From the Ron Paul Liberty Report:
Colorado was among the four states where voters approved a minimum wage hike in November. Among the specific provisions for the new wage hike was the stipulation that tipped workers — such as waiters who receive tips and are paid below the standard minimum wage — will receive a mandated wage hike of 99 cents.
Naturally, this will lead to an increase in costs for restaurant owners who will then seek to raise prices and/or reduce costs. KDVR in Denver reports:
Kanatzer owns The Airplane Restaurant in Colorado Springs and said he has already increased his kids menu prices. …
“I increased it a dollar — my kids menu prices went from $4.99 to $5.99,” Kanatzer said. Raising prices can only go so far, however. Contrary to what many non-economists seem to believe, it is not possible to simply “pass on the extra cost to customers.” As any