Minimum wage laws are harmful and immoral
Making sure that every worker is paid a “living wage” is a good thing, right?
Well, it certainly sounds good, but let’s unpackage the premise to confirm that we’re not actually advocating a policy which does more harm than good.
Minimum wage laws prohibit any person from being employed if the value they offer is less than a certain arbitrary amount. For example, Bob is an unskilled individual looking for work. Jane, a local shopowner, makes a few extra dollars in profit every hour, and is in need of someone to sweep the floors. She would love to be able to pay someone like Bob to clean the floors, and Bob would love to have the job. However this transaction can never take place because the hourly amount Jane can afford to pay for this work is less than her State’s minimum wage. As a result, Jane’s floors are not cleaned as often as she’d like, and Bob remains unemployed.
Was Jane wrong to not pay Bob more than the value she’d be getting from him?
September 28, 2018 @ 4:12 am
Minimum Wage laws are destructive on many levels and you point out a great example.
Which is better for the employees:
-Minimum wage set at $23/hr?
-Minimum wage set at $7/hr?
-Minimum wage set at $0/hr?
Who would willing work for $0/hr if the purpose of the job or employment was to earn an income? Just because there is no set minimum wage doesn’t mean the talent pool wouldn’t self regulate and compete to prove a higher worth. To say an employer and employee couldn’t negotiate on their own to define a mutually beneficial compensation arrangement without government intervention is also beyond insulting.
Rising costs of goods, higher unemployment, understaffed work environments are all unintended consequences of this seemingly noble law.
This also leads to another touchy subject of modern times, the antimeritocracy movement.
September 28, 2018 @ 4:26 am
Proponents of this seemingly noble law also face a moral dilemma: they support violent interference of this transaction between employer and employee, yet offer no alternative. They’re essentially saying, “I will not allow Jane to pay Bob what she wants to pay him and what he wants to receive…yet I will offer absolutely no alternative option to Bob.”
Depriving someone of their best option (which is clearly the case since they’re willing to take the job), while you offer them exactly zero dollars, is patently immoral and benefits no one.