How to Keep More Kids on the Streets
Weekly Editorial - May 3, 2012
Questions
Consider each of the following statements made by Professors Boudreaux and Williams. This view of minimum-wage laws is possibly unfamiliar to you. For each of the professors' statements, write agree or disagree. Explain your answers.
- "Raising the minimum wage hurts the very people - low-skilled workers - that champions of the raise intend to help, because it prices many such workers out of jobs." (from para.1)
- "Put yourself in the place of an employer and ask: 'If I must pay $8.50 an hour to whomever I hire, does it pay me to hire a person who...possesses skills that would only allow him to contribute $5 an hour to my bottom line?' Most employers would view hiring such a person as a losing economic proposition. Therefore the effect of minimum-wage legislation is to discriminate against the employment of low-skilled persons, who are for the most part young, and mostly minority young, people." (from para. 2)
- "Yet wishful thinking aside, no employer can afford to pay a worker more than that worker's services are worth to the firm." (from para. 3)
- "No employer who wants productive employees can afford to pay less than that worker's services are worth to the firm, either. Wages in market economies reflect each worker's productivity." (from para. 3)
- "As people age they gain more skills and experience. The resulting higher productivity pushes their wages up." (from para. 5)
- The evidence is overwhelming that minimum-wage legislation has a negative effect on the employment of low-skilled workers." (from para. 7)
- "As a careful empirical study done in 2000 by Cornell University economist Richard Burkhauser and some co-authors concluded: 'Minimum wage increases significantly reduce the employment of the most vulnerable groups in the working-age population - young adults without a high-school diploma (aged 20-24), young black adults and teenagers (aged 16-24), and teenagers (aged 16-19).'" (from para. 7
- "Even the liberal economist Paul Krugman...has admitted that raising the minimum wage likely reduces employment prospects for low-skilled workers." (from para. 8)
- "Compassionate policy requires that we think with our brains and not with our untutored hearts." (from para. 11)