Florida's minimum wage is up for discussion this year. Proposed as "Florida Amendment 2, the $15 Minimum Wage Initiative" residents are now voting in support of incrementally increasing the minimum wage each year until 2026 to reach $15 per hour. A vote against this decision will leave the minimum wage to $8.56 an hour. If the vote is approved, Florida will be the first to set this price as the minimum wage through ballot. There are fears about the minimum wage increasing, understandably so. Apparently, there is an impact statement on the ballot for the amendment:
THIS PROPOSED CONSTITUTIONAL AMENDMENT IS ESTIMATED TO HAVE A NET NEGATIVE IMPACT ON THE STATE BUDGET. THIS IMPACT MAY RESULT IN HIGHER TAXES OR A LOSS OF GOVERNMENT SERVICES IN ORDER TO MAINTAIN A BALANCED STATE BUDGET AS REQUIRED BY THE CONSTITUITION.
Scary right?
It is not just the possible negative impact the minimum wage has on the states budget that has people worried; concerns about how businesses will pay for this new minimum wage-cutting down hours, letting people go, tightening budgets- has people doubting the motives behind it. However, a look at basic economics and money shows that while this is likely in the short run, eventually the markets will readjust themselves to support these wages and allow people a higher quality standard of living.
The last time Florida has reconsidered wage was 2004, and a look at price level indicators like the Consumer Price Index shows that workers are unable to support themselves on $8.00 an hour due to the natural rate of inflation making everything more expensive while wages remain static. Anecdotally, this holds true. My friends, family and even myself struggle to pay for anything nowadays; and with COVID-19's economic effects just on the horizon, I find myself worried about how I will support myself in a year when I will be on my own. While there is nuance to the economic effects of increasing minimum wage- employment dead weight loss, trickle down economics, higher taxes, higher government spending- what matters is sustaining survival. Most people have to choose between doctors appointments and food, or car payments and rent.
The reason why these nuanced negativities are so scary is because there are other parts of the government that are broken, making something as simple as wages so tricky to increase. And that is something I am afraid not many people consider. Do not decline this amendment because of those nuances and instead be in support of change, because changing the minimum wage will allow us to open up discussion about healthcare, government spending, tax cuts and more. I believe everyone is entitled to their own opinion, but with that I also believe their opinion can be wrong. Humans function collectively not individually, and seeing how the current administration has skewed people more towards thinking about themselves, I believe that is why many are hesitant to agree upon this increase. They are worried about how their taxes will change, how their job will change especially if they are not reliant on this change to survive. But what they fail to realize, and I believe many fail to remember, is that with your neighbors success comes your success. I could dive deeper into a myriad of different examples, but what matters is minimum wage. With an increase in peoples budget, they will be less inclined to take out credit to survive and increase their disposable income, in turn pumping more cash instead of debt in the economy.
Our current economics system is based on Keynesian Economics, and a component of the argument for how the economy works is that after a certain income level, people are able and more inclined to save and invest their money in the market. Before that price point, people consume it, putting towards aforementioned debt and taxes with negative savings. In layman's terms, after a certain wage, you are able to afford to have savings and assets- grow your capital or at least utilize your paycheck more efficiently without debt. Once you're able to earn more than your means of living, you contribute more to the economy than less. We have become too accustomed to using debt, but this debt will catch up eventually with no way to pay it back. We feel it now because of the pandemic, and it is only going to get worse as the months go by, the stimuluses pile on and there is no real permanent solution. This amendment can be one of them, so please vote for it. If you do not live in Florida, vote for a wage increase wherever you are. If you do not care about it, someone else does, and that is a mentality we have to start adopting more frequently in America.
Sources:
“Florida Amendment 2, $15 Minimum Wage Initiative (2020).” Ballotpedia, ballotpedia.org/Florida_Amendment_2,_$15_Minimum_Wage_Initiative_(2020).
CHIANG, ERIC. MACROECONOMICS: Principles for a Changing World. WORTH PUB, 2019.
Comments
Post a Comment