On the minimum wage vote, the Senate got it wrong!
Earlier this month, in a straight party-line vote, the N.H. Senate killed a bill to increase the minimum wage. “This war on business has got to stop,” a local Senator cited as his reason. This bill was not a “war on business,” but just the opposite. Much of this difference of opinion depends on how you see “business.”
In my interactions with small businesses in the area, the answer to the question “What do you need?” is always the same: more customers. The best way to stimulate more customers is to put more money in their pockets. When local people have more to spend, they will spend more locally. This increase in business may lead to the need for more employees. Jobs are created. I also learned that most local small businesses pay more than the minimum wage. They understand that investing in those who help to make the business work is just good for business stability and worker loyalty.
When you look back on the auto industry bailout, it was the “Cash for Clunkers” that really got it moving. Without buyers, there is no business. An added benefit of workers making more money is that it may reduce the need for supplemental programs that so many are eligible for.
The more conservative economic approach is known as the “Trickle Down Theory.” In this system, stimulus and incentives are fed to the top of businesses. If business can be done more cheaply, perhaps jobs can be created. It does not work well for several reasons. First, it does not provide the stimulus buying power that customers need to buy. Secondly it fails to recognize one of the more unfortunate human characteristics: self interest. If a CEO of a business can get work done as cheaply as possible, there is more left over for the CEO. There is no incentive to hire more people than absolutely needed. With a glut of workers, there is no need for a business to be loyal to those workers. In short, not much trickles down. More jobs rarely result. David Stockman, one of the architects of this system has said, “It doesn’t work.” Yet, there are many who continue to embrace this concept.
The Senate missed a rare opportunity to help the working people and small businesses of New Hampshire.
Jon Manley (D-Bennington) represents Hillsborough District 3, which includes Bennington, Greenfield and Hancock.