It ’ s as if the politicians never learned about supply and demand. They think prices can be set wherever government decrees, with no consequences. Twenty-year-old Dillon Hodes understands that. He’s a winner of the video-making contest run by my charity, Stossel in the Classroom. Hodes saw what happened to his friend when the Kroger she worked at raised its minimum wage to $12 an hour. “She was getting paid $12 an hour, but slowly, they started cutting her days, her hours. She was (eventually) regulated to only working on Sundays. That’s because she was young and inexperienced,” explains Hodes. “She’s worth the world to me, but she wasn’t worth $12 to Kroger.” The $12 minimum wage took away her job. How much more damage will a $15 minimum do? Rigel Nobel-Kosa, another sitc.org video It’s as if the politicians never learned about supply and demand. They think prices can be set wherever government decrees, with no consequences. But there are many bad consequences.
contest winner, pointed out that many high employment “countries such as Iceland, Norway, Sweden and Switzerland” have no minimum wage laws. They do not end up with impoverished workers making a penny an hour. Wages, like all prices, are a function of supply and demand. Switzerland has much less unemployment than the U.S. Esther Rhodes won our high school essay contest, pointing out that America’s first minimum wage laws were racist. At the time they were passed, blacks were more likely to be employed than whites. Blacks were paid less – but they had jobs. Congressman Miles Clayton Allgood, D-Ala., then said he hoped a minimum wage law would stop “cheap colored labor in competition with white labor.” So, explains Rhodes, although Americans now think a minimum wage was meant to help the neediest people, “it was meant for the opposite: to keep the poor and the minorities from getting jobs!” She also understands that the law now makes it harder for her to get a job. “I’m 14,” says Rhodes. “My labor wouldn’t be worth $15 an hour!” All government’s workplace rules have nasty unintended consequences. If only the politicians were as smart as the sitc.org kids. © Creators Syndicate, Inc.
John Stossel is an award-winning contrarian journalist and most recently the author of No They Can't! Why Government Fails – But Individuals Succeed.
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October 2019
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