Being Libertarian Perspectives will serve as a weekly, multi-perspective opinion and analysis piece by members of Being Libertarian’s writing team. Every week the panel, comprised of randomly selected writers, will answer a question based on current events or libertarian philosophy. Assistant Editor Dillon Eliassen will moderate and facilitate the discussion.
Dillon Eliassen: CNN.com reports that jobs are becoming easier to find, but the wages for many of those types of jobs are low. Would a $15 minimum wage have a chilling effect on job creation within these sectors since demand is so high? What are some of the other implications of this current labor market?
John Engle: The minimum wage debate certainly has come roaring back to this election cycle, thanks to its roll-out in some cities, and Bernie’s call for a national $15 minimum. His proposal is both distressing and predictable. As a child of Old Labor, his interests have always lain with the specific interest groups rather than workers generally. He sees America as its coasts and has little time for the in-between. So while a $15 minimum wage probably won’t do a whole lot to the richer parts of America, it will decimate the places with lower cost of living. Speaking specifically to the kinds of jobs in question, it is likely that they will indeed cause some chilling effect. That is especially so for the retail and food preparation jobs, which compete more and more against automation. If Bernie laments the decline of Main Street now, just wait until Amazon is all that’s left.
Dillon: The CNN story points out that many of these low paying jobs are in the healthcare industry, and those can’t be automated.
John: True, but they can be “industrialized”. When the cost of employing someone as a home or personal healthcare aide becomes too onerous, the only option may be to enter a facility that can provide those services more cheaply through scale.
Ni Ma: I think the effects of current minimum wage hikes won’t be hugely noticeable until another recession hits (we may already be in one, but can’t know for sure yet). Most of the $15 legislation passed in US cities and states won’t take effect until a couple of years from now, as far as I know.
John: The plan in most parts is to phase it in. And some of the city plans are two-level minimum wage. I think if they were to roll it out nationwide like how Sanders suggests, most of the south, Appalachia and parts of the Midwest would feel the damage quite quickly.
Ni: Normally politicians make sure they’re long out of office by the time it actually materializes, so people don’t make the connection. All the praise, none of the blame.
John: True that. It’s a rare occasion that a politician allows blame to be correctly apportioned.
Just look at the student loan forgiveness program Obama has set up. That’s a bomb set to go off in about 10 years.
Ni: Yes, this why they get to laugh at those who jump the gun on making quick predictions and further discredit all of us by extension.
John: It’s all musical chairs.
Ni: There’s also the possibility that inflation lifts most wages to the point where the minimum wage is below market by that time, in which case its effect is next to nothing.
John: That’s one of the reasons they should enshrine an inflation adjusted to minimum wage policies if they are going to have a minimum wage. The long pauses and sudden jumps cause uncertainty in the price of labor inputs over time, and causes shocks to businesses.
Saber Lambert: In regards to the market I am very narrow in my beliefs. Let the market sort it out. No minimum wage, as it is really just a fancy term for Unemployment Law, and get rid of the Fed.
Ni: It’s a fancy term for: Mutual voluntary agreements that violate my unilaterally imposed rules will get you shot.
Neil McGettigan: There is a cost to everything, including ignoring the facts of reality, the science of scarcity, e.g. economics. If anything, raising the minimum wage will help college students because if an employer is paying a shelf stock boy $15 bucks an hour, he may as well hire someone able to lecture on the basic points of Nietzsche and Foucault. Screw those poor high school grads with minor criminal records; we need to save those crappy jobs for clean cut upper middle class 24 year olds.
John: As if someone who spends four years being told they are special snowflakes and vanguards of the coming revolution would accept a stock boy job.
Dillon: Is it a coincidence or deliberate that a 15 dollar minimum wage will arrive in about 4 years and that four year college degrees are going to be “free?” Is there anyone out there that believes in a $15 floor, but not free college? They must go hand in hand, right? I don’t think it’s controversial to say that much more research has been done on the effect of raising the minimum wage than the effect free college would have on the labor market. I’m not a conspiracy theorist but (whenever someone says that, you can be sure he’s about to come up with a conspiracy theory), if the possibility of leaving school with $100k in debt is not taken off the table, but somebody out of high school is guaranteed $31,200 a year before taxes, you’re going to have fewer people going to college right? And fewer people in college means fewer people being indoctrinated into Leftist ideology. Live at home rent free a few years while working a $15 an hour job and saving money is preferable to leaving college with $100k in debt with only $15 guaranteed.