Why do so many people accept the notion that imposing and raising legal minimum wages are good for people at the lower income levels? Do they have some inexplicable “propensity” to demand higher wages for others through government mandate as their own economic circumstances improve? I think the more reasonable explanation is a failure to understand and appreciate all the implications of the logic and reality of supply and demand in labor markets. That is, it is the result of wrong and faulty ideas that are sometimes easier to impress upon people than the often abstract and indirect chains of causation through which market processes operate, including in the demand for labor.
James Rogers expresses his objections to the narrative of middle-class economic stagnation . Here’s his conclusion:
The telling point about income, however, should not be lost in these weeds. Contrary to seemingly ubiquitous claims of income stagnation, the data show incomes for all American households increased substantially over the last generation. The data also show existing tax and transfer policies have in fact had their intended effect, with a substantial redistribution of income gains from the richest Americans to the poorest Americans. The data do not support a central economic claim of both left and right critics of neoliberalism.