Paul Samuelson, strong Keynesian, 1970 Nobel Prize Laureate in economics, and author of the enormously successful college textbook, “Economics,” was right, once. Commenting in 1970 on a proposal to raise the minimum wage to $2.00/ he wrote: “What good does it do a black youth to know that an employer must pay him $2.00 an hour if the fact that he must be paid that amount is what keeps him from getting a job?”
And the New York Times, then recognized worldwide as the newspaper of record, headlined an editorial on Jan. 14, 1987, “The Right Minimum Wage: $0.00.” The editorial then stated “There’s a virtual consensus among economists that the minimum wage is an idea whose time has passed. Raising the minimum wage by a substantial amount would price working poor people out of the job market.” (Both passages quoted in “If Only Most Americans Understood” by David R. Hender- son, in the Aug. 1 Wall Street Journal.)
How can any politician, or anyone else for that matter, be so stupid as to believe that it will help workers to make it more expensive to hire them?
Samuelson’s remark is also a sad commentary on the state of the U.s. dollar, which has deteriorated so much in value since 1970 that the proposed increase in the minimum wage ($2.10, raising the minimum from $5.15 to $7.25) is more than the entire minimum wage was in 1970.