Friday, February 17, 2017

wage subsidies are far better than the minimum wage (well, that is, if you're trying to help the working poor)

If govt is going to try to help the working poor: instead of a higher minimum wage, they should directly subsidize the wages of low-income, working, heads-of-household.

(Before that, I'd stop taxing the working poor through FICA and state income taxes, but that's a separate post. Besides, Dems are so passionate about pounding the working poor with $1,000's of income taxes every year. So let's let the Dems have their fun and focus on this proposal instead.)

Wage subsidies are better targeted than the MW-- only hitting the folks we're really trying to help. Subsidies don't make them more expensive/difficult to hire. (Or is that the point?) It doesn't create *any* unemployment among people who really need to work and get training.

Support for the MW is largely driven by a.) a lack of policy imagination; b.) labor market cartels (unions) who benefit from it; and c.) ignorance about the MW's racist origins and racist outcomes.


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