IBD Editorial: If A $15 An Hour Minimum Wage Is Good, Why Not Make It $200?
This Investors Business Daily editorial explains why increasing minimum wages is actually a lose-lose game for both workers and consumers and how raising wages negatively affects prices. For more information on minimum wages from a free market perspective, see AFPF’s Need to Know memo on the minimum wage here.
If A $15 An Hour Minimum Wage Is Good, Why Not Make It $200?
Posted 08/20/2013 06:44 PM ET
Labor: Fast-food workers are planning a one-day strike on Aug. 29 to demand an increase in wages from the $7.25 minimum to $15 an hour. But if $15 an hour is so great, why not ask for $100 or $200 an hour instead?
The question is, of course, absurd. Any elementary-school child — at least, one not educated in a U.S. public school — could answer correctly: That at $100 an hour, or $200 an hour, no one would be hired to do a job that the market valued at far less. And many would be fired.
Take the fast-food industry. Prices for food would be so high that consumers would stop eating at McDonald’s, Wendy’s or other cheap fast-food outlets. It would be a treat only the rich could afford, at a few select outlets in Beverly Hills and other swanky locales. Fast-food workers would be laid off by the thousands.
OK, but $15 an hour isn’t $100 an hour. True enough. But the principle is the same. By our calculation…Read more…