R: Abolish the Minimum Wage

Nearly every thinking economist will tell you that the minimum wage is terrible policy. It increases the unemployment rate because firms simply won't hire anyone whose output is lower than the wage he must be paid. It especially hurts working class young people, who often miss out on opportunities to learn valuable skills on the job. Unionized workers—who already have exorbitant salaries—benefit from the exclusion of new entrants, and from contract wages that are usually tied to the minimum wage. It is also a great reelection tool for politicians who pay lip service to helping the poor. That's why it has been so difficult to abolish.

But perhaps there is a case to be made for the minimum wage on more theoretical grounds. Should wages reflect only a worker's product, or do employers have an obligation to provide their employees with a decent standard of living? Do market economies diminish human worth by treating workers as little more than tools, scarcely different from computers and wrenches? Perhaps the minimum wage prevents exploitation of labor in some cases, and actually coaxes employers to value their employees above their profit margins. But why should the government force this relationship upon workers and firms? If employer and employee consent to a transaction (labor in exchange for an agreed wage), why should the government punish them? Even if the government is responsible for fostering good moral character, is requiring a certain amount of money to change hands really the right way to do it?