The Art of the Big Lie on the Minimum Wage

Politics at times is the art of the Big Lie.

That thought reared its head when I saw articles about a bunch of Congress people recently. They had called a big press conference — to announce how they were getting behind the idea of the $15 minimum wage for all Americans.

These politicians know absolutely that what they propose will harm many workers. They know it will cause many job losses. They know the job losses will hurt older workers and minorities the most, especially young minorities.

To say that research shows this is like saying the sun came up today. The politicians have seen countless studies that detail the harm. Still, they push for the $15 wage across the land.

How can they do this? It endangers the jobs of so many voters.

They do it because most of those voters don’t know how much such forced minimum wages harm them. And harm their prospects. They only know they can’t find a job, or that they were laid off. They don’t associate this with the high minimum wage.

The latest research on this comes from the National Bureau of Economic Research. It details how much harm the higher minimum wage inflicts on jobs that can be done by robots.

Suppose a company pays 50 folks $10 an hour to do menial work. Now the government orders the firm to pay them $15. The business crunches the numbers, and concludes that a few robotic machines are worth the investment. The cost of the machines is less than the cost of the 50 workers.

An article in The Wall Street Journal described McDonald’s recent moves. Unions, cities, and states pressured the company to raise entry-level wages. It did, and the politicians claimed victory for the workers. Ah, but McDonald’s immediately accelerated moves to digital technology. In order to cut the number of employees it needs. Duh.

We know many jobs will become automated. The politicians know this. They know if they raise the minimum wage dramatically, they bring on the automation more quickly.

Yet they trumpet their plan and whistle in the wind. They falsely promise that “increasing the minimum wage will provide economic security for all working Americans.”

This is utter rot. And they know it. A few cities have jacked up minimum wages dramatically. This makes residents feel they have done a good thing for the low-wage folks. Yet, in many of those cities, low-wage jobs have shrunk in response to the new wage.

The cold reality is that some jobs are only worth $10. If we artificially raise the cost of those positions to $15, employers scrub them. Simple as that. Or they automate them.

The politicians remind me of an old farmer I chatted with years ago. We talked about new farming techniques that would reduce his plowing. Less plowing would preserve more of his precious topsoil. It would reduce erosion. It would cut his fuel and equipment costs.

He agreed that it would, but...

I can still see the sheepish grin on his face as he said, “I’m gonna keep on plowin’ — I just like to see that soil turned over. Just like I’ve seen it all my working days.”

The politicians just like to keep saying, “We’re working to save jobs and to create more jobs. Increasing the minimum wage will provide economic security for all working Americans.”

All working Americans who happen to be in Congress.

From Tom…as in Morgan          

Tom Morgan writes about political, financial, and other subjects from his home near Oneonta. Contact Tom at tomasinmorgan@yahoo.com. You can read more of his writing at tomasinmorgan.com