Minimum Wage Chic
I was a little amused to see a letter on the letters page rebuking B&W (actually, me) for ‘perpetuating the fashionable nonsense of minimum-wage laws.’ No. Minimum wage laws may be nonsense, but they’re hardly fashionable. They’re too old for that, for one thing, at least in the US. And they’re not fashionable anyway, any more than unions are. Are you kidding? Unions? The minimum wage? Yeah, right, they’re about as fashionable as poodle skirts, or peanut butter and grape jelly sandwiches on Wonder bread, or Maxwell House coffee made in a percolator, or zootsuits. No. The word class is fashionable, provided it’s accompanied – chaperoned, as it were – by the words ‘race’ and ‘gender’ – but that’s it. The thing itself is fashionable only if you’re in one of the right ones, and that doesn’t include the working class.
I would say hostility to the minimum wage is more fashionable than the minimum wage itself is – fashionable in the same sense and the same circles in which libertarianism is fashionable, that is. Libertarianism is not quite as hot as it was during the bubble, but it’s still a lot hotter than the boring old minimum wage is. You might as well say health and safety laws are fashionable.
But, we are sternly told, the minimum wage is bad, because it costs jobs. Sometimes it does, though there is dispute about how often, how invariably, how much, and so on. But even if it does, that doesn’t make it bad, full stop. Not all by itself. What it does is make it bad in one way, but not in another. There are fewer jobs, but the jobs there are pay more. Some people have no jobs, but other people work for – too little, instead of much too little.
It’s interesting that even in raving-right-wing Murka, there is a high level of political support for the minimum wage, and for raising it more often and higher than it gets raised. Even here, it is widely thought that people who do a job should actually be paid decently for it. The fans of the unregulated market don’t agree, of course; they think the market should decide. They also think the market should be helped to decide by always being oversupplied with unskilled labour, so that wages will always be as low as possible.
One of the odd things about the argument that the minimum wage costs jobs, in fact, is that full employment is not a goal anyway, and the government takes steps to prevent full employment any time the unemployment rate falls ‘too’ low. We heard about that a lot during the bubble. The unemployment rate was 4% – oh dear, uh oh – time to raise interest rates and hope it goes up again quick like a bunny. Well, if full employment is not the goal, is in fact not permitted, then why is it a problem that the minimum wage costs jobs?