“It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a ‘dismal science,’” once said Murray Rothbard, the late iconic Austrian School economist.
“But it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance,” he qualified.
Which brings us to Pennsylvania Gov. Tom Wolf, who yet again is shilling for an increase in the state minimum wage, by 2027, to $15 an hour.
Wolf & Co. – the governor and his “progressive” acolytes fully qualifying as the Coterie of the Ignorami – first bemoan that it is a matter of “fairness” that the government-dictated wage floor be raised by nearly 107 percent.
After all, they argue, the minimum wage has been static since 2009 and, and, and, well, you know, there’s been inflation.
Sorry, but inflation values that $7.25 at only $8.84 today, not the $12 hourly wage (a 65.5 percent increase) that Wolfe & Co. first seek to jack the minimum. And it’s a good bet that a $15 hourly rate in six years also will exceed the inflation rate.
Even if one supports the minimum wage – and we don’t; markets should set wages, not governments — how can anyone rationally support such an out-of-whack increase?
That bogus argument slain, Wolf & Co. move on to the “moral” argument. And this is where their ignorance is fully exposed.
“Raising the minimum wage will help workers,” the governor says. “It will bring more money into local businesses. It will stimulate our economy. But most importantly, it is the right thing to do.”
And, of course, don’t you know, “The economic literature — it’s very hard to find any indication that actually treating your employees more fairly ends up being worse for your business,” Wolf also says.
Whew! No doubt that economic literature is hard to find – if you either don’t look for it or ignore what’s in front of your face.
Does Wolf really expect us to believe that he has no knowledge of the just-released latest Congressional Budget Office (CBO) analysis of the effects of a $15 national wage floor?
Under the federal legislation that, if passed, would go into effect in 2025, 1.4 million jobs would be lost because, as USA Today reports, citing the CBO, “higher wages would increase the cost of producing goods and services and, in response, many employers would reduce their workforce or hire fewer employees.”
What’s moral about that, Governor?
To crib from and reword a Wall Street Journal editorial on the topic, “How many jobs for the young and unskilled do you want to lose, Gov. Wolf?”
The Journal also notes, again, citing the CBO analysis, that “prices would rise for goods and services that rely on entry-level labor” and “the federal budget deficit through 2031 would increase $54 billion … as the government spent more on unemployment benefits and health-care programs.”
As Steven Horwitz, writing for the Foundation of Economic Education, reminds, “The worst type of economic ignorance is the type of ignorance that is the worst in all fields: being ignorant of your own ignorance.”
Now, we know this might sound oxymoronic, but even political leaders have an obligation to be honest brokers in the prosecution of public policy.
Sadly, however, Wolf & Co’s. push for a $15 minimum wage is intellectually dishonest and morally broken.
Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy (cmcnickle@alleghenyinstitute.org).
