What Should Minimum Wage Be?
Zero, of course.
In a great article published yesterday by the Atlanta Journal-Constitution–which does seem to be diversifying a little bit to the right in its editorial page, a welcome change–Richard Burkhauser makes the point that if we are serious about reducing unemployment—particularly among the young and inexperienced, who if allowed to remain chronically un-and under-employed, will create all sorts of headaches down the road—then politicians need to revisit the 40% increase in the minimum wage passed in 2007. Well, duh.
It’s just common sense, so much so as to be, effectively, axiomatic: the artificial inflation of the cost of goods and services—which is exactly what happens with a “minimum wage”—messes up the economy. When government meddles in what ought to be private affairs—even when government does it with the best of intentions—the train goes off the tracks. It is so predictable as to be laughable that when employers are forced to pay employees more than the employees are worth, there will be less employees doing more work.
Progressive politicians don’t understand this—or if they do, they are simply evil people. Because it hurts everyone when the minimum wage is increased—everyone. The price of goods and services go up, and/or the quality of goods and services goes down, and/or the unemployment rolls increase. There’s simply no way around that, because to think otherwise is to subscribe to what I call the “Big Bag o’ Money Theory” about business: businesses have a big bag o’ money just sitting around collecting interest and dust, and it’s a bag o’ money that business ought to be sharing with others, so when the government passes silly laws to make businesses give more money to its employees, it’s as simple as digging into the big bag o’ money and divvying up “their fair share”.
And leprechauns will soon be flying out of…somewhere.
Want to put people back to work? At the very least, create a second minimum wage targeted at the young unemployed. Get ’em working for, say, $5 an hour. They won’t get rich—minimum wage won’t make anybody rich, nor should it—but they’ll get working. And they’ll help business. And they’ll develop skills and prove their merit and all sorts of good things that are currently being blocked by this monstrosity we call “minimum wage”.