Gene's reply: The minimum wage, according to Milton Friedman's book, "Money Mischief," represents a counterbalance to monetary growth, if you connect all the dots. (I like the term monetary expansion and the Austrian School of Economics likes the term monetary inflation, but we all mean the same thing.) Friedman states: "substantial inflation is always and everywhere a monetary phenomenon" (p. 193, "Money Mischief," by Milton Friedman). One quickly realizes he is talking about monetary expansion, which is the primary driver of price inflation. Minimum wages are a response to rising prices/ price inflation. So, the minimum wage is a direct reaction to monetary expansion.
Governments inflate the money supply in order to maintain a supply of money for an expanding population. If America became a nation of one billion people someday, we would need to expand the money supply in order for there to be enough money in circulation to conduct business between everyone. If there were only one million $10 bills in circulation, for example, 300 million Americans today would not have access to $10 bills, etc., etc. Imagine the negative impact of not being able to have a common medium of exchange. You would hope to have the right stuff in your closet for barter for gas, food, etc. It would be a mess to figure out and would slow the economy, increasing poverty and unemployment. This is the official argument. Gandhiji, for example, used free market alternatives to the British system, and they didn't fall off the map, and the world didn't end.
The solution is to abolish monetary expansion (central banking) or tie monetary expansion to population growth, as it was originally intended. The problem with the latter solution is that we've never been disciplined enough to tie monetary expansion to population growth. The central bankers and politicians always have these not so little pet projects to fund, so they collude to fund these projects through creating new money. It's easier than raising taxes to our face, so they raise an unseen tax behind our back with the printing press.
Abolishing monetary expansion means abolishing the central banking system (5th plank of "The Communist Manifesto.") Alternatives would have to be studied before we could go off the paper rush we are on, but I like what I see of the bitcion concept so far, and the free market always has a way around the barriers. My solution is to seek private alternatives to a central bank, along with abolishing the most violent thing on earth in the process, government. Study Gandhi.
In the mean time, if you refuse to adjust a minimum wage to the impacts of monetary expansion, the intrinsic value of labor wages (your paycheck) will be transferred into the hands of employers, investors and government beneficiaries, etc., etc. until we are living in boxes outside the chain linked fences of giant corporations. You will have engineers making enough to buy a bicycle to drive to work. Then the workers will unite into giant unions and the pendulum will swing in the other direction for a few decades until unions become too greedy and people abandon them in droves.
The pendulum must be stopped. We must abolish government, and the free market will cause the economy to come into balance.
Answer to your question: Overall, the historic numbers look like darts scattered all over a dart board, so no one really knows what the true impact of the minimum wage is on employment, under the present Keynesian-Marxist paradigm of U. S. monetary policy.
Tolstoyan-Gandhian Libertarian Candidate for Texas Governor
[Endorsed by Dr. Noam Chomsky (Intellectual of the Age) and Dr. Ravindra Kumar (World's Most Prominent Gandhian Intellectual)]
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