
 |
The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014
Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology
John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain
The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious
April 14, 2014
Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time
Eric Schulzke: First degree: How America really recovered from a murder epidemic
Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships
Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin
Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate
Justin Caba: Eating Watermelon Can Help Control High Blood Pressure
April 11, 2014
Rabbi Hillel Goldberg: Silence is much more than golden
Susan Swann: How to value a child for who he is, not just what he does
Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer
Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You
April 9, 2014
Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?
Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau
Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau
Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease
April 8, 2014
Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease
Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear
April 4, 2014
Amy Peterson: A life of love: How to build lasting relationships with your children
John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet
John Ericson: Why 50 million Americans will still have spring allergies after taking meds
Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves
April 2, 2014
Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?
Frank Clayton: Get happy: 20 scientifically proven happiness activities
Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene
|
| |
Jewish World Review
August 9, 2006
/ 15 Menachem-Av, 5766
The minimum wage vision
By
Walter Williams
| 
|
|
|
|
http://www.JewishWorldReview.com |
There are decent people, without a selfish hidden agenda, who support increases in minimum wages as a means to help low-skilled workers, and there are other decent people, with the identical goal, who strongly oppose increases in the minimum wage. So the question is: How can people who share the same goals, helping low-skilled workers, come up with polar opposite means that produce polar opposite results?
It all depends on one's initial premise. It would do us some good to make our initial premises explicit and check them against reality. One initial premise is that an employer needs a certain number of workers to accomplish a given task. That being the case, increasing the minimum wage simply means that all low-skilled workers will enjoy a higher salary and employers will have lower profits and/or customers will pay higher prices. With this vision of how the world operates, the logic of increasing the minimum wage as a means of helping low-skilled workers is impeccable.
Another initial premise is that there is no fixed number of workers necessary to accomplish a given task. Employers might be able to substitute capital for labor such as using dishwashing machines instead of dishwashers, automatic elevators instead of elevator operators, self-service gasoline stations rather than full-service gasoline stations, online reservations rather than reservation clerks or relocating their operation overseas. People who share this initial premise can still have concern for the welfare of low-skilled workers but argue that increasing minimum wages will cause unemployment for some of them and deny job opportunities for others. Given their initial premise, the logic of their argument is also impeccable.
Thus, the question to decide is which initial premise best describes how the world operates. Is it the one that says there's a fixed number of workers necessary to perform a given task, or the one that says employers have flexibility in the mix of workers and capital they use and where in the world they can choose to manufacture? I think the latter description more properly describes how the world operates.
Place yourself in the position of an employer and ask: If a worker costs me, say, $7 in wages, plus mandated fringes such as Social Security, unemployment compensation, sick and vacation leave, making the true hourly cost of hiring a worker $9 an hour, does it pay me to hire a worker who's so unfortunate to have skills that enable him to produce only $5 or $6 worth of value per hour? Most employers would conclude that doing so would be a losing economic proposition.
There are a couple other villains in the piece that force employers to respond to increases in wages that exceed a worker's productivity. If he did hire such workers, he would earn lower profits. Soon, investors would abandon him and put their money where returns are higher.
There's another villain the customer. If the employer retained workers whose wages exceeded their productivity, to cover his costs he would have to charge you and me higher product or service prices. I don't know about you, but I prefer lower prices to higher prices, and I'd switch my patronage to those firms who adjusted to the higher labor cost.
Congress can easily mandate higher wages, but they cannot mandate higher worker productivity or that employers hire a particular worker in the first place. Those of us who truly care about the welfare of low-skilled workers should focus our energies on helping them to become more productive, and a good start would be to do something about the rotten education that many receive.
Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.
Walter Williams Archives
© 2006, Creators Syndicate.
|
|
Columnists
Toons
Lifestyles
|