The Trump Administration has made great strides in supporting businesses and workers through simplifying the tax code in the Tax Cuts and Jobs Act(TCJA). Not only are individuals benefiting from increased take-home pay, but companies are also paying less in taxes. In response, businesses have increased wages, handed out more bonuses, and contributed more to retirement funds. American families now have more money to use and save.
However, Democrats recently introduced a bill that has the potential to cripple the market. The Raise the Wage Act (H.R. 582) creates a federal minimum wage of $15 an hour to be enacted by the year 2024. Creating a minimum wage hurtsbusinesses and forces company leadership to choose payroll over other employee benefits, like retirement contributions or bonuses. Chairman of the Committee on Education and Labor and sponsor of H.R. 582 Congressman Bobby Scott says that this legislation is good for business and the economy because the worker will have more money to spend at businesses. But, increased wages correlate to higher fixed or operating costs which force higher prices on goods and services or even business closure. This hurts the consumer, or in this case the minimum wage earner. Even with an increased wage, the typical American would not be able to afford more goods and services because of the increased costs of products.
If Congress really wants to support hard-working Americans and their families, they should enact policies aimed at deregulating and minimizing barriers to entry. For example, the costs associated with occupational licensing shut outmany potential workers. Eagle Forum encourages Congress to stand with the American worker by supporting legislation that incentivizes, not mandates, businesses to increase wages and jobs.