The battle over minimum wage is raging. Emotions are running hot. Some cities are setting the bar very high. For example, Seattle is mandating a $15/hour wage. Economically, the issue is very simple. Minimum wage laws do not raise anyone’s wage. This is because it’s...
The principle here is that we need to look to greater economic freedom, not greater government intervention, as the path to economic improvement for everyone, especially the poor.
The politics of the minimum wage are simple. No congressman or president owes his office to the poorly educated black and Latino youth vote.
The efforts underway by the Service Employees International Union, and its political and media allies, to raise the minimum wage from $7.25 to $15 per hour would, if successful, cause major unemployment among low-skilled workers, who are the supposed beneficiaries of...
Justice demands that people are compensated on the basis of performance, not on the basis of their need or of the egalitarian ideal dominant in today’s culture.
Labor unions have been supporters of minimum wage laws in countries around the world, since these laws price non-union workers out of jobs.
Countries with minimum wage laws almost invariably have higher rates of unemployment than countries without minimum wage laws.
The fundamental issue is not wage rates, but productivity. If a worker desires a higher wage, he must produce more in a given period of time.
Those who benefit from government coercion seldom like it when the gun is turned around and pointed at them. They have no hesitation to demand that government use compulsion for their benefit, but complain when compulsion is directed at them. As an example,...
The first fundamental law of demand postulates that the lower the price of something, the more will be demanded, and the higher the price, the less will be demanded. To my knowledge, there are no known exceptions to the law of demand. That was until last fall when 650...
The Democrats who now control Congress want to change President Bush’s Medicare drug benefit to require government officials to negotiate drug prices with the pharmaceutical companies. Under the current program, competing insurance companies cut the deals and...
To the extent that the government simply “caps” premiums it will result in no insurance at all as it makes for an unprofitable bet for any insurance company.
There are decent people, without a selfish hidden agenda, who support increases in minimum wages as a means to help low-skilled workers, and there are other decent people, with the identical goal, who strongly oppose increases in the minimum wage. So the question is:...
It was a common political move when Chicago’s city council voted recently to impose a $10 an hour minimum wage on big-box retailers. There is nothing that politicians like better than handing out benefits to be paid for by someone else. What was uncommon was the...
About a fortnight ago, Mrs. Williams alerted me to an episode of Oprah Winfrey’s show titled “Inside the Lives of People Living on Minimum Wage.” After a few minutes of watching, I turned it off, not because of the heartrending tales but because most...
With all the recent hype and demagoguery about gasoline price-gouging, maybe it’s time to talk about the basics of exchange. First, what is exchange? Exchange occurs when an owner transfers property rights or title to that which is his. Here’s the essence...
I first became aware of the law of gravity as a small child when I pedalled by tricycle off the porch and crashed into the yard. Gravity was of course operating all along, whether I was aware of it or not. Economics is a lot like that. Many people who are completely...
Senators Edward Kennedy, D-Mass., and Rick Santorum, R-Pa., both introduced proposals to increase the minimum wage from its current $5.15 an hour. Sen. Kennedy’s proposal would have raised the minimum wage to $7.25 in three steps over 26 months, while Sen....
A recent front-page story in the Wall Street Journal told of rising hunger and malnutrition amid chronic agricultural surpluses in India. India is now exporting wheat, and even donating some to Afghanistan, while malnutrition is a growing problem within India itself....
Ladies and gentlemen, it is understandable to want to help out poor families, and toward that end it has been suggested that Congress increase the minimum wage, from the current $5.15 an hour to $6.65 an hour. Well, I have good news and bad news for you. The bad news...
During the gasoline shortage that began in 1979, motorists were often waiting in long lines of cars at filling stations — sometimes for hours — in hopes of reaching the pump before the gas ran out. The ways that Ted Kennedy and Ronald Reagan proposed to...
History has seen many calls for minimum wages for the same reason — to eliminate competition with workers who’d work for less.
Businessmen in Santa Fe, New Mexico, are going to court to defend their most basic economic right–the ability to voluntarily negotiate wages with their employees. Last month, the Santa Fe city council voted to raise the minimum wage to $10.50 per hour over the...
When Hawaii recently passed a law controlling how high the price of gasoline can go in that state, it was the first law controlling the price of gasoline since 1981, when President Ronald Reagan ended federal control over oil prices. What was unusual about the...
Even the Department of Energy’s study found that price caps — which, let’s not forget, are what got California into this mess in the first place — won’t improve the energy situation. In fact, they’ll likely make it worse. The study...
It was only a passing news item when the financial information service Standard & Poor’s lowered the rating it gave to bonds issued by the state of California. But it has big implications and it also shows the big difference between economics and politics....
The last time so many people were as bedeviled as the people of California are today by electrical blackouts was back in 1979, when motorists in cities across the country were lined up for hours at filling stations, waiting to get gas. Both shortages had the same...
As an economist, whenever I hear the word “shortage” I wait for the other shoe to drop. That other shoe is usually “price control.” So it was no great surprise to discover, after the electric power shortage in California made headlines, that...
Warning: Over certain issues, otherwise intelligent people may, repeat, may suffer instantaneous, and often irreversible, brain-freeze. Take the minimum wage. The City Council in Santa Monica, Calif., a town also known as “Moscow on the Pacific,” just...
Every so often, without fail, the Republicans remind me why I don’t join the party. A recovering drug and alcohol abuser, living in the streets, recently told me the following story. One day, in desperate need of money, he went to the owner of a convenience...
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