I recently read an article from The Economist called Trickle-up Economics. In this article many profoundly bad ideas were discussed mainly involving hikes to the minimum wage. This article as wrote after president Obama started trying to increase the minimum wage to support his ideas.
I found it odd that the article mentions, “The introduction of Britain’s minimum wage in 1999 had no notable impact on jobs”, without considering how the world of human action works. When the cost to employ a human goes up past the worth of that worker that worker become unemployed. In this Britain example they are analyzing a moving situation that has many variable not just one. Sure based on the data they pulled, they must have had no unexpected unemployment that year. But did they consider that they might have done this minimum wage law during a year of more growth than they expected making it so that the growth their economy deserved and their people deserved will never happen. In the end all the minimum wage with do is make it so that for the current economy less workers are employable at that rate.
One of the only statements that he makes that I can somewhat agree with is, “a higher minimum wage costs some low-skilled workers their jobs while helping those who keep them”. This is basic logic, anyone not worth the new minimum wage will become unemployed. If anyone is being pulled down a little right at that line, they might try to work harder to show their employer they are worth keeping on at the new minimum wage. But in the end, the minimum wage can’t increase any humans’ value to keep them employed, only the worker can do that through skills they pick up and dedication. Also those “few” that lose their jobs because they are not worth the minimum wage, when will they be able to get a new job or any job. They will have a hard time getting back into the work force because they will be fighting against others that never had to leave it, making the ones that originally got the job more valuable to the employers. This is also preventing the free market and free trade from working. The man who gets unemployed would gladly work for below the minimum wage if that meant he had a job, I say this because he was already doing this an now government stepped in and told him that he can’t work for that little, even though he was content making that trade because it was his best offer to improve his life. Why would anyone think they have a right to stop someone from improving their life?
The minimum wage always will eliminate jobs for people who are willing and ready to do them for a lesser wage. They wouldn’t be working the job they have at the minimum wage unless it was better than their alternatives meaning they are not currently worth more than the minimum wage. This just cuts people off from our economic system. I don’t see how we could ever purposefully remove anyone from that thriving prosperous network we have for an economy.