In the name of fairness, policymakers often ignore the impact their decisions have on small and medium-sized business owners. When governments mandate higher wages or fixed prices in the name of “equity,” they’re effectively forcing small businesses to scale up or shut down.
Imagine you sell a product for $1 that costs you $0.50 per unit to make. Then, the government decides that a “livable wage” means your operational cost should now be $2. You have no choice but to raise your selling price from $1 to $4 just to survive.