Wednesday, May 21, 2008

Wage subsidies, finally!

CBC Story: Wage subsidies announced for rural P.E.I. jobs

As I wrote in a previous post I supported the Ghiz government in his decision to discontinue the propping up of agriculture. Now the Ghiz government says he has a plan for those workers. He is going to help create jobs for them with wage subsidies in rural areas. Programs like this are making me more and more a fan of the Ghiz government.

What I really like about this program is that it can lead to so much more. As I have written elsewhere I have issues with minimum wage. I tend to think the solution is in wage subsidies rather than minimum wage. An obvious question is 'How does the government pay for it?' If companies are paying less in wages then they can pay more in taxes. There will, however, be companies with highly paid employees that will save nothing in wages but pay more in taxes. This is true and that is the trade off. But it is a trade off that is long over due.

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