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Minimum Wage and other thoughts

By Theresa Fritz Camoriano

First, I would like to apologize for not posting an issue of Jefferson Review last week.  I had to make an emergency trip to Connecticut to bring my Uncle John down to Kentucky for the winter.  Our trip went well, and we are now getting into a new routine.  Unc’s first request was a U of L Cardinals baseball cap, so he is quickly becoming a local!

Now that the Democrats have won a majority in both houses, they say one of their first priorities will be to pass a law to increase the minimum wage.  They claim this will help low skilled workers, but, while it may help a few people, it really will harm many more.  The fact is that employers cannot afford to pay a person more than he or she produces, so increasing the minimum wage will make the lowest skilled workers unemployable.  Employers will hire people who have more skills and who can produce enough to be worth what they are paid, or they will automate their operations more, or, in some cases, they will simply go out of business.

People need to understand that it is no more possible to pass a law to overturn the laws of economics than it is to pass a law to overturn the law of gravity.  Unfortunately, the laws of economics say that low skilled workers who are not very productive will not be able to earn high wages.  The best thing we can do to help such people is to help them get an education or help them get started at a low wage, so they can obtain training and move up. 

Our daughter Andrea started a job a few months ago stocking shelves at night, and she enjoyed it.  However, she did not work quickly enough to be worth the wages she was being paid, so she was let go.  Her employer liked her but could not afford to keep paying her more than she was producing.  It is hard to see how the existence of that high wage helped her.  She would have been far better off to have been paid a lower wage while she learned how to do the job efficiently or perhaps found a job within the company to which her talents were better suited.  In either case, losing the job because she was not productive enough to be worth the wage did not help her.  Increasing the minimum wage will have a similar effect on many people who currently have jobs, and it will prevent many others from getting a job. 

Unfortunately, those people will be largely invisible, and most of them will not understand that the cause of their problems will be the very politicians who claim to care about them so much. 

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