Elliott C. Back: In Aere Aedificare

Those workers now making $5.15 an hour, or $10,300 a year, on their minimum salaries have just received a raise of 41%. Over the next few years, if the Senate approves the wage hike, these minimum wage employees will make $14,500.

I’m not sure the economics of this are a good idea. First, it only benefits the 450,000 or so Americans making minimum wage. Second, it does nothing to offset the costs of their employers. Why not let the free market decide wages?

A minimum wage doesn’t do anything for people who make significantly more than it, either. If wages are to be raised, why are minimum wages being raised? If compensation is based on market merit, shouldn’t those making more money get a raise for their hard efforts? If minimum wages are paid to those jobs or individuals who are least useful to the market, shouldn’t they be then paid less?

It seems to me that the minimum wage system is an unnecessary burden to a developed society. If jobs need to be done, people will pay a premium to have them done. Without minimum wage, I find it unlikely that people will as a whole make less money than before. If you look into the history of the minimum wage, you’ll see that it came about as a means of avoiding strikes, thus actually giving corporations the ability to set a low grade of pay. Take back your freedom, vote away minimum wage!

3 Responses to 'Minimum Wage Increase: Only for the poor'

1. Will said:

   on January 14th, 2007 at 5:13 pm

   Having a minimum wage does have it’s costs, but it also gives people with presumably the most pent-up demand some more spending power.

2. Andrew said:

   on January 14th, 2007 at 5:37 pm

   Another reason why raising the minimum wage is a bad idea is because the supply of minimum wage-laborers will increase, as more unskilled people wish to get minimum wage jobs, but the demand for the actual laborers will decrease, because the price of the labor has gone up. Thus minimum wage will only help those who excel at a minimum wage job, and it will result in those who aren’t as adept being fired. It’s a text-book example of social darwinism, where the best-fitted get an increase in wages, and the less-fit lose their jobs.

3. Cibbuano said:

   on January 14th, 2007 at 6:54 pm

   For me, it seems crazy that people make so little at minimum wage. It’s almost impossible to survive on minimum wage - here in Australia, the minimum is quite high, around $12-13 an hour, but most people in Sydney make over $15, I’d guess…

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