Apparently I missed the story earlier this week that Mitt Romney wants to index the federal minimum wage for inflation. This is SUCH a lousy, unconservative idea, it's finally caused me to ask a question a lot of other conservatives have been asking for months: "Is this guy really one of us?"
Let me tell you why I oppose the minimum wage, and why, therefore, I think Mitt's proposal takes a bad idea and makes it worse.
First, and most important, employers are the GOOD GUYS. They're the ones who provide jobs, and health care benefits, and retirement funds, etc., for tens of millions of people. They're also providing valuable goods and services to customers, and trillions of dollars in tax revenue to various levels of government.
In light of this, setting a wage floor and indexing that wage floor to inflation sends entirely the wrong message to employers: "If you risk your capital to do good, socially desirable things for individuals, for the economy at large, and for government at all levels, we're going to impose significant costs on you, just because you've got deep pockets...and because we can (what are you going to do about it?)."
Second, apart from punishing desirable behavior, the minimum wage is really just a lazy, cowardly, unrepublican trick. Like annual budget deficits, minimum wage laws allow the public at large to enjoy certain benefits without paying the full costs associated with those benefits. The minimum wage is basically our way of saying, "As a country, we've decided that we want to set a floor on wages, but we don't really want to pay the tab for that. So, we'll just make employers pay it."
How ridiculous is that? Here's what we should be saying instead, "As a country, we've decided that we want to set a floor on wages. We feel so strongly about that, we're going to guarantee a federal wage subsidy, paid for out of tax revenues. That's right--we're all going to kick in a little to achieve this important public policy objective." (Not, "Yup, we're all going to agree to squeeze employers even beyond the taxes they pay so that we can achieve this important public policy objective without having to reach into our own pockets.")*
Third, the minimum wage is very poorly targeted. The struggling single mom at an entry-level job gets paid the minimum wage, and we think, "We're doing this for her." But what about the kid working part time in a family business? The retired senior citizen who just likes to get out of the house and be around people? The second earner in a household that isn't relying on the extra income?
You don't need a minimum wage for these people (and you certainly don't need one indexed to inflation). You don't need a minimum wage for anyone, in fact. You need to let the market set wages at the intersection of the supply curve and the demand curve. If that results in lower wages than we're comfortable with, then we, as a people, can pay for a direct federal wage subsidy out of our taxes. We can target that subsidy as broadly or as narrowly as we want, so that we are subsidizing the wages of say, full-time workers, and/or heads of households in single-income families, and/or people working their way through college, and so on.
THAT's as conservative an approach as you're going to get to a subject as unconservative as a guaranteed wage. That's the approach Mitt ought to embrace...not his mind-boggling suggestion that we take a bad idea and make it 3% worse each year.
*I'm genuinely offended at the idea of politicians, who produce nothing, expropriating the proceeds of other people's risk, investment, and labor, and redirecting those proceeds to the politicians' own electoral benefit.
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