Proponents of a federal $15 minimum wage like progressive Senator Bernie Sanders argue that it would lift millions of workers out of poverty. But the former CEO of McDonald’s just warned that artificially spiking the cost of labor could hasten the drive toward automation and instead leave many workers replaced with machines.
The minimum wage debate is littered with examples of second‐order consequences that tend to get ignored.
Governments can’t simply mandate higher wages into existence without imposing significant unintended consequences.
Bloomberg News recently ran a profile of Arin Dube, a Professor of Economics at the University of Massachusetts, Amherst. The story is a powerful one. It explores how Dube went from a 16-year-old burger flipper earning $3.85 at a McDonald’s in Seattle to a leading authority on the minimum wage. With federal legislation proposed to … Continue reading Bloomberg Article Misleads by Omitting Key Detail about Economists Surveyed on $15 Minimum Wage
A company spokesperson directly cited the city council’s ordinance mandating higher wages as the reason they are closing down.
For Americans hitting the drive-thru at their local McDonald’s, a $15-an-hour minimum wage could hit them in their wallets. According to a January report released by James Sherk, a former research fellow in labor economics at The Heritage Foundation, fast-food prices would rise by 38 percent under a $15-an-hour minimum wage and cause a 36 … Continue reading In 1 Chart, What Your Favorite Fast-Food Items Would Cost With $15 Minimum Wage
Getting a job requires experience; getting experience requires a job. This is one reason the trap of poverty can be so difficult to escape. But what is the root of this trap? Solutions exist, but they are too often blocked by misguided policies such as the well-intentioned minimum wage. By eliminating the opportunity to work, … Continue reading The Minimum Wage Outlaws Work Experience