DEPARTMENT OF UNINTENDED CONSEQUENCES – AT 10:49 A.M. ET:  Minimum wage laws just changed in a number of states.  The intent is good, to give people a better life.  But does it work?  A cautionary tale from The Wall Street Journal: 

More than two dozen states and cities raised their minimum wages on Jan. 1. It’s well-established in the economic literature, if not in the minds of proponents of these laws, that the result will be job losses. Yet this empirical reality fails to capture the emotional reality of the employees who are let go, or of the business owners who had no choice but to let them go. I learned this on a snowy November day in Hillsdale, a college town in rural south-central Michigan.

Michigan’s minimum wage rose in September to $8.15 an hour from $7.40 (the minimum wage for tipped employees rose 17%, to $3.10 an hour). The wage will rise to $9.25 by January 2018. The law was enacted by a Republican legislature, and signed by a Republican governor to head off a more draconian proposal that left-wing activists were attempting to place on the November ballot.

But the good intentions behind these political machinations didn’t make a difference to Jack Mosley, a pastor who until this fall operated a restaurant in Hillsdale called Tastes of Life. The increased minimum wage, he told me, was “the straw that broke that camel’s back,” forcing him to close his doors and lay off his 12-person staff.

COMMENT:  Please read the whole story.  The road to Hell is, indeed, paved with good intentions.

January 5, 2015