California Prohibits Young Adults & High School Dropouts From Holding Jobs

Of course, no headline will ever say that. But that is exactly what they have done.

Fox News reports:

“The bill, which would raise the state’s minimum wage to $9 in July of 2014, and then to $10 in January 2016, would mark California’s first minimum wage hike in six years… But while Democrats say the bill will help workers hurt by the recession, Republican lawmakers argue that it will encourage businesses to cut jobs, leaving many of those workers unemployed instead. The California Chamber of Commerce also opposed the bill calling it a ‘job killer.’”

This is not a matter of opinion. Any time you use political power to force people to pay more for a product fewer people will purchase that product. Wages are just another kind of price. An employer is purchasing labor from a person. When the government threatens jails or fines against people unless they pay more than the labor is worth to them, then they will stop purchasing the labor. They will not only stop hiring but will lay off workers.

Why is this hard to grasp? If the CEO of Mars Corporation decided that his company wasn’t making enough revenue from selling M&M’s, could he increase the price of M&M’s by twenty percent and expect to see more money pour in from customers? When you raise the price, you lose sales. Profits would drop, not rise, with such a change. Some people would stop eating chocolate candy. Others would find a competitor’s product that they prefer to paying the higher price. Of the few who still purchased the more expensive M&Ms, they might not have enough money left over to buy their usual monthly supply of Skittles or Snickers so that Mars would end up losing money on those other products and still end up worse off. Such a stupid CEO would lose his job; but stupid politicians, with their economically brain-dead journalists, almost never get held responsible for the damage they do to “help the poor.”

If minimum wage makes people richer, then why not set the minimum wage at $20 or $100 per hour? Won’t that make everyone richer? No? But why not if minimum wage increases are such a good thing?

To even speak of minimum wage earners as one group or class is bogus. As one blogger points out:

“The average household income for a family with someone earning the minimum wage is nearly $50,000. Most workers earning the minimum wage aren’t poor; they are spouses or teenagers living at home like the kid who delivers pizza to buy gas for his BMW.”

The Heritage Foundation gives the citations and shows us that only a small fraction of minimum wage earners are trying to support a family on a minimum wage job. So, if you think the government can help those unfortunate people, why not present a plan for doing so (I’m doubtful government can help but at least show me a plan to do so if you disagree with me). Why not target the ones who need help rather than hurt all employers, increase all unemployment, cause price inflation, and damage the economy?