Friends on Facebook are discussing “A ‘very credible’ new study on Seattle’s $15 minimum wage has bad news for liberals” (Washington Post). Of course, like most things in the U.S. media, this starts off with a lie (the minimum wage in Seattle is $13/hour, not $15/hour). But let’s look at the rest of the article…
With labor more expensive, employers are getting rid of their lowest-skilled employees (certainly those for whom the market wage would be less than the minimum legal wage). Okay, that’s Econ 101. But is it “bad news for liberals”?
Suppose that the goal of a liberal is to live in a city without too many unsightly low-skilled people (see Tyler Cowen explains why rich white Democrats freely express love for immigrants and people of color for how liberals already have segregated themselves away from dark-skinned Americans and immigrants).
Can the liberal make it illegal for anyone without a college degree to live in his or her city? Probably not. Can the liberal make it illegal for anyone without a college degree to work in his or her city? Sure! That’s the minimum wage.
With a minimum wage much higher than other parts of the U.S., a city can limit its residents to (1) folks with high-paying jobs or pensions, (2) Official Poor who are already established in public housing and other welfare systems (mostly funded by state and federal taxpayers), and (3) divorce or custody plaintiffs who collected a free house, child support, and/or alimony through the family law system.
Low-skilled immigrants don’t fit into any of these categories. By definition they can’t have high-paying jobs (since they are “low-skill”). They would have to survive in the city for 5-10 years on a waiting list before they get their free apartment and they don’t have sufficient family connections to do this. Immigrants are unaware that having sex with a high-income American will yield the spending power of a medium-to-upper-income American and/or they have religious or social scruples that prevent them from having sex with an already-married dermatologist.
What do readers think? Instead of building a wall or aggressively preventing 8 low-wage people from sharing a 2-bedroom apartment, a city simply puts in a high minimum wage. With no jobs available for undesirable/Deplorable people, the city is left with the sought-after “creative class” plus some folks on Welfare who vote for Democrats and make the city wealthier by pulling in Federal Medicaid, food stamp, and housing dollars. If you’re a Democrat on the city council or in the mayor’s office, what’s not to like about that outcome?
- Can Puerto Rico be a laboratory for the future of the rest of the U.S.? (Puerto Rico already has the equivalent of a $15/hour minimum wage)
Update: A Facebooker commented on the above with “To illustrate that point, Singapore enforces a minimum wage on immigrant labor, but not on its own citizens. Does anybody believe a government would pass a law to treat foreigners worse than its own citizens?” (this post from a law firm suggests that it the minimum wage is about $2,660 per month)