Pay Hazard

‘MANY well-meaning people favor legal minimum wage rates in the mistaken belief that they help the poor,” Nobel laureate Milton Friedman has observed. “It has always been a mystery to me why a youngster is better off unemployed at $4.75 an hour than employed at $4.25.”

Pretty much everyone—from Milton Friedman to the Congressional Budget Office to the 1987 editorial board of the New York Times—agrees that raising the minimum wage increases unemployment. Under the headline, “The Right Minimum Wage: $0.00,” a New York Times editorial concluded that the minimum wage was “an idea whose time has passed.” The CBO estimates that President Clinton’s proposal to increase the minimum wage from $4.25 to $5.15 would cost 500,000 jobs—mostly the jobs of teenagers, minorities, and part-time workers.

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Pete Du Pont

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‘MANY well-meaning people favor legal minimum wage rates in the mistaken belief that they help the poor,” Nobel laureate Milton Friedman has observed. “It has always been a mystery to me why a youngster is better off unemployed at $4.75 an hour than employed at $4.25.”

Pretty much everyone—from Milton Friedman to the Congressional Budget Office to the 1987 editorial board of the New York Times—agrees that raising the minimum wage increases unemployment. Under the headline, “The Right Minimum Wage: $0.00,” a New York Times editorial concluded that the minimum wage was “an idea whose time has passed.” The CBO estimates that President Clinton’s proposal to increase the minimum wage from $4.25 to $5.15 would cost 500,000 jobs—mostly the jobs of teenagers, minorities, and part-time workers.