MInimum Wage Nightmare

I just heard on the news this morning (accidentally while looking for today's weather), that California's politicians approved a $15 per hour minimum wage. They call it "economic justice". I call it "economic illiteracy". California politicians say they want to "be an example to the rest of the nation". OMG help us!

This is a sad example of "What Is Seen and What Is Not Seen", which the great economist Frédéric Bastiat wrote about over a hundred years ago. The benefit to those who get those $15 per hour jobs is highly visible and highly touted in the Political Theater. What remains invisible and are all the jobs that are lost when companies have to cut the bottom-end and entry-level jobs in order to pay the raised wages. What is not seen are the entry level jobs and new small business that simply never get started because labor costs are too high. 


What is hidden from view is the fact that higher labor costs force companies to automate much of their entry-level jobs that formerly were a step up for many of the most needy in our society. The automation we encounter at gas pumps and grocery store check-outs is a direct result of minimum wage laws. When government uses force to impose higher wage prices on business, owners and managers look for ways to cut costs. Automation is one way to cut labor costs. Minimum wage means jobs will be cut. The other invisible cost is the necessary increase in end prices to consumers - that mostly hurts those who can least afford it - the elderly, the disabled, and the poor.


And we sill haven't learned. Liberals haven't learned. Conservatives haven't learned. 
The Left claims to care about the poor and downtrodden and "economic justice". Yet they mostly care about what LOOKS like a good idea. Never mind that minimum wage laws hurt the most poor and the most helpless in society. Leftists wring their hands over the growing gap between the 1% and the 99%, yet minimum wage laws create and feed that unnatural divide between the haves and have-nots, a divide which the free market could NEVER create on its own.


The Right claims to be in favor of limited government and free markets. But, they contradict that principle by their belief in the need for a "mixed" or "controlled" economy. The minimum wage laws expand the power of Big Brother, and enable more and more regulations to be piled on top of the small businesses that the Right Wing claims to support.


Sorry folks, you can't make the world better with force.
https://www.lewrockwell.com/2016/01/walter-e-williams/bunch-liars-minimum-wage/

What Did We Learn From The Revolutionary War?

The upcoming 4th of July holiday makes me relate our current problems to those "days of yore". What about today's conflict over immigration? What about the insistence by R's and D's alike that we need a "mixed" marketplace? Does top-down regulation and control deliver on its promises? Or, like libertarians like to say, does every government program exacerbate the problem it claims to be curing?

The Revolutionary War was fought in part because of all the trade restrictions that England was heaping on the colonies. There were lots of restrictions, fees, taxes, and regulations that were in place to stop newcomers from starting up new businesses. This mercantilist mentality made sense to many people, because they thought that newcomers were going to hurt the businesses that they had grown accustomed to. The restrictions not only hurt new businesses, the restrictions also hurt consumers the way any monopoly hurts consumers; prices and shortages increased while quality declined. Also, the burden on creativity kept new inventions and innovations out of the marketplace. . . All in the name of benefitting the existing businesses.

There are so many parallels we can draw between these restrictions on newcomers in businesses and restrictions on newcomers we call "immigrants". Restrictions on immigration are just another form of welfare. These restrictions benefit the existing populace. In effect, this creates a monopoly that raises prices and dampens creativity in the marketplace. Never mind that the marketplace we're talking about is what we call "the US population"; we are shooting ourselves in the foot by creating a monopoly on "citizenship" for the current residents of the US.

For every one privileged person who is "protected" and "supported" by immigration or business restrictions and regulations, there are hundreds and thousands of people who are being hurt by such an enforced monopoly. Taxes are raised to support these laws, politicians get expanded powers, freedoms are jeopardized, busybody neighbors spy on neighbors, new businesses are stifled, prices are pushed up, the variety of goods and services is limited, creative market solutions and innovations are smothered, and on and on. It's what government does to everything it touches; the benefits are visible, while most of the costs are invisible. When future prosperity and happiness are thwarted, you don't see a crater in the ground where that future was going to sprout.

"Since no one but you can know what's best for you, government control can't make your life better." Harry Browne