Thursday, April 2, 2015

OMG Activist Wants to Raise Minimum Wage in the State of Washington to $16 per Hour

Nick Hanauer, a Seattle based venture capitalist and early investor in Amazon, has apparently never bought, from Amazon, Henry Hazlitt's important book, Economics in One Lesson: The Shortest and Surest Way to Understand Basic Economics.

Or if he did buy and read it, he did not grasp the central theme of the book: that there are economic consequences to actions that may not be seen and understood on a quick examination.

Such as that minimum wage laws cause unemployment.

Hazlitt wrote in Newsweek magazine in April 1966 (via Business Tides also available at Amazon)
If there is anything that economists of nearly all schools agree upon, it is the folly of minimum wage laws...We cannot make a man worth a given amount by making it illegal foe anyone to offer him less. We merely deprive him of the right to earn the amount that his abilities and opportunities will permit him to earn, while we deprive the the  community even of the moderate services he is capable of rendering. 

 Hanauer apparently understands none of this.

He plans to launch a campaign to bring a $16 an hour minimum wage proposal to voters in Washington in 2016.

"16 for 16 is a bumper sticker, that's a headline," he said.



  1. Doesn't "32 for 16" make an even better bumper sticker, since it suggests a magic doubling?

  2. Hanauer has been an economic ignoramus for a long time. Here's an example:

  3. Wow, I was thinking of moving to WA state but if this were to pass, sorry.

  4. It's weird, but when I was a kid (had to be < 11, because we were still living in New York), I would grab Newsweek from the mailbox and immediately turn to Hazlitt's page. He just made so much sense! I don't know if I was precocious, or we just expected more from ourselves in those days.

  5. There's a third possibility: to wit, he did read Hazlitt and did understand it.

    Then either unemployment is a price he's willing to pay in return for some other end. Or unemployment IS the end.

  6. Hannauer doesn't even pay his own employees anywhere near that minimum in entry level positions in his companies.

  7. This Hanauer guy is clueless. It just goes to show that you can still become rich and understand nothing about basic economics. I remember a couple of years back Peter Schiff debated him on his radio show. You can find it in a two-part segment by searching Youtube for "Schiff vs Hanauer"