Wage hike a socialist disaster

By Governor Paul LePage

The socialists at the Maine Peoples’ Alliance are leading the effort to raise the minimum wage to $12. This would be disastrous for small businesses, entry-level employees and the elderly.

If you increase the cost of doing business, one of two things will happen – maybe both. First, business owners will have to lay off workers to make up for the significantly higher wages they now have to pay. This will hurt inexperienced teenagers and other low-skill workers seeking part-time jobs. If employers have to pay high wages for a worker, they will hire someone with more skill and experience.

Second, business owners will have to raise their prices to cover the costs of the higher wages. This hurts the elderly and others on fixed incomes. They will suddenly have to pay higher prices, even though their income has not gone up.

Even worse, the Maine Peoples’ Alliance proposal would automatically raise the minimum wage every year, even during downturns in the economy. Automatically raising wages while revenue is going down would put some companies out of business.

Furthermore, this proposal will be devastating for restaurants. Wait staffs would be paid the minimum wage, which means they would get much smaller tips, if any. Restaurants would have to pay tens of thousands of dollars more in wages – some may have to pay hundreds of thousands.

This would raise prices on the menu by 20 percent, which means you would pay more sales tax. Workers’ comp and payroll taxes also would increase. These massive increases could put some of your favorite restaurants out of business for good.

The Maine Peoples’ Alliance proposal will go to the voters as a ballot question in November. It would destroy jobs and inflict terrible damage on Maine businesses, especially in the retail, hospitality and tourism industries.

That’s why a coalition representing the retail, hospitality and tourism industries, as well as the business community, strongly opposes the proposal.

Members include the Retail Association of Maine, Maine State Chamber of Commerce, Maine Restaurant Association, Maine Innkeepers Association, Maine Energy Marketers Association, Maine Grocers and Food Producers Association, Portland Region Chamber of Commerce, Lewiston Auburn Metro Chamber of Commerce, Manufacturers Association of Maine, Maine Insurance Agents Association, Maine Tourism Association, SkiMaine Association, Mid-Maine Chamber of Commerce, Bangor Region Chamber of Commerce and the Bangor Convention and Visitors Bureau.

This coalition is supporting a bill that would raise the minimum wage to $10 by 2020, allowing businesses time to absorb the additional cost.

The Legislature can put this proposal on the ballot as a competing measure. Mainers could then choose between the catastrophic proposal from the Maine Peoples’ Alliance or the approach from the coalition that would increase costs more slowly.

The socialists at the Maine Peoples’ Alliance think all business owners are wealthy and can afford to pay workers higher wages. Mainers know this is not true. Our state is made up of small, mom-and-pop businesses that operate on very thin margins.

The Maine Peoples’ Alliance proposal will obliterate those margins and put your corner store and your favorite restaurant out of business. Price increases also will hurt the elderly on fixed incomes who will be forced to pay more for goods, services and food.

Maine people deserve a more thoughtful alternative. I urge you to call your legislators and tell them to support a bill for the common-sense competing measure. If Maine is going to raise the minimum wage, it should be done in a rational and business-like manner – not by social activists who don’t understand simple economics.

The governor’s office can be reached at 287-3531, toll-free: 1-855-721-5203, TTY: Maine relay 711 (for Deaf and hard of hearing. Emails can be sent from maine.gov.



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