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Minimum wage hike would hurt low income workers....

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Minimum-wage hike would hurt low-income workers

By Benjamin Yount | Illinois Watchdog

SPRINGFIELD  -  Minimum-wage workers, many of whom spent Thursday striking, should look at Illinois before convincing themselves that a higher minimum wage will solve their problems.

HIGHER WAGE, FEWER PROBLEMS? Low wage workers aren't always helped by higher minimum wage.

HIGHER WAGE, FEWER PROBLEMS? Low wage workers aren't always helped by higher minimum wage.

Illinois is one of the best paying states in the country, but the economic reality in the Land of Lincoln proves why a higher minimum wage does not make things better for low wage workers.

Illinois' $8.25 an hour is the fourth highest minimum wage in the country. Only Washington, Oregon and Vermont pay more.

But Illinois has the second highest unemployment rate in the country. Only Nevada is worse.

Illinois' 9.2 percent jobless rate dwarfs the national rate - 7.2 percent.

"While we can't place all the blame of our state's woes on the minimum wage, it clearly is a factor and one of the reasons Illinois continues to seriously lag behind our neighbors," Kim Clark Maisch, Illinois' director for the National Federation of Independent Business, said.

In other words, someone working a minimum wage job in Iowa earns a dollar less, but because Iowa has half the unemployment - 4.8 percent - there more jobs to be had.

If nearly one in 10 people not having a job wasn't bad enough, Maisch said the figures are far worse for the people who usually work minimum wage jobs.

"In fact, teen unemployment (16-19 year olds) is around 26.5 percent in Illinois and 48 percent in the city of Chicago," Maisch said.

LET BUSINESSES BE: Maisch says Illinois businesses want the government off their backs.

LET BUSINESSES BE: Maisch says Illinois businesses want the government off their backs.

That means half the young people in Illinois' largest city cannot find a job. No minimum wage, no matter how high, is helping them.

And don't kid yourself, young people are the ones doing most of the work for minimum wage.

As a 2012 Bureau of Labor Statistics report notes "Although workers under age 25 represented only about one-fifth of hourly paid workers, they made up about half of those paid the federal minimum wage."

Maisch said most minimum-wage workers are only part time, few are the heads of households, and less than 5 percent are adults who work full time.

But even full time at minimum wage does not make someone poor.

The federal government's poverty threshold defines a single person making less $11,490 as poor. Working 40 hours a week, someone making Illinois' $8.25 an hour would earn $17,160 a year.

The feds say a family of four is poor if they earn less than $23,550. If both parents work minimum wage jobs in Illinois, they'd bring home $34,320.

That family of four would earn more than $40,000 a year if Illinois Gov. Pat Quinn has his way.

Quinn has been pushing to raise Illinois' minimum wage to $10 an hour.

Maisch said if Illinois can't find jobs for its citizens while paying $8.25, what will the state look like at $10 an hour.

$40,000 A YEAR: A $10 minimum wage equals about $40,000 a year.

$40,000 A YEAR: A $10 minimum wage equals about $40,000 a year.

"If government would stop intervening by setting artificial wage rates, mandating expensive and burdensome regulations like Obamacare, and stop throwing roadblocks up to starting small businesses our state and our country would be much better off," Maisch said. " When I ask my members - small business owners - what do you need to help you succeed in your business they say "tell government to get out of the way."

Contact Benjamin Yount at Ben@IllinoisWatchdog.org or find him on Twitter @BenYount.

grandma B

by on Aug. 30, 2013 at 9:19 PM
Replies (11-16):
Sisteract
by Socialist Hippie on Sep. 1, 2013 at 1:00 AM
1 mom liked this

Increasing the MW will only decrease the number of positions and workers.

grandmab125
by Gold Member on Sep. 1, 2013 at 3:12 AM

 Like hell you did.  This is dated May 1, 2013

SACRAMENTO (CBS13) – The combined debt of California’s state and local governments is at least $848 billion and could escalate past $1.1 trillion, according to a new report.

The California Public Policy Center – focused on the analysis of California’s financial information on the state and local government levels — based its findings on official reports from the offices of the state controller and treasurer.

READ: California Public Policy Center Report

Gov. Jerry Brown’s $27.8 billion “wall of debt” was only part of the state’s official debt that the report put at $132.6 billion.

 

Much of the state’s debt comes from general obligation bonds — funds for public works — totaling $73.1 billion, unemployment insurance loans totaling $10.9 billion, and lease-revenue bonds totaling $11.3 billion.

The debt of K-12 public school districts was estimated at $49.7 billion, city government debt was $68.1 billion, county government debt was $22.1 billion, redevelopment agencies and special districts was $110.4 billion, unfunded pension liabilities at 7.5 percent interest was $128.3 billion and unfunded retiree healthcare liability was $136.8 billion.

According to the report — at 5.5 percent interest — an additional $200 billion would be added to unfunded pension liability.

The total $848.4 billion state and local government debt is called a “low estimate” by the report.

Adding, California’s long-term debt acquired by K-12 schools, cities, counties, special districts and redevelopment agencies as well as unfunded pension liabilities and future retirement healthcare could balloon the debt to $1.13 trillion.

Quoting Sisteract:

You're far behind- You can nix CA from the list- we righted the ship here.

Quoting grandmab125:

 Wake up.....IL has a $100B debt for unfunded state pensions, and owes $6B in unpaid bills.  IL, CA, NY and the out of control Fed gov't will be the next Greece.

Quoting -Celestial-:

Ooooooooooo a whole 8.25 an hour. They can buy a can of tuna with their ramen noodle cups


And illinois and greece is always the scapegoat

 


 

grandma B

grandmab125
by Gold Member on Sep. 1, 2013 at 3:20 AM

 Oh?

California's debt still a heavy cloud over state's future

Gov. Jerry Brown's new budget presented a plan to pay back nearly $28 billion owed, but various sources estimate the state's debt at hundreds of billions.

January 13, 2013|By Evan Halper and Chris Megerian, Los Angeles Times
 

SACRAMENTO — Gov. Jerry Brown proclaimed last week that California, which now has enough cash to pay its day-to-day bills, can no longer be described by naysayers as a "failed state."

But even though it appears to be free of the deficit that dogged the Capitol in recent years, the state is no model of financial health.

Sacramento is legally obligated to pay many billions of dollars withheld from schools, local governments and healthcare providers as lawmakers struggled repeatedly to balance the books. It owes Wall Street more per resident than almost every other state. And it has accumulated a crushing load of debt for retiree pensions and healthcare, now totaling more than taxpayers spend each year on all state programs combined.

The budget Brown proposed Thursday addresses only a small portion of the overall debt, which stems from the same types of bills that drove cities like Vallejo, Stockton and San Bernardino into bankruptcy. The state is likely to find its debt consuming an ever larger share of money meant for the basic needs of government.

"Every year we fail to acknowledge or fix these things, it just makes the cost bigger," said Joe Nation, a former Democratic assemblyman who teaches public policy at Stanford University.

When he released his budget plan, Brown vowed to knock down the state's "wall of debt." He presented a timeline for repaying nearly $28 billion the state owes to government programs that it raided for cash or deprived of funds over the years, as well as some bonds sold to balance the budget.

Payments of $4.2 billion would be made in the budget year that begins in July. Subsequent payments, growing to as much as $7.3 billion a year, would continue into 2017.

At that point, Brown says, $4.3 billion in debt would remain, mostly for delayed payments to healthcare providers and money owed to municipalities and schools for implementing state mandates.

"By paying down the debt, we've put ourselves in a stronger position when things go bad, as they inevitably do," Brown said.

But numerous reports by state agencies, think tanks and academics have shown the wall of debt to be many stories higher than $28 billion — hundreds of billions of dollars over the next few decades. Brown's repayment plan does not significantly reduce the sizable debt to Wall Street or account for promises the state has made to its current and future retirees but is not setting enough money aside to cover.

"If we just ignore these longer-term pressures, we're going to be back in the soup soon," said Mike Genest, who was budget director for Gov. Arnold Schwarzenegger.

State officials must grapple with a major shortfall in the retirement fund for teachers. Fund officials have warned that Sacramento needs to immediately start contributing about $3 billion annually to keep the pension system solvent.

Quoting Sisteract:

You're far behind- You can nix CA from the list- we righted the ship here.

Quoting grandmab125:

 Wake up.....IL has a $100B debt for unfunded state pensions, and owes $6B in unpaid bills.  IL, CA, NY and the out of control Fed gov't will be the next Greece.

Quoting -Celestial-:

Ooooooooooo a whole 8.25 an hour. They can buy a can of tuna with their ramen noodle cups


And illinois and greece is always the scapegoat

 


 

grandma B

Kathy489
by Bronze Member on Sep. 1, 2013 at 8:35 AM

 

You're exactly right with this. I'm surprised. I thought you usually took the side of the liberals. They don't understand that the ecomony works by way of supply and demand and free enterprise. They keep trying to control it.

Quoting Sisteract:

Increasing the MW will only decrease the number of positions and workers.


 

Ziva65
by Bronze Member on Sep. 1, 2013 at 12:51 PM

"That family of four would earn more than $40,000 a year if Illinois Gov. Pat Quinn has his way."

One major flaw in his assumption- he is assuming that the hours will be the same, well, guess what? The hours will be cut so his annual number doesn't pan out. Business don't intend on increasing their bottom line in personnel costs- it just means less hours. As a business owner, that is exaclty what I would do.

Sure, meet the letter of the law, just cut hours.

JoJoBean8
by Silver Member on Sep. 1, 2013 at 1:04 PM

Raise the minimum wage and watch how many jobs vanish. 

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