Rep. Jesse Jackson, Jr. has a novel idea for ending poverty: make it illegal. He explains in this short video of a speech he gave on the House floor:
The Constitution should be amended to guarantee everyone the right to a decent home. That way, everyone will get one. In a speech he gave on the House floor, he asks, “What would that do for home construction in this nation? What would that do for millions of unemployed people?”
The Constitution should also be amended to guarantee the right to decent health care. Jackson implores, “How many millions of doctors would such a right create?”
Education needs an amendment, too. “How many schools would such a right build, from Maine to California?” Jackson goes on to wonder how many jobs would be created by giving every student and iPod and a laptop.
Many people believe that the minimum wage is a major source of America’s prosperity. Actually as of 2009 only 4.9 percent of (employed) workers earn minimum wage or less. Prior to the Great Recession the average was between 2007 and 2000 was 2 to 3 percent.
This is another case of what is seen (workers who get minimum wage) and what is unseen (workers who don’t get to work because minimum wage). If the minimum wage was truly the path to prosperity, by that logic then, why don’t we raise the minimum wage to $100 dollars per hour? Actually that sounds pretty good — but wait a second — as economists have been saying for about 200 years now, “there’s no such thing as a free lunch.”
So let’s say that the law goes into place and is perfectly enforced (i.e., nobody works for $99/hour or less). Some businesses shut down, but all businesses cut down on employment because it is too costly to hire the same amount of labor as before the minimum wage increase.
We find that unions around the nation support minimum wage increases. It’s definitely not because union member workers earn minimum wage (because then they’d fire their union because the union dues would make their wages fall below minimum wage). It might be because they unions care about non-union workers, but wait is there a better reason? Let’s take an even more compelling look at the minimum wage.
Anyone can tell you that there is more than one way to do things. To get to New York, one can take a plane, a bus, a train, a car, walk, bicycle there, etc. Likewise in production, there’s more than one way to produce a good. Let’s say fence manufacturing: I can hire one skilled worker for $25 or I can hire three unskilled workers at $8.25 per hour ($24.75 total)—both create the same level and quality of fences. At those skilled/unskilled wages I’d prefer to hire unskilled workers and save 25 cents.
The skilled worker gets Congress to agree that people ought to be paid a fair wage, so they pass a higher minimum wage at $9 hour. All of a sudden I must pay the unskilled workers $9 (or $27 for all three). At a total of $27 for three unskilled workers all of a sudden the skilled worker becomes a better option at $25! In fact the skilled worker looks better all the way up to $27.00! How about the three unskilled workers? Now they’re unemployed. There’s no job out there that they have the skills to command a wage of $9.
While unions may or may not be naïve in thinking that they harm their fellow laborers by supporting minimum wage, they sure have one strong personal incentive to support it.
The clever video trailer for Matt Ridley’s soon-to-be-released book The Rational Optimist: How Prosperity Evolves, has the theme that “everybody is working for everybody else” to provide enormous choices that kings couldn’t command.
Yet Matt Ridley does more than describe how things are getting better. He explains why. Prosperity comes from everybody working for everybody else. The habit of exchange and specialization—which started more than 100,000 years ago—has created a collective brain that sets human living standards on a rising trend. The mutual dependence, trust, and sharing that result are causes for hope, not despair.
This bold book covers the entire sweep of human history, from the Stone Age to the Internet, from the stagnation of the Ming empire to the invention of the steam engine, from the population explosion to the likely consequences of climate change. It ends with a confident assertion that thanks to the ceaseless capacity of the human race for innovative change, and despite inevitable disasters along the way, the twenty-first century will see both human prosperity and natural biodiversity enhanced. Acute, refreshing, and revelatory, The Rational Optimist will change your way of thinking about the world for the better.
Coming from the UK, CEI Senior Fellow Iain Murray knows a little something about the history of political empires. Today, however, we find ourselves faced with a new era of eco-imperialism, particularly in the field of global warming policy. Iain explains:
“Eco-Imperialism” = efforts by the developed world to impose its environmental priorities on the developing world. Developed countries seek to pressure the Third World into reduce greenhouse gas emissions “for the sake of the planet,” regardless of its impact on the standard of living and prospects for economic growth in those nations. Cost-effective energy use is critical for Third World people, and is the fastest path toward ending poverty.
This, and other great videos, are also available at the new online multimedia destination CEI On Demand.
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