American History20 Nov 2008 10:36 am
The minimum wage is now 70 years old, and any sort of opposition to it is dismissed these days as curmudgeonly nonsense, the sort of thing one finds on the lunatic fringe of the far right. One figure who is often unfairly placed in that category is the economist Milton Friedman. Yes, Friedman was about as much of a free market absolutist as you could hope to find, and, yes, he did support Conservative Senator Barry Goldwater’s 1964 run for the presidency.(Incidentally, that run is often considered the beginning of the Conservative Movement in America, which many think may have ended with the recent presidential campaign of Goldwater’s successor as Senator from Arizona—John McCain.)
But, when the Nobel Laureate was asked what his most important achievements were, he listed two causes not often associated with conservatism: his contribution to ending the compulsory military draft, and his opposition to the criminalization of drugs. Perhaps Friedman’s argument against the minimum wage is worth considering after all.
On December 7, 1975, Friedman appeared on the television program The Open Mind with Richard D. Heffner (read the entire transcript here) and made the astonishing claim that the minimum wage was a disaster for poor people and, in particular, a disaster for black Americans. His reasoning is as calm and simple as his claim is shocking: if employers don’t believe that somebody is worth the minimum wage, they aren’t going to pay them that amount. That would be charity—a perfectly wonderful thing, but not something many employers can afford. Instead, they simply won’t hire that person at all. Friedman’s conclusion is that the minimum wage leads to greater unemployment and hurts exactly the people it is meant to help.
Watch him making the claim, and see what you think:
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