What Ted "The Lion" Kennedy Could Always See

Via DougJ

I don’t know why this pisses me off so much

But it does. Charles Lane at Kaplan:

Yet in July, the federal minimum wage went up as planned, at the cost of 300,000 jobs, according to one economist’s estimate. As it happens, the employment-reducing effect of minimum wage laws is abundantly documented. Those who take issue with my suggestion are taking issue with that evidence.

The literature is thoroughly compiled and reviewed in “Minimum Wages and Employment,” a 184-page article published three years ago by economists David Neumark and William L. Wascher in Foundations and Trends in Microeconomics, a peer-reviewed journal.

The guy who wrote the editorial in the Wall Street Journal in the first link is one of the co-authors to the second. Can’t Lane find more anti-minimum wage economists? And, for God’s sake, “peer-reviewed journal”, like that was some kind of a trump card?

Think Progress pointed out:

almost all of the economic research on the subject shows that the minimum wage has little to no effect on employment. The most well-known researchers on the subject — David Card and Alan Krueger — examined a minimum wage increase in New Jersey, and found that “employment actually expanded in New Jersey relative to Pennsylvania, where the minimum wage was constant.”

And here’s Paul Krugman saying the same thing.

So Lane’s critics present a huge body of evidence undermining his claims and he trots out one guy from UC Irvine and one peer-reviewed article and pretends that refutes it all?

This is so pathetic that I can’t even wrap my head around it.

4 comments:

J said... / Jan 8, 2010, 4:47:00 AM  

"And, for God’s sake, “peer-reviewed journal”, like that was some kind of a trump card?"

LOL then the Think Progress piece states:

"The most well-known researchers on the subject", like that was some kind of trump card...

http://seekingalpha.com/article/148209-employment-minimum-wage-maximum-stupidity

There are numerous other examples of employers substituting capital for labor simply because the minimum wage has made low-skilled workers uncompetitive. For example, handcarts have replaced skycaps at airports. The main reason fast-food restaurants use paper plates and plastic utensils is to avoid having to hire dishwashers.

As a result, many low-skilled jobs that used to be the first rung on the employment ladder have been priced out of the market. Can you remember the last time an usher showed you to your seat in a dark movie theater? When was the last time someone other than the cashier not only bagged your groceries, but also loaded them into your car? By the way, it won't be long before the cashiers themselves are priced out of the market, replaced by automated scanners, leaving you to bag your purchases with no help whatsoever.

The disappearance of these jobs has broader economic and societal consequences. First jobs are a means to improve skills so that low skilled workers can offer greater productivity to current or future employers. As their skills grow, so does their ability to earn higher wages. However, remove the bottom rung from the employment ladder and many never have a chance to climb it.

J said... / Jan 8, 2010, 4:55:00 AM  

and might I add, the youth unemployment rate (16 to 24 year olds) is at 50% right now, due to the labor market not having anywhere to allocate jobs for teens/young adults with no job skills. And you morons wanna make it worse for them.

J said... / Jan 8, 2010, 5:01:00 AM  

http://economics.gmu.edu/wew/articles/06/folly.html

"Two important surveys of academic economists were reported in two issues of the American Economic Review, May 1979 and May 1992. In one survey, 90 percent, and in the other 80 percent, of economists agreed that increasing the minimum wage causes unemployment among youth and low-skilled workers.

Minimum wages can have a more insidious effect. In research for my book "South Africa's War Against Capitalism" (1989), I found that during South Africa's apartheid era, racist unions, who'd never admit blacks, were the major supporters of higher minimum wages for blacks."

J said... / Feb 23, 2010, 9:49:00 PM  

http://www.house.gov/jec/cost-gov/regs/minimum/50years.htm

" While it is not yet clear why Card, Katz and Krueger got the results that they did, it is clear that their findings are directly contrary to virtually every empirical study ever done on the minimum wage. These studies were exhaustively surveyed by the Minimum Wage Study Commission, which concluded that a 10% increase in the minimum wage reduced teenage employment by 1% to 3%.

The following survey of the academic research on the minimum wage is designed to give nonspecialists a sense of just how isolated the Card, Krueger and Katz studies are. It will also indicate that the minimum wage has wide-ranging negative effects that go beyond unemployment. For example, higher minimum wages encourage employers to cut back on training, thus depriving low wage workers of an important means of long-term advancement, in return for a small increase in current income. For many workers this is a very bad trade-off, but one for which the law provides no alternative."

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