Dear Friends,
With all budget bills having passed last week, the House now turns its attention to many of the policy proposals put forward by the majority. Among the more controversial proposals: increasing the minimum wage, and day care provider unionization.
Minimum Wage Increase
Today on the House floor, we're going to be debating the first increase in the minimum wage since 2005. The current proposal would raise the wage from the current rate of $6.15 per hour all the way up to $9.50 per hour, putting Minnesota at among the highest minimum wages in the country.
While this may sound like a good thing, there are many underlying concerns about such a drastic increase. Raising the minimum wage increases labor costs for businesses of all sizes, many of which are already operating on small or non-existent profit margins due to the recent economic downturn.
It is important to consider that above the direct cost of proposed minimum wage increases, the added costs of additional employment taxes such as social security, Medicare, workman's compensation and unemployment insurance are add-on costs to increases payrolls burdened by employers resulting from the proposed increases.
Many employers have had to lay off employees in the last five years, and raising the minimum wage would compound those problems. This proposal would hurt the low-wage workers that the majority is intending to help with this wage increase.
Simply raising prices to cover increased costs is most often not an option in a market driven economy. Will small business survive this unfunded mandate? As a matter of broad public policy, should the smallest employers bear the greatest burden of this law? Only 2.3% of workers earn the minimum wage and many of these are teens and minorities gaining their first job experiences.The majority seems to believe that politicians know better how to price goods and services better than business owners and the market in which they compete.
Day Care Provider Unionization
Next week the House is expected to take up a bill that would work to establish a statewide union for all family child care providers. Any licensed or unlicensed provider who accepts a state subsidy would be required to join the union if established.
Simply put, it's a way for union bosses to force participation in and contributions from private enterprises to mandate contributions to campaign and political causes at the expense of hard-working day care providers and families.
One union official stated in the Star Tribune that $8 out of every $25 for union dues would go to the national union in Washington D.C. It simply doesn't make sense for childcare subsidy money intended to help Minnesota children to go to national union organizations in Washington.
Budget Update
This week the arduous conference committee process officially began as members of the House and Senate begin to work out the differences between the House and Senate budget bills passed over the past few weeks.
Once members of the conference committees agree on a final bill, the legislation will be sent back to the House and Senate for concurrence and final passage before heading to the Governor's desk. I would expect to start seeing conference committee bills coming back as soon as the week after next. When the bills do come back from conference, the only options remaining are to approve or re-refer the bills. House rules do not permit amendments any longer after bills go to conference committee.
Cannons at the Capitol
On Wednesday, members of the New Ulm Battery came to the Capitol to celebrate their 150th year with cannon fire on the front lawn. It was a unique sight to see -- I wanted to share this picture with you, courtesy of MN House Public Information Services.
Have a great weekend,
Rep. Jerry Hertaus