Do minimum wage laws help or hurt?
Once again Democratic politicians want to increase the dosage of a popular but extremely toxic form of public policy snake oil. In his State of the Union message Tuesday President Obama proclaimed,“Tonight, let’s declare that in the wealthiest nation on earth no one who works full time should have to live in poverty, and raise the minimum wage to $9 an hour. We should be able to get that done.” Pat Quinn, the governor of Illinois, last week proposed raising his state’s minimum wage from the current $8.25 an hour to $10 an hour.
Most people, especially college freshmen and sophomores, feel that minimum wage laws are beneficial. When discussing the topic I would ask, “If a minimum wage of $8 is better than one of $5, why skimp? Why not make the minimum wage $10, or $20, or $30?” Passing minimum wage laws is relatively easy. If eliminating poverty is that easy, why not go all the way? Why be so miserly? It’s not your money you’re spending. Go big or go home!
Most people realize that a minimum wage of $30 or $50 an hour would not work or be a good idea. They recognize that employers simply could afford to hire far fewer people at such wages. Most people can appreciate that not everyone is worth $30 an hour. Minimum wage laws at those levels would do major damage to the economy. Less obvious is the fact that virtually any minimum wage does the same kind of damage.
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