Higher wages won’t solve Arizona’s affordability issues

Independent Newsmedia

OPINION — In response to Bill Meade’s opinion, Why Arizonans must push for a livable wage: The concerns raised are real. Many families are struggling, and pretending otherwise is dishonest.

Where I disagree is in the proposed solution. Mandating higher wages does not fix affordability. In fact, it often makes it worse.

From an Austrian economics perspective, wages are prices. They reflect productivity, skills, capital investment and demand.

When government forces wages above what a job produces, costs do not disappear. They show up as higher prices, fewer entry-level jobs, reduced hours and accelerated automation.

This happens especially in high-cost regions like Maricopa County.

The deeper problem facing working families is not that employers are uniquely greedy. It is that government takes too much from paychecks and inflates the cost of essentials.

Payroll taxes alone remove over 15% of wages before workers see their money. Income taxes take more. Inflation erodes what remains.

Housing is expensive because zoning and permitting restrict supply. Health care costs soar due to mandates, licensing cartels and employer-based insurance rules that eliminate price discipline.

Raising the minimum wage does nothing to address these structural burdens. It simply shifts costs onto small businesses and consumers, including the very workers it is meant to help.

If we want to improve dignity and security for working people, there are better options.

Exempt low- and middle-income workers from payroll taxes. Eliminate income taxes on the first $40,000 of earnings. Legalize housing density and streamline permitting. Remove occupational licensing barriers that block upward mobility. Decouple health care from employment and allow real competition.

Most importantly, stop debasing the currency through inflation, which quietly destroys purchasing power year after year.

Compassion should be measured by results, not intentions. If the goal is higher take-home pay and lower living costs, the answer is not more mandates.

The answer is less government between workers and their paychecks.

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