“There they go again!” Ronald Reagan’s words echoed in my mind as I read Rod Livdahl’s recent letter supporting a raise in the minimum wage.
The viability of minimum wage laws has been discounted by a large majority of economists. There certainly is not enough space to argue this point here, but Nobel Prize winning economists such as the late Milton Friedman have done so very eloquently. I would suggest reading his classic economics text, “Free To Choose,” or perhaps Walter William’s short essay, “Minimum Wage, Maximum Folly.”
These men have devoted their lives to the study of economics and can actually respond to a minimum wage question with reasoned thinking and not knee-jerk emotionalism.
The free market is the best arbiter of wages. The wage is “set” by the skill of the worker and the desire of the marketplace to pay for that skill. Raising the minimum wage does nothing to improve the worker’s skill, set but it does a lot to eliminate his job altogether. An unskilled worker can raise his own wage by gaining new skills desired by the marketplace, but only if he can begin the climb on the bottom rung of the economic ladder. A mandated minimum wage can cut that bottom rung out for many young and unskilled workers, preventing them from even beginning the climb.
With the bottom rung cut out, these people are no longer workers and they experience what the real minimum wage always is: zero.