End Minimum Wage Now!

There are two ways the state acts: solving problems that do not exist; and small problem, huge solution.  We have a huge solution to the tiny problem of unemployment.  The Federal reserve system has maximum employment as one of its mandates.  

Unemployment is aggravated by government policy.  Misallocation and malinvestment of investment based on opaque signal to noise ratio leaves businesses adrift and failing, diminishing the demand side. This is the small problem.  The much larger problem is minimum wage

Unemployment is voluntary.  In the West it is harder to make your own work but not impossible.  Anyone who is not working has weighed the options and decided not to work.

One of the aggravating causes of unemployment is minimum wage laws. A free market means people are free to contract.  With minimum wage laws, this is just not so.

The idea behind minimum wage laws is to avoid worker exploitation.  The catechism of the Catholic Church speaks to justice in wages.  Something the catechism fails to mention: anyone and everyone can earn a living wage through self-employment.  Indeed, people becoming self-employed is so popular, yet anathema to the social planners, that “independent contractor” is a status the IRS strictly controls and works hard to discourage.  Church teaching implies, and state planners yearn, that all will work for someone else.  But independent contractors earn more for themselves and cost a company less than an employee. By forcing people to be employees, the result is people yield less income to be less productive.

Not everyone needs a living wage.  There are students, pensioners, and the desperate, the starter over who would be delighted to work... clearing the market of these creates economic activity, which allows more to work more productively and eventually earn that living wage.

In order to be exploited, one has to be employed.  Unemployment is an even worse kind of exploitation, since the condition is largely the result of the actions of state planners, and perpetual unemployment among the masses means perpetual employment for those tasked with addressing the problem with policy.  Tweak on.

Get rid of all wage laws and let wages fall to clear the market.   Once employed, people begin to agitate... more people producing requires more and better managers.  It becomes an upward spiral.  There is also labor trouble.  This is good.

We are not getting out of this problem until costs fall, prices fall, wages fall.  The game plan for the powers that be is to rid debt through hyperinflation.  It is light now with food medicine, education and gas prices rising.  profits are being mulcted to fund the powers that be.  The big debt is unfunded pension liability, and when the retiree is collecting $10,000 a month finds a loaf of bread is $10,000, then the problem will be solved. (To whom will the retiree complain?)  On the other hand, as prices drop, pensioners will sue if anyone tries to cut the $10,000 per month when bread drops to ten cents a loaf.  When you are the problem, and you only take, not give, what do you think will happen? 

When running a company with longshoreman labor, the business agents often tried to tweak me by asserting the workers were not our employees, we were privileged to have union people as supplier of labor. I could not agree more.  They were part of a free association that provided labor to companies.  We were quite profitable with union labor.

Employer abuse is checked by labor action.  There are no employees to abuse unless they are first hired.  Once hired, they can and do start trouble.  People say there are unions therefore there are problems.  This is prima facie nonsense. There are problems, therefore the are unions.

Labor laws require management and labor meet and confer...  not meet and agree.  At any such meeting, there is no such thing as outrageous union demand, only outrageous management concessions.  Management is always in charge.  Management that complains about unions is in the measure of that complaint.

This has been stopped by labor laws in usa, which is a terrible thing, because when you match labor and regulation you end up with the unions bought off by the state, and now they are weak and ineffectual.  USA needs a free union movement to reinvigorate our economy.


Here is a classic on politics and economy by a longshoreman.


Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post