February 27, 2013

Minimum Wage

Recently there has been a lot of talk about minimum wage. This was mostly sparked by the president saying he wanted to increase the minimum wage to 9.00 dollars. Now to every American that doesn't understand economics or understand how employment works this ides might seem to make sense. Why wouldn't we try to make our lower class hard workers get more money for there hours?

While reading Why Unions Want a Higher Minimum Wage the article states many things that this policy promotes in our economy. The first one is the negotiations of wage talks pressure employers and unions to hammer out new contracts. Helping the unions gain more years under contract with the employers which is beneficial. Second the increase in the minimum wage  restricts businesses ability to hire low skilled workers who would be willing to work for less then the minimum wage rate. This in turn lowers competition against these union workers. Union workers see an increase in employment and income while non union members see a drop in jobs and income. The unions only concern is that the union members have gained higher wages and reduced the overall competition. The conclusion is even though the wage increase have evidence to have an negative effect on employment it is still being backed by Democrats.

So how do we understand this as  human action? Obviously it is one political party looking out for the individuals that have backed them. Is this what we want in our society? If we want to live in a free society this is not what we want. Freedom in society means that a man depends as much upon other people as other people upon him. With these unions and minimum wage policies it is almost guaranteeing an uneven playing field. Looking back on history in a more free society and capitalistic economy employers will pay there workers the wages they deserve or this company will ultimately not have anyone to run the organization or company.   Mr. Ford paid higher wages than any other industrialists or factories because we wanted people to want to come and work for him. This is a trend we are seeing in our society that it is the duty of the government to support, subsidize, and give privileges to special groups. Unions are just another pressure group who want to attain for themselves a special privilege at the expense of everyone else. I believe this is not the right policy we should be putting into place and we should be working on getting away from politicians who are only looking out for there district and pressure groups who are trying to gain special interest over other groups. Movement to Capitalist society where the ultimate bosses are the consumers.

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