Posted on Jun 30, 2021
The New York Times Explains Why the Minimum Wage Should Be $0.00 | Jon Miltimore
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https://fee.org/articles/the-new-york-times-explains-why-the-minimum-wage-should-be-000/?utm_source=email&utm_medium=email&utm_campaign=2020_FEEDaily
There are many reasons people and politicians find the minimum wage attractive, of course. But the Times, in an editorial entitled “The Right Minimum Wage: 0.00,” skillfully rebuts each of these reasons in turn.
Noting that the federal minimum wage has been frozen for some six years, the Times admits that it’s no wonder that organized labor is pressuring politicians to increase the federal minimum wage to raise the standard of living for poorer working Americans.
“No wonder. But still a mistake,” the Times explains. “There’s a virtual consensus among economists that the minimum wage is an idea whose time has passed.”
There are catches…[A higher minimum wage] would increase employers’ incentives to evade the law, expanding the underground economy. More important, it would increase unemployment: Raise the legal minimum price of labor above the productivity of the least skilled workers and fewer will be hired. The argument isn’t convincing. Those at greatest risk from a higher minimum would be young, poor workers, who already face formidable barriers to getting and keeping jobs. The idea of using a minimum wage to overcome poverty is old, honorable – and fundamentally flawed. It’s time to put this hoary debate behind us, and find a better way to improve the lives of people who work very hard for very little.
There are many reasons people and politicians find the minimum wage attractive, of course. But the Times, in an editorial entitled “The Right Minimum Wage: 0.00,” skillfully rebuts each of these reasons in turn.
Noting that the federal minimum wage has been frozen for some six years, the Times admits that it’s no wonder that organized labor is pressuring politicians to increase the federal minimum wage to raise the standard of living for poorer working Americans.
“No wonder. But still a mistake,” the Times explains. “There’s a virtual consensus among economists that the minimum wage is an idea whose time has passed.”
There are catches…[A higher minimum wage] would increase employers’ incentives to evade the law, expanding the underground economy. More important, it would increase unemployment: Raise the legal minimum price of labor above the productivity of the least skilled workers and fewer will be hired. The argument isn’t convincing. Those at greatest risk from a higher minimum would be young, poor workers, who already face formidable barriers to getting and keeping jobs. The idea of using a minimum wage to overcome poverty is old, honorable – and fundamentally flawed. It’s time to put this hoary debate behind us, and find a better way to improve the lives of people who work very hard for very little.
Minimum Wage
Economics
Jobs
Edited >1 y ago
Posted >1 y ago
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Organized labor is no friend of the poor and low-skilled. Every increase in the minimum wage makes higher union wages look more reasonable, as well as reducing the competition for union jobs. As noted above, any time what the employee contributes to the company's bottom line is lower than the cost of having the employee, that job is at risk.
Just as bad, and even sneakier, are the endless attempts to saddle employers with required benefits. Paid paternal leave, for example, is still a cost to the employer, which the companies are aware and is factored in to the cost of having an employee. Benefits make up about 28% to 41% of the cost of having an employee.
And let's not forget the sneakiest of all taxes, inflation. Every time the government prints another billion dollars, they reduce the purchasing power of the money in your bank account, as well as your social security and retirement checks.
Just as bad, and even sneakier, are the endless attempts to saddle employers with required benefits. Paid paternal leave, for example, is still a cost to the employer, which the companies are aware and is factored in to the cost of having an employee. Benefits make up about 28% to 41% of the cost of having an employee.
And let's not forget the sneakiest of all taxes, inflation. Every time the government prints another billion dollars, they reduce the purchasing power of the money in your bank account, as well as your social security and retirement checks.
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