Blame it on #BUSH! Why Are Seattle Restaurants Closing?

by Kim D.

Last week the impending minimum wage hike, soon to hit Seattle, Washington on April Fool's Day, turned into a cat fight when Seattle Magazine asked "Why Are So Many Seattle Restaurants Closing Lately?" But this controversial topic is not a joke. On April 1st, Seattle business owners will be required to pay $11 per hour at a minimum with a scheduled increase to reach $15 per hour by January 2017 for large business owners and 2018 for smaller ones.

Conservative-minded pundits were quick to point out the obvious, taking their cue from the Washington Policy Center:

The shut-downs have idled dozens of low-wage workers, the very people advocates say the wage law is supposed to help.  Instead of delivering the promised “living wage” of $15 an hour, economic realities created by the new law have dropped the hourly wage for these workers to zero.

The more liberal-minded folk are, needless to say, freaking out and hitting back hard with their alternative "closing" theories, like poor location, but to be fair, not a one has put the blame on the Koch Brothers or George Bush . . . yet.  So despite a legal challenge from franchise owners who claim this law is unfair, the Seattle wage-hike experiment will begin April 1st now that a judge has ruled not to block any part of the new law.

According to Congressional Research Service, inflation is the driver behind the need to increase the minimum wage: 

The minimum wage is not indexed to the price level. It has been legislatively increased from time to time to make up for the loss in its real value caused by inflation. 

Under the leadership of FDR, the government began a national minimum wage in 1938. Employers were then required to pay a minimum of 25 cents per hour. The minimum wage reached $1 in 1956 thanks to Eisenhower. Under George Bush, two increases were legislated, and to date the national minimum wage is $7.25, signed into effect by Barack Obama in July of 2009.

Thanks to his nifty, non-challenged, phone and pen, President Obama would love nothing more than to drastically raise the national minimum wage. So, for now, all eyes are on Seattle and how small businesses fare with the new law and challenges to keep the doors open. 

But the real question should not be how many Seattle businesses will close. Rather, by how much will prices increase? How many minimum-wage employees will have hours reduced? How many employees will end up on unemployment?