Monday, May 19, 2014

Swiss Miss

Congratulation to Switzerland for rejecting the world's highest minimum wage.  And the vote on the referendum wasn't close--the citizen rejected it over 3 to 1.

At present, the country has no minimum wage.  This measure would have guaranteed approximately $25 an hour.  It was backed by unions, who said it would fight poverty, especially in a country with such high prices.  Business leaders and others argued it would just drive prices higher and also increase unemployment.

In fact, it's so expensive to live in Switzerland (and why that's so is a question well worth asking) that the minimum they were asking for was about equivalent in purchasing power to the $15 minimum wage some Americans have been demanding at fast food establishments.

It's tempting to vote for more money--who doesn't want people do better, especially at the bottom?  But even assuming compensation shouldn't be tied to the worth of one's work to an employer, you can't get money from nowhere.

The common question to ask people who support a "living wage" is why not make it $100,000, or a cool million.  They generally respond this is a reductio ad absurdum (though as far as I can see they're willing to keep adding to wages they're not paying for until it gets pretty absurd).  But that's not the point.  It's common to hear these higher wages are essentially costless, or even a positive thing for the economy. (They often pull out that old Henry Ford chestnut about his paying $5 a day so his workers could buy his product.)  But when they object to raising wages much higher because it's not possible, at least they're admitting there's a cost.  The question becomes is the cost worth it for other reasons, not c'mon cheapskate, do you care or don't you?


Anonymous Anonymous said...

It's funny the left is pulling out the Ford $5/day story. Back in my day at Yale (30+ years ago), the bastion of the far left there, the American Studies department, denounced the Henry Ford wage as a crude, paternalistic, nativist form of social control over immigrants, with a strong element of crass corporate self-interest. Interesting to see that my lefty profs would largely agree with Forbes.

(As an aside, the American Studies department at Yale, the first of its sort, was initially funded by a conservative millionaire who thought the History department had gone too far left. Talk about the law of unintended consequences.)

9:27 AM, May 19, 2014  
Anonymous Anonymous said...

Yale- that's the Stanford of the east coast

10:01 AM, May 19, 2014  
Anonymous Anonymous said...

So because $100 is ridiculous, so is any other amount? They taught that at Yale?

10:43 AM, May 19, 2014  
Blogger LAGuy said...

Anon 3, I think you missed the point.

11:24 AM, May 19, 2014  

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