altruistic as they may sound.

PastorJon on February 14, 2013 at 7:03 PM

Yeah, raise the minimum wage to about a $1000. an hour.. but stipulate journalists and TV talking heads must not raise their salaries in response to the raise in the minimum wage. See how long that lasts.

JellyToast on February 14, 2013 at 7:03 PM

Like virtually every other topic, the leftist theology flies in the face of all empirical evidence, yet they steadfastly believe it anyway.

Minimum wage. Taxes. Government spending. ‘Climate change’. Gun control.

Pick a topic, any topic. The liberal position is almost always diametrically opposed to anything that has been tried and actually works – in fact, they propose solutions that have been tried repeatedly and proven to fail.

wtf.

Midas on February 14, 2013 at 7:07 PM

If, as steveangell insists, we are to give in on minimum wage increases just because it makes us look bad to poor people if we oppose it, what is to stop the Democrats for pushing for $10? $15? Should we abandon any principle that people who already prefer the party that gives them welfare won’t like us, why does the GOP exist?

Perhaps we should just be the party of “the poor” just like the Democrats. How would that work out?

Not well.

PastorJon on February 14, 2013 at 6:56 PM

Come on the democrats raise the minimum wage about every four years when possible. The democrats have no real desire to make it too high actually they prefer to give money to the poor and assure they vote for them.

This $9 rate could actually help the Republican Party as more people could make do with it and thus not need hand outs.

I have had children who worked at WallMart and even then a decade ago WallMart made sure they had no more employees than the minimum possible to get the work done. Now this has spread into most stores and companies. Companies already have every incentive to keep the workforce at the absolute minimum thus a higher wage they have few options. Increase prices or go out of business is really about it. They are already increasing prices so this might increase them a bit more but then to it could end up mostly a wash.

Why is there so much anger over this but not about the numerous bills that have passed giving more and more benefits to the “poor”? Either cost employers money. The fact that it is harder to see does not eliminate the cost.

When I see the GOP shut down government over the crazy spending I will start to think they care. I would bet that if given a choice of even $12/hour but no Obama Care and the elimination of most other government requirements that business would jump on that in a second. Shutting down Obama Care would more than compensate for the extra $1.50/hour. Pick the right fight.

Steveangell on February 14, 2013 at 7:09 PM

Big Red Ed has just moved up to the MSLSD Moron #2 spot in my book,#1 being held by the Great Tingles.Proof positive liberals refuse to learn math!

jeffinsjvca on February 14, 2013 at 7:34 PM

There are people who get paid to study the effects of raising the minimum wage? And they don’t agree? What simpler concept is there?

The effects of a minimum wage hike:

Short term rise in unemployment as the lowest paid workers are terminated, their wages reallocated to those who will be receiving the government-mandated wage increase.

A slight increase in what is commonly termed “productivity” as companies accomplish the same amount of work as before, but with fewer employees.

Cost increases not absorbed by employee terminations will be made up for by increasing the prices of a company’s goods/services.

As more companies increase their prices due to the forced wage increases, each company’s costs increase. These costs get passed onto clients and eventually onto consumers as higher prices.

Over time, the end result is that – get this now – the end result is that everything costs more, effectively reducing the value of currency. In other words, each dollar is worth less. The money you have stashed in the bank is worth less. And since you got no raise, you make less.

In the end, those who got the bump up really got no bump. Everyone else took a loss.

While I won’t go into it here, the reason for this outcome is that economies are based on relative free-market values of work produced. Period. You can throw a bunch of other crap in there, but in the end, they serve only to distract from that one fundamental concept.

ROCnPhilly on February 14, 2013 at 7:36 PM

Schultz: No way will raising the minimum wage will hurt small businesses

…how can this dumb Fother Mucker…even have a job?…let alone one in front of the public?

KOOLAID2 on February 14, 2013 at 7:54 PM

his $9 rate could actually help the Republican Party as more people could make do with it and thus not need hand outs.
—-

Steveangell on February 14, 2013 at 7:09 PM

Heh. How naive.

CW on February 14, 2013 at 8:19 PM

In other words, the workers who will benefit from an increase are secondary and tertiary earners – think more of teenagers with summer jobs, of spouses earning some income on the side, or of elderly grandparents earning some retirement income, and less of primary breadwinners.

Of course, it won’t actually help those people, because they aren’t worth $9 an hour and won’t have jobs.

Sort of like the way most kids aren’t worth $7 now and therefore most of them don’t have jobs, something unthinkable a mere 6 years ago.

HitNRun on February 14, 2013 at 9:02 PM

Absofrigginlutely.

The minimum wage will not, and CANNOT, ever be more than a bare-bones barrier to big businesses treating Americans like Asian peasants. (I note with great approval that small businesses are much less likely to do this.)

Trying to use min-wage increases as a social engineering tool is stupid beyond belief of anyone rational, which of course excludes liberals. Trying to do this during a recession is idiotic to the point of needing to be involuntarily committed!

MelonCollie on February 14, 2013 at 9:03 PM

If you have a family of 4 and make minimum wage, you made some very bad decisions in your life.

Bevan on February 14, 2013 at 3:25 PM

Absolutely. The way today’s public schools are run, you have to work hard not to graduate. It’s a challenge but not impossible to work your way through community college or a career school. With very few exceptions, people supporting a family on minimum wage have chosen to do so. Low wages should be a motivator to getting a better job or more training/education.

hopeful on February 14, 2013 at 9:16 PM

his $9 rate could actually help the Republican Party as more people could make do with it and thus not need hand outs.
—-

Steveangell on February 14, 2013 at 7:09 PM

Heh. How naive.

CW on February 14, 2013 at 8:19 PM

Remember when the Republican Party had lost its way and we needed to purge the RINOs and get some real conservatives instead?

GOP = Whig.
We have had enough.
Time to start a party to replace the GOP.
2010 proved we are the majority. Let’s just all leave the GOP and start a new real Conservative Party. No RINO’s allowed.

Steveangell on January 15, 2013 at 9:05 PM

Good times…

RINO in Name Only on February 14, 2013 at 9:22 PM

I am not really surprised, but schultz has to be one of the most stupid talking heads in the broadcast media. However, he still is not dumber than obama.

Old Country Boy on February 14, 2013 at 9:55 PM

NPR ran a segment in which they interviewed two people:
a) The “food runner” at a restaurant, and
b) The owner of the restaurant.

They asked what the effects would be of raising the minimum wage from $8 to $9.

(a) said it would be great for him — it would have a big effect on his earnings.
(b) said that, to cover the new wage, he’d have to adjust the hours his restaurant was open to eliminate times where the restaurant’s low business rendered it unprofitable to stay open. In addition, during low clientage periods, he would probably send more staff home.
(a), when appraised that his hours might be cut to cover the increased wages, said that things were already bad that way — the owner already sent some staff home when the business was bad, and it greatly affected “food runner”s bottom line.

So, for one restaurant, and one “food runner”, the equation is obvious — he will NOT be earning more as a result of increasing the minimum wage — and, in fact, there’s a great possibility he may be earning less. And the owner of the restaurant is going to try to maximize his profit by decreasing the hours, where possible, of his employees.

I can guess that a lot of people who hire minimum wage people will be hiring about 12.5% fewer of them, given the economy, should the wage go from $8 to $9.

Sadly, those making minimum wage also probably can’t afford to fuel their cars, given the nice increase in gas prices Obama has given them — but they voted for him, so I can’t feel too sorry…

unclesmrgol on February 15, 2013 at 2:11 AM

Well, Eddie….

Once you kill small business, true, you can’t hurt it anymore.

Between regulations, “health care”, etc., and dumping on minimum wage…I’m glad I shut down last year.

Value received for value perceived. Someone who makes a company money will get their due. Someone who costs a company money will find themselves released from employment.

ProfShadow on February 15, 2013 at 8:35 AM

his $9 rate could actually help the Republican Party as more people could make do with it and thus not need hand outs.
—-

Steveangell on February 14, 2013 at 7:09 PM

Heh. How naive.

CW on February 14, 2013 at 8:19 PM

That’s not naive. That’s weapons-grade stupid.

gryphon202 on February 15, 2013 at 9:21 AM

I have had children who worked at WallMart and even then a decade ago WallMart made sure they had no more employees than the minimum possible to get the work done. Now this has spread into most stores and companies.

That is how a business works. You don’t hire more than what is necessary. Duh. That’s not even Business 101, that’s remedial.

Tell you what, go hire 7 people to cut your hair. What? Why pay for 7 people when you only need one person to get the job done?

Exactly.

Cam Winston on February 15, 2013 at 9:38 AM

I have had children who worked at WallMart and even then a decade ago WallMart made sure they had no more employees than the minimum possible to get the work done. Now this has spread into most stores and companies.

And it’s been true for as long as I’ve been in corporate America. It’s a driver of productivity. If you have enough [of anything, including labor], you have too much. So be it.

Every time, every single time, without fail, that we have raised the minimum wage, the same deleterious effects occur. There is simply no getting around it. To pretend otherwise simply because it makes us feel good about ourselves…ArGh! There are no words for my frustration.

gryphon202 on February 15, 2013 at 9:53 AM

If Ed is so sure, why not have Comcast, who now controls NBC & MSNBC, raise their minimum wage to $20/hour (just so we can hurry along the unintended consequences). – J_Crater on February 14, 2013 at 6:58 PM

Just make the wage paid to everyone $20 per hour at Comcast. Even pay Ed Schultz $20/hour. That is the only fair thing to do.

SC.Charlie on February 15, 2013 at 11:30 AM

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