Should we raise the minimum wage?

The Washington bureau chief of the Chicago Tribune informed us this
week in the lead of his “news”
story

on the prospects of a 20 percent hike in the minimum wage that, “The
soaring economy has taken the sting out of most of the arguments against
an increase.”

Oh yeah?

Let’s take a look at those arguments and another that, perhaps,
Merrill Goozner and his associates in the beltway media establishment
haven’t bothered to examine.

“Opponents traditionally argue that giving a raise to the nation’s
least well-off workers would cost jobs to teen-agers and the unskilled,”
Goozner writes. “But since the minimum wage was last raised, to $5.15 an
hour in 1997, job opportunities paying at or near the minimum have
soared, welfare rolls have plummeted and unemployment among teens has
plunged to its lowest level since 1969.”

Hmmmm. Well, let’s see. Now it is considered a good thing,
apparently, that the number of jobs at the lowest pay scale is soaring.
I would think that the real measure of a successful economic program
would be that the number of top-paying jobs was soaring.

The drop-off in welfare Goozner cites is more likely attributed to a
program under which recipients can no longer collect unemployment
benefits indefinitely rather than a hike in the minimum wage. Of course,
most of us who are opposed to raises in the minimum wage are also
opposed to welfare. A good way to see an even bigger drop in welfare
would be to eliminate it.

The fact of the matter is that no one is helped by hikes in the
minimum wage. They are a pittance in the big scheme of things. If you
rely on the government raising the minimum wage so you can make more
money, then you are dependent on the government. That is a trap. And
it’s a trap many politicians like. They love it when you need them.

I would ask a couple of questions to those so eager to raise the
minimum wage by a dollar or more. For starters, why are you so cheap?
Why not raise it 100 percent? Or, better yet, how about 1,000 percent?
If raising the minimum wage doesn’t have any negative effects on the
economy, why not mandate salaries of $100,000 a year?

“Oh, Farah,” you say, “nobody’s suggesting anything that dramatic.
All we’re talking about is a measly $1 an hour. Why are you being so
ridiculous?”

But it’s not me who is being ridiculous. If these incremental hikes
in the minimum wage are really so good for the economy, if they don’t
have any negative effects on people, why not make them much bigger, much
more “generous”? Why not hit our target the first time? Why do we have
to keep going back to the well?

The reason, I think, is clear. Everyone acknowledges that such large
mandates on private commerce would have a devastating impact. We would
destroy the U.S. economy. If there is major harm done by large-scale
intrusion of the government in private business matters, then smaller
injuries — perhaps even undetectable hurts — are occurring with the
smaller mandates.

No one is suggesting that the economy is flourishing because of
increases in the minimum wage in recent years. What they argue is that
the damage they do hasn’t been very severe — which means they concede
there has been some damage. And that means that our economy would be
stronger — by some degree — if these increases had not been approved.
So, why on earth would we want to keep gambling? Why would we take an
action that could very well start the next recession? Why would we want
to slow down the economy by even a tiny percentage? Why take action to
hurt the economy at all?

But there’s an even better argument against raising the minimum wage
than the pragmatic, common-sense, economic principles. There is simply
no constitutional justification for such intervention by government in
the private affairs of men. If you think there is, spell it out for me.
Where is the constitutional authority for Washington dictating what you
can pay me or what I can pay you? That is a private matter, not a public
matter, not one requiring government regulation.

And that brings me to the real issue. It’s no wonder opponents of the
minimum wage lose nearly ever time this subject is debated — because
they argue against the next increase. That’s not what I am doing. What I
am doing is arguing that the minimum wage should and must be scrapped
altogether.

There is no legal authority for it and there is no practical economic
argument for it. It is simply a means by which one political class buys
the votes of others.