Skip to comments.Bachmann is Right About the Minimum Wage
Posted on 07/04/2011 11:09:32 AM PDT by Kaslin
Michele Bachmann has drawn some media flack about her views on the minimum wage.
She has said that the minimum wage is a bad idea and that getting rid of it would bolster employment.
Despite a considerable body of academic literature and a whole lot of common sense that supports Bachmanns view, some reporters seem to have a hard time with it.
A Washington Post columnist blogged about a recent exchange between Bachmann and a morning talk show host on this subject with the headline: Michele Bachmanns radical position on minimum wage.
Here we sit today with over 9 percent unemployment, two and half years after enactment of the largest government stimulus spending bill in our nations history. There are a million fewer Americans working today than when the stimulus was passed.
Yet, I recall no Washington Post or New York Times headline which read: Obamas radical idea to borrow a trillion dollars to create jobs.
I made the point in my book Uncle Sams Plantation, originally published several years before Michele Bachmann arrived in Washington, that the minimum wage, like most government programs targeted to low income Americans, hurts the very communities it purports to help.
By government setting a floor on the wage that an employer is permitted to pay, individuals whose employment value falls below that wage simply will be unemployed.
Rather than generally lifting wages at the bottom end of our work force, which is the supposed objective of the minimum wage, it simply creates unemployment. A wage of $6.50 an hour, 75 cents less than todays minimum wage, isnt much, but its a lot more than zero.
The last round of federally dictated minimum wage increases occurred just as we entered the last recession. So its perverse effects were magnified.
The minimum wage was increased in three steps from $5.15 an hour before July 2007 to $7.25 an hour in July 2009.
When the first increase occurred in July 2007, black teenage unemployment was at 30 percent, 25 percentage points higher than the then 5 percent national unemployment rate. After the last increase to $7.25 an hour went into effect in July 2009, black teen unemployment reached 50 percent, 40 percentage points higher than the national rate.
Regarding the impact of minimum wage increases over this period, the director of the Center for Business and Economic Research at Ball State University observed, Instead of hiring a dozen teens to work a popular summer restaurant or theme park, a company would hire six or less. Instead of filling positions that required no skills, companies were making due with what they had. In the long run, this hurt young, unskilled workers.
A study from this Center estimates that the minimum wage may have led to elimination of 550,000 jobs.
This is one study, but there are others. And there are many economists of note, including Nobel Prize winners, who have written about the perverse effects of the minimum wage.
Economics has been called common sense made difficult. In the case of the minimum wage, you dont need fancy models to draw the logical conclusion of what to expect.
Just think how any business owner will behave when the government sets a floor on how much he or she can pay workers. Its obvious that those at the bottom of the scale will get shut out.
It should be equally obvious that those shut out are the same ones that in all likelihood have dropped out or will drop out of school and whose life can be changed dramatically by having the opportunity to work and acquire skills and build a resume.
If there is anything radical about Michele Bachmanns stand on the minimum wage, its not what she has said, but that she has had the courage to say it.
Every time the min wage goes up, so does the price of a loaf of bread so it’s all a wash in the earnings department. Also, anyone with savings takes a hit and their $ are devalued.
Minimum wage laws keep people down. They are disincentive from going out and improving yourself to make more money. Government forces employers to pay people more to stay in mind and spirit-killing zombie jobs that they might otherwise be forced to get out of to make more money. Minimum wage laws are making millions of people into mind-numbed zombies who will never really be alive.
Conservatives make the case that minimum wage hurts businesses. We must make people see that this legislation directly hurts those that it purports to help.
She is right about a lot of things as many conservatives are but just being right does not qualify one to be President. In her 5th year of Congress her resume is as thin as Obama’s. And the stories leaked about how bad she manages her congressional office as well as the high turnover in staff does not point to someone with the executive skills to manage the entire federal government. She should run for Governor and get some executive experience but I guess her ego is too big for that.
Seems reasonable to me.
But to fight the Minimum Wage, you have to fight the entire mindset behind it. So you MUST convince people that getting rid of the minimum wage (or, say, phasing it out), will result in virtually full-employment. Little by little. It’s a hard sell, and I respect her for opening the discussion.
If you go to McDonalds, you see that their drink dispensers (behind the counter) now do everything, from dropping the right cup, putting in the right amount of ice, to filling to the right level (for the size of the cup) to putting the cap on the cup. That is VERY EXPENSIVE, and I have no doubt that the minimum wage caused them to use this (i.e., one less employee per store).
That is how you approach the issue...otherwise you get demagogued, again.
She should introduce legislation to that effect then. Congress makes the laws.
...Rather than generally lifting wages at the bottom end of our work force, which is the supposed objective of the minimum wage, it simply creates unemployment... The minimum wage was increased in three steps from $5.15 an hour before July 2007 to $7.25 an hour in July 2009. When the first increase occurred in July 2007, black teenage unemployment was at 30 percent, 25 percentage points higher than the then 5 percent national unemployment rate. After the last increase to $7.25 an hour went into effect in July 2009, black teen unemployment reached 50 percent, 40 percentage points higher than the national rate.Minimum wage laws should be handled (or rejected) by the states. Probably the best approach would be state-by-state legislation which would spin out the authority to set the mw to the counties. Cost of living varies a lot. Clearly the national minimum wage is pointless in NYC, while still being much too high in other places, like Pelosi's tuna canning plant.
The fry machines are automated now too.
The “true” minimum wage is zero.
Once you accept the concept of an artificial minimum wage;
you wet the stage for proposing a maximum wage.
If you have a job that you value at 3 bucks and hour;
and I am willing to do that job for 3 bucks an hour;
it is insane that the federal government would step in between you and I
and forbid that we reach such an agreement.
RATS believe that employers are obligated to pay “a living wage” [whatever that is]. This is absurd; if an employer cant sell an employee’s labor for “a living wage,” his business will suffer if he is forced to pay it.
My dad, a flaming liberal, was holding forth about “paying a living wage.” I said, “Look, I am trying to start a business. I could use some help, but I am not even making that “living wage” you are talking about. What if someone wants to work for me as opposed to not having a job at all? Am I supposed to still pay them “a living wage?”
He had no answer for that since he has never been an employer. For that matter, neither have I, I am a one man shop.
They do indeed, and what do businesses, especially the small ones do, when the minimum wage is raised? They cut the hours of their minimum wage employees and lay some of them completely off. Because they can not afford to pay them the higher wages
LOL. Why would anyone bother to work for less, when they can get much more from welfare, SS, WIC and other programs. Lowering the min wage won’t do a damn thing unless you reduce social welfare programs too.
“The fry machines are automated now too.”
EXACTLY. But it is political SUICIDE to argue against the minimum wage, unless you can show the damage it causes to employment.
What experience did Obama have going into any office?
No, she should not run for governor of Minnesota. She would waste her time and money. She would clearly lose if trying to be governor of a state that would put the idiot leftist mental patient Mark Dayton in as governor and would elect Al Franken as Senator. Not to mention Paul Wellstone before.
Do not say she could win because Tim Pawlenty won. Pawlenty is a traditional Republican, not an ultra, ultra conservative like Bachmann. And even then, the voters there replaced him with a far left winger.
The thing about Michele Bachmann is that she is so much smarter than her dumb critics. She knew better than to fruitlessly run for hopeless positions, so she ran where she had a chance.
Meanwhile, the dumb critics waste all our time by continuing to tell her what to do...to be a guaranteed loser.
Instead of the winner she is...
I left out a ‘you are’, but you get the point.
That fact alone, shows why this country is doomed.
Except for union workers, most of whose wages are also tied to the minimum wage> Even though they make far above it, they still get the increase, which is why the unions - in the private sector - are the most vocal proponents of it.