Is $10 Too High for a Minimum Wage?

A debate is raging about Ontario's minimum wage. Certain people would like to see it raised to $10.00 per hour, while some believe that it's just too much and will cripple that provinces economy. Some of the arguments I've read for the wage increase seem to center around the gap between this country's rich and our poor.

One of the consistent arguments I've been watching around the Canadian blogosphere is that the average wage in Canada is a paltry $38,000 a year, while at the same time, according to a January 2nd, 2007 Canadian Press (via the Vancouver Sun) article entitled Top CEOs have already made more than typical worker:

...the 100 highest-paid private-sector executives will have earned an average Canadian's salary of $38,010 by 9:46 a.m. [January 2].

Apparently a few people think that no one person should earn $11,000,000 a year, regardless of who they are or what they do. Some of these folk apparently believe that capping salaries will do a great deal in helping reduce poverty. This school of thought is absolute garbage and outside of a socialist—no, communist—society would never fly. I'm especially miffed by people who think CEO salaries should be capped. What about those people who built massively successful companies from the ground up? Should we limit how much money they can personally gain from their own property (ie: their company)? No.

That being said, I also don't believe that raising the minimum wage to $10.00 per hour will cripple or even severely harm Ontario's (or any province for that matter) economy in the long run. Sure there will be some short term effects as the labor market adapts to the the new expense. However, it will most likely end up in spurring a number of very important industries (retail, for one) in very short order. As every one knows, Canadians like to spend money—and a lot, as soon as they receive it.

I'm completely for raising the minimum wage to $10.00 an hour although I don't think it will do a lot to help the people earning that wage. It will do a little, but not a lot. I also believe that limiting a person's potential earning would have devastating effects for every industry in our economy. Not only that but it would also hurt this country's society as many of our best and brightest would leave for "greener" pastures.

Later in the discussion Saskboy offered the suggestion There must be some way to remain capitalistic, yet encourage the hyper-rich to better reinvest their money instead of sinking it into a dozen homes or vehicles for themselves alone. I can agree to that.

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