by Mitch Kokai
Senior Political Analyst, John Locke Foundation
While many Democrats have been pushing for a $15-per-hour government-mandated minimum wage, Republican presidential nominee Donald Trump has suggested he might support a smaller wage hike. Kyle Sammin explains in a Federalist column why Trump’s proposal might benefit his campaign while hurting the economy.
Last week, Donald Trump endorsed increasing the federal minimum wage to $10 per hour, up from the current rate of $7.25. This could be just another off-the-cuff policy position, soon to be forgotten—after all, he took the opposite position just a few months ago—but it could also signal Trump’s long-promised pivot to general election issues.
Backing a minimum wage hike might violate the free-market promises of the party of which Trump has just assumed leadership, but it would also be a shrewd strategy and an effective play for moderate voters turned off by Hillary Clinton’s close embrace of Wall Street.
On the economy and taxation, Republicans have had it easy recently. When asked if they would like higher taxes, more deficits, or a broader role for the government in the national economy, a large majority of the American people have consistently said “No.” This made life easy for a Republican campaigning on those issues. Democratic politicians, who said “yes” to all those questions, had the heavier burden of convincing voters to change their minds in favor of a more interventionist state. All Republicans had to do was agree with the existing majority.
But the picture was never as black-and-white as that. On a few issues, the Democratic position against the free market has consistently been the popular one. Among these: raising the minimum wage. …
… Unlike many of the more extreme Trumpian pronouncements, his call for a $10 minimum wage fits squarely within the mainstream of American opinion. …
… There are also voters and politicians motivated by an honest belief in the justice of the free market. They believe people should agree to be employed based on conditions they arrive at through arm’s-length negotiations, not government coercion. If that principle is important to you, you are not likely to endorse wage controls, any more than you would endorse price controls or government monopolies.
Beyond that principle, though, there are also practical objections to minimum wage hikes. Many economists believe increasing the minimum wage decreases the availability of low-skill jobs, thereby hurting the very group of workers it purports to help. By raising the cost of labor, wage hikes encourage employers to outsource or automate work that might otherwise be done in America by Americans.