skip to main |
skip to sidebar
Bob Murphy takes apart both the morality and economics of Robert Reich’s case for a $15-per-hour minimum wage
From Cafe Hayek.
"Reich addresses the obvious objection that raising the
minimum wage to $15/hour will reduce employment among low-skilled
workers. Reich dismisses this as fear-mongering and claims, “More money
in people’s pockets means more demand for goods and services, which
means more jobs.”
This proves too much. Notice that Reich doesn’t make a nuanced
argument, balancing certain quantitative factors where the increased
demand for goods and services offset the disemployment effect of more
expensive labor up until $15/hour, but then flips if the wage rate were
pushed to, say, $16/hour. Given the arguments Reich has presented, it’s a
mystery why we are settling for $15/hour. Why not push for a $20/hour
minimum wage? It can’t be that such a move would cause
disemployment–Reich just told us, with no caveats, that more money in
people’s pockets means more demand for goods and services.
Indeed, Reich ends his video saying, “It’s the least we can do.” Okay then, Mr. Reich, what’s the most we
can do, according to your worldview? Once you admit that, we can at
least see how there are downsides to your proposal, and the viewer can
start wondering whether $15/hour–the alleged “least we can do”–is such
an unambiguously “moral” proposal after all."
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.