Brace for consequences from Wynne’s wage hike

The Wynne government’s 21 per cent hike in the minimum wage Jan. 1 is good politics and poor policy.

On the politics side, the government now is aligned against certain Tim Hortons franchise owners and with labour and the usual crowd of shrill voices quick to protest.

In the midst of this brouhaha it’s easy for Premier Kathleen Wynne and company to sell themselves as defenders of the poor and downtrodden — saviours of the working stiff, if you will.

How this will play out at the ballot box next summer is unknown. But it’s pretty certain more of the organized labour vote will fall to Wynne.

In recent years this government has bought support from teachers’ unions among others by giving away the farm at the drop of a notice to bargain. The minimum-wage hike is likely to bring broader support from labour.

It seems to matter little that Wynne and Labour Minister Kevin Flynn were out of line when they said certain Tims franchise holders were “bullying” for taking action to reduce labour costs in face of the minimum wage increases.

Bullying is something Wynne and company know a lot about. That’s their modus operandi when it comes to dealing with Ontario’s people.

They bullied Toronto into abandoning plans for tolls on major highways, they bullied school boards to close schools without regard to students, they bullied rural Ontario on wind factory locations, etc.

The campaigning involved in this move could be called crass politics at its ugliest.

Wynne’s unpopularity was plumbing new depths so the Liberals had to do something. What better than action that appears to help the poorest working families in Ontario?

Obviously it’s hard to argue with that, without risking the aforementioned shrill wrath.

In addition, it’s hard to feel sympathy for millionaire owners of Tims franchises who cut employee benefits by memo from Florida.

But that’s not everyone. It’s a popular myth that all business owners are well off.

Our province is full of mom and pop shops selling everything from convenience items to gifts and hardware and, yes, even doughnuts. These people put up money (often borrowed) to establish a business and provide some employment at great personal financial risk.

They often work hours that, if counted, would mean they earned $5 an hour or less for themselves and their families than their workers. (Been there, done that, couldn’t afford the T-shirt.)

All the emotional support for higher minimums makes it sound so simple. Pay more and improve lives. Problem solved.

On the other side, Ontario’s Financial Accountability Office reported the hike could cost as many as 50,000 people their jobs. How does that benefit anyone?

Tristin Hopper of the National Post recently dealt with the ultra-simplistic suggestion that businesses should just hike their prices to compensate for the added costs. It’s not brain surgery to understand that when you make things more expensive, people buy fewer of them, leading to job losses.

In addition, a minimum-wage hike probably won’t fix poverty and might make it worse. Seattle was one of the world’s first jurisdictions to bring in a $15 minimum wage. It has spawned layoffs and cuts in hours, resulting in monthly losses of $125 per worker on average.

That experience and others illustrate the negative consequences of this vote-buying move might not be known for some time.

Thinking of this government’s record of mismanagement, we can only hope those consequences begin to emerge before June’s election.