Raising the minimum wage is one of those ideas that will never go away because A) it polls well (people like things that sound nice and can be explained in under 10 seconds), and B) politicians love to pander.
It’s a hot issue in the Democratic primary right now thanks to the #FightFor15 movement, which has succeeded in getting a $15-per-hour minimum wage enacted in liberal states such as California and New York.
Many liberals, including Bernie Sanders, have been calling for a federal minimum wage of $15-an-hour. The federal minimum wage is currently $7.25-an-hour, but many states have set their own higher minimum rates.
Hillary Clinton has been more of a skeptic, arguing (quite reasonably) that $15 might make sense for big, high-cost cities like New York and San Francisco, but is a little unfeasible for smaller towns and rural areas. She knows better, but is having a hard time resisting the urge to pander by simply endorsing #FightFor15 at the federal level.
Liberal economists know better, too. Oddly enough, few are willing to go on the record opposing a $15-an-hour federal minimum wage:
Princeton’s Alan Krueger is a liberal economist who isn’t afraid to weigh in. A $15-an-hour minimum wage could be “counterproductive,” he argued in the New York Times, because the higher wage would likely result in significant layoffs outside big cities and states where wages are already high.
States that have enacted the $15 minimum wage may already be feeling those effects:
Any increase in the minimum wage would do little to stem the tide of automation in our society, and would probably have the opposite effect, as businesses find ways to replace workers with machines.
It will be interesting to see how the #FightFor15 plays out if Hillary (as expected) become the Democratic nominee. Will she and other Democrats do what comes naturally, and demagogue the issue, for example, by portraying it as a matter of life and death? And, if so, will liberal economists continue to keep quiet?
Barack Obama repeatedly told Americans: “If you like your health care plan, you can keep it.” After Obamacare went into effect in 2013, that was exposed as a gigantic lie. That’s when a bunch of liberal economists and pundits started explaining that, yes, of course you won’t be able to keep your health care plan. Few were eager to speak up at the time when Obama was selling reform to the American people.
Imagine that.