Can lawmakers raise the minimum wage since it is ensconced in the state Constitution?

miniwage

Democrats in the Nevada Legislature have introduced Senate Bill 106, which proposes to raise the minimum wage by 75 cents a year until it reaches $11 an hour for employers who provide health insurance and $12 an hour for those who do not.

This would affect profitability of employers, tend to push all hourly wage earnings up, possibly result in higher unemployment and increase the cost of goods and services in general — thus affecting nearly everyone in Nevada. The story was relegated to the bottom of the business page in the Las Vegas newspaper, but was the lede story in the Elko paper. AP gave it short shrift.

One minor problem with this proposed law is that the voters approved an initiative petition in 2004 and again in 2006 that amended the state Constitution to require that the minimum wage be tied to the federal minimum wage or inflation, whichever is higher. The current federal minimum wage is $7.25 an hour. The amendment also said the minimum wage would be a dollar higher for employees who failed to provide health insurance. So far as I can find, the amendment does not give lawmakers the option to alter this without asking the voters to again change the Constitution.

According to Legislative Counsel Bureau fact sheet published in 2015:

“Because provisions governing the minimum wage rate are included in the Constitution, any changes to the minimum wage provisions require a constitutional amendment. There are two ways to amend the Constitution. One way is through the citizen initiative process. Citizen initiatives for constitutional amendments must be approved in identical form in two consecutive general elections. This is the process that enacted the current minimum wage requirements in the Constitution. The second way to amend the Constitution is through the legislative process. The Senate or Assembly may propose a constitutional amendment, which must pass in identical form with a majority of members of both houses in two consecutive biennial sessions. After that, the proposal must pass a popular vote during the next general election.”

Just such a constitutional amendment was proposed in late 2015, but was dropped during the hectic election year, reportedly because the difficulty of getting enough signatures to put it on the ballot.

SB106 proposes to rewrite NRS605.250 to alter the minimum wage. That law currently reads: “Except as otherwise provided in this section, the Labor Commissioner shall, in accordance with federal law, establish by regulation the minimum wage which may be paid to employees in private employment within the State. The Labor Commissioner shall prescribe increases in the minimum wage in accordance with those prescribed by federal law, unless the Labor Commissioner determines that those increases are contrary to the public interest.”

Las Vegas newspaper columnist Victor Joecks quoted Gov. Brian Sandoval’s press secretary as saying:

“Due to the predicted loss of jobs and harm to small businesses, the potential to block young people and individuals with less work experience from open positions, and an increase in consumer prices, the Governor has historically opposed a legislative mandate to increase the minimum wage.”

This implies the governor might veto such a bill even if it passes constitutional muster.

As I’ve pointed out on a number of occasions the impact of such a bill is far ranging and carries unintended consequences.

“Unfortunately, the real minimum wage is always zero,” economist Thomas Sowell points out, “regardless of the laws, and that is the wage that many workers receive in the wake of the creation or escalation of a government-mandated minimum wage, because they either lose their jobs or fail to find jobs when they enter the labor force.”

The Congressional Budget Office has estimated that if the federal minimum wage were increased to $10.10 an hour — as proposed by President Obama and others — up to a million workers would lose their jobs.

According to the American Enterprise Institute, when the minimum wage rose 41 percent between 2007 and 2009, the jobless rate for 16- to 19-year-olds increased by 10 percentage points, from about 16 percent in 2007 to more than 26 percent in 2009 — even higher for minorities.

These are entry level jobs without which younger Americans cannot build the skills needed to earn higher pay.

Another Heritage study reported that every dollar increase in minimum wage really only raises take-home pay by 20 cents once welfare benefits are reduced and taxes are increased.

Then there are the affects on everyone. A Cato Institute analysis reports that a “comprehensive review of more than 20 minimum wage studies looking at price effects found that a 10 percent increase in the U.S. minimum wage raises food prices by up to 4 percent and overall prices by up to 0.4 percent.”

Minimage wages also tend to push younger workers with less worthy skills out of the job market, and Nevada already has the 10th highest youth unemployment rate in the nation at 13.5 percent.

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19 comments on “Can lawmakers raise the minimum wage since it is ensconced in the state Constitution?

  1. Rincon says:

    If the Constitutional amendment forbids it, and it appears to do so, then one hopes that the courts would strike down any law that is in violation.

    When it comes to the idea of a minimum wage in the first place, I love it and hate it. Those who feel there is no need for it have a naive belief that the wage world is incapable if degenerating to the point that people could be forced to toil at miniscule wages just because supply becomes bigger than demand. Since this actually is occurring in over a hundred countries today, it’s hard to understand the basis for this belief.

    That being said, a minimum wage is more of a sledgehammer than a scalpel and it is true that it denies employment to some of those with little job experience, preventing many from taking the first step up the ladder. At the risk of beating a dead horse, I believe the best alternative is to change welfare laws so that people are required to work for their welfare check. The amount of a weekly welfare check might then become a de facto minimum wage, but many would opt for jobs paying less than the welfare system in order to obtain crucial experience and knowledge. The welfare system would also be tied to full time wages. After all, if someone declines full time employment, then there should be little concern that they can’t make enough to make ends meet. This means that, say, students who wish to work part time might well prefer a low paying job to being forced into full time work in order to get welfare benefits.

  2. Steve says:

    Add to that health insurance coverage. COBRA was always a joke. Medicaid as a function of unemployment benefits would make sense.

    Chronically unemployed would be covered only as long as their unemployment benefits last.
    Disabled already are covered.

    These coverage’s would be as basic and as limited as possible and also subject to tax just like unemployment benefits currently are.

    This would take care of all the whining and eliminate the “individual mandate” while not creating a so called “single payer” system.

    The safety net should catch falling people but it should not be a luxury mattress. Encouragement to get off the system should be incorporated into every aspect of the system. Even to the point of providing bonuses for social workers who get people off the system and losses for those same people who don’t get people off the system.

    When I was out of work, ACA pushed me to Medicaid. Since I have money, I didn’t need it and I found I could be held monetarily responsible for any medical services after I found employment.
    The thing that stands out for me is the people I dealt with in the Nevada Medicaid system, it seems like they were all trying as hard as they could to get me to accept their system. I showed them how much money I had put away and it was all after tax so not counted as income. But they told me that didn’t matter, I was still destitute according to all their rules.
    Getting them to let go was like pulling teeth.
    For ACA I simply changed my “estimated” income and it was no longer pushing me to Medicaid.

    I could have simply gone for Medicaid and unemployment but this is not me. I do know people who do exactly that, no matter how much they have in the bank, they suckle right on up to the government teat and happily slurp away.

    The system is set up to encourage its employees to have more “clients” and those “clients” are encouraged to stay on the system as long as possible.

    I know from experience, they tried to do it to me.

  3. deleted says:

    A country as rich as ours absolutely needs to guarantee all citizens “a minimum wage”.

    Countries with far less (damn socialist Scandinavians) do it, with the result that their people are healthier, wealthier, happier, live longer lives, and have it better it nearly all ways.

    And lest it be said, that this “idea” is so contrary to the ideals our beloved founding fathers had when they established this republic, I direct your attention to the words of Thomas Paine, Benjamin Franklin, and others.

    It’s tragic the way the right has twisted the words of these great men to get us to a country where it’s acceptable for the 1% to steal as much as they can carry off! to the applause of their sycophants, but it’s wrong to believe that the masses of American citizens are bad somehow for wanting a decent life.

  4. Rincon says:

    I don’t think many of us would deny food, shelter and reasonable medical care to those that are truly needy and are trying their best to find gainful employment. The problem is our distrust in those who remain in the system for what we feel is too long. Fact is, some of those deserve our distrust while others deserve compassion. Any successful system must be able to tell one from the other.

  5. Steve says:

    All “minimum” wages are exactly zero. Nada. Nothing. Bupkis.
    No matter what you try to make people pay to employ other people, the fact remains that people who are locked out of that economic condition will be paid the true “minimum wage”

    Patrick lives in a dream.

  6. Barbara says:

    “Countries with far less (damn socialist Scandinavians) do it, with the result that their people are healthier, wealthier, happier, live longer lives, and have it better it nearly all ways.”

    If Scandinavians have it better why doesn’t Patrick move there?

    As for me, I have begun the process of selling my business. I will be voting with my feet and moving back to Texas. Having lived here since 1993, I love many things about Las Vegas, but I do not see it as a place to retire.

  7. deleted says:

    There is no “if” Barbara, Scandinavian countries do have it better. In all the ways I said.

    But like most people I suppose, I’ll probably just try and middle through in the country I was born in.

  8. Rincon says:

    Nissen may not like taxes, but seems rather ungrateful to be living in one of the best countries in the world. When I googled, “countries listed by standard of living”, Denmark came up number 4 (we came in 8th, which ain’t too shabby).

    The next was Wikipedia, which apparently used the same index. Next was Britain’s telegraph, which listed Denmark number 3. US News was next, also with Denmark at number 3. Something called Numbeo also listed them as number 3 (these last three were all different indexes).

    Then we finally get to Insider Monkey, which doesn’t rank Denmark in the top 11, which is all they showed. Nations on line listed Denmark 16th. I couldn’t penetrate Business Insider. Cnn put Denmark at number 4.

    Somehow, this makes Mikkel Nissen look like a grade A whiner.

  9. deleted says:

    Rincon:

    You’re always going to have people who are disgruntled. She apparently is.

    No matter.

  10. I notice neither of you mention that to attain this “high standard” of living…the citizens of Denmark (part of my heritage) must surrender 80 cents of every dollar they make to support the socialist government and it’s redistribution to those who didn’t earn it. No Thanks! You’d both be squealing and whining when you saw your Danish paycheck…and where all your money went!

  11. deleted says:

    HFB:

    I suppose “giving up” something, in return for something better; I.e. A higher standard of living, a higher rate of education, a longer life span, being healthier, and happier, makes the exchange well worth whatever you believe they are giving up.

    Where did all their money go? I guess it “went” in exchange for all those better things. Maybe it’s me.

  12. deleted says:

    Amazing. Americans, well the vast majority of the poor and what’s left of the middle anyway, keep subsidizing the rich, and getting poorer themselves everyday.

    “In the U.S., between 1978 and 2015, the income share of the bottom 50% fell to 12% from 20%. Total real income for that group fell 1% during that time period.”

    http://www.marketwatch.com/story/income-share-of-bottom-50-is-collapsing-finds-researchers-including-piketty-2017-02-07?link=MW_latest_news

  13. Rincon says:

    “To put this change into perspective, if the US had the same income distribution it had in 1979, each family in the bottom 80% of the income distribution would have $11,000 more per year in income on average, or $916 per month”. https://en.wikipedia.org/wiki/Income_inequality_in_the_United_States

    And we thought Conservatives always want to go back to the good old days. It does make all the complaining of how expensive clean energy would be seem less than reasonable.

  14. Steve says:

    Never thought I would be told ’79 was “the good time days”

    Those gas lines were fun, huh?

  15. Rincon says:

    Hmmm…good point. Maybe the “good time days” for you were during the Gilded Age.

  16. Steve says:

    Cute, pulling out the “caveman” insult.

  17. Anonymous says:

    Clever reply, Steve.

  18. Steve says:

    Ah, Rincon. You think the “Gilded” Age was a “Trump” card!

    laugh

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