Friday, December 20, 2013

Economic Reality and the Minimum Wage | RealClearPolitics

But they must doubt their own case. Otherwise, they would propose an even higher amount, confident it will be irrelevant to hiring decisions. If a minimum wage of $20 or $30 an hour would cause layoffs, though, why wouldn't $10.10? At what point on the wage scale does the law of supply and demand take effect?
Even liberal hero Paul Krugman, a Nobel laureate in economics and columnist for The New York Times, has grudgingly acknowledged this reality. In his 1998 textbook, he wrote that "the centrist view is probably that minimum wages 'do,' in fact, reduce employment, but that the effects are small."
In the short run, McDonald's and KFC might have little choice but to keep staffing at current levels and cough up more on payday. But in the long run, employers would have a significant incentive to find ways to employ fewer workers -- by automating tasks, moving to more self-service, demanding more of each employee, cutting back store hours or closing marginal outlets.

Oh no, they are so smart they can pick the exact right amount of the minimum wage so that no one gets hurt by their use of force.  You see, folks with uniforms and guns can solve anything if the leadership is as smart as this administration is.

No comments:

Post a Comment