Article I wrote and peer reviewed studies showing the harm of raising minimum wage. ------- Help The Poor: Abolish Minimum Wage There are some well documented facts and logical reasons to abolish government imposed minimum wage laws that haven’t been discussed and should be understood by the public. Economists and educators who don’t provide this important information are likely trying to persuade people to except a political ideology rather than inform people. A better understanding of economics and minimum wage could lead to less government intrusion, greater opportunity for the poor and a much healthier US economy. Unemployment data tells us a once well-known fact that raising the minimum wage increases unemployment in the inner cities. Increasing unemployment in the inner city harms the most vulnerable people in our society affecting a disproportionate amount of minorities. It reduces the opportunity to get the job experience necessary for people to earn a living and improve their standard of living. The high unemployment motivates or at least contributes to the increase of people finding other means of financial support. Therefore, raising minimum wage contributes to destroying families in the inner city because, unemployment promotes having children born out of wedlock in order to qualify for government support and contributes to crime as a means to make money. Raising the minimum wage could be seen as possibly one of the most severe forms of prejudice when considering the devastating affects it has on inner city minorities and their families. This is explained in greater detail by notable economists such as Thomas Sowell and Milton Freidman. Higher costs of minimum wage imposed on businesses force many of them to relocate outside of the US. Some critics will dismiss the loss of low paying jobs as no real loss to the economy or to the workers by focusing only on the lowest paid workers. This is a mistake as it does not recognize that businesses offer a large variety of jobs with many higher paying positions to fill. For every low paying entry level position used to train workers there is usually higher paying positions for more experienced employees, management positions and skilled personnel to take care of supplies, sales, bookkeeping and other necessary functions. Businesses also provide demand for skilled labor outside of the company for a variety of tasks and equipment. These tasks may include advertising, delivery, legal support, tax preparation, electricians, plumbers and construction workers for building and/or for expanding facilities. If a business friendly environment is promoted with the free market determining the wage, then there will be more businesses competing for a limited supply of labor. This allows the free market to increase wages naturally through the principle of “supply and demand.” Businesses that can’t keep up with paying the wages demanded by a limited labor supply die out naturally or move to other countries with lower wages. Government artificially increasing the minimum wage will result in losing some businesses without replacing them with other employment opportunities, putting more people out of work. This also causes a “pooling of labor” at the minimum wage level which compresses wage scales and slows down the ability of people to advance. This situation can cause more of a disparity between the large number of workers at the bottom as compared to the top wage earners contributing social problems based on “class envy.” A critical consideration is the loss of innovation that accompanies the businesses that relocate outside of our country. Breakthroughs almost invariably come from people working within or around a business that is the basis for the breakthrough. This should not be underestimated as many economic “booms” are the result of new developments such as micro wave ovens, personal computers, video games, jet skis, quad runners, internet and cell phones. Every company lost is one less possibility that we will be part of the next “economic gold rush. Article linking to the study of ECONOMIC MODELS which is titled: “The Negative Effects of Minimum Wage Laws” by Mark Wilson former deputy assistant secretary of the US Dept. of Labor heartland.org/policy-documents/negative-effects-minimum-wage-laws
Posted on: Sat, 25 Oct 2014 15:55:48 +0000
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