Andrew Cuomo’s dangerous minimum wage power play

It was bound to happen. President Obama’s disregard for the legislative branch and illegal unilateral action on immigration has inspired someone else to declare themselves king of a lower fiefdom.

Last week, New York Gov. Andrew Cuomo (D), not content to allow his younger brother to hog the headlines for constitutional abuse, announced that he was going to handpick a state wage board that would be responsible for raising the minimum wage.

His gross power grab was necessitated by the stubborn refusal of the newly elected Republican majority in the state Senate to rubber-stamp his demand for a minimum wage increase.

{mosads}The arguments against a minimum wage increase are rooted in simple math. A restaurant owner makes about 4 percent profit while spending about a third of revenues on labor costs. When the government arbitrarily raises labor costs, but cannot pass those additional costs along to the consumer and maintain profitability, a business owner can choose to either cut the number of employees to offset the labor cost increase, or if that is not an option, close the restaurant. Neither outcome is good for the hapless employee who just wants to make some bank.

In Seattle, hipster foodies have been stunned that some of their favorite haunts are suddenly dark due to that city’s massive minimum wage increase. One likely can find them consoling themselves eating brownie bite finger-food in the marijuana bars that are cropping up in their stead.

In New York, Cuomo’s move to wave a magic wand and bring a minimum wage increase into existence has the potential of doing even more harm. If Cuomo can decide that he doesn’t need no stinkin’ state legislature to change the labor costs for businesses in the state, those businesses are at the mercy of the political whims of the moment. It is impossible to run a business without some degree of cost certainty, and Cuomo’s power grab will likely have an even greater chilling effect on hiring new, less expensive employees than the cost increases themselves.

Small business owners and their associations will be compelled to budget dollars to contribute to whomever sits in the governor’s mansion in Albany, N.Y., as the state’s chief executive will have a literal knife to their throats every day. Of course, no politician in New York would ever engage in raw extortion to fill their personal and campaign coffers.

And imagine the competition to be one of the three who gets to decide whether the minimum wage should be $9, $10 or even $20 an hour. They will be feted like third-world potentates as they investigate labor costs in the food industry at places like La Grenouille in midtown Manhattan and Gotham Bar and Grille in Greenwich Village. A spot on the commission will be more hotly contested than a seat on the Miley Cyrus tour bus.

That’s what you get when checks and balances in government get overrun by politicians desperate to make a splash in the hopes that someone will notice and think they are presidential. Cuomo’s power play, however, makes him look more like a petty city ward boss threatening to stop garbage pick-up than the person to lead the free world.

However, in President Obama’s America, common sense seems to have taken a permanent backseat to the pandering redistribution of other people’s money to build a power base. At least that’s what Cuomo hopes.

Manning is president of Americans for Limited Government.