Initially, they will firmly state, “The claims of our opponents are overblown; the detrimental effect they predict will never happen.” Once they’ve won the public over to their side, though, they become comfortable enough to admit the truth: “Well, maybe our critics were about the detrimental effect. But so what?”
This is where we are in the debate over a $15 minimum wage. For years, critics of wage floors have complained that raising the minimum wage to that level would increase unemployment. And for years supporters of the minimum wage claimed that wouldn’t happen. However, now that the $15 wage has been approved in two of the largest states in the union — California and New York — the advocates are willing to admit, “Yeah, it will lead to increased unemployment. But so what?”
If you think I’m exaggerating, consider a recent headline at the Washington Post: “The $15 minimum wage sweeping the nation might kill jobs — and that’s okay”
In the article Lydia DePillis notes the very shift in response I outlined. Step #1: Critics complain about the detrimental impact, and are assured it will not happen:
With each new mandate, of course, come warnings of a job apocalypse. “While raising the minimum wage sounds compassionate, it will probably hurt the very workers its advocates want to help,” writes the Heritage Foundation’s James Sherk, bemoaning the District of Columbia’s $15 proposal.
In response, advocates for the higher wages have been careful to say that with a couple exceptions, studies show that minimum wage hikes to date have not meaningfully affected employment. Even $15 in a few years is not likely to change that, they point out.
And why do they say it won’t happen? Because they need to win the political argument and get the public on their side:
Of course, advocates have an incentive to make that argument: Especially in less economically dynamic places than California and New York City, even admitting that a proposal could kill jobs is politically risky. [emphasis in original]
But then the minimum wage side got some big wins — and with that came political margin and comfort. Now comes Step #2: They can admit the truth:
But even defenders will admit that eventually, as the minimum wage keeps rising past its historical high-water mark, it’s possible that some jobs could be lost. [emphasis in original]
So yeah, it’ll kill jobs. But so what? That’s not what matters anyway, right? And what does matter to the minimum wage advocates if not minimum wage jobs?
For its advocates, the question isn’t whether minimum wage hikes will kill jobs, but rather how to help people who end up unemployed when they do.
In other words, the minimum wage will kill jobs but that’s fine since those jobs were terrible anyway. Besides, the newly unemployed can just go on the government dole. Again, I’m not putting words in their mouths. This is what some economists are actually advocating:
“Why shouldn’t we in fact accept job loss?” asks New School economics and urban policy professor David Howell, who’s about to publish a white paper on the subject. “What’s so bad about getting rid of crappy jobs, forcing employers to upgrade, and having a serious program to compensate anyone who is in the slightest way harmed by that?”
Howell is talking about something like the Trade Adjustment Assistance program, which assists people who lose their jobs due to international trade deals. Sure, it might be harder to prove that your job was eliminated because of a minimum wage hike, or that a high minimum wage kept you from getting a job in the first place. But in principle, he says, the savings created by all the welfare benefits that won’t have to be doled out to people who are now making more money could be re-invested in vocational training, subsidized jobs, and direct income supports for those who can’t find work.
It’s truly amazing what a few wins will do for the level of political candor. Even California Governor Jerry Brown admits that it makes no economic sense and is not really about helping workers keep their jobs.
“Economically, minimum wages may not make sense,” said Brown. “But morally and socially and politically they make every sense, because it binds the community together and makes sure that parents can take care of their kids in a much more satisfactory way.”
If you are currently a low-skilled worker making minimum wage in order to gain skills and climb the economic ladder you might be wondering, “If raising the minimum wage causes me to lose my job and go on welfare, how does that improve my life?” The answer is: It doesn’t. Because it was never intended to help you.
Ever notice that some of the biggest supporters of the $15 minimum wage are the unions and union members (like Lydia DePillis)? Few union members make less than $15 an hour so why does it matter to them? The answer is that by raising the wage floor they can push for even higher wages. If the teenager at the local fast-food restaurant is making $15 an hour flipping burgers then even the lowest-paid union worker should, in the unions view, be earning much, much more for their labor. And as Governor Brown would admit, giving the unions what they want makes sense “politically.”
Most forms of class warfare involve the lower classes complaining about the wealthy. But in this case, the middle class is willing to increase inequality and hurt the poor as a means of improving their own wages. This is a rather astounding admission that shows how politically comfortable they are putting people out of work to advance a policy that even Jerry Brown admits doesn’t make economic sense.
You don’t often find example like this where progressives admit they are willing to put the poor out of work. But perhaps we should not be surprised that they are now comfortable enough to say to people who they are putting out of work, “Let them eat welfare.”