House Votes to Raise Minimum Wage to $15 an Hour. It Could Be a Disaster.

This article originally appeared in The Daily Signal, then in The National Interest, and finally at Yahoo.

“Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passions, they cannot alter the state of facts and evidence.” — John Adams.  This especially applies to raising the minimum wage rate.

For over 70 years, innumerable academic studies by economists have authoritatively demonstrated that a raise in the minimum wage profoundly affects precisely those persons it was intended to benefit — what are described in the economic literature as “marginal workers” — women and ethnic minorities. Perhaps the most tragic group affected over decades has been Black teenage male unemployment.  When the minimum wage rate goes up, employers have fired or not employed this class of workers because of the coercive mandates of government intervention in the labor marketplace.

One observer has perceptively noted:

“The tragic irony of the regulated workplace is that it most adversely affects those on the margins of society. Beyond their disemployment effects on those whose labor is rendered submarginal by regulations on wages and working conditions, regulations in the workplace also exacerbate and perpetuate inequities that would otherwise be mitigated by the market process.”

The minimum wage is one of the most racist and discriminatory laws ever passed since slavery and Jim Crow segregation. If one does the detailed research in the historical literature and political legislative practice during the Progressive Era (1900-1920) one will find incredible statements by the nation’s most notable and famous economists supporting it PRECISELY because it would be discriminatory and racist.

“In 1931, Congress passed the Davis-Bacon Act, requiring uniform wages for any workers employed in federally funded public works projects. In 1933, the National Industrial Recovery Act was signed into law, mandating industry-specific wages throughout the economy. In 1938, the Fair Labor Standards Act — the only one of the three to remain permanently on the books — took effect, initially imposing a federal minimum wage for any worker engaged in interstate commerce.

“All of these laws served to price African-Americans out of the job market. Rather than forcing employers to pay non-racist wages, it simply forced blacks to shift from suffering race-motivated wages to suffering race-motivated unemployment.”

See two outstanding books which particularly document these horrific facts – Illiberal Reformers: Race, Eugenics, and American Economics in the Progressive Era, by Professor Thomas C. Leonard; and The Progressive Era, by Professor Murray N. Rothbard.


11:27 pm on July 20, 2019