Raise the Minimum Wage? No, Let's Scrap It
John Aziz argues for a basic income policy instead
By Evann Gastaldo, Newser Staff
Posted Dec 6, 2013 11:44 AM CST
Protesters protest for higher wages outside a McDonalds restaurant in Chicago, Thursday, Dec., 5, 2013.   (AP Photo/Paul Beaty)

(Newser) – The idea of raising the minimum wage is a popular one, but not a very good one, writes John Aziz for The Week. His idea? Abolish the minimum wage, and replace it with a "basic income policy." There are two types: Either the government pays anyone whose income is below a certain threshold to get them to that threshold (this is known as a "negative income tax"), or the government pays everyone something, no matter what they earn. The second version "would obviously require more funds—meaning higher taxes—but in a future where corporations are making larger and larger profits while requiring fewer and fewer workers due to automation, such policies may become increasingly feasible," Aziz writes.

The problem with the minimum wage, he notes, is that if a company doesn't want to pay it because it doesn't think the job is worth, say, $9 an hour, the alternative is to make do without hiring—or to hire overseas instead. Indeed, "countries with no minimum wage tend to have much lower unemployment." With a basic income policy, low-skilled people (including the young) would find it much easier to get work, because companies would be more willing to hire them. Afraid such a policy would encourage laziness? Aziz isn't: A basic income wouldn't make anyone "rich or successful," meaning "people would still have many personal and financial incentives to work and to become entrepreneurs. If anything, the fact that there is no longer a minimum wage would probably create more employment, not less." Click for his full column.

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Showing 3 of 190 comments
freddiefedora
Dec 9, 2013 1:35 PM CST
Bring back high paying production jobs to the US - you know, the millions that have been outsourced, and then high school kids can work at fast-food joints like they used to - for minimum wage for pocket money. Bring back adult jobs for adult pay again to the US.
Lou Bernardo
Dec 9, 2013 11:12 AM CST
Vote out the big spenders in Congress and control spending and the value of the dollar won't erode and you won't need raises to keep up with inflation.
Ezekiel 25:17
Dec 7, 2013 6:19 PM CST
It was great to study Russia in public school in the 80's when the U.S.S.R. was still in existence. Total employment was an interesting facet of the process. It was not until I got to college and I had several communist instructors and professors did I realize the truth of socialism and communism(Trotsky versus Lenin and Marx). U.S.S.R. did not have unemployment. You went down to the party office for your district and signed up for one of the available public jobs. You could be painting government buildings, sweeping streets, working on roads, or even working in a party office. You worked and you got a check and government rations. Of course the bad side was included such as the gulags, long lines to redeem your coupons for commodity foods, and the 500 people waiting at the public health clinic to be seen for a medical problem. So in the USA, Obama cries that benefits will run out for people on unemployment. They make around 70-percent of their last weekly wage for sitting at home and accessing a state unemployment website once a week to check in and apply for one of the listed jobs. Of course, all those sneaky recipients know to apply for an opening as a heart surgeon. Now I'm not totally against a state office of labor or unemployment. No, I've never received any government entitlement such as Section-8, unemployment, SSI, TANF, AFDC, etc. But the state office of unemployment is a good place for a college grad to post a resume other than Indeed or Monster. I got a call one day from a hotel owner as he was looking for a new night manager. I went down that afternoon for the interview. It went well and I was working a few days later. I have to say, working at hotels for the next 7 years was some of the best years of my life. Looking back, maybe I should have majored in hospitality.