Minimum Wage Increase Hurts The Least Powerful



A couple of times a year someone, often not realizing that he is a vicious racist, proposes some increase in the minimum wage. The higher something costs, the fewer are sold. We sell more Cokes than TV sets. We sell our labor, but there is a barrier beyond which we cannot go.

The law of economies tells us that we cannot pay someone more than the value of his labor, plus costs of business plus profit. We cannot. Everyone’s labor must cover the cost of employing him. This is not a choice.

When we raise the minimum wage, the costs to the employer goes up, without a balancing increase in the value of the labor. The business adjusts by buying more machines or raising prices or giving a smaller hamburger patty. He must do something. He certainly will not add more people to his labor force.

Who gets the dirty end of the stick in this case? It is the least powerful in our society, as always with liberal do-gooder errors. The inner city black kid with a marginal education will be further squeezed out of the labor force. I ask our misguided friend, “If inner city minority kids are currently unemployed at a rate of 50 percent, how will making them more costly to employ provide additional jobs?” Too often poorly thought out schemes to improve the lot of union members, who chiefly benefit from minimum wage increases, end up pushing our inner city citizens up against the wall. Don’t the suffering people of Detroit have enough to contend with already?

Andy McKinney


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