I’m stoked that my Mondayising Members Bill has successfully proceeded to select committee. Members Bills provide the opportunity to pass legislation against the Government. A sensible idea and sufficient luck mean positive change becomes possible from the opposition benches.
It looks like the heavens are smiling on me. I have just now heard that I’ve had a second bill drawn. This time I aim to raise the minimum wage to $15/hour.
I’m convinced that the minimum wage needs to go up sooner rather than later. There is too much inequality in NZ. The poverty inequality drives is destroying lives and wasting the opportunity to get the best out of our people. I’ve previously explained how this has come to pass and why it is hurting us.
Critics argue that too high a minimum wage risks growing unemployment. At some point this is undoubtedly true. If the minimum wage went up to $30/hour, a bunch of businesses would go under. That wouldn’t be good. On the other hand, if the minimum wage is too low, the Government ends up dishing out subsidies to families to keep them out of poverty (or worse, it chooses not to give out subsidies to keep them out of poverty).
A direct link between minimum wage and employment has never been successfully drawn. Expect a Nobel Prize for any economist who manages it. What we do know is that a lot of the rhetoric does not match reality. National raised the minimum wage just 70 cents in their last 9 years in Government and unemployment soared. Labour raised it $5 in their last 9 years and towards the end of their time enjoyed the lowest unemployment in the Western World.
A $15/hour minimum wage seems to have consensus in New Zealand as a figure that will not cause unemployment, but comes closer to a living wage.
Interestingly, a lot of small and medium businesses routinely pay this wage because they know their workers, believe in them and understand how close to the poverty line they live. It tends to be a few rogue larger firms that screw their workers down to the lowest common denominator.
The costs of treating poverty related illnesses low-paid workers and their families bear are carried by all of us through the health system too. So we effectively as taxpayers end up subsidising rogue employers and their bad practices. This is bad for NZ socially and economically and it needs to stop.
I argue for increases in the minimum wage over time on the basis that it stops bad employers from exploiting low wages as a means of generating wealth. Instead they have to explore ways of working smarter and increasing productivity. Most employers get this.
But fresh thinking from those who subscribe to a mean understanding of human nature suggest that even they should support minimum wage increases. Of particular interest to me this week is a recent article written from a very conservative economic perspective that shows why even Act Party acolytes ought to get in behind this change.