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Why We Don't Need a Higher
Minimum Wage
(or a minimum wage at all)
by Jeffrey ten Grotenhuis, Online Editor/Staff Writer
"Capitalism would take advantage of workers and pay them next to
nothing without a minimum wage," says Junior David Hayes regarding
the question of whether we should have a minimum wage or not. As
many may have heard, Governor Arnold Schwarzenegger signed a bill
more than two weeks ago, which will raise the minimum wage in
California twice in the next two years by a dollar and twenty-five
cents. That means that in 2008, California's minimum wage will be
eight dollars! But is this beneficial to students and workers
Councilman Jim Saxton, who is
outspoken when it comes to economic issues, supports the opposite
view; that minimum wage is detrimental to our economy, "Raising the
minimum wage hurts the poor. It takes away jobs, keeps people on
welfare, and encourages high-school students to drop out. The reason
for this result is that with a larger pool of applicants,
competition is stiffer. Low-skilled workers have a more difficult
time getting those job skills that are crucial to economic
well-being." So, for instance, it Junior Jimmy Vlahos, who is an
extremely unskilled person, wants to apply for a position at
McDonalds, the employer will hire someone with more experience since
employees mustproduce more than what he gets paid in an hour.
So how does this affect high-school
students? Sin- ce the minimum wage will increase by 75 cents an hour
in January and by 50 cents more the year after that, then many
students will be tempted to drop out of school to earn "easy money."
And even if students don't drop out of school as a result of this
increase, it will become much more difficult to work part-time.
Stephen Gilmore, of the Wall Street
Journal, believes that an increase in minimum wage is a form of
control which cannot coexist with the law of supply and demand, "Why
stop with wages? Why not do something about high prices for gas,
food and other goods? After all, if government can dictate wages, no
reason they can't control prices at the same time, too, right?" Too
much regulation in the market results in the economic system
becoming something other than capitalism. Price control is what
countries like Vietnam exercise. Furthermore, price control stifles
competition because workers have no incentive to excel in their job.
Surely it is more productive and satisfactory to get paid according
to production rate.
Supporters of the minimum wage bill
argue that it will greatly help families in California since the
standard of living is currently very high. However, this is not the
case, because by providing some with a more comfortable standard of
living, dozens more are left unemployed. Furthermore, Jim Saxton
argues that minimum wage is irrelevant for most people in poverty
due to the fact that "only 9.2 percent of poor people of working age
have full-time jobs." It certainly seems that low-skilled jobs are
almost entirely composed of struggling parents trying to support
their families, but more than half of the employees at low-skilled
jobs are single individuals, many who live with their parents.
If the minimum wage keeps rising,
then those jobs which are essential to poor Americans will become an
alternative for higher-skilled applicants and therefore create more
poverty. The current national economic policy seems to be, "If it
ain't broke, don't fix it." Well, for poverty's sake it should.
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