On Meet The Press, staff attorney for the National Employment Law Project, Tsedeye Gebreselassie advocates an increase in the minimum wage and Resident Scholar at the American Enterprise Institute, Michael Strain, makes the case against it.
However, I am more shocked by Strain's argument against the minimum wage than Gebreselassie's argument in favor of it. Nowhere does Strain point out that the minimum wage will result in greater unemployment of low skilled workers, whose marginal revenue product is below the minimum wage. In fact, he pretty much implies that the cost would be absorbed by businesses without negative consequences to some workers. He further goes on to buy into the argument that people earning the current minimum wage need to be helped in some fashion with additional support income. Naturally this "help" is to be directed by the government and taken from others, he specifically mentions hedge funds.
This, of course, is all absurd. As Murray Rothbard argued, if increasing the minimum wage is such a great thing, why not raise it to $100.00 or a $1,000.00?
As for the idea that those earning a minimum wage are not earning a "living wage," what does this mean in America? They certainly earn enough money to buy food. They may have to double-up with others for living quarters, but in New York City or San Francisco, a person earning $50,000 is likely to have to double-up. Should $50,000 somehow not be considered a living wage?
When examined closely, the entire concept of a living wage is nothing but a propaganda slogan with no facts behind it. No one earning the current minimum wage is sleeping on the streets. The only street sleepers are those that are so dysfunctional that they are unemployable at current minimum wage rates. What we should do is eliminate all minimum wages, so that these people can earn some money and leave the rest to private charity.
Strain mentions none of this.
The minimum wage advocate, Gebreselassie, of course, also fails to consider the negative ramifications of a higher minimum wage.
The clip is here.