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Milton Friedman On The Unholy Coalitions Of The Minimum Wage

Tyler Durden's picture





 

This week we were told that, by the magic of a non-deficit-increasing wave of our President's hand, the minimum wage should be increased to $9 (a 24% rise from the current $7.25 federal minimum wage) and anchored to inflation going forward. The rabbit-holes of whether this is a good or bad thing run deep and in very different directions. However, in three short minutes, Milton Friedman provides some critically clarifying truthiness on the unholy coalitions between 'do-gooders', 'special interests', 'trade unions', and the vicious circle that this non-market-based decision will create. "Do-Gooders believe passing a law saying nobody shall get less than [a minimum wage] is helping poor people (who need the money). You're doing nothing of the kind. What you're doing is to ensure that people whose skills do not justify that wage will be unemployed." It is no accident that youth unemployment is almost double the overall unemployment rate. We never learn... and as Friedman concludes, "it is the exact people who the do-gooders are trying to help that are hurt the most - the poorest!"

 

 


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Sun, 02/17/2013 - 11:26 | Link to Comment roadhazard
roadhazard's picture

Nine dollars an hours is only big money if you live fifteen to a mexcan trailer, otherwise it is starvation wages. That said, it ain't going to happen.

Sun, 02/17/2013 - 12:05 | Link to Comment batterycharged
batterycharged's picture

What Milton fails to recognize is that labor costs are not based on SKILL alone. And that wages should not be based on market needs alone.

If you have only one Mexican migrant farmer to pick your apples, and he asks for $20/hr...and you pay it. Does that mean his skills are worth $20?  Or if you  have a million unemployed MDs or JDs, does it mean they are worth $1/hr??

If we have a glut of labor, there's no reason capital should benefit from this by fucking people over with low wages.

The min wage puts a bottom on HUMAN DIGNITY. At what wage does it make it impossible for a person to survive? That's why we have a min wage.

Milton only cares about how people with money can make money.

Milton wanted higher education loans to be life-long, where each borrower pays a percentage of their income for their LIFE.  It looks like the gov't has achieved his wishes.

 

 

Sun, 02/17/2013 - 13:24 | Link to Comment epwpixieq-1
epwpixieq-1's picture

You fail to recognize a fundamental concept in the pseudo-science termed economics and that is that EVERYTHING is relevant and only fundamental laws of Nature are (sort of, but lets not go in this direction) absolute.

So IF this Mexican migrant farmer is the only one willing to pick these apples and you are WILLING to pay him $20/hr, for YOU this labor is WORTH $20/hr. If not, well you either can pick the apples on your own and that will SAVE you $20/hr or just leave them to get rotten.

In the second case IF there are million unemployed MDs or JDs ( one in the general case are sort of drug sellers and the other wealth redistributers ), and they are WILLING to work for $1/hr, well their labor IS WORTH $1/hr, for they VALUE it this way, otherwise they would have gone and start doing something more useful for themselves.

And just to give you another example, how much is WORTH, your body's self healing/regenerating powers that technically DO not need any MDs knowledge to heal you form ANY disease ( unless of course the genetic makeup is the problem ). The answer is RELEVANT, for it is worth nothing because you are NOT paying for it, but at the same time it is WORTH YOUR LIVE or your well being. How is this for what is worth something and what is not.

Or how much are worth the herbs that grow freely in nature that can help you body heal itself ( in the right proportions of course ) or the simple booklet that stores the knowledge passed with centuries how to use this herbs.

Again my advice is do not confuse worthiness as a concept, because in Nature, nothing is worth but everything has some usefulness for in natural dynamic of live. 

And for the last. It seams that according to Nature our civilization is not worth even a dime. How about that, for being worth something.

Mon, 02/18/2013 - 00:09 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

A wage market that disrespects the dignity of the living with deliberate intent to harm is one that itself should be harmed.

Sun, 02/17/2013 - 12:30 | Link to Comment granolageek
granolageek's picture

So says the guy whose showcase  protege cannot go to Europe because he will be arrested for the murder of a Spanish citizen. The fact that said citizen was a cardinal of the catholic church means that he really will get the book thrown at him.

Sun, 02/17/2013 - 14:07 | Link to Comment SmoothCoolSmoke
SmoothCoolSmoke's picture

This man's initials say it all.  He's a MFer  I really doubt he's worth the money he gets paid.

F him and his elitest handlers.

Sun, 02/17/2013 - 14:49 | Link to Comment hooligan2009
hooligan2009's picture

hey..it's an old show! check out charlie rose (doing the interview...friedman died in 2006, aged 94. 

don't shoot the writer..read the words and decide...do you think that raising the minimum wage corrects a tendency to slave wage rates or creates uemployment?

Sun, 02/17/2013 - 15:03 | Link to Comment egoist
egoist's picture
Sun, 02/17/2013 - 16:37 | Link to Comment Black Markets
Black Markets's picture

Having a minimum wage is a terrible bullshit idea.

It forces mothers out of work because it eats into the positive carry of their child care and fucks up the career and pension of virtually every woman in the country. Unless you earn several magnitudes more than the carer.

Fuck her.

It also fucks up young people as companies are much less inclined to hire some spotty little twerp to sit about in their office picking his nose and posting on Facebook off his iPhone all day if they have to pay him a "living wage", instead he is consigned to masturbating in his parents basement instead of becoming the future IT Manager.

Fuck him.

Companies also are far more likely to mechanise or outsource as the economics of plucking chickens or assembling toy soldiers is dramatically changed if the ultra high turnover trailer trash you employ to loiter around your assembly line suddenly qualify for 20% more pie.

Fuck them.

All the minimum wage does is raise the bar of HR departments and dissuades companies from hiring school leavers.

If you want to increase the value of labour v's capital have a war.

If you want to increase the market value of poor people then train them up.
Price fixing does not help these people. Closing the skills gap does.

Give a man a fish and feed him for a day, give a man a net and feed him for life. That's the slogan that we used to use to raise money for Africa.

Today the same slogan applies to the US and all the slackers therein.

Sun, 02/17/2013 - 17:36 | Link to Comment uncle reggie
uncle reggie's picture

So, ZH rolls out some vintage Friedman rubbish and the crowd roars. Lots here who love that red meat still dripping with warm blood.

Sun, 02/17/2013 - 19:47 | Link to Comment trendybull459
trendybull459's picture

Things is simple as its,first you make people poor forwarding them into bancrupcies of personal,then later divide their minimum wages into half,their not unemployed as units,then for those who never have chance to be hired you put unexpected hike in their wage because its obviouse to all but not government that the wages do not catchs with double digit inflation,so you making visible step forward which actually 2steps backward.Why?Think twice,government want(but do not do) to write off debit and adding up minimum wage is creating even more money print to free its hands just pushing the can for few months,not even years

we got new Forum in russia and in russian,but you can talk english(as most russians speaking it),to leave comments in translite or russian,what is good is that Russia absolutly free country if it apply to critics of their enemies,it takes some few minutes to be free from Big Brother watching being registred in Mail.ru

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Sun, 02/17/2013 - 22:34 | Link to Comment which way weste...
which way western man's picture

another "jew" criminal masquerading as quite something else

Sun, 02/17/2013 - 23:20 | Link to Comment tony bonn
tony bonn's picture

milton friedman was a murderer.....he and his evil cabal or rockefellerites terrorized the latin american world and continue to do so today with his fake free enterprise bullshit - socialism for the rich, free enterprise for everyone else.....see naomoi klein's shock doctrine for details...

milton friedman was a murderer - he laments a minimum wage - it would be a godawful shame if the supply of dom perignon white gold jereboam were imperiled by allocating a few more plutocratic dollars to the working poor.....

milton freedman was a murderer - fuck all of you self indulgent self righteous assholes who begrudge anyone decencies.....

for you selfish fucking assholes who deplore welfare, you could get rid of it by providing decent wages and encouraging investment instead of whining about some poor slob who might be given something he doesn't quite deserve....oh - and milton friedman was a murderer....

Mon, 02/18/2013 - 00:07 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

Friedman is such an asshole. He never admits that employers & employees can work together to combine many skills into a single job & get that minimum wage to work. He also doesn't address the real problem with wage purchasing power, that it must continually drop where a combination of fiat inflation, offshoring, automation & fraud. We can control & attack fraud, tax benefits to offshoring & creative use of automation so that jobs are created WITH automation improvements instead of being disruptive. We may, we should try to, destroy fiat currency so that we can destroy inflationary destruction of wage purchasing power. IF we can destroy central banking fiat currency we can destroy the biggest excuse to have minimum wage laws or demands for them: the loss of purchasing power for the poorest people

Mon, 02/18/2013 - 02:44 | Link to Comment Peter K
Peter K's picture

OK. ZH has rehabilitated Milton Friedman. What took you so long?

With respect to minimum wage, I suspect there is an ulterior motive. Higher minimum wages feed illegal immigration. And since an amnesty is just around the corner, the Demoshitheadcrats need to load the boat.

 

Mon, 02/18/2013 - 08:17 | Link to Comment sbfeibish
sbfeibish's picture

Who needs the article, when you've got the comments?

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Tom Brady's a North Korean robot.  Priceless.

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