The sun still rises in the east, and the government-mandated minimum wage is still bad policy

Iain Murray of the Competitive Enterprise Institute explains for Washington Examiner readers why, despite its popularity, a minimum-wage increase remains a bad idea.

There are few policies more popular than increasing the federal minimum wage. In a 2013 Gallup poll, 76 percent of respondents approved of the idea. It seems to make economic and moral sense on an intuitive level. President Obama reflected this sentiment in his Oct. 11 weekly radio address, saying, “We believe that in America, nobody who works full time should ever have to raise a family in poverty. … America deserves a raise right now.”

Yet most economists oppose the concept of a minimum wage at all, and data back them up. In fact, the minimum wage harms those it is intended to help. …

… Most economists agree that the minimum wage cannot achieve its aim. Harvard economist Greg Mankiw’s “Ten things economists believe” is a list of statements that members of the economics profession finds uncontroversial. Here is one of the statements: “A minimum wage increases unemployment among young and unskilled workers.” This proposition is supported by 79 percent of economists.

James M. Buchanan, Nobel Prize winner for economics in 1986, put it thus:

“Just as no physicist would claim that ‘water runs uphill,’ no self-respecting economist would claim that increases in the minimum wage increase employment. Such a claim, if seriously advanced, becomes equivalent to a denial that there is even minimal scientific content in economics, and that, in consequence, economists can do nothing but write as advocates for ideological interests.”

The overwhelming majority of empirical studies into the effects of the minimum wage find that it erodes employment. In 2007, David Neumark of the University of California-Irvine and William Wascher of the Federal Reserve surveyed over 100 minimum wage studies published since the early 1990s. They discovered that over two-thirds of them found negative effects on employment, while only about an eighth found positive effects. Worse, those studies that focused on the low-skilled people including youths found particularly bad damage done.