<blockquote><a href="http://en.wikipedia.org/wiki/Minimum_wage" target="_blank">The minimum wage is</a> the minimum rate a worker can legally be paid (usually per hour) as set by statute. It is different from the lowest wage determined by the forces of supply and demand in a free market.</blockquote>
<blockquote><a href="http://www.mises.org/econsense/ch36.asp" target="_blank">In truth, there is only one way to regard a minimum wage law:</a> it is compulsory unemployment, period. The law says: it is illegal, and therefore criminal, for anyone to hire anyone else below the level of X dollars an hour. This means, plainly and simply, that a large number of free and voluntary wage contracts are now outlawed and hence that there will be a large amount of unemployment. Remember that the minimum wage law provides no jobs; it only outlaws them; and outlawed jobs are the inevitable result.</blockquote>
In other words: anybody whose work is not worth the minimum wage set by the government, shall not be employed. Nobody would support any minimum wage law if it were written precisely that way.
So, as an example, an industrious coffee shop owner is forced by the government to pay each employee, regardless of competence or worth, no less than $5.15 to pour coffee and wipe down counters. This means that if there are two employees whose job descriptions are objectively worth $1.00/hr (like pouring coffe and wiping counters for instance) the employer is still obligated to pay them each $5.15/hr--unfair to the employer--and, if one of the two employees' work is worth twice what the other's is, the worth-less employee still gets the same minimum wage as the worthy employee--unfair to the worthy.
But that's not the end of the unfairness--let's say this coffee shop owner works it out so that between the good worker <i>and</i> the slacker he can get $10.30 of work out of them, breaking even. What that means is that the good worker is not only being over-worked and under-paid, but until the slacker decides to step up productivity some, there's no chance for a raise since his productivity is being stolen to subsidize the slacker's slacking habits--which, of course, does nothing to motivate this bong-smoke socialist to do anything but slack off some more.
The injustice is not over yet. Let's assume we are just talking about someonewho really wants to work, and not some glue-huffing retard who thinks his dedication to wearing black fingernail polish, rather than work is merit enough for a rock star's paycheck. Lets also say that welfare pays the equvalent of $3.50/hr. What minimum wage says is that even if this guy who wants to work, <i>wanted</i> to work for $5.00/hr, he would be a criminal for doing so, as well as his employer. That despite the agreement between them that the job is worth $5.00/hr, the government rolls in and declares that this workers effort are worth nothing--so much so in fact, that they are willing to pay him $3.50/hr to do nothing! Not only does this guy get less than he could earn, we don't even get the benefit of his services--the job is not being done, or if it is, it's being done by some poor schlep who's desperately trying hard enough to merit his $11k/year job so he doesn't have to be a $7k/year welfare recipient himself--or, this work being done by someone, like you perhaps, who is getting paid well in excess of the minimum wage because your effort merits it, but now your productivity suffers because you are scrubbing the men's room urinals instead of the actual job you were hired for. Then you wonder why you get no raise despite the fact that you're doing both your job and that of the janitor.
So, the result now,is that we have this cup of coffee that costs a quarter in materials, and has to cost the consumer $5.00 to cover the artificially inflated wages of this apathetic, nose-ringed, angst ridden, hemp activist beverage pourer with sanctimonious delusions of socal entitlement.
In order to cover that $5.00 cup of coffee, the guy who actually earns $5.15/hr must be paid $25.00/hr because that's just about where 1 cup of premium coffee, brewed using the best equipment available, served competently and courteuosly should rate against the wages of someone who's work is worth $5.15--that is ~1/5, or ~$1.00. Thanks to minimum wage, your 5-spot is worth only a buck.
You should also be able to predict from this, that the employer of this coffee drinker must inflate the costs of their services to cover the artificially inflated wages of his employees as well, all which continues to erode the value of the 5-spot--not only the 5-spots being spent, but also the 5-spots being use for wages. The real insidious part of minimum wage infaltion is that it works not only to devalue wages, but it also increases prices at the same time. So the government give the minimum wage recipient a raise--they end up giving everyone else a raise too, while making everything more expensive to buy with a minimum wage; provided employers can still sell enough $5.00 lattes to keep paying minimum wage employees--otherwise: crack whore; the unregulated labor force!
That's right, there's an unregulated labor force out there: prostitution, cock fighting, drug dealing, gun running, child pornography, slavery, burgulary--not to mention "undocumented foriegn laborers." Why are there so many Mexicans and Southeast Asians working under the table in the U.S.? Is it because they have a penchant for exploitation? Hell no! They're here because some jobs are really worth less than $5.15/hr, and they're willing to take that wage, and that's more than they'd make in the country where they <i>were</i> being exploited.
Which brings up racism. That's right; the minimum wage is racist. In this country minimum wage means being white is worth no less than $5.15/hr. How does this work? Like this: If 2 prospective employees--one black, one white, but otherwise equal--apply for a minimum wage job, Mr. AryanFront employer can hire white guy with a crew cut and golf shirt at no financial cost--none. He doesn't even have to worry about his competitors picking up the aspiring black worker for less, because they too have to pay him $5.15/hr. If this black worker were allowed to contract his labor for $4.00/hr, or $5.14 even, choosing the white guy would cost RacistJackass $1.15/hr (or $0.01 depending). Moreover, his competitors, if not racist, have the opportunity to hire the black worker at a cost advantage.
If you think this is not the case, you should check out how the white dominated unions in apartheid South Africa complained that the lack of minimum wage regulations led employers to hire cheap black laborers over better trained and better paid white folks. Which, coincidentally was exactly the same argument (check the cogressional record) used by Robert Bacon when he wrote the Davis-Bacon Act (the first minmum wage law) in response to Southern contractors bringing black labor to a federal project in his Long Island district; a labor regulation which forces contractors engaged in government contracts to pay employees union wage scale (unions, which incidently were, at the time, usually exclusively white); effectively barring Southern blacks and immigrants from working on plush, government funded construction projects.
Minimum wage doesn't neccessarily <i>have</i> to be racist; on it's best day, minimum wage is only a state sponsored protection for older, higher paid workers from the competition of anyone who would accept less pay for the same work. The surprise for me was that though I understood that minimum wage and Davis-Bacon were, in observable and measurable effect, racist policies--I just had no idea that they were racist in intent. It's not my intent to describe why I think racism is wrong, so back to this coffee shop owner I've been discussing.
Consider for the moment that a pound of premium coffee only costs the coffee shop owner about the same $5.15 he's paying his internally and eternally disgruntled employee each hour. I say "only" because it most likely comes from a nation without a state inflated minimum wage; if it did, then eveybody from the bean-bag loader on up would have to be subsidized by the coffee drinker, and that half-caf-2%-double vanilla latte with nutmeg and cinnamon would cost $25.00 instead of the extortionate $5.00 already causing wallet anurisms everywhere.
Things could be worse; we could be subject to the ridiculous notions of "Living Wage" proponents. These short sighted assholes believe any job worth doing for 40 hours a week (even if done poorly) is worth a wage one can live on. It's a career. Like pouring fuking coffee for instance. The thrust (in all our asses) is that if someone's intelligence, talent, industriousness, or abition limits their social contribution to pouring coffee, their claim on society for food, clothing, shelter, medical care, education, and pension (not to mention esteem, respect, affirmation and validation) should NOT be limited--and that it is morally valid to make that unlimitied claim at (government) gunpoint.
I doubt that anyone could argue that $100k/year is insufficent to cover the substistence of a family of 4, let alone an individual. You don't have to be an economist as savvy as Greenspan to predict that guaranteeing everyone in the country $100k salary would soon lead to rampant inflation and the loss of jobs (like pouring coffee) that no one under any circumstance will pay $100k for--leaving the poor unable to afford a $100.00 box of Rice Krispies, or any thing else for that matter.
Living wage is just the expansion of minimum wage to dumbass proportions. Minimum wage is morally and fiscally bankrupt for the same reasons that Living wage is; and Living wage is morally and fiscally bankrupt as for the exact same reasons that giving everyone in the country $100k salary would be--and ultimately just as impotent.
Artificially devaluing the rewards for productive capacity (by artificially making $1.00/hr worth of work pay any amount more, say $50.00/hr, for instance) requires more money to be printed because buyers and sellers still know what shit is worth regardless of what the government says about the dollars. Printing more money, without also increasing productivity must lead inevitably to inflation. It does so because there is just more money around. Spain discovered this back in the days when gold was the universal meduium of exchange, and they were looting the central and South Americans of all the gold they had. Ripping off the Mayans did not make any Spaniard any more ptoductive--they weren't creating any new wealth. Introducing all that new gold in the Spanish economy did not make every Spanish citizen more wealthy--they just had more gold. Having more gold was of little consolation when it took twice your daily wages in gold to get a day's worth of food.
The real irony is that those who propose these "wage justice" ponzi schemes do so for the alleged benefit of the poor; yet inflation can benefit the rich that these assholes are opposed to on their bullshit principles. Inflation benefits those who can afford to put their excess wealth into real goods like land, durable goods, stocks, and art. So, if these folks have excess stuff to sell, stuff purchased at pre-inflationary prices--stocks perhaps, they not only get to experience capital gains (if the value of the stock grew) but also the profits from the new inflated price structure.
Those who can merely save, get crushed by the fact that the $10.00 they set aside last week is worth only $9.50 this week. In fact, everyone who acts as a lender, wether it's being a savings account holder, health insurance owner, IRA, 401k, homeowner's insurance, bond holding, etc., get shafted because the money you are being payed back with is worth less than the money you contributed, which cuts into, or negates your interest dividend.
So, those who can have a $5.00 cup of coffee (or a $10.00 loaf of bread) and still have money left over are the ones who could invest. They are the ones who can sell their cheaply aquired stock at a profit for no other reason than the government drove the price up. And if they still have that same inflated amount of money when inflation eventually recedes, they realize a government granted windfall that those unable to afford expensive durable goods, stocks, and $17.50 bowls of cornflakes can't. You should now be able to predict what this trickle-up economic policy means for those at the top of the economic food chain--particularly those who are already rich: a big fat unearned raise provided artificially, through the use of force, by the government. Those at the bottom get a wage (if they still have a job) that looks better than the one they had before, but oddly provides so much less. Well done!
Of course, if we <i>were</i> to make the minimum wage $100k/year, in the long run, provided there is no additional government interference, the whole thing would shake out to just about where we are now, except that the same retarded cranks who now gripe that 17k/year is insufficient for the poor, will then claim that 100k/year is insufficient for the poor. So why do we engage in this bullshit? It's because we would like to say, "Human beings, no matter how worthless, are worth <i>something</i>, some minimum." It's a grandiose gesture that a human being's social worth, particiularly to politicians, is equatable to economic worth--despite the fact that determining such worth is so evasive that it has to be established at gunpoint.<blockquote><a href="http://oregonmag.com/Cox404.htm" target="_blank">Too often, we give the benefit of the doubt to folks who support a higher minimum wage.</a> We shouldn't. There are only two reasons someone would support so bad an idea: either they don't realize the economic harm it causes, or they want the harm.</blockquote>After all this, and all this time, I think they want the harm.