Recently headed in the right direction, the Caddo Parish Commission can’t veer back into stupidity, as it threatens to do by compounding a mistake it has made previously.
This week, the Commission will decide whether to extend a $15 an hour minimum wage policy to significant contracts and contractors. Earlier this year it committed the folly of doing that to its employees. The silly argument made at the time for that was it made for a “living” wage that would diminish poverty and therefore crime.
Of course, research demonstrates that setting artificial wage floors that overpay for the contribution a particular activity makes for society ends up to the detriment of society. Visibly, it eliminates jobs either by having to spread out more work to fewer people in order to make it economically viable and has a similar ripple effect upwards in pay grades, and/or in background this increases automation as that becomes relatively cheaper eventually to the point of the most cost effective strategy.
Fortunately, the decision caused little degradation as almost all Caddo jobs already paid over that. But the move to slap it onto potentially the tens of millions of dollars of contracts let each would have a broader reach. The cost of doing business and capital outlay would increase, meaning doing less for the citizenry and/or increasing taxes. The reduced productivity and removal of resources from their most efficient users, individuals, would depress economic development in an area already suffering from that.
The parish already recognizes that problem in its budgeting with over a half a million dollars set aside for economic development. And it would put even more strain in a budget that overall runs in the red because dedicated revenues for juvenile justice or those dedicated to criminal justice generally can’t cover juvenile justice costs, as well as those for the Caddo Correctional Center as paid to the sheriff., to the tune of around $6 million.
Half of commissioners didn’t intend for it to be that much, as last month they voted to roll forward property taxes that could have squeezed another $1.2 million out of property owners. But the other half of them showed cooler heads and voted against that, thwarting the two-thirds majority needed for a roll forward to succeed.
Of course, there were plenty of alternatives other than raising taxes. Mineral revenues of $3.5 million ended up getting shuttled to the Reserve Trust Fund that is approaching $40 million, intended for use for disasters, economic development opportunities, and emergencies. The same Oil and Gas Fund gets tapped from time to time for luxuries such as backup solar power capability for neighborhoods when power goes out or recreational programs instead of a necessity like justice administration. And the Riverboat Fund spews out a million dollars a year to mainly nongovernmental organizations with some political pull. All of these sources are alternatives to running in the red or to increasing taxes.
Matters would be made worse by expanding the scope of the minimum wage requirement. Caddo citizens should hope the same wisdom in not raising property taxes is applied by a Commission majority to derail this detrimental expansion.
No comments:
Post a Comment