On September 28, the Maine Heritage Policy Center (MHPC) held a press conference regarding the minimum wage at the State House. Its central event was presentation of an analysis by MHPC economic policy analyst Liam Sigaud entitled “Unintended Consequences.” Nick Isgro, Mayor of the City of Waterville, Carolyn Brodsky, President & CEO of Sterling Rope Co., Richard Snow, owner of Maine Indoor Karting and David Clough, Maine State Director for National Federation of Independent Business (NFIB)

The mayor explained that Waterville runs on “small family owned operations that run on thin margins and thrift” and that a minium wage jump would erode those margins so deeply that job losses were inevitable. He said that some business owners told him that they might be forced to close their doors. Brodsky and Snow explained the negative effects on their enterprises.

From clothing stores, to bakeries, to car washes, there are people working now that won’t be working if this law passes. The many high school and college students working part-time and building their first work skills are going to be out of luck. I’ve even talked to some business owners that are going to have to decide if they can even stay open.” The NFIB State Director summed up the reasons why the national organization opposed such minimum wage increases as the one imposed by Question 4 in Maine’s November 8 election.

This column has addressed the problems with the minimum wage increases before. Sigaud’s examination of the unintended consequences adds an important dimension to this discussion. Let’s agree upfront that all legislation and regulation will produce unintended consequences. These might be beneficial or they may do damage, but they are always unintended. This is so because our culture, society, economy, and personal qualities are so complicated and numerous that it’s impossible to anticipate them all.

It’s possible, however, to anticipate some of them and this is what Sigaud’s report attempts to do. It includes an assessment of the actual cost of compliance. Nick Isgro’s Waterville small businessmen will have to bear this cost. There is no consensus about the number of jobs lost due to boosts in the minimum, but it’s pretty well agreed that there will be some. Some liberal economists have argued that they aren’t jobs worth saving anyway. There’s certain to be a ripple effect throughout small and large businesses since experienced, skilled and reliable workers will expect the differentials between minimum-wage pay and skilled-wage pay to be maintained. In other words they expect a noticeably bigger pay check than that pimpled adolescent that lurches and loafs around in the stock room. We must not expect small business owners to mortgage their homes to pay the minimum wage increases. They will have to raise their prices to stay in business. Mainers who survive on fixed incomes (chiefly social security payments) will get no increases, but they will be paying those increased prices.

Sigaud’s analysis concludes that “Question 4 would cause thousands of vulnerable workers to lose their jobs, have devastating effects on Maine’s business community, and reduce Maine’s regional competitiveness.” Some liberals may dismiss this analysis on grounds that MHPC is a “conservative” organization. This is not a response at all, but an ignorant dismissal. If Sigaud’s analysis is erroneous or plain false it should be easily disputed without “assassination by classification.”

I attended this press conference and detected no Democratic legislators in the audience. You might have thought they could have benefitted from exposure to contrary ideas. Unlike the Republican membership, the Democratic legislative delegation contains almost no one who has any experience owning a small business. If you did think this, you will be missing the central consideration motivating the Democratic enthusiasm for the minimum wage: It polls well. Their attention is fixed on the unannounced intended consequence: success at the polls. There appears to be wide-spread agreement among pollsters that millions of voters across our great Republic will feel good if the can vote to help out the poor folks without sacrificing a cent of their own. It’s always good when you can feel compassionate and generous while passing the cost of your benevolence on to some one else.

No need to consider unintended consequences. No need to pay attention to see how well the intended consequences worked out. No need to think about the complexity of our economy. Cast a vote; feel good, go about your business as if the real world was irrelevant to your self-congratulation.

Incidentally, I know that most readers don’t care to track an argument that depends on statistics, but it’s worthwhile to mention this: About 5,800 Maine workers work full-time in their primary job at minimum wage.

John Frary of Farmington is a former candidate for U.S. Congress, a retired history professor, an Emeritus Board Member of Maine Taxpayers United, a Maine Citizen’s Coalition Board member, and publisher of FraryHomeCompanion.com. He can be reached at [email protected].