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The Minimum Wage is a Terrible Economic Policy


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In my Communications class, we had to give a Persuasive Speech. I thought this would be a perfect opportunity to explain a policy that most people are for yet don't understand it.

I had a great closing argument regarding the fact that unemployment is up 2% since July, which is also the same time the minimum wage was raised.

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The Minimum Wage is a Terrible Economic Policy

  1. 1. Why the Minimum Wage Is a Terrible Economic Policy Matt Brown
  2. 2. We’ve All Been There...
  3. 3. Minimum Wage Increase July 2009 - Department of Labor raises Minimum Wage from $6.55 per hour to $7.25.
  4. 4. Sounds Great Right?
  5. 5. What Am I Going To Learn? By looking at simple economics, you will see how it is a poor economic policy: History Fallacy of Government-Hampered Wages Economics 101
  6. 6. A Brief History Lesson Created in the Fail Labor Standards Act of 1938 Practically no public confidence in the Markets Federal Government had no confidence in its own self Act passed to combat 19% unemployment and -6.2% growth in 1938
  7. 7. Arbitrarily Set Wages?
  8. 8. Why Favor Only $7.50? If Minimum Wage Advocates believe it is actually a good policy, why do they favor only a $7.50 - $14 minimum? Why not $100? $1,000? $10,000? It’s so employees are paid fairly right?
  9. 9. Intro to Economics Whether we love it or loathe it, supply and demand operates everything. What is Supply & Demand you might ask? When the price of something (SUPPLY) goes up, people buy less of it (DEMAND). Gas Prices/Gold/Milk etc. Supply is inversely related to Demand due to scarcity
  10. 10. Intermediate Economics
  11. 11. Master’s In Economics You don't need a Ph.D. in Economics to know that jacking up prices leads fewer people to buy. Those people include employers, who hire less labor when labor is made artificially more expensive. The Economic consequence of political largess is to make labor artificially more expensive.
  12. 12. Let’s Face It The Minimum Wage is just another Feel-Good Law "It's tempting to think of higher minimum wages as an anti-poverty weapon, but such an idea doesn't even pass the smell test. After all, if higher minimum wages could cure poverty, we could easily end worldwide poverty simply by telling poor nations to legislate higher minimum wages." Walter Williams