Salt Lake Tribune
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Subsidizing poverty: Some costs should be shifted back to business
This is an archived article that was published on sltrib.com in 2006, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Utah's governor is far from the only chief executive who has been known to build his hopes for the future on the creation of more private-sector jobs.

More jobs mean more check stubs that say "State Income Tax Withheld" and more money spent in stores ringing up sales tax revenue. Even for small-government conservatives, that is a formula for supporting whatever level of state services is deemed necessary without increasing tax rates.

But it doesn't always work that way.

The undeniable fact is that too many jobs don't pay enough to support even the smallest family and don't provide health coverage. Adding such low-wage jobs to our economy can prove a net loss to the Utah commonweal.

Figures are kept in different ways by different outfits. But the best guess is that, in 2005, Utah taxpayers paid some $387 million to provide Medicaid, food stamps, child care and the like to households where at least one person has a job.

These are not people who sit around all day watching soaps. These are families, often headed by single working mothers, who may work a little or a lot, but still don't have enough money to make it without at least some call on the taxpayer. Often, and most expensively, that call is for Medicaid, the federal-state program that provides far too little health care to far too many working families.

The search for high-wage jobs has motivated much action by our leaders, including Gov. Jon Huntsman Jr.'s $70 million income tax restructuring proposal and his laudable $65 million Utah Science, Technology and Research Initiative. That is money the government would spend to subsidize desirable jobs.

But a proposal to reduce the amount by which the state subsidizes undesirable jobs, by increasing the state minimum wage from $5.15 to $7 an hour, was shelved by the Legislature in favor of a $100,000 study on whether such a move would benefit workers enough to justify the pain it would cause their employers.

That would be useful information. More important would be to know how much each low-wage job costs the taxpayer, and to devise a way to shift some of those costs back to the private sector, via higher wages or health insurance pools.

Because we can't afford to subsidize pinch-penny employers any longer.

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