Carpe Diem

By far, the two best cartoons about the minimum wage ever

minwage11PayneMinWage

I’ve featured both of these cartoons before on CD, but because they’re so good and because there’s still so much economic amnesia/illiteracy about the minimum wage law government practice of forcing unskilled and low-skilled workers to remain unemployed (copying Don Boudreaux), I’m posting them again.

Both are from my favorite editorial cartoonist Henry Payne (reprinted with permission).

20 thoughts on “By far, the two best cartoons about the minimum wage ever

  1. Send these to the mayor and his challenger in Seattle. Both have come out in support of a $15 minimum wage for the city. Interestingly though, Mayor McGinn “supports it” by claiming he’ll sign anything the city council passes.

    Way to appeal to the low-information voter without actually doing anything! “I’ll let you eat cake, if the city council bakes you one!”

    • alternately, it could be that the cost to buy his productivity gets raised above that of capital and results in substitution and or outsourcing, possibly overseas.

      the notion that because a worker’s marginal productivity exceeds what he is paid that hiking his wage arbitrarily does not result in lost jobs misses much of the picture.

      such a hike changes the relative merits of substitutes, and reduces profits or increases prices (or both). reducing profits reduces investment and thereby growth and thereby jobs. increasing prices reduces real income and thus real buying power and thus jobs.

      this is what the card and kreuger crowd cannot seem to grasp. even if a min wage hike does not cost the earner HIS job, it will cost someone else theirs and prevent other jobs from being created..

      • Morganovich can’t even grasp the “paradox of thrift,” in his upside-down world.

        I guess, he won’t be happy, until American low-income real wages (which are falling) converge with Chinese low-income real wages (which are rising).

        Raising low-income real wages, which are too depressed in the U.S., will facilitate a virtuous cycle of consumption-employment, to raise both consumption and saving.

        It’s a “market failure” when all the productivity gains go to a leaf blower, for example, and none to the low-skilled worker operating the leaf blower.

        • peak, you are as persistent as you are ignorant, but i am done engaging with you. tantrum all you like.

          you are simply too stupid and dishonest.

          the paradox of thrift has been disproven 100 times and i know you know it because i have personally shown you how over and over.

          anyone who thinks there is a paradox of thrift does not understand what savings is. the real paradox is why clownish keynsians believe that savings are stored under the mattress and not put to productive use. the us has shown MORE not less growth during periods with high savings rates.

          when you ask yourself “why won’t people with actual econ educations talk to me” remember this post.

          this is why.

          it’s because you are not just ignorant, but a liar. (oh, and using multiple logins to agree with yourself is childish. you know the thread i mean. “i could not agree more…”)

          you not only seize repeatedly on the worst crackpottery in econ, but then repeatedly trot it out over and over even after it is debunked.

          i know you will not roil off in a cloud of cognitive dissonance and tell yourself how wonderful you are and that it’s some conspiracy that dozens of people here all think this, but it’s not peak. it’s just you, and contrary to your bizarrely tenacious beliefs about your own intellect and education, it’s really obvious to all but the most hard of thinking.

          it does not require conspiracy for many people to independently call a fool a fool.

          ok, that’s all.

          i’m going to go back to ignoring you now.

          • Morganovich, everything you say about me describes you, not me. I don’t need to log in as someone else like you do. You believe economics is whatever you want it to be. You’re in for a rude awakening, if you ever wake up.

            Now, you got me wondering how many aliases you have on this blog.

            All you do is prove your ignorance of American mainstream economics and play cute little games. You should find another blog and compete with someone like Nancy Pelosi.

            You contribute no value here.

    • The marginal productivity of somebody is below minimum wage. Otherwise, there wouldn’t be such nattering about the minimum wage. If everyone’s marginal productivity is above the minimum wage, then everyone would command a salary above the minimum wage.

    • Nick Bradley, normal people have learned you can’t have a conversation on economics with Morganovich. and his circus, because he’s like a pre-20th century witch doctor, who believes voodoo is the only real medicine.

      Don’t let him drive you away, like some others, who got fed-up with him.

  2. Raising the minimum wage will cause greedy, weak, and poorly managed firms (represented in the cartoons) to lose business or fail. Other firms will not only capture their market share, they’ll benefit from the increased demand.

    • Imposing arbitrary costs on businesses to kill off the ones who can’t take it is not a very smart idea. Still, Wal-Mart supports minimum wage increases, for presumably similar reasons. They can handle it since they already pay more than the minimum wage, but their locally owned competitors often can’t.

  3. More than 10 years ago, San Francisco implemented a living wage that applied to any business supplying services to the city. I owned such a business. The living wage was about $9 an hour plus $2 an hour for healthcare. While my skilled employees earned more than this living wage, new hires and low skilled workers did not.

    As a small employer, it was my pleasure to pay my employees more money. But San Fran would not allow us to adjust the contracted labor price they paid for our services. Instead they simply contracted for labor services from companies located outside of San Francisco.

    No surprise I guess that in less than 3 years, there were no longer any San Fran based businesses of my kind.

    I guess I was naive enough to think that the City Counsel of SF actually wanted to provide opportunity to lower skilled workers. That they would accept higher costs in order to support higher minimum wages as they expected every consumer to do.

    I understand now that it was just a way to drive low skilled businesses out of San Fran so that they could attract high tech companies paying higher taxes. I know that rents are about 8 times higher than they were.

    Who cares what happened to the low skilled minimum wage workers anyway? Certainly not the folks who implemented the living wage.

    • I’ve written about the minimum wage before, and while the economics of why it’s a terrible idea are pretty straightforward, it’s the way that the political consequences of hiking the minimum wage pay off that makes it really insidious. Here’s an excerpt:

      The reason that the minimum wage persists despite being awful economic policy is because it is a political no-lose situation for the party that has set itself up on the principles of class warfare. The worker who gets a pay raise as a result of an increase in the minimum wage is grateful to the government for raising the minimum, while the worker who loses their job when the minimum wage is increased is far more likely to blame corporate greed, as his political masters tell him to. He’s probably never seen intersecting supply and demand curves before in his life and doesn’t understand that it is the government’s fault that he is now a legally non-profitable (and therefore unemployed) worker. Instead, he goes on the dole, and is grateful to the government for providing support in his unemployment.

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