Latest posts by Donald Kendal (see all)
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Changing our country and its laws back to a manageable and sane state is more complicated than the average small-government advocate may think. One cannot simply look at the situation in black and white, right and wrong mindset. A longer term strategy must be established.
This article is the result of a conversation I was engaged in earlier this week. I was speaking with a like-minded individual about the minimum wage. While we are both principally against the idea of a minimum wage, I was playing the “devil’s advocate” role. My stance was that there are so many laws and regulations on the books that distort and harm the economy, a minimum wage is necessary to prevent even lower wages.
Before I go any further, I want to state that I understand the consequences of a minimum wage and the effects it has on those that are unable to find a job.
The minimum wage is a solution the government created to deal with the side effects of failed economic policies. Like in many cases, the government chooses to treat the symptoms while leaving the underlying conditions unaltered. When capitalism is transformed by government into a crony-capitalism hybrid, the natural laws of supply and demand are not allowed to operate correctly. What we are left with is a flawed system with underutilized resources, including labor.
This is what brings me to my main point. Untangling the mess that we are in will take careful and thought-out steps. Our situation is like a stereotypical tangled ball of Christmas lights. You can’t just start pulling at strings; you have to pull the right strings first. The laws that we speak out against routinely do not exist in a vacuum; they have effects and consequences in other areas.
Here’s an example. Most, if not all, small-government advocates prefer smaller taxes. However, if a law passed eliminating all taxes only for the top 1%, most, if not all, would be against that change. Even though this appeals to the principle of lower taxes, most would concede that a more balanced approach is necessary.
While I do not advocate a raise in the minimum wage, I do believe other actions need to take place first prior to the potential elimination of said wage. Actions that level the playing field between small and big business, actions that create a friendlier environment to hire more people, etc., need to occur first. One major step in the right direction would be the simplification of the tax code. Closing loopholes exploited by big business and reducing regulations that hurt small business would create a more uniform market. Eliminating or reducing payroll taxes would also benefit employees by decreasing the cost of a new hire. These steps are just a few moves that could occur quickly with little or no unintended consequences.
If the economy were allowed to function in true free-market fashion, resources would be used as efficiently as possible. Eventually, full employment would be attained and a natural rise in wages would follow.
The laws that distort the free market and society have been built up since the founding of our nation. Unwinding the mess cannot be done haphazardly. Pulling the wrong string first may cause a knot that can’t be untied, causing the whole mess to crumble down on the average citizen’s back. Moving toward a society with a far more limited government requires careful planning and strategy.