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There’s been a lot of talk about the recent Budget Address, especially about the taxes on low income workers and about their minimum wage. Presently, the government is asking parliament to past an Act to increase the salaries of government officials – because these government officials haven’t had a salary increase since the 1980’s.

It’s not habitual that Dominica Weekly comment on political affairs going on the island, but I couldn’t stand there and listen to the Political garbage that the Labour Party was dishing out. In my opinion, I have no problem in government officials getting an increase in their salaries. But isn’t the government put in power to protect the people and care about their needs. It appears the table has turn. If this Act is approved in parliament to increase these salaries then again it falls back on the tax payers who are the minimum wage workers. Who themselves haven’t had an increase in their minimum wage since the 1980’s too. So basically what this government trying to say to the people is that it’s ok for my salary to increase but it’s not ok to increase the minimum wages of workers who are the fragile backbone of this country. Can someone explain the justification in this ❓

Yesterday, one of my favorite bloggers John Chow wrote an article titled “Why Minimum Wage Laws Should Be Killed”, where he shared some interesting insights on the Minimum wage and its direct relation to minimum wage workers. Below is are quotes from the article.

Minimum Wage Law Hurts The People It Was Designed To Protect

Jobs are subject to the laws of supply and demand just like any other commodity, with or without a minimum wage law. If something is price low, you sell more. When you price it high, you sell less. When wages gets too high, companies hire less. The means more unemployment. Canada’s (British Columbia) minimum wage is $8.00 an hour (and our dollar is almost on par with the U.S. now). Canada has higher unemployment than the U.S. I wonder why?

The whole point of a minimum wage law is that the market wage for some workers is deemed to be too low. If it is fixed by law above the market level, it must be at a point where the supply exceeds the demand. Economists have a technical term for that gap. It’s called unemployment. Advocates of minimum wages either reject that elementary logic or don’t care.

A minimum wage law denies workers the freedom and right to negotiate their own wage contracts. It forces employers to lay off workers whose work is no longer worth the minimum wage and reconsider future hiring plans.

Minimum Wage Laws Are Unfair To Workers

What is a fair wage? My answer would be whatever the employee and the employer negotiates. Certainly it is not fair to be forced by the government to be unemployed at $5.85 per hour. Minimum wage laws forces workers to remain unemployed rather than accept work at a lower wage. It forces the unemployed to accept the indignity of welfare rather than the indignity of a job. It kills job opportunities for youth, women, visible minorities, unskilled workers and denies young workers the chance of getting on-the-job-training and work experience.

It’s Self Defeating Model

Raising the minimum wage may make it look like it’s giving more money to workers but it’s really a self defeating model. Assuming the business doesn’t lay off any workers, it’s operating cost just went up. What does a business do when their operating expenses increase? They raise prices to make up the difference. That adds to inflation. Suddenly, everything cost more and that wage increase buys about the same amount of stuff it did before.

We Are In A Global Economy

An increase in the minimum wage is always followed by an increase in off shoring jobs. Does the US have any tech support call centers left? When you operate in a global economy, having minimum wage laws just means businesses can go somewhere else to find labor. It’s not just big businesses that are off shoring jobs to districts with no minimum wage laws. You’ll be amazed at how many mom and pop operations are sending work offshore.


People! We live in a Capitalist country. You have no limits on what you can achieve in life. I have the power to change my situation if I don’t like it, and so can you. Its not the government’s job to take care of you and your family but for many people they believe that the government owes them something. You don’t like living on minimum wage? You can’t live on the salary you’re making now? Then do something about it – turn things around. So when the government decides to increase the minimum wage. You can tell them to “Go to Hell”. I don’t know about you, but no government is going to control my destiny.

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Comment by Dan
2007-07-26 11:04:46

Economics is not quite so simple. Individual workers have no leverage when labor is in oversupply and jobs are scarce — exactly the situation in Dominica, and for menial positions available to the unskilled.

I won’t get into a discussion blog exchange on this, but the answer, like most things in life (I’ve learned at my age) lies somewhere between the extremes, and is seldom, if ever, simple.

Comment by caris
2007-07-30 05:43:05

sir with no disrespect i like your articles about dominica.i think u should leave politics and economics out of your articles cause u did a terrible job on this one.u contradicted yourself quoting your friends article.i think the people who manager the country should get a descent salary as to prevent/lessen may also attract more skilled people to enter politics.there are civil servants who earn much more than the prime minister go figure. a hike in thousands of civil servants salaries is nothing compare to the increase of parliamentarians.that should not even be compared.not all Dominicans are dumb. we live in a capitalist world where its all about money and nothing to do about the people.i shall tell u and others stop comapring Dominica to the more developed countries cause i dont think u all would like to see if Dominica becomes like them.There is a lot of Government assistance in Education,Health Care and Housing,3basic needs.In the wealthier countries there things come at a very steep price.Off shore job sourcing is just another excuse by the cooperate world to make exaggerated profits and basically use people as slaves.i shall stop here cause i can go on and on.But i shall ask dominicans enjoy your home dont wish to be in other country.and if you are in a next country do what you can to develop her.stop with the politics game.SOCIALISM IS THE WAY FORWARD.CAPITALISM IS SLAVERY.

Comment by Veselo
2007-07-31 10:20:29

Oh no… With socialism is not life.
I was born in the country with socialism and I do not want it that for anybody.

It’s time, when people have a lot of money, but they can’t use it, because no food and no products in the shops. I remember a time, when my mother have to wake up at 5 a.m. to go to the street and stand there about 3-5 hours before she can get something in the shop.

People didn’t work at their job, because they knew it’s socialism and doesn’t matter will you seek of doing something or just relax – you will get the same results.

People can’t be individual. They have to be normal, as everybody.
Not step left, not step right. You have to do, that party will tell you. You can’t have your opinion. You can’t say anything. You can’t have the belief in something… you can’t do many things. No freedom.

Comment by caris
2007-08-04 09:28:33

Liudmila this is not socialism,this is communism.the socialism i am talking about is the people of my island coming together on a common front and moving the country forward.this is by forming co-operatives in villages in various the government making land availabe to young and upcoming farmers.socialism in that terms is moving from the norm of capitalism which is ruled by the coperate world.the socialism i talk is about is one in which government makes decissions which affects/helps the common man.i hope u understand where i am coming from.thank u very much

Comment by Veselo
2007-08-05 01:25:28

Let me understand you.
For example, you create co-operative. By your opinion in what measure government must interfere in the work of your cooperative so that would be socialism?

Comment by Dan
2007-08-06 20:14:08

In theory, capitalism appeals to greed, and socialism to envy. In practice, capitalism lauds competition but acts to destroy it and socialism creates its own corrupt elite.

The only solution that would work would have to be independent of human nature, and that can’t happen. Most of us, therefore, are consigned to live lives of quiet desperation.

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