Monday, March 19, 2012
Donovan’s Minimum Wage “Compromise”
Donovan’s compromise is a bit like that of Solomon’s, who proposed that a baby whose parentage had been questioned should be cut in half with a sword, each half to be parceled out to the disputing mothers. Solomon’s inelegant solution, offered as a ploy to ferret out the real mother, would have resulted in a dead baby. Mr. Donovan – perhaps in order to demonstrate his willingness to compromise should he ever reach the U.S. House of Representatives – has now offered a more “moderate” proposal: The Labor and Public Employees Committee recently voted 8-3, with the consent of the Speaker, to trim back Mr. Donovan’s minimum wage hike. Mr. Donovan’s compromise bill raises the minimum wage by 50 cents to $8.25 in each of the next two years, future raises to be pegged automatically to the consumer price index.
With whom, it may be asked, was Mr. Donovan compromising when he shaved 25 cents off his initial minimum wage proposal and then indexed future boosts to the steady and reliable escalation in the consumer price index -- which, like taxes, always goes up and never comes down? One of the reasons the consumer price index will be going up in the post-Barrack Obama era has to do with inflation. When the national government prints too much paper money, it devalues the purchasing power of the dollar. The decrease in the purchasing power of the dollar means that it takes more dollars to buy a loaf of bread or a gallon of gas or a politician for sale. This increases the price of goods, and tying wage increases to the price of goods protects favored interests – such as union members inclined to vote for Mr. Donovan – from the ravages of inflation caused by legislative spendthrifts such as Mr. Donovan.
Most Republicans in the General Assembly, Senator Tony Guglielmo of Stafford dissenting, sincerely believe that the Donovan “compromise” will result in a dead baby. In any case, Mr. Donovan, who prefers force majeure to compromise and is a former organizer for the Service Employees International Union, has not been inclined to compromise with Republicans in the General Assembly on budget matters because, as Napoleon once pointed out to the pope of the day, the Vatican opposition to his hubristic ambition was short on battalions. The opposition to Mr. Donovan’s Solomonic decision to increase the minimum wage is more likely to come from queasy Democrats.
And why, it may be asked, are Democratic big spenders in Connecticut’s General Assembly all of a sudden queasy. Well, elections are nigh; that’s one thing. There are indications that Connecticut’s plane, headed at full speed toward the hills, will sooner or later crash into the mountain; that’s another. Governor Dannel Malloy during his first few months in office, with the concurrence of unionized state workers, levied a broad-based Matterhorn sized tax increase on pretty much everyone in the state, tapping out future income tax resources; that’s another thing. And then there’s this: With the concurrence Speaker Donovan and President of the Senate Don Williams, General Assembly Democrats progressivized the income tax, instituted a New Earned Income Tax Credit without offering offsets in welfare payments and levied a new charge on businesses, although for years spendthrift Democrats in the General Assembly have been witnessing promising entrepreneurs and businesses leeching into other states less prone to punishing regulations and taxes.
Under the progressive regime favored by Mr. Donovan, destructive increases in taxation and regulation – yet another hidden tax passed on by businesses to consumers – simply rearrange chairs on a sinking Titanic. Any artificial increase in Mr. Donovan’s minimum wage beyond the point of diminishing returns will force businesses that cannot afford the increase to a) raise prices and reduce market share in a competitive economy, b) lay off workers and compel other employees to take up the slack without proper remuneration, and c) shut down business that likely employ the low income workers Mr. Donovan hopes to enrich through legislative means.
Other Democrats running against Mr. Donovan for the coveted 5th District Congressional seat presently held by U.S. Rep. Chris Murphy have pushed themselves so far left of center during the primary that it is doubtful any of them will be able to raise reasonable objections to Mr. Donovan’s destructive bill or his candidacy for the U.S. Congress.