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FDR DINOSAURS

Tuesday, May 31, 2005

Eliminate the minimum wage It's settled. Another FDR era program has outlived its usefulness, and should be eliminated. The federal minimum wage, adopted in 1938 to guarantee a wage of at least 25 cents an hour to employees engaged in interstate commerce or in the production of goods for interstate commerce, is no longer needed. The original law mentioned interstate commerce as a nod to the constitution, since Congress is specifically allowed to regulate interstate commerce. Of course, nearly anything produced can be transported from one state to another. McDonalds employees who sell you a hamburger that you just might transport across state lines, are protected by the federal minimum wage law, which has been stuck at $5.15 an hour since 1997. Its singular value now is to frustrate Sen. Ted Kennedy, who tries to raise it every year, but has been defeated seven years in a row. Maybe that's good enough reason to keep it, but my head tells me otherwise. In practically every corner of the country, the labor market has made the federal minimum wage obsolete. Most employers bound by the minimum wage pay more than that, not because the government tells them they have to, but the market tells them so. Their fellow businessmen and women, bidding for the same labor, are willing to pay more, so they do too. On top of that, many states have adopted a minimum wage that exceeds the federal standard. In all, according to the USA Today, 17 states and the District of Columbia, have minimum wages that are higher than $5.15 an hour. They are, for the most part, in states where the cost of living is higher than average. I'm not a fan of any minimum wage, but I can live with it if it's set by states, and not by the federal government. First, states do have the constitutional authority via the 10th Amendment. Federal constitutional authority is flimsy at best. Second, states can set a minimum wage that makes more sense. Having the same minimum wage for D.C. and South Carolina makes no sense at all, since the cost of living in the two places is vastly different. One of my daughters lives in a Virginia suburb of D.C. and rents a three-bedroom house for nearly $2,000 a month. She tried to buy the house for $400,000. The owner wanted a half-million. That's four times what the same house would sell for in a similar neighborhood in Greenville or Spartanburg. Should D.C. and South Carolina have the same minimum wage? I truly enjoy seeing Sen. Kennedy squeal every time his colleagues in Congress turn down another increase in the minimum wage, but sooner or later, his side will carry the day, and Congress will go along. More than likely, in order to get some Republican votes, Kennedy will agree to attach another form of corporate welfare onto the bill. It's time for the federal minimum wage to die a natural and overdue death. If someone wants to move from South Carolina to D.C. or Alaska in order to make $7.00 or $7.15 an hour, that would be an act of financial stupidity on their part. But if other states want to draw the stupid people out of South Carolina, who am I to stop them? Ralph Bristol

posted by Jack Mercer @ 5/31/2005 03:59:00 AM

2 Comments:

At 6/07/2005 12:37:00 AM, Kristy said…

Any thoughts on jobs like those in agriculture? Even though California's minimum wage is much higher than the fed's, our agribusiness pays undocumented workers under the table b/c they will work for less than the minimum. So much for market forces, eh?
At 6/07/2005 07:14:00 AM, Jack Mercer said…

Hi Lefty!

GREAT to hear from you! Its been a while.

My thoughts on hiring of illegal aliens are kind of independent of the minimum wage rules. Those unethical employers will hire and pay them whatever they want to regardless of the minimum wage. The law means nothing to these people no matter what.

Make sense?

Thanks again for stopping by! Will be in touch.

-Jack