Apr 092016

The progressive in me cheers the idea that the minimum wage ought to go up. The federal minimum wage, $7.25 an hour, set by the Fair Labor Standards Act, hasn’t been raised since 2009. Good luck feeding more than one or two mouths or making rent in a city working 40 hours a week at that rate. And remember that a lot of minimum-wage workers involuntarily work fewer than 40 hours a week.

Low-end earners are a little better off in progressive Washington State. We have the nation’s highest minimum wage, $9.47 an hour, and adjusts annually to keep up with the consumer-price index. But nobody’s getting fat in Seattle grossing $388.80 a week. The average rent on a 1-bedroom apartment in Seattle runs $1,600 a month.

That said, the progressive in me is brought back to earth by a reminder that the real minimum wage is zero, nada, zilch. The Stanford University economist Thomas Sowell put it this way his book Basic Economics in 2011:

Making it illegal to pay less than a given amount does not make a worker’s productivity worth that amount—and, if it is not, that worker is unlikely to be employed. Yet minimum wage laws are almost always discussed politically in terms of the benefits they confer on workers receiving those wages. Unfortunately, the real minimum wage is always zero, regardless of the laws, and that is the wage that many workers receive in the wake of the creation or escalation of a government-mandated minimum wage, because they either lose their jobs or fail to find jobs when they enter the labor force.





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