A Sad Story is No Substitute for Sound Policy

woman-cryingAnecdotal evidence laced with emotion is the favorite rhetorical device of leftists whose arguments cannot stand up to solid economics and logical scrutiny. A recent, treacle-drenched profile on a 33-year-old refugee from Bangladesh paints the story of a girl trapped in poverty by Canada’s low(!) minimum wage. The woman in question, one Acsana Fernando, classifies herself as one of the working poor, lamenting her inability to rise up the income ladder while ignoring the fact that she now earns more than the vast majority of people in the world. Still she, and those writing about her, act like it is an injustice that minimum wages are not higher.

Economics is all about the seen and the unseen, and while the seen is plainly on display in the personality of Ms. Fernando, what’s unseen in this article is the equally compelling and even more heartbreaking story of the worker whose limited skills and experience only allow her to produce $10.00 of value per hour, instead of the $10.25 minimum wage the law requires.

In a sense, this person is legally barred from working, since the standards set by the government make the decision to hire her distinctly unprofitable for any firm. And while the girl in the article is gaining experience and skills and will someday rise above her current wage, there is no such hope for her less productive counterpart, who has been condemned to a life on the government dole.

But the left doesn’t care about these people. They do not offer the same opportunities for a convenient photo op. They do not play into the narrative of the evils of capitalism. Progressives would rather create a permanent underclass of dependents, whose existence ensures their own continued survival and on whose votes they can count.

Ms. Fernando says that she has been working for some time, but is unable to rise above minimum wage level work. That indicates that she is not producing more than that level of value. There is absolutely no reason to believe that she would be able to keep the job she laments having if the government were to mandate higher wages. The very policy she implicitly lobbies for may well drive her out of the “working poor” (a meaningless distinction, since she is not remotely poor by global poverty standards) into the just plain poor.

This is what creates the black market for immigrants, able to get paid under the table for less than minimum wage. This is why the United States is expending billions of dollars to close an unclosable border and deport people whose only crime has been a desire to work.

The frustrating thing about the minimum wage debate is that higher minimum wages are always presented as a moral imperative, as if mandating price levels is somehow charitable or kind-hearted. The reverse is true. Minimum wages destroy lives, destroy careers and lock people into a cycle of poverty from which they can never escape. Minimum wages directly punish the poorest members of society, those with the least education, the least skills and the least opportunity, by forbidding them from earning a wage commensurate with their productivity in order to gain experience and independence.

Sob stories like the one presented above misrepresent the issue and are nothing more than manipulative propaganda designed to shut down rational thought in favor of raw emotion. That is no way to set policy, and it is no way to help people.

While there is no doubt that Ms. Ferguson would like to be doing better, it is important to remember that earning $10 an hour is luxury very few people in the world enjoy, and almost certainly more than she was earning back in Bangladesh. Mandating wages is not what allowed a few Western countries to rise into prosperity, nor is it the way to keep them there. The sooner we learn that economic freedom is the shortest path to wealth, the sooner we can abandon these ridiculous appeals to emotion-based policy.

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2 Responses to “A Sad Story is No Substitute for Sound Policy”

  1. Can you provide data on the counter-factual case of those in Canada who desire to work but can't because the minimum wage prices them out of the labor market? Is there a large stock of involuntarily unemployed individuals who can't get minimum wage positions, and if so where do they show up in the statistics and what portion of the labor force do they represent?

    If you have no data then won't people question if this article's statements are themselves nothing more than "anecdotal evidence laced with emotion"?

    • thellama73 says:

      The unemployment rate in Canada is 7.2 percent, and for young people (those likely to produce the least value for an employer) it is 14 percent. That's more than 1.3 million people. There are plenty of people who want to work but can't.

      But my argument is not primarily an empirical one, nor is it an emotional one. It's a matter of logic. If a worker is only capable of producing $10 of value an hour, no employer will pay them $10.25 and that person will remain unemployed.

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