Minimum wage, maximum unemployment

With the elections now over, we now hear that one of the first laws that the new congress will pass is an increase in the minimum wage from $5.25 per hour to $7.25.

Why only $7.25? Why not $10 even? Why not $20 or $100? Heck, let's just make it $1,000 so that everyone is on par with the country's best attorneys. Or $1 million a day, like the best hedge fund managers.

Of course, for anyone with the slightest common sense, and for others with a passing grade in Economics 101, we know that a minimum price on anything causes more supply than demand - in this case labor.

At the current minimum wage of $5.25 there are relatively few people who are priced out of the market. At $1,000 an hour, we would have 99% or more unemployment.

The point is that you don't make anybody worth $7.25 (or any other number) by making it illegal to pay him or her less. All you do is make him or her unemployed, unless of course someone is willing to break the law. Now that's nice - creating criminals out of people who want to hire fellow citizens. Perhaps this goes hand in hand with those who think it is perfectly fine for people to walk across the Mexican border without permission. All of those illegal immigrants who work in the US automatically create a criminal out of every employee. In either case, however, people would rather be a criminal than unemployed. The difference is that in the case of the illegal immigrant, the employer doesn't risk much that the employee will turn in the employer to the police, because the employee faces deportation. In the case of paying a US citizen below the minimum wage, however, the employer would have to think more than twice because the worker only loses his or her job if the police is told.

The minimum wage falls into the same category of counterproductive social experiments as alcohol prohibition 1920-33 and the current war on drugs, which started softly 1914 and was intensified under Richard Nixon and again under Ronald Reagan.

Alcohol prohibition 1920-33 didn't do anything to reduce alcoholism, but it made almost every American adult into a criminal, and it created mafias, violence and police corruption. The war on drugs, well - same thing.

So here we go again - the government setting a price where it has no business being involved at all. Raising the minimum wage will not add a penny to a person's pocket who is making $5.25 today. It will only make this person unemployed. 180 degrees counterproductive.

The only sane thing to do is of course the abolition of the minimum wage, period. This would create employment opportunities for those not worth $5.25 an hour.

The minimum wage is the mirror image of the maximum price, another government favorite insanity. It has been applied at times in the past for things such as gasoline (1973, 1979) and rental apartments. All you got was of course a shortage of gasoline and apartments. Pretty obvious to anyone with the slightest common sense or listening to the first hour of Economics 101. Now there is talk about setting maximum prices on prescription drugs and (again!) gasoline. Will they ever learn?

Where did the hurricanes go?

Several months ago, l watched Al Gore's movie on the world going to hell in a handbasket as a result of global warming, in turn a result of pollution. This movie was filmed mostly at the end of 2005 or early 2006. The climax of the movie is when Al Gore points out that the Earth has become warmer over the last 30 years, and that 2005 was the warmest year yet (at least since the Bronze age). All of this heat is supposed to be the cause of the hurricanes that devastated Florida and the Gulf Coast in 2005. I remember Al Gore wagging his finger and implying that it is just going to get worse and worse unless we "do something."

Now here is one point: What happened to the hurricanes in 2006? 2005 was bad and allegedly the result of these nasty global warming trend, in turn caused by pollution. By this token, 2006 should have been even worse. More pollution, warmer climate, more hurricanes.

I have no idea whether 2006 was warmer or colder than 2005, but I do know that our cars got cleaner in 2006 as they have in each of the last 30 years. And I do know that the hurricanes somehow took a vacation. Perhaps they come back again in 2007, but for the moment I don't hear Al Gore pushing this particular argument. I mean, if 2005 was the worst year because there were so many hurricanes caused by the warm weather as a result of the pollution, then 2006 must have been the best year because there weren't any hurricanes caused by cold weather as a result of reduced pollution, right?

I don't think so, either way, but at a minimum the recent data does undercut Al Gore's argument as much as anybody else's. My memory isn't the best, but I do remember the logic as it was presented less than a full year ago, and things now look to have turned 180 degrees.

Speaking of degrees, Global Warming may have been the theme of the last 18 years, but it was only in the 1970s that many of the same people (Al Gore himself?) warned about the new ice age. I remember distinctly that when I was in school in 1980 we were taught that we would have to move to Africa because "not even in Spain would it be warm enough to grow oranges." The cause of this new ice age? The same one as global warming, of course: Pollution. No matter whether the Earth becomes warmer or colder, the cause is always the same.

Yeah, and during the bronze age and the ice age... Looooots of industry, lots of pollution!

Ever thought about the simplest physical facts? At night, it gets colder than during the day, at Winter, it gets colder than Summer - and vice versa. And what's the reason for that? The sun, of course. That's some radical temperature differences between night and day, Summer and Winter. Why can't global warming (the 1988 to present fad) and the new ice age (the 1970s fad) simply be the result of the sun's emitting power not being 100% even? Perhaps it is just a bit stronger at times, and weaker at other times? I am not a scientist, but it does make sense that such fluctuations better explain what's going on in terms of temperatures on Earth, than this pollution business.

Think about it: There was no industry until some 200 years ago. And the temperatures on Earth went up and down before 1800 anyway. Then pollution increased until the 1970s and then temperatures went both up and down for those almost 200 years. And then after 1970 our environment has been getting cleaner every year, first allegedly causing a new ice age and now more recently causing global warming. Hey, the logic doesn't hold.