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April 9, 2014

"The Morality of the Minimum Wage," by Donald Boudreaux

In "The morality of the minimum wage," in the Pittsburgh Tribune-Review, Donald Boudreaux argues that proponents of minimum-wage legislation should consider not only the benefits but the costs of introducing a minimum wage. 

Professor Boudreaux writes: 


Suppose that I invent and use minimum-wage legislation that, by casting 500,000 low-skilled workers into the ranks of the unemployed, causes these workers' annual incomes to fall from $15,000 to $0. But the legislation also raises the wages of 16.5 million other workers. In effect, the incomes lost by the now-unemployed workers are transferred to the still-employed workers.
Am I acting immorally to use this legislation? Is the $7.5 billion taken annually from the 500,000 workers who lose their jobs and given to the other workers who keep their jobs stolen property that should be returned to those unemployed workers — returned in the form of opportunities to regain their jobs?
Politicians, pundits and economics professors who've read the Congressional Budget Office's February report on raising the minimum wage to $10.10 per hour, yet who continue to endorse a higher minimum wage, evidently believe that it's morally acceptable to steal $15,000 annually from some poor workers if the proceeds are given to other workers.
Read more: http://triblive.com/opinion/donaldboudreaux/5888427-74/workers-minimum-wage#ixzz2yTwcfPSP 
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Suppose that I invent and use minimum-wage legislation that, by casting 500,000 low-skilled workers into the ranks of the unemployed, causes these workers' annual incomes to fall from $15,000 to $0. But the legislation also raises the wages of 16.5 million other workers. In effect, the incomes lost by the now-unemployed workers are transferred to the still-employed workers.

Am I acting immorally to use this legislation? Is the $7.5 billion taken annually from the 500,000 workers who lose their jobs and given to the other workers who keep their jobs stolen property that should be returned to those unemployed workers — returned in the form of opportunities to regain their jobs?

Politicians, pundits and economics professors who've read the Congressional Budget Office's February report on raising the minimum wage to $10.10 per hour, yet who continue to endorse a higher minimum wage, evidently believe that it's morally acceptable to steal $15,000 annually from some poor workers if the proceeds are given to other workers.

Read the full column at TribLive.com.