And, Do Note, the Money They Are Spending Is Theirs – Not Other People’s

by Don Boudreaux on July 18, 2013

in Economics, Seen and Unseen, Work

Here’s a letter to the Kansas City Star:

Barbara Shelly objects to the Koch Foundation’s ad for economic freedom (“Koch ‘economic freedom’ ad is a bust,” July 11).  She closes her column by alleging that “Get rid of the minimum wage and take away some of the other things the Koch brothers see as undermining societal well-being, like student loans and food stamps, and Charles Koch will have to recast his ad campaign.  There will be many fewer people in the 1 percent.”

Overlook Ms. Shelly’s ignorance of the meaning of percentages and focus instead, for example, on her implied assertion that the minimum wage is a boon for poor people.

Economics teaches that forcing low-skilled workers to sell their labor at prices higher than their labor is worth to employers hurts low-skilled workers by stripping many of them of opportunities to enter the workforce.  History reveals that the U.S. minimum wage was first imposed to protect politically powerful owners of northeastern textile mills from the competition of southern mills that employed legions of unskilled southern workers at wages lower than prevailed in the northeast.  And ethics warns that a precious freedom is trampled upon when politicians restrict the terms of employment that individual men and women may choose to demand or accept.

Ms. Shelly’s obliviousness to any possible merits of these arguments – and her sanctimonious dismissal of anyone who dares to advance them – qualifies her as Exhibit A in what I suspect is the case for why Charles and David Koch spend so much of their own money promoting a better understanding of free markets and a free society.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA  22030

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