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$15 and a Can of STP

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A long a time ago, a songwriter who would probably not agree with the conclusion of this piece penned a line in an obscure tune about a gas station theft: “We got $15 and a can of STP.” The only relevance it has here is the dollar amount, $15, which is the supposed new acceptable minimum hourly wage.

Several cities have already passed, or appear poised to pass, such a minimum wage increase, and the debate is on as to the effects. There seems to be broad agreement that enacting such a minimum wage would force upward pressure on prices, downward pressure on employment, and hasten the automation of certain jobs—disagreement is more over the extent and whether or not it’s important.

Proponents certainly have good intentions: after all, who couldn’t use a raise? Plus, businesses out there make huge profits, right? True and true (sort of: some are living large, most are just making it, so this could potentially kill many companies), but irrelevant on both counts.

The problem here lies with arbitrariness. A minimum wage is, by nature, an arbitrary figure, dating back to the first federal minimum wage. If $15 is good, then why not $20? The latter figure would put these workers right in the middle class, after all. And why not $50? That would really do these folks a lot of good, as well as others who might currently only make, say, $25 per hour.

Even proponents of the $15 wage will balk at this sort of argument and concede that at some point, the minimum wage just isn’t reasonable.

An arbitrary minimum wage is in no way tied to the value of the worker’s production. It is doubtful that a typical fast food joint could keep the same staff and get $15 of value per hour. Higher prices would deter sales and only the most efficient, experienced, skilled workers would remain, ironically harming the workers who need the job the most: the un- and low-skilled.

Another point: Our current $15 per hour minimum wage debate is another case of a government solving a niche problem in general.

An oft-repeated argument in favor of a boosted minimum wage is that it is difficult to raise a family on such a low salary. The fact is that the number of bread-winners making the minimum wage is so small that is scarcely worth state attention, at all. Moreover, such workers are typically the beneficiaries of state aid for essentials such as food and housing.

So again, the proponents of these increases have their hearts in the right place. Unfortunately, data and experience get in the way of desire.



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