Economic Ignorance on the Minimum Wage
It absolutely amazes me that there are still people who defend a government-mandated minimum wage. It is truly a testament to the long-lasting effect of indoctrination and propaganda to which students are subjected in public (i.e. government) schools and state-supported colleges and universities.
The latest example of this phenomenon is the editorial board at the Los Angeles Times. In an editorial yesterday, the Times called for an increase in the federal minimum wage of $7.25 per hour. The Times says that such an increase would help ensure that “working people earn a decent living.”
I’ll bet that if the members of the Times’s editorial board were asked if they favor America’s “free-enterprise system,” they would all respond, “You bet we do. As Americans, we are all advocates of free enterprise.”
But free enterprise means enterprise that is free of government control, regulation, planning, and management. How can enterprise be free if government is dictating how much businesses must pay workers?
The idea of actually freeing economic enterprise from government control is anathema to statists because they are convinced that disaster would ensue, especially for workers. If the government doesn’t set a minimum wage, they believe, workers would receive a wage of $1 dollar per hour or even less.
That mindset, of course, fails to take into consideration the economic law of supply and demand. If labor is scarce and demand for labor is high, greedy, profit-seeking employers will not be able to find workers who are willing to work for $1 per hour. That’s because other employers will be hiring them for $5 or $10 or $20 or $30 an hour. If an employer isn’t willing to match what his competitor is offering, then that employer doesn’t get the workers. It is the law of supply and demand, not the whims of individual employers, that determine how much workers are going to be
Article from The Future of Freedom Foundation
The Future of Freedom Foundation (FFF) is a leading voice in libertarian thought, tirelessly advocating for individual liberty, free markets, and limited government. Established in 1989, the FFF is more than just a think tank; it’s a hub for intellectual exploration and policy advocacy that draws on the classical liberal tradition and Austrian economics. Through insightful articles, videos, and events featuring top libertarian minds, the organization provides a robust critique of mainstream politics and policies, championing instead the principles that underlie a truly free society. For anyone seeking a principled stand for freedom and limited government, the Future of Freedom Foundation serves as an invaluable resource and an inspiring beacon.