Dr. Martin Hash Podcast

The politics behind Minimum Wage is intentionally confused & emotionally charged, touching as it does on people's outrage, chartible inclinations, resentment towards business, and savior complex. Appealing to people's sensibilities, the basic argument is that an hour's work should be at least enough to buy a meal at Taco Bell. In a narrow context, that's a pretty compelling argment, even to a liberty ideolog. And it would take extraordinary leverage to get someone to take a job that pays less than that because truly poor people can get government assistance, though thoughts of exploiting the plight of illegal immigrants come to mind.

Minimum Wage has a pedestrian appeal that is quite difficult to refute because the ramifications of a Minimum Wage are also quite fuzzy: most people can't comprehend that there are some jobs that simply are not worth the cost of paying someone to do. In a liberty society, government can’t force a customer to pay more than the market will bear for goods and services without grossly distorting and eventually ruining the economy. There are plenty of examples of protectionism in history & in Europe today to prove this assertion, and we need only look back to the 1970s Price Controls in America to see a homegrown example.

If the choice is between employers paying the low wage the job is worth & letting government assistance cover the difference, or not having the job at all, keeping the job is clear to calculate: an unemployed person would get more government assistance than an employed person, plus the training, plus the work ethic, plus the fitting into society. Also, Minimum Wage forces people into the underground economy where there is no Minimum Wage, no withholding & no worker protections. Plus it inspires a contempt for government & people-who-know-better-than-you.