If the economy worked the way liberals thought it did, we wouldn’t have much to worry about with the raising the minimum wage. If we could simply raise the wages of workers on the bottom of the income ladder without consequence, the question would arise of why we couldn’t simply raise the minimum wage to something ridiculous like $100 an hour.
The cartoon below illustrates perfectly the difference between how liberals think the minimum works versus how it actually works:
The only clarification is that the first image should read “jobs that generate more or less than $15 an hour in gross profit” (rather than revenue — but I’m an Analytical Economist, so forgive me).
The research backs up the basic message of the cartoon. A 2014 study by the nonpartisan Congressional Budget Office found that raising the minimum wage to $9 an hour would cost between 100,000 and 200,000 jobs. The costs of a $10.10 minimum wage were between 500,000 and 1 million jobs.
But little details like this never seem to bother liberals — or Bernie Sanders for that matter.
[Note: This post was authored by The Analytical Economist]