Have you noticed the price of everything, especially food, has been increasing quite a bit lately?
John Balentine, a former managing editor for the Lakes Region Weekly, lives in Windham.
I recently ordered a cinnamon doughnut and iced coffee at my local coffee shop and left with eight fewer dollars in my pocket. A trip to the grocery store costs a lot more than it used to, too. Somehow, I can’t leave without spending double what I did just a few years back. Trips to fast food joints will likewise set you back significantly if you order anything not on the dollar menu.
Price hikes really hit me on a recent trip to a Subway sandwich shop, which I love because it’s both healthy and tasty. I bought a combo meal that rang up in excess of $12. Showing my age as well as my descent into Old Man Curmudgeon-ness, I reflexively asked the young cashier to make sure the tally was correct. To my disappointment, she nodded that it was. I then said something like, “Back in my day, lunch here cost about $5, not $12.” She laughed politely and I coughed up the cash while also promising myself I’d never pay that much for a sandwich, chips and drink ever again.
What’s going on here, I wondered as I wandered back to my car.
Inflation is what’s going on, and it’s all because entry-level workers like that cashier are being paid an ever-increasing minimum wage. When Maine voters approved a referendum in 2016 to raise the minimum wage, they started a cascade of effects impacting pricing in all sectors of the Maine economy. Yes, people at the lower rungs of the wage scale earn more, but things cost more, too. We’re now seeing the fruit of this mistake by Maine voters starting to hit our wallets.
And it’ll just get worse as vote-buying politicians elsewhere in the country seek further increases in the minimum wage, as national Democrats have promised. Democrat presidential hopeful Joe Biden wants to institute a countrywide $15 minimum wage. If that happens, look for a sandwich combo meal to also cost $15.
While it may sound like progress to pay entry-level employees a “livable wage,” Democrats forget that buying power is what really matters in economics. Everyone’s buying power shrinks when businesses are forced to increase prices to offset higher employee salaries. (And rarely do longer-tenured employees see such drastic increases, effectively reducing their buying power.)
According to the Maine Department of Labor, the state’s first uniformly enforced minimum wage commenced in October 1959 at $1 an hour. It rose to $2 in 1974. Since then, it’s been raised a few dozen times, quite rapidly so in recent years.
Maine’s minimum wage went from $5.15 in 2000 to $7.50 in 2010, where it stayed until 2016, when progressive activists put the wage question to voters, and voters took the bait, hook, line and sinker.
The minimum wage skyrocketed to $9 beginning Jan. 1, 2017, $10 beginning Jan. 1, 2018, and $11 beginning Jan. 1, 2019. The current $12 wage began Jan. 1 of this year.
Starting Jan. 1, 2021, Maine’s minimum wage will increase commensurate with the consumer price index, which tracks the cost of living. With companies charging more for everything to cover salaries, it’s probably a good bet Maine’s minimum wage will increase substantially once again as higher overall costs to do business beget even higher minimum wages.
If that happens, just order the sandwich. Forget the chips and drink. You can’t afford it.
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August 04, 2020 at 02:59PM
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