Letter to | the Editor
To the Editor:
Brad Hicks’ recent column in the Express caused me to think about the minimum wage a bit.
Most people have no idea why there is a federal “minimum wage.” It has nothing to do with the workers, or “fairness,” or “a living wage.” The federal minimum wage was enacted specifically to stop companies from moving jobs out of the northern states to the less expensive southern states, where wages – and the cost of living – were much lower.
From the Washington Times, May 28, 1998:
In yesterday’s Wall Street Journal, Burton W. Folsom, Jr., explained the origins of the federal minimum-wage law in the 1930s: A Yankee plot to strangle the South’s economy.
“During the 1920s and ’30s, the American textile industry had begun to shift from New England to the South, where the cost of living was lower and where Southern workers produced a high-quality product for lower wages,” writes Mr. Folsom, a senior fellow with the Mackinac Center for Public Policy in Midland, Mich. “Politicians in Massachusetts, led by Republican Sen. Henry Cabot Lodge, Jr. and House Minority Leader Joseph Martin, battled in Congress for a law that would force Southern textile mills to raise wages and thereby lose their competitive edge.”
Politicians in Dixie were quick to spot this evil Yankee conspiracy, Mr. Folsom writes.
“Northern industries are trying to stop the progress of the South, and they feel if they can pass this bill, it will really be a tariff against Southern goods,” Rep. Sam McReynolds, Tennessee Democrat, argued in the 1930s.
Hmm. Massachusetts politicians pushing for a minimum-wage increase? Sound familiar?
“Sen [Edward M.] Kennedy would have us believe that what has been good for Massachusetts is good for the nation,” Mr. Folsom writes of the Massachusetts Democrat. “That was wrong in 1938 and it’s still wrong 60 years later.”
We have eighty years of history that shows that “minimum wage” laws destroy jobs, particularly entry-level jobs, and the higher the “minimum wage” the more jobs are destroyed.
A long time ago when I was a lad the minimum wage was $1/hour (and mailing a first class letter cost three cents). Today it’s $7.50/hour (and mailing a first class letter costs 50 cents) and many people want it to be $15/hour. What those people don’t realize is that raising the minimum wage actually devalues the dollar, because not only does that minimum wage increase, all other wages increase proportionately and all prices also go up.
Jobs have value to the employer; if the cost of having that job done (wages) is higher than the value of the job, the job gets eliminated. One would hire someone to mow one’s lawn for $10, but if the worker demands $100 to do the job that grass isn’t going to be cut (at least mine isn’t).
The stereotypical minimum-wage job is the fast-food worker. I note that many such workers are demanding they be paid $15/hour, and I also note that someone has invented a kiosk where customers can order and pay for their meals (and other things), and someone else has invented an automated grill that cooks and assembles hamburgers (and other things). In the near future, it will be possible to prepare and serve fast food meals without any human intervention. The bottom line here is that some fast food workers are in danger of pricing themselves out of their jobs.
Robert Ackley
Emerson