CARES Act: Prelude to a $15 Minimum Wage?

 

 

By Thomas L. Knapp

Included in the March 2020 Coronavirus Aid, Relief, and Economic Security (CARES) Act were three programs with less euphonious acronyms: FPUC, PEUC, and PUA. These programs extended (by 13 weeks), expanded (to self-employed workers), and added a $600 per week federal kicker to, state-level unemployment benefits. As July comes to a close, more than 25 million Americans are about to lose that federal kicker.

The usual setup for the usual partisan fight over whether generous government benefits help the congenitally hard-working American people through tough times (the Democratic line) or discourage the congenitally lazy American people from getting off the couch and going to work (the Republican line)?

Well, yeah, but that this one’s shaping up a little differently than usual. Most American workers have presumably noticed the math involved here.  I doubt many of them consider that math mere coincidence: Assuming a 40-hour work week, $600 breaks down to $15 an hour.

For several years now, ongoing campaigns have tried to sell Americans on $15 an hour as the bottom end of “living wage” territory, and as a proper minimum hourly wage to be required by law. In fact, some cities and states have already adopted $15 per hour minimum wage laws, and some large employers have committed to that number whether it’s the law or not.

Election-year politics being what they are, I expect a compromise as the House, Senate, and White House negotiate a second edition of the CARES Act:

The Democratic House will grudgingly accept an end —  not immediate, but after an extension of no more than another three months — to the $600 unemployment kicker, in return for a $15 per hour federal minimum wage.

The Republican Senate will grudgingly accept a $15 per hour federal minimum wage, in return for phasing out the unemployment kicker.

US president Donald Trump will fist-pump and claim that he’s putting America back to work. Democratic presidential nominee Joe Biden will strut and claim that his party’s giving America a raise.

I’m against minimum wage laws for several reasons. Here are two: As a libertarian, I want government out of labor markets on principle; and as a supporter of unions, I want workers organizing for good wages and benefits instead of settling for the cheap substitutes Big Business lets its government servants hand out.

But my opposition to minimum wages doesn’t depend on a particular level. I’m no MORE against $15 an hour than I am against the current $7.25 an hour, or against the $3.35 an hour that prevailed when I entered the work force.

While it’s true that minimum wage hikes hurt some of America’s poorest and least skilled workers and don’t really help anyone in the long term, there’s an up side to them as well:

As the effects of each minimum wage hike propagate through the economy and it turns out to have been a wash at best, a few more workers will stop falling for government’s economic planning baloney and unionize themselves instead. Which any good libertarian loves and supports as a fine example of the market at work.


Thomas Knapp -- Photo Credit Avens O'Brien

Photo by Avens O’Brien

Thomas L. Knapp (Twitter: @thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.

 

The views and opinions expressed in this commentary are those of the author and do not necessarily reflect the official position of Citizens Journal

 


Get Citizensjournal.us Headlines free  SUBSCRIPTION. Keep us publishing – DONATE

Leave a Reply

Your email address will not be published. Required fields are marked *