Posted on by Art Powell

The problem with minimum wage legislation is that it is an inappropriate tool to solve a very difficult problem. A universal basic income would be a more effective way of dealing with poverty.

People working for low wages are only a part of the problem of people struggling to survive on minimum incomes. Legislated minimum wages may help some people at the bottom of the wage scale, but it will do nothing for the others and may even add to the number of unemployed.

The agricultural surplus is the excess food a farm worker produces beyond his/her own needs. This is what allows the rest of us to do the things we do. With the huge agricultural surplus we currently have and with modern technology we do not need for everyone to “work” for the most part of their lives.

In our society we have traditionally distributed this surplus via jobs and wages. It may be this system is breaking down and we should be looking for alternatives such as a basic income scheme. Unfortunately many people have a religious quality belief that employment is essential and that anyone who does not work his/her entire life is a deadbeat. The work ethic is great for those who want to build empires based the work of others. Maybe the minimum wage is appealing because it is seen as a way of transferring profits to workers.

Another problem with minimum wage legislation is that it distorts the operation of the market and some low paying jobs may be lost as the minimum wage raises costs. A universal income scheme would allow individuals to decide the minimum wage at which they would work. Those people who want to eat fast foods would have to pay enough for the restaurant to attract workers as people would not be obligated to work in order to survive.

We probably should not take for granted the agricultural surplus will continue indefinitely as there are many things which could wreck our food factories. There could also be problems with the non-agricultural part of our economy. In either case minimum wage legislation will not be of much use whereas a universal income scheme might make adjustments easier.

If you liked this post your are invited to comment, press the like button and/or click one of the share buttons. If you disagree you are invited to say why in a comment. While I like the idea of sharing this platform, my personality is such that I don’t reply to many comments.

Share this: Facebook

LinkedIn

Twitter

Email

Print

Reddit

Tumblr

Pinterest

Pocket

Telegram

WhatsApp

Skype

Like this: Like Loading... Related

Filed under: Economics | Tagged: agricultural surplus, basic income scheme, Economics, minimum wage, minimum wage legislation, Poverty, profits |