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The Set of Available Options Is Smaller Than Many People Suppose

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Here’s a letter to Medium:

Regarding your detailed account of the difficulty of being a single mom earning a low wage (“Five Days In the Life [2],” October 2): no one doubts that the challenges facing low-wage workers such as Adriana Alvarez are far more grueling than are the challenges facing workers who earn higher pay.  But if your report is meant to make a case for raising the minimum wage, it fails.

As difficult as it is for Ms. Alvarez to make ends meet with hourly pay of $10.50, it would be immensely more difficult for her to make ends meet with hourly pay of $0.00.  Yet such a drop in pay will be the eventual result for many workers such as Ms. Alvarez if government were to raise the minimum wage to a rate higher than the hourly rates that they now earn.

The choice for policymakers is not between, on one hand, all low-skilled workers earning low pay (while also gaining valuable job experience that permits them in the future to earn higher pay) versus, on the other hand, all low-skilled workers, thanks to a hike in the minimum wage, earning higher pay.  Instead, the choice is between, on one hand, all low-skilled workers earning low pay (while also gaining valuable job experience that permits them in the future to earn higher pay) versus, on the other hand, many low-skilled workers, thanks to a hike in the minimum wage, earning no pay and also being denied opportunities to get the valuable job experience necessary for them to earn higher pay in the future.

So if your goal is to better inform policymakers with ‘day-in-the-life’ accounts of the struggles of low-skilled workers, you should run – in addition to your account of Ms. Alvarez’s difficult daily routine – an account of the far more difficult daily routine of a single mom who earns nothing per hour because the minimum wage has priced her out of work, opportunity, and hope.

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

(Thanks to Tim Townsend for alerting me to this Medium report.)

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