Here’s a letter to Mother
Jones:
Congratulations! You’ve well and truly slain a straw man by reporting
that “[c]onservatives have long portrayed minimum-wage increases as harbingers
of economic doom, but their fears simply haven’t played out” (“As Cities Raise Their Minimum Wage, Where’s the Economic
Collapse the Right Predicted?” April 16).
No serious opponent of minimum wages has ever said that they are
“harbingers of economic doom” and sparks of “economic collapse.” Not Milton
Friedman. Not F.A. Hayek. Not Thomas Sowell. Not my colleague Walter Williams.
No credible scholar or pundit has ever made such a prediction about minimum
wages at the relatively low levels that these wages are set in the United
States. The reason is that only a small percentage of the workforce earns wages
at, or just above, the prevailing legislated minimum. Therefore, minimum-wage
hikes of the sort that are typical in the U.S. cannot possibly propel the
economy to the brink of “collapse” or unleash economic “doom.”
What minimum-wage hikes do unleash, however, is devastation upon
a relatively small number of largely invisible workers – workers who are the
least skilled and most disadvantaged. Raising the minimum wage destroys jobs
for many of these poor workers while making the jobs of other such workers more
onerous. But because these workers are so relatively few in number, their
suffering, while very real, is easy to miss when looking at the aggregate data.
This fact explains why some – by no means a majority – of minimum-wage studies
(particularly those that examine only short spans of time) find no negative
employment effects.
Serious opponents of minimum-wage legislation insist that it is unjust
to overlook the suffering of people forcibly priced out of work or into jobs
less preferable than the ones they would otherwise have – unjust even if the
number of affected workers is so small as to be missed by weak empirical
studies and too tiny to be classified as ”doom.”
Sincerely,
Donald J. Boudreaux
Professor of Economics
and Martha and Nelson Getchell Chair for the Study of Free Market
Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
(I thank Timothy
Wise for the pointer to the Mother Jones report.)
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