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Where Have All The Jobs Gone?

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By Timothy Sandefur

I once worked for less than minimum wage. I needed the money, and the work wasn’t hard, so I took the job. I thought that I had the right to do what I wanted with my own labor.

I agreed with Mary Travers, who once told the Boston Globe that people shouldn’t "tell the poor what to do with their bodies."
But now it seems Travers has changed her mind. She and her musical group Peter, Paul and Mary recently performed at a concert to raise support for a Santa Monica ordinance (Measure JJ) which would raise the minimum wage to $12 per hour in certain parts of the city. The ordinance, which goes before voters November 5, is supposed to help the poor. But in fact, it will dry up opportunity, increase the cost of living, and end up hurting the very people its supposed to help.
The reason is simple: you cannot make people richer by making their jobs illegal. A $12 minimum wage is essentially a sign saying "It is better for you to be unemployed than for you to earn $11 an hour." It means businesses will have less incentive to train people, or to hire unskilled or inexperienced workers. And it will increase the cost of living. After all, businesses that now must pay their employees more will have to raise prices, so they can afford to. Many businesses will just leave, or will lay off employees to cut costs. Others will choose not to open stores in Santa Monica, since the cost will be too high. Measure JJ doesnt help the poor, it just makes jobs harder to find.
Its common sense: if you make it more expensive to hire people, fewer people will be hired. A study by the Employment Policy Institute found that after the federal government raised its minimum wage by 50 cents in 1996, 215,000 teenagers lost their jobs, even though the economy was generally strong. Particularly hard hit were minorities. The employment rate among Black teenaged boys fell by 9 percent, compared to a 4 to 5 percent decrease among their White and Hispanic peers. Thats why Nobel Prize winning economist Milton Friedman calls the minimum wage "the most anti-Black law on the books."
The best way to help the poor is to make it cheaper for people to create jobs: make it easier to get business licenses; ease off on regulations, paperwork and taxes that cost businesses so much time and money. (Proponents of Measure JJ secretly know this. Thats why it only applies to businesses making more than $5 million per year. They know small businesses couldn’t afford it.) The worst way to help the poor is to pursue policies that make products and services more expensive, like minimum wages, which force businesses to raise prices. One study by the Hoover Institution found that after the 1996 increase, families in the bottom 20 percent income bracket paid an average of $61 more per year for commodities.
But minimum wages aren’t just ineffective they’re also wrong. People have a right to earn a living however they choose, so long as it harms nobody else. If someone wants to work for $10 per hour, what right do others have to stop him? In fact, one reason the Fourteenth Amendment was passed was, in the words of one of the Senators who wrote it, to protect "the liberty...to work in an honest calling and contribute by your own toil in some sort to the support of yourself, to the support of your fellowmen and to be secure in the enjoyment of the fruits of your toil." Until the 1930s, courts routinely held that the Fourteenth Amendment barred the government from infringing on a persons right to earn a living, a right which Justice William O. Douglas called "the most precious liberty that man possesses. Man has indeed as much right to work as he has to live, to be free, to own property....To work means to eat. It also means to live... So the question here is not what government must give, but rather what it may not take away."
Proponents of the minimum wage, like Mary Travers, think they know what’s good for everyone else, and therefore have the right to tell us what we can do with our own bodies. If someone wants to hire me for $5 an hour, and I agree, Measure JJ would send my boss to jail for six months. And all for a policy that will only end up hurting the poor. It reminds me of something else Mary Travers once wrote: "Sadly, [some people] seem unconcerned with the grinding poverty others must endure. Once again, the poor will bear the brunt of self-righteousness, enforced by law."

Mr. Sandefur is a Fellow in the Center for Public Interest Law at Sacramento-based Pacific Legal Foundation. Pacific Legal Foundation is the oldest, largest, and in the words of the Washington Post, "perhaps most influential" public interest law firm dedicated to limited government.

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