Discussing this year’s bill to revive New Hampshire’s minimum wage and raise it by 24 percent, Rep. Sally Kelly, D-Chichester, said the minimum wage “should have nothing to do with politics, Republican or Democratic.” There is a rich irony in a politician saying that politics should have nothing to do with a law that would use the power of the state to force a transfer of wealth from one group of people to another. The minimum wage is about nothing but politics.
It is not about economics. The research shows that minimum wage laws hurt low-income workers. Economists David Neumark and William Wascher reviewed more than 100 minimum wage studies for the National Bureau of Economic Research in 2006. They found that the minimum wage does reduce employment among low-wage workers and that “the studies that focus on the least-skilled groups provide relatively overwhelming evidence of stronger disemployment effects for these groups.” If you want to put the lowest-skilled Granite Staters out of work, raise the minimum wage.
It’s not about boosting the economy. Only 0.035 percent of all hourly wage workers in New Hampshire earn the minimum wage. The average entry-level wage in the state is $10.33 an hour — 42 percent higher than the minimum and $1.33 (14.7 percent) higher than the $9 minimum that would be set by House Bill 1403, the minmum wage bill Rep. Kelly and others are trying to pass.
This is not about economics at all. It is about politics. Raising the minimum wage is a wedge issue politicians use in election years to drive their voters to the polls. In the process, they reduce work opportunities for a lot of their low-income supporters.