By Kirsten C. Tynan
Arizona Daily Wildcat
October 29, 1997

Bigger paychecks will lead to higher cost of living

Arizona Daily Wildcat Kirsten C. Tynan

When you think about arguments against minimum wages, what comes to mind? Minimum wages hurt businesses that can't afford to absorb additional costs. Minimum wages weaken the economy. These points are worthy to note, but the most important argument is that minimum wages hurt people, often the most economically disadvantaged.

Minimum wages hurt people financially. A price floor makes it illegal for people with fewer skills to sell their services for lower prices than more skilled workers. Thus, the most unskilled workers lose their jobs, unable to compete in a permanent buyer's market for labor. Who says so?

Many people - including Nobel laureate in economics Milton Friedman and Joe Stiglitz, chairman of Clinton's Council of Economic Advisers. And numerous studies support their conclusion.

Minimum wages also lead to a price-wage spiral that increases the cost of living as wages are artificially increased. Gains in workers' wages are soon lost to increasing prices. Workers who make just over the minimum wage are hurt as well. While they are unlikely to see wage increases, they are still affected by increasing prices and their buying power drops.

Minimum wages are an affront to human dignity. Paternalistic government controls over wages tell workers that they are not able to bargain for themselves. Rather than treating workers as responsible adults, minimum wage laws commodify them and encourage employers to do the same. Since the supply of workers exceeds the jobs available, employees are easy to replace. There is no economic incentive for employers to treat them with respect. Discrimination in the workplace based on superficial standards is consequently encouraged. Since wage rates are no longer a factor in competition for many jobs, other factors such as an employer's biases regarding race, sex, religion, etc. are more likely to factor into employment decisions.

Regardless of the intentions of minimum wage proponents, governmentally imposed wage floors do not help disadvantaged workers. Minimum wages only add to the unfair advantage that employers already enjoy thanks to other government assistance. Workers have unemployment, decreased buying power, indignity in the workplace and less control over their lives to look forward to.

Kirsten C. Tynan is a senior majoring in mechanical engineering, and a Libertarian Student.