CARES Act: Prelude to a $15 Minimum Wage?
by Thomas Knapp
Jul 28, 2020 | 2019 views | 0 0 comments | 209 209 recommendations | email to a friend | print
Included in the March 2020 Coronavirus Aid, Relief, and Economic Security (CARES) Act were three programs with less euphonious acronyms: FPUC, PEUC, and PUA.

These programs extended (by 13 weeks), expanded (to self-employed workers), and added a $600 per week federal kicker to state-level unemployment benefits. As July comes to a close, more than 25 million Americans are about to lose that federal kicker.

It made for the usual partisan fight over whether generous government benefits help the congenitally hard-working American people through tough times (the Democratic line) or discourage the congenitally lazy American people from getting off the couch and going to work (the Republican line)?

But this fight is shaping up a little differently than usual. Most American workers have presumably noticed the math involved here. I doubt many of them consider that math mere coincidence: Assuming a 40-hour work week, $600 breaks down to $15 an hour.

For several years now, ongoing campaigns have tried to sell Americans on $15 an hour as the bottom end of "living wage" territory, and as a proper minimum hourly wage to be required by law.

In fact, some cities and states have already adopted $15-per-hour minimum wage laws, and some large employers have committed to that number whether it's the law or not.

Election-year politics being what they are, I expect a compromise as the House, Senate, and White House negotiate a second edition of the CARES Act.

The Democratic House will grudgingly accept an end - not immediate, but after an extension of no more than another three months - to the $600 unemployment kicker in return for a $15-per-hour federal minimum wage.

The Republican Senate will grudgingly accept a $15-per-hour federal minimum wage in return for phasing out the unemployment kicker.

President Donald Trump will fist-pump and claim that he's putting America back to work. Democratic presidential nominee Joe Biden will strut and claim that his party is giving America a raise.

I'm against minimum wage laws for several reasons. Here are two: As a libertarian, I want government out of labor markets on principle; and as a supporter of unions, I want workers organizing for good wages and benefits instead of settling for the cheap substitutes Big Business lets its government servants hand out.

But my opposition to minimum wages doesn't depend on a particular level. I'm no more against $15 an hour than I am against the current $7.25 an hour, or against the $3.35 an hour that prevailed when I entered the work force.

While it's true that minimum wage hikes hurt some of America's poorest and least skilled workers and don't really help anyone in the long term, there's an upside to them as well.

As the effects of each minimum wage hike propagate through the economy and it turns out to have been a wash at best, a few more workers will stop falling for government's economic planning baloney and unionize themselves instead, which any good libertarian loves and supports as a fine example of the market at work.

Thomas L. Knapp is director at the William Lloyd Garrison Center for Libertarian Advocacy Journalism.

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