The Big Mac Rule – Minimum wage increase failures. (updated Christie remarks)
New Jersey voters foolishly approve constitutional amendment to auto adjust Minimum wage.
The voters of New Jersey voted to raise the minimum wage and tie future automatic minimum wage increases to cost of living with a constitutional amendment. I voted against it. But I stand to win, because in a few years I expect to retire. I will rent my house in New Jersey and move to a place I have secured in Florida. I won’t be buying a new car, new appliances, or a new home. I won’t have to worry about high interest rates. My rates are locked. I would have to live a lot longer than can reasonably be expected before I need to worry about inflation.
Heaven help the young and those just starting out. I remember 18% mortgage rates. I remember when it was better to go in to debt an buy now than save for something. Of course, back then most people weren’t already in debt. New jersey is entering a self defeating spiral of inflation that will harm everyone, but the young and the elderly who can’t leave New Jersey will get hurt the most.
And it isn’t logical. There is a simple way to explain it to people.
I call it the Big Mac Rule.
When I started working minimum wages was about a $1.35. The Big Mac was about $0.59. You had to work a little less than 1/2 hour at minimum wage to earn enough (discounting taxes) to buy a Big Mac. Today the minimum wage stands at 7.25 per hour. A big mac costs about $3.99. You need to work a little more than 1/2 hour(discounting taxes) to buy a Big Mac. For all the increases in minimum wage you can’t buy more Big Macs with your wages at $7.25 an hour then you could at $1.35 per hour.
What is the point of pushing up the rate of the minimum wage, if people end up working longer to buy the same the minimal extravagances and the basic commodities that people who earn minimum wage want or need. Things like non-processed foods, basic grocery and detergents, paper products and similar commodoty items that are all impacted by minimum wage increases.
There there is taxes. While the cost of everything basic that is most important to the needy goes up, so does the taxes everyone pays. The Democrat legislators in Trenton must like that.
UPDATE: Governor Chris Christie holds press conference in Union City, New Jersey
Governor Chris Christie is happy with all the voters who picked him for another term on Tuesday, but he says they made a big mistake in approving the constitutional amendment that hikes New Jersey’s minimum wage by a dollar and allows for automatic cost-of-living increases.Christie made his comments at a charter school in Union City, where he held his first press availability in weeks.
This is why I don’t want Christie as the Republican candidate. He is real happy with the people who vote for him, but they are leading him left, he is NOT moving them right. His best shot at President would be to run as a democrat in the primary against Hillary. Because the people who support him include Republicans like me that have given up hope that a Republican will stand for anything, and Democrats that know he is a squish. He might be a loud mouth in your face speak from the heart squish, but he isn’t getting Republicans elected and he isn’t preventing bad socialist policies from being implemented. We got enough of that in Washington without him.
The rest of the remarks follow:
“You just shouldn’t amend the constitution to do this,” Christie said. “We should’ve come to an agreement on how to do it legislatively.”
Christie, as well as business groups, have claimed the change can force some employers to cut hours and lay off workers, or pass the increased costs on to consumers. (Emphasis is mine)
To reverse the hike and inflation clause, or adjust it, the issue would have to go on the ballot again.
The new minimum wage, $8.25 per hour, will go into effect January 1.
Gov. Christie Reacts to Minimum Wage Hike
By Dino Flammia November 6, 2013 4:28 PM – New Jersey 101.5