Economic Consequences of the Minimum Wage — Videos

Posted on March 10, 2013. Filed under: Blogroll, Books, Communications, Economics, Employment, Federal Government, government, government spending, Law, liberty, Life, Links, media, Microeconomics, People, Philosophy, Politics, Psychology, Public Sector, Rants, Raves, Regulations, Security, Unemployment, Unions, Wealth | Tags: , , |

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Minimum-Wage

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Does the Minimum Wage Hurt Workers?

Dan Mitchell Explains Why Boosting the Minimum Wage Is Bad for Low-Skilled Workers

John Stossel – The Minimum Wage and Consequences

John Stossel – The State Against Blacks

Good Intentions 2of3 Minimum Wage, Licensing, and Labor Laws with Walter Williams

John Stossel – Real World Effects Of Minimum Wage

Increasing Minimum Wage Good or Bad for Small Business?

The Truth about the Minimum Wage

Milton Friedman on Minimum Wage

[yourtube=http://www.youtube.com/watch?v=ca8Z__o52sk]

Power of the Market – Minimum Wage

The Job-Killing Impact of Minimum Wage Laws

Both Sides of The Minimum Wage Debate

Walter E Williams – Davis Bacon Sellout

Williams with Sowell – Minimum Wage

Walter E Williams – Minimum Wage as a Racist Tool

Walter Williams: Up From the Projects

State Against Blacks – Conservative Dr. Walter Williams

Characteristics of Minimum Wage Workers: 2011

In 2011, 73.9 million American workers age 16 and over were paid at hourly rates, representing 59.1 percent of all wage and salary workers.1 Among those paid by the hour, 1.7 million earned exactly the prevailing Federal minimum wage of $7.25 per hour. About 2.2 million had wages below the minimum.2 Together, these 3.8 million workers with wages at or below the Federal minimum made up 5.2 percent of all hourly-paid workers. Tables 1 through 10 present data on a wide array of demographic and socioeconomic characteristics for hourly-paid workers earning at or below the Federal minimum wage. The following are some highlights from the 2011 data.

  • Minimum wage workers tend to be young. Although workers under age 25 represented only about one-fifth of hourly-paid workers, they made up about half of those paid the Federal minimum wage or less. Among employed teenagers paid by the hour, about 23 percent earned the minimum wage or less, compared with about 3 percent of workers age 25 and over. (See table 1 and table 7.)
  • About 6 percent of women paid hourly rates had wages at or below the prevailing Federal minimum, compared with about 4 percent of men. (See table 1.)
  • About 5 percent of White hourly-paid workers earned the Federal minimum wage or less, compared with about 6 percent of Blacks and about 3 percent of Asians. Among hourly-paid workers of Hispanic ethnicity, about 5 percent earned the minimum wage or less. (See table 1.)
  • Among hourly-paid workers age 16 and over, about 11 percent of those who had less than a high school diploma earned the Federal minimum wage or less, compared with about 5 percent of those who had a high school diploma (with no college) and about 2 percent of college graduates. (See table 6.)
  • Never-married workers, who tend to be young, were more likely than married workers to earn the Federal minimum wage or less (about 9 percent versus about 2 percent). (See table 8.)
  • Part-time workers (persons who usually work less than 35 hours per week) were more likely than full-time workers to be paid the Federal minimum wage or less (about 13 percent versus about 2 percent). (See table 1 and table 9.)
  • By major occupational group, the highest proportion of hourly-paid workers earning at or below the Federal minimum wage was in service occupations, at 13 percent. About 6 in 10 workers earning the minimum wage or less in 2011 were employed in service occupations, mostly in food preparation and serving related jobs. (See table 4.)
  • The industry with the highest proportion of workers with hourly wages at or below the Federal minimum wage was leisure and hospitality (22 percent). About one-half of all workers paid at or below the Federal minimum wage were employed in this industry, primarily in restaurants and other food services. For many of these workers, tips and commissions supplement the hourly wages received. (See table 5.)
  • The states with the highest proportions of hourly-paid workers earning at or below the Federal minimum wage were Georgia, Mississippi, and Texas (all between 8 and 10 percent). The states with the lowest percentage of workers earning at or below the Federal minimum wage were Oregon, California, Washington, and Alaska (all under 2 percent). It should be noted that some states have minimum wage laws establishing standards that exceed the Federal minimum wage. (See table 2 and table 3.)
  • The proportion of hourly-paid workers earning the prevailing Federal minimum wage or less declined from 6.0 percent in 2010 to 5.2 percent in 2011. This remains well below the figure of 13.4 percent in 1979, when data were first collected on a regular basis. (See table 10.)

Source: U.S. Department of Labor, Bureau of Labor Statistics (BLS). These data on minimum wage earners are derived from the Current Population Survey (CPS), a monthly nationwide survey of households. Data in this summary are 2011 annual averages.

1 Data are for wage and salary workers age 16 and over and refer to earnings on a person’s sole or principal job. Hourly earnings for hourly-paid workers do not include overtime pay, commissions, or tips received. All self-employed persons are excluded whether or not their businesses are incorporated.

2 The presence of a sizable number of workers with wages below the Federal minimum does not necessarily indicate violations of the Fair Labor Standards Act, as there are exemptions to the minimum wage provisions of the law. The estimates of the numbers of minimum and subminimum wage workers presented in the accompanying tables pertain to workers paid at hourly rates; salaried and other non-hourly workers are excluded. As such, the actual number of workers with earnings at or below the prevailing Federal minimum is undoubtedly understated. Research has shown that a relatively small number and share of salaried workers and others not paid by the hour have earnings that, when translated into hourly rates, are at or below the minimum wage. However, BLS does not routinely estimate hourly earnings for non-hourly workers because of data concerns that arise in producing these estimates.


Characteristics of Minimum Wage Workers: 2011, Tables 1 – 10

Characteristics of Minimum Wage Workers: 2011 (PDF)

Table 1. Employed wage and salary workers paid hourly rates with earnings at or below the prevailing Federal minimum wage by selected characteristics, 2011 annual averages
Characteristic Number of workers
(in thousands)
Percent distribution Percent of workers paid hourly rates
Total paid hourly rates At or below minimum wage Total paid hourly rates At or below minimum wage At or below minimum wage
Total At minimum wage Below minimum wage Total At minimum wage Below minimum wage Total At minimum wage Below minimum wage
AGE AND SEX
Total, 16 years and over 73,926 3,829 1,677 2,152 100.0 100.0 100.0 100.0 5.2 2.3 2.9
16 to 24 years 14,436 1,896 893 1,003 19.5 49.5 53.2 46.6 13.1 6.2 6.9
16 to 19 years 3,936 899 491 408 5.3 23.5 29.3 19.0 22.8 12.5 10.4
25 years and over 59,490 1,933 784 1,149 80.5 50.5 46.8 53.4 3.2 1.3 1.9
Men, 16 years and over 36,457 1,433 648 785 49.3 37.4 38.6 36.5 3.9 1.8 2.2
16 to 24 years 7,290 787 388 399 9.9 20.6 23.1 18.5 10.8 5.3 5.5
16 to 19 years 1,872 373 212 161 2.5 9.7 12.6 7.5 19.9 11.3 8.6
25 years and over 29,167 647 260 387 39.5 16.9 15.5 18.0 2.2 0.9 1.3
Women, 16 years and over 37,469 2,395 1,029 1,366 50.7 62.5 61.4 63.5 6.4 2.7 3.6
16 to 24 years 7,147 1,109 505 604 9.7 29.0 30.1 28.1 15.5 7.1 8.5
16 to 19 years 2,064 526 279 247 2.8 13.7 16.6 11.5 25.5 13.5 12.0
25 years and over 30,323 1,286 524 762 41.0 33.6 31.2 35.4 4.2 1.7 2.5
RACE, SEX, AND HISPANIC OR LATINO ETHNICITY
White (1) 59,314 3,006 1,258 1,748 80.2 78.5 75.0 81.2 5.1 2.1 2.9
Men 29,743 1,108 484 624 40.2 28.9 28.9 29.0 3.7 1.6 2.1
Women 29,571 1,898 774 1,124 40.0 49.6 46.2 52.2 6.4 2.6 3.8
Black or African American (1) 9,523 577 324 253 12.9 15.1 19.3 11.8 6.1 3.4 2.7
Men 4,252 222 117 105 5.8 5.8 7.0 4.9 5.2 2.8 2.5
Women 5,271 356 208 148 7.1 9.3 12.4 6.9 6.8 3.9 2.8
Asian (1) 3,037 99 36 63 4.1 2.6 2.1 2.9 3.3 1.2 2.1
Men 1,425 41 13 28 1.9 1.1 0.8 1.3 2.9 0.9 2.0
Women 1,612 58 23 35 2.2 1.5 1.4 1.6 3.6 1.4 2.2
Hispanic or Latino (1) 13,264 720 340 380 17.9 18.8 20.3 17.7 5.4 2.6 2.9
Men 7,703 326 154 172 10.4 8.5 9.2 8.0 4.2 2.0 2.2
Women 5,561 394 186 208 7.5 10.3 11.1 9.7 7.1 3.3 3.7
FULL- AND PART-TIME STATUS AND SEX
Full-time workers (2) 53,594 1,274 522 752 72.5 33.3 31.1 34.9 2.4 1.0 1.4
Men 29,292 501 205 296 39.6 13.1 12.2 13.8 1.7 0.7 1.0
Women 24,302 773 317 456 32.9 20.2 18.9 21.2 3.2 1.3 1.9
Part-time workers (2) 20,199 2,545 1,153 1,392 27.3 66.5 68.8 64.7 12.6 5.7 6.9
Men 7,103 932 443 489 9.6 24.3 26.4 22.7 13.1 6.2 6.9
Women 13,096 1,615 711 904 17.7 42.2 42.4 42.0 12.3 5.4 6.9
Footnotes:
(1) Estimates for the above race groups (White, Black or African American, and Asian) do not sum to totals because data are not presented for all races. Persons whose ethnicity is identified as Hispanic or Latino may be of any race.
(2) The distinction between full- and part-time workers is based on hours usually worked. These data will not sum to totals because full- or part-time status on the principal job is not identifiable for a small number of multiple jobholders. Full time is 35 hours or more per week; part time is less than 35 hours.

NOTE: Data exclude all self-employed persons whether or not their businesses are incorporated.

http://www.bls.gov/cps/minwage2011tbls.htm#1

Labor Force Statistics from the Current Population Survey

Series Id: LNS14000012
Seasonally Adjusted
Series title: (Seas) Unemployment Rate – 16-19 yrs.
Labor force status: Unemployment rate
Type of data: Percent or rate
Age: 16 to 19 years

unemployment_teenagers

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
1948 8.5 10.0 10.5 9.5 7.0 9.3 9.7 9.6 8.8 8.5 9.1 8.5
1949 10.0 10.6 11.9 13.2 13.4 13.8 14.3 15.0 14.6 15.8 14.0 15.4
1950 15.2 15.2 14.3 12.0 13.3 12.2 11.2 10.7 10.9 10.3 9.5 11.1
1951 8.5 8.1 8.3 7.9 6.7 8.3 8.7 8.2 8.3 7.7 9.5 7.6
1952 9.3 8.3 8.2 7.6 8.9 8.4 8.8 8.5 8.9 8.4 8.2 7.6
1953 6.9 6.7 6.7 7.1 6.4 6.9 7.3 7.4 7.3 9.7 8.6 11.8
1954 12.1 13.5 13.0 13.6 13.4 10.5 12.9 14.0 14.0 12.2 11.4 12.6
1955 11.7 11.3 11.0 10.7 10.9 10.8 10.4 11.5 11.3 11.0 11.7 11.0
1956 10.6 11.4 11.5 10.9 11.9 12.2 11.2 10.1 9.8 10.1 12.6 9.7
1957 11.6 10.5 11.2 11.1 11.4 11.7 11.8 11.5 11.0 10.9 13.4 13.1
1958 14.4 14.6 14.7 17.2 16.3 15.4 17.9 16.0 17.9 16.0 15.9 14.9
1959 14.0 12.9 13.6 15.0 14.3 13.9 14.5 16.1 14.9 15.8 15.1 15.3
1960 14.6 13.1 15.6 14.2 13.9 14.6 13.9 15.3 14.5 16.1 14.7 16.4
1961 17.1 17.4 17.1 16.4 15.8 16.6 17.3 17.1 18.0 16.9 16.0 15.3
1962 16.2 16.0 15.1 15.1 14.2 13.6 13.9 14.1 14.5 14.3 16.3 14.4
1963 15.8 17.7 17.1 16.8 18.7 17.2 18.1 16.1 17.4 17.1 17.7 16.3
1964 16.7 15.8 16.3 17.0 16.4 16.8 14.7 16.7 15.7 15.8 15.6 17.1
1965 16.8 16.7 15.8 16.2 14.8 15.3 14.5 13.9 14.7 14.5 13.0 13.3
1966 13.0 12.4 13.1 13.0 13.6 13.0 12.9 12.4 12.8 12.6 11.8 12.1
1967 11.9 12.9 11.6 12.1 12.8 12.9 13.0 13.4 12.9 13.7 13.8 13.0
1968 12.0 12.9 12.7 11.8 12.5 13.9 13.8 12.0 12.0 11.8 12.2 12.7
1969 12.0 11.9 12.3 12.0 12.4 12.2 12.8 12.2 12.6 12.6 11.6 11.8
1970 13.5 13.3 13.4 14.7 14.2 16.3 14.7 15.7 16.2 16.7 17.4 17.1
1971 16.8 16.3 16.9 16.3 16.8 17.7 17.7 16.8 16.7 16.9 16.9 16.9
1972 16.9 18.0 17.2 16.5 15.3 15.9 15.6 16.5 16.3 15.8 15.7 15.6
1973 13.7 15.3 14.3 15.5 14.9 13.8 14.3 14.0 14.7 14.4 15.0 14.6
1974 14.6 14.9 14.9 14.3 15.4 16.3 16.8 14.9 17.0 17.2 17.8 18.2
1975 19.5 19.4 19.9 19.9 20.4 20.9 20.7 20.7 19.5 19.8 19.0 19.8
1976 19.6 19.0 18.9 19.5 18.6 18.5 18.3 19.6 18.6 19.0 19.2 19.1
1977 18.9 18.4 18.6 18.0 17.8 18.8 17.5 17.4 18.0 17.2 17.2 15.5
1978 16.7 17.2 17.3 16.6 16.0 15.4 16.5 15.7 16.4 16.1 16.3 16.7
1979 16.1 16.1 15.9 16.3 16.1 15.7 15.6 16.5 16.5 16.5 15.9 16.2
1980 16.5 16.6 16.3 16.2 18.6 18.9 19.1 18.9 18.0 18.4 18.5 17.6
1981 19.1 19.3 19.2 18.8 19.1 19.8 18.6 18.8 19.7 20.3 21.3 21.1
1982 22.0 22.6 21.8 22.8 22.8 22.9 24.0 23.7 23.6 23.7 24.1 24.1
1983 23.1 22.8 23.5 23.4 22.8 24.0 22.8 22.9 21.7 21.4 20.2 19.9
1984 19.5 19.4 19.8 19.2 18.7 18.2 18.8 18.7 19.2 18.6 17.7 18.8
1985 18.8 18.3 18.2 17.5 18.5 18.5 20.2 17.9 17.9 20.0 18.3 19.1
1986 18.1 18.8 18.2 19.2 18.6 19.2 18.4 18.0 18.4 17.7 18.1 17.5
1987 17.7 18.0 17.9 17.3 17.4 16.5 15.8 15.9 16.2 17.3 16.6 16.0
1988 16.1 15.6 16.6 16.0 15.3 14.2 14.8 15.4 15.5 15.1 13.9 14.8
1989 16.4 15.0 13.9 14.6 14.8 15.7 14.2 14.6 15.2 15.0 15.5 15.3
1990 14.8 15.0 14.3 14.7 15.0 14.3 15.0 16.3 16.4 16.5 17.1 17.4
1991 18.6 17.4 18.3 17.8 18.8 18.5 19.4 18.9 18.8 19.1 19.0 20.3
1992 19.2 20.1 20.3 18.5 20.1 23.0 20.8 19.9 21.0 18.3 20.5 19.8
1993 19.9 19.7 19.7 19.5 19.8 19.9 18.4 18.4 18.2 18.7 18.5 17.9
1994 18.3 18.0 18.0 19.1 18.0 17.6 17.6 17.3 17.5 17.5 15.6 17.0
1995 16.5 17.4 16.1 17.5 17.5 17.1 18.2 17.3 17.6 17.4 17.5 18.0
1996 17.7 16.8 17.1 17.1 16.8 16.2 17.1 16.8 15.6 16.3 16.8 16.6
1997 16.8 17.1 16.4 15.9 16.0 16.8 17.1 16.1 16.1 15.1 14.8 14.0
1998 13.9 14.5 14.8 13.5 14.8 14.9 14.6 14.7 15.0 15.7 14.7 13.5
1999 15.2 13.9 14.2 14.2 13.3 13.9 13.4 13.3 14.8 13.8 13.9 13.4
2000 12.7 13.8 13.3 12.6 12.8 12.3 13.4 14.0 13.0 12.8 13.0 13.2
2001 13.8 13.7 13.8 13.9 13.4 14.2 14.4 15.6 15.2 16.0 15.9 17.0
2002 16.5 16.0 16.6 16.7 16.6 16.7 16.8 17.0 16.3 15.1 17.1 16.9
2003 17.2 17.2 17.8 17.7 17.9 19.0 18.2 16.6 17.6 17.2 15.7 16.2
2004 17.0 16.5 16.8 16.6 17.1 17.0 17.8 16.7 16.6 17.4 16.4 17.6
2005 16.2 17.5 17.1 17.8 17.8 16.3 16.1 16.1 15.5 16.1 17.0 14.9
2006 15.1 15.3 16.1 14.6 14.0 15.8 15.9 16.0 16.3 15.2 14.8 14.6
2007 14.8 14.9 14.9 15.9 15.9 16.3 15.3 15.9 15.9 15.4 16.2 16.8
2008 17.8 16.6 16.1 15.9 19.0 19.2 20.7 18.6 19.1 20.0 20.3 20.5
2009 20.7 22.2 22.2 22.2 23.4 24.7 24.3 25.0 25.9 27.1 26.9 26.6
2010 26.0 25.4 26.2 25.5 26.6 26.0 26.0 25.7 25.8 27.2 24.6 25.1
2011 25.5 24.0 24.4 24.7 24.0 24.7 24.9 25.2 24.4 24.1 23.9 22.9
2012 23.4 23.7 25.0 24.9 24.4 23.7 23.9 24.5 23.7 23.7 23.6 23.5
2013 23.4 25.1

Federal Minimum Wage Rates, 1955–2012

Value of the
minimum wage
Value of the
minimum wage
Value of the
minimum wage
Year Current
dollars
Constant
(1996)
dollars1
Year Current
dollars
Constant
(1996)
dollars1
Year Current
dollars
Constant
(1996)
dollars1
1955 $0.75 $4.39 1983 3.35 5.28 2011 7.25 5.06
1956 1.00 5.77 1984 3.35 5.06 2012 7.25 4.97
1957 1.00 5.58 1985 3.35 4.88
1958 1.00 5.43 1986 3.35 4.80
1959 1.00 5.39 1987 3.35 4.63
1960 1.00 5.30 1988 3.35 4.44
1961 1.15 6.03 1989 3.35 4.24
1962 1.15 5.97 1990 3.80 4.56
1963 1.25 6.41 1991 4.25 4.90
1964 1.25 6.33 1992 4.25 4.75
1965 1.25 6.23 1993 4.25 4.61
1966 1.25 6.05 1994 4.25 4.50
1967 1.40 6.58 1995 4.25 4.38
1968 1.60 7.21 1996 4.75 4.75
1969 1.60 6.84 1997 5.15 5.03
1970 1.60 6.47 1998 5.15 4.96
1971 1.60 6.20 1999 5.15 4.85
1972 1.60 6.01 2000 5.15 4.69
1973 1.60 5.65 2001 5.15 4.56
1974 2.00 6.37 2002 5.15 4.49
1975 2.10 6.12 2003 5.15 4.39
1976 2.30 6.34 2004 5.15 4.28
1977 2.30 5.95 2005 5.15 4.14
1978 2.65 6.38 2006 5.15 4.04
1979 2.90 6.27 2007 5.85 4.41
1980 3.10 5.90 2008 6.55 4.77
1981 3.35 5.78 2009 7.25 5.30
1982 3.35 5.78 2010 7.25 5.22
1. Adjusted for inflation using the CPI-U (Consumer Price Index for All Urban Consumers).
Source: U.S. Department of Labor. Web: http://www.dol.gov/esa/whd/flsa/.

Information Please® Database, © 2012 Pearson Education, Inc. All rights reserved.

Wage and Hour Division (WHD)

History of Federal Minimum Wage Rates Under the Fair Labor Standards Act, 1938 – 2009

The table of federal minimum wage rates under the Fair Labor Standards Act, 1938 – 2009 is also available in a PDF Version. In order to view and/or print PDF documents you must have a PDF viewer (e.g., Adobe Acrobat Reader v5 or later) available on your workstation.

Minimum hourly wage of workers in jobs first covered by

Effective Date 1938 Act 1 1961 Amendments 2 1966 and Subsequent
Amendments3
Nonfarm Farm
Oct 24, 1938 $0.25
Oct 24, 1939 $0.30
Oct 24, 1945 $0.40
Jan 25, 1950 $0.75
Mar 1, 1956 $1.00
Sep 3, 1961 $1.15 $1.00
Sep 3, 1963 $1.25
Sep 3, 1964 $1.15
Sep 3, 1965 $1.25
Feb 1, 1967 $1.40 $1.40 $1.00 $1.00
Feb 1, 1968 $1.60 $1.60 $1.15 $1.15
Feb 1, 1969 $1.30 $1.30
Feb 1, 1970 $1.45
Feb 1, 1971 $1.60
May 1, 1974 $2.00 $2.00 $1.90 $1.60
Jan. 1, 1975 $2.10 $2.10 $2.00 $1.80
Jan 1, 1976 $2.30 $2.30 $2.20 $2.00
Jan 1, 1977 $2.30 $2.20
Jan 1, 1978 $2.65 for all covered, nonexempt workers
Jan 1, 1979 $2.90 for all covered, nonexempt workers
Jan 1, 1980 $3.10 for all covered, nonexempt workers
Jan 1, 1981 $3.35 for all covered, nonexempt workers
Apr 1, 19904 $3.80 for all covered, nonexempt workers
Apr 1, 1991 $4.25 for all covered, nonexempt workers
Oct 1, 1996 $4.75 for all covered, nonexempt workers
Sep 1, 19975 $5.15 for all covered, nonexempt workers
Jul 24, 2007 $5.85 for all covered, nonexempt workers
Jul 24, 2008 $6.55 for all covered, nonexempt workers
Jul 24, 2009 $7.25 for all covered, nonexempt workers

Where to Obtain Additional Information

This publication is for general information and is not to be considered in the same light as official statements of position contained in the regulations.

For additional information, visit our Wage-Hour website: http://www.wagehour.dol.gov and/or call our Wage-Hour toll-free information and helpline, available 8am to 5pm in your time zone, 1-866-4USWAGE (1-866-487-9243).

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Santa Obama’s $9 Minimum Wage: Good Propaganda, Bad Economics–Videos

Posted on February 19, 2013. Filed under: American History, Blogroll, Business, College, Communications, Demographics, Diasters, Economics, Education, Employment, Federal Government, Fiscal Policy, government spending, history, History of Economic Thought, Inflation, Law, liberty, Life, Links, Macroeconomics, media, Microeconomics, Narcissism, People, Philosophy, Politics, Psychology, Public Sector, Rants, Raves, Regulations, Resources, Talk Radio, Technology, Unemployment, Unions, Video | Tags: , , , , , , , , , , , , , |

Santa Obama’s $9 minimum wage: good propaganda, bad economics

By Raymond Thomas Pronk

Presidential economic policies like the proverbial “road to hell” are often paved with good intentions.

In his 2013 State of the Union address, President Barack Obama said:

“Even with the tax relief we’ve put in place, a family with two kids that earns the minimum wage still lives below the poverty line. That’s wrong. Tonight, let’s declare that in the wealthiest nation on Earth, no one who works full time should have to live in poverty and raise the federal minimum wage to $9 an hour. This single step would raise the incomes of millions of working families. It could mean the difference between groceries or the food bank; rent or eviction; scraping by or finally getting ahead. For businesses across the country, it would mean customers with more money in their pockets.”

Why not increase the minimum wage to $18 per hour and win America’s war on poverty?

What are the economic consequences or impact of a $9 minimum wage on young high school and college students seeking employment? A decidedly negative impact if economic history is any guide.

The large increase in teenage unemployment is partly driven by the increase in the minimum wage. When the minimum wage rate was increased in July 2008 from $5.85 to $6.55 there was an upward spike in the teenage unemployment rate to greater than 20 percent. When the minimum wage was again increased in July 2009 from $6.55 to its current rate of $7.25, there was another upward spike in the teenage unemployment rate to greater than 25 percent. This rising trend of upward spikes in teenage unemployment rates after an increase in the minimum wage is reflected in the following chart.

Unemployment rate or percent of 16-19 years from 1948 to present

             unemployment_rate_1948_present_16_19-years_edited           

Source: Bureau of Labor Statistics, Department of Labor

David Neumark, professor of economics at the University of California, Irvine and William L. Wascher, deputy director in the Division of Research and Statistics at the Federal Reserve Board, in their book, “Minimum Wages,” provide a comprehensive review of the evidence on the economic effects of minimum wage laws. They concluded that such laws reduce employment opportunities for less-skilled workers, tend to reduce their earnings and are not very effective in reducing poverty.

If Congress passes an increase in the minimum wage to $9 as proposed by Obama, young, inexperienced, low-skill workers, especially blacks and Hispanics, will again be hurt for they will not be hired by businesses who cannot afford to pay them the higher mandated minimum wage. This will be reflected in yet another spike upward in the teenage unemployment rate that might exceed 30 percent.

Furthermore, young American citizens, especially blacks and Hispanics, will face stiff competition from the more than 11 million illegal aliens who predominantly seek low-skilled jobs. Obama and progressives in both the Democratic and Republican parties want to grant these illegal aliens immediate legal status to work in the U.S.

Obama is repeating the past economic policy mistakes of progressive presidents from both political parties such as Hoover, Roosevelt, Truman, Johnson, Nixon, Carter and the Bushes in mandating higher than free market wage rates. These well-intentioned but massive government interventionist economic policies lead to prolonged depressions and recessions with high unemployment rates, especially for young, inexperienced, low skilled and minority workers.

Thirty years ago the black economist, Walter E. Williams, explored the effects of federal and state government intervention into the economy, including minimum wage laws, in the PBS documentary, Good Intentions, based upon his 1982 book, “The State Against Blacks.” Those favoring a rise in the federal minimum wage would be well advised to view this video together with “Milton Friedman on the Minimum Wage” on YouTube before advocating an increase in the minimum wage.

For young American citizens an entry-level job paying a lower competitive market wage rate is preferable to no job at a higher government mandated minimum wage.

Good intentions are not enough. Results measured in jobs created count.

Raymond Thomas Pronk is host of the Pronk Pops Show on KDUX web radio from 3-5 p.m. Fridays and author of the companion blog http://www.pronkpops.wordpress.com/

Digital Age-Why is Coolidge the Forgotten President?-Amity Shlaes

Sumner’s Explanation of The Forgotten Man – Revised for the 21st Century

Sumner’s Explanation of The Forgotten Man – Revised for the 21st
Century

By Joshua Lyons 9/25/09

As soon as A observes something which seems to him to be wrong,  from which X is suffering, A talks it over  with B, and A and B then propose to get a law passed – with the praise of Y – to remedy  the evil and help X.

Their law always proposes to determine  what C shall do for X or, in the better case,  what A, B and C shall do for  X.

As for A and B, who get a  law to make themselves do for X what they are willing to do for  him, we have nothing to say except that they might better have done it without  any law, but C is forced to comply with the new law.

All this  is done while Y looks on with glee and proclaims that  A and B are so good for helping poor  X.

A is the  politician
B is the humanitarian, special interest, do-gooder, reformer, social speculator, etc.
C is The Forgotten Man (i.e. you, me, us)
X is the downtrodden, the oppressed, the little guy, the misunderstood, etc.
Y is the Mainstream Media

In other words…
As soon as THE POLITICIAN observes something which seems to him to be wrong, from which THE DOWNTRODDEN is suffering, THE POLITICIAN talks it over with THE HUMANITARIAN, and THE POLITICIAN and THE HUMANITARIAN then propose to get a law passed – with the praise of THE MAINSTREAM MEDIA – to remedy the evil and help THE DOWNTRODDEN.

Their law always proposes to determine what THE FORGOTTEN MAN shall do for THE DOWNTRODDEN or, in the
better case, what THE POLITICIAN, THE HUMANITARIAN and THE FORGOTTEN MAN shall do for THE DOWNTRODDEN.

As for THE POLITICIAN and THE HUMANITARIAN, who get a law to make themselves do for THE DOWNTRODDEN what they are willing to do for him, we have
nothing to say except that they might better have done it without any law, but THE FORGOTTEN MAN is forced to comply with the new law.

All this is done while THE MAINSTREAM MEDIA looks on with glee and proclaims that THE POLITICIAN and THE HUMANITARIAN are so good for helping poor THE DOWNTRODDEN.

The preceding commentary was based on William Graham Sumner’s explanation of The Forgotten Man.

http://forgottenmenblog.blogspot.com/2009/09/sumners-explanation-of-forgotten-man.html

MinimumWage

food-stamps-minimum-wage-graph-1970-2010-no-population

The Truth about the Minimum Wage

Obama: “Raise Minimum Wage to $9 an Hour” – SOTU 2013

More on Minimum Wage

Obama’s $9/Hour SOTU Minimum Wage 

 Milton Friedman on Minimum Wage

Power of the Market – Minimum Wage

Williams with Sowell – Minimum Wage

The Job-Killing Impact of Minimum Wage Laws

“Good Intentions” by Dr. Walter Williams

Dr. Walter Williams’ 1982 PBS documentary “Good Intentions” based on his book, “The State Against Blacks”. The documentary was very controversial at the time it was released and led to many animosities and even threats of murder.

In “Good Intentions”, Dr. Williams examines the failure of the war on poverty and the devastating effect of well meaning government policies on blacks asserting that the state harms people in the U.S. more than it helps them. He shows how government anti-poverty programs have often locked people into poverty making the points that:

- being forced to attend 3rd rate public schools leave students unprepared for working life
– minimum wages prevent young people from obtaining jobs at an early age
– licensing and labor laws have had the effect of restricting entrance of blacks into the skilled trades and unions
– the welfare system creates perverse incentives for the poor to make bad choices they otherwise would not

Dr. Williams presents the following solutions to these problems:

Failing Public Schools – Give parents greater control over their children’s education by setting up a tuition tax credit or voucher system to broaden competition in turn revitalizing both public and non-public schools

Minimum Wages – Remove the minimum wage from youngsters to give more young people the chance to learn the world of work at an early age instead spending their free time idle an possibly falling into the habits of the street

Restrictive Labor Laws, Jobs Programs – Eliminate government roadblocks that prevent new entrepreneurs from starting their own business

Welfare Programs – Enact a compassionate welfare system such as a negative income tax which would remove dependency and dis-incentives for the poor to get themselves out of poverty

Scholars interviewed in the documentary include Donald Eberle, Charles Murray, and George Gilder.

Good Intentions 1 of 3 Introduction and Public Schools with Walter Williams

Good Intentions 2 of 3 Minimum Wage, Licensing, and Labor Laws with Walter

Good Intentions 3 of 3 The Welfare System and Conclusions with Walter Williams 

Government Intervention and Individual Freedom | Walter Williams

Obama: “Time to Pass Immigration Reform” – State of the Union 2013 

Contrasting Views of the Great Depression | Robert P. Murphy

 

Why You’ve Never Heard of the Great Depression of 1920 | Thomas E. Woods, Jr.

Uncommon Knowledge: The Great Depression with Amity Shlaes

Calvin Coolidge: The Best President You’ve Never Heard Of – Amity Shlaes

Amity Shlaes, Author, “Coolidge”

Keep Cool With Coolidge, Not Obama: Obama Reveals His True Hatred of Business

Obama Wants $9 Minimum Wage…

 

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