We've repeatedly said on the blog that the big beneficiaries of the $15 minimum wage hike are more likely to be politicians rather than American employees and would be employees, who'll likely see a stagnant economy in part because of these government-mandated hikes.
Andrew Napolitano makes the case that politicians ignore the economic consequences of their actions and hope the voters will reward them in a piece on the Reason website using the "What if …" format.
He also gives a good account of the ideas upon which the government-mandated minimum wage hike rests:
What if the latest craze among big government-crowd in both political parties is to use the power of government to force employers to pay some of their employees more than their services are worth to the employers?
What if this represents an intrusion by government into the employer-employee relationship? What if this consists of the government's effectively saying that it knows the financial worth of employees' services better than the employers and the employees do?
What if the minimum wage, now on the verge of being raised to $15 per hour everywhere in the land, is really the government's using threats of ruin and force to transfer wealth? What if the $15-per-hour figure is based on a political compromise rather than on free market forces or economic realities?
Yes, an employer knows what a job is worth and what she is willing to pay to get it done. When the government commands that she pay more, she will likely make other accommodations, such as combining this job with another and laying off one of the job holders. She, not the politicians, will be regarded as the villain.
Napolitano suggests that these unrealistic minimum wage hikes interfere with the right of the employee "to sell labor by going to work and the right of an employer to purchase that labor by paying a salary are part of the natural right to exchange goods and services, which the Constitution was written to protect." During periods of great American prosperity, that was the operating principle.
The biggest losers are the low-skilled workers who would be better off getting a job at below a $15 minimum wage with the opportunity to gain skills and advance. Likely, employers will judge many low-skilled workers not to be worth $15 an hour and these workers will be non-workers. Some will move to welfare assistance, which could lead to higher taxes to help serve these people. The chain of consequences is such that politicians will probably just call for further wage hikes!
Here's Napolitano's kicker:
What if all this came about not because of market forces, such as supply and demand, and not because people worked harder and produced more but because of lawless, greedy politicians—heedless of basic economics—who think they can write any law, regulate any behavior and tax any event without adverse consequences?
What if the politicians who caused this did so just to win the votes of those they promised to help? What if these politicians only helped themselves? What if the minimum wage increase is a fraud? What do we do about it?
Every time I write about the minimum wage, I always feel like I need to start with some statement that I am not hard-hearted, that I want the best for American workers.
But unrealistic, mandatory wage hikes are not the best for the American workers. They are the best for the American politicians.