Friday, November 8, 2013

Politicians and the Minimum Wage

Hide the costs show the benefit. 


Who pays for the minimum wage increase.  If it were a tax who would it fall on?

It clarifies things to think in terms of consumption so for the minimum wage workers to consume more who consumes less.

In the short run business owner who hire minimum wage workers will consume less.  Why do we want them to consume less rather than using a broad based tax.

In the long run consumers who consume products and services produced by business who hire minimum wage workers will consume less.  Why do we want them to consume less rather than using a broad based tax.

In the all time periods minimum wage laws tend to decrease employment so the low skilled unemployed consume less . Why do we want them to consume less rather than using a broad based tax.

A negative income tax or a basic income guaranty seems far superior  for everyone except for  the politicians. The minimum wage lets the politicians hide the costs show the benefit.

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