Natural Citizen
American Made
- Aug 8, 2016
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Relevant reading...
Raising minimum wage hurts the poor
Snip...
...Economic principles dictate that when government imposes a minimum wage rate above the market wage rate, it creates a surplus ''wedge'' between the supply of labor and the demand for labor, leading to an increase in unemployment.
Employers cannot simply begin paying more to workers whose marginal productivity does not meet or exceed the law-imposed wage. The only course of action available to the employer is to mechanize operations or employ a higher-skilled worker whose output meets or exceeds the ''minimum wage.'' This, of course, has the advantage of giving the skilled worker an additional (and government-enforced) advantage over the unskilled worker.
For example, where formerly an employer had the option of hiring three unskilled workers at $5 per hour or one skilled worker at $16 per hour, a minimum wage of $6 suddenly leaves the employer only the choice of the skilled worker at an additional cost of $1 per hour. I would ask my colleagues, if the minimum wage is the means to prosperity, why stop at $6.65--why not $50, $75, or $100 per hour?
Those who are denied employment opportunities as a result of the minimum wage are often young people at the lower end of the income scale who are seeking entry-level employment. Their inability to find an entry-level job will limit their employment prospects for years to come. Thus, raising the minimum wage actually lowers the employment opportunities and standard of living of the very people proponents of the minimum wage claim will benefit from government intervention in the economy!
Furthermore, interfering in the voluntary transactions of employers and employees in the name of making things better for low wage earners violates citizens' rights of association and freedom of contract as if to say to citizens ''you are incapable of making employment decisions for yourself in the marketplace.''..
Raising minimum wage hurts the poor
Snip...
...Economic principles dictate that when government imposes a minimum wage rate above the market wage rate, it creates a surplus ''wedge'' between the supply of labor and the demand for labor, leading to an increase in unemployment.
Employers cannot simply begin paying more to workers whose marginal productivity does not meet or exceed the law-imposed wage. The only course of action available to the employer is to mechanize operations or employ a higher-skilled worker whose output meets or exceeds the ''minimum wage.'' This, of course, has the advantage of giving the skilled worker an additional (and government-enforced) advantage over the unskilled worker.
For example, where formerly an employer had the option of hiring three unskilled workers at $5 per hour or one skilled worker at $16 per hour, a minimum wage of $6 suddenly leaves the employer only the choice of the skilled worker at an additional cost of $1 per hour. I would ask my colleagues, if the minimum wage is the means to prosperity, why stop at $6.65--why not $50, $75, or $100 per hour?
Those who are denied employment opportunities as a result of the minimum wage are often young people at the lower end of the income scale who are seeking entry-level employment. Their inability to find an entry-level job will limit their employment prospects for years to come. Thus, raising the minimum wage actually lowers the employment opportunities and standard of living of the very people proponents of the minimum wage claim will benefit from government intervention in the economy!
Furthermore, interfering in the voluntary transactions of employers and employees in the name of making things better for low wage earners violates citizens' rights of association and freedom of contract as if to say to citizens ''you are incapable of making employment decisions for yourself in the marketplace.''..