I wrote a story about poor Clarence who retired in 1979, and even poorer Larry who retired last year. I created these characters to challenge the notion of calculating a real interest rate by subtracting inflation. The idea is that the decline of a currency can be measured by the rate of price increases. This price-centric view leads to the concept of purchasing power—the amount of stuff that a dollar can buy. It’s the flip side of prices. When prices rise, purchasing power falls.
Water is distributed in California and other Western states not by market prices but by the political process.
The politics of the minimum wage are simple. No congressman or president owes his office to the poorly educated black and Latino youth vote.
Justice demands that people are compensated on the basis of performance, not on the basis of their need or of the egalitarian ideal dominant in today’s culture.
Labor unions have been supporters of minimum wage laws in countries around the world, since these laws price non-union workers out of jobs.
Countries with minimum wage laws almost invariably have higher rates of unemployment than countries without minimum wage laws.
The fundamental issue is not wage rates, but productivity. If a worker desires a higher wage, he must produce more in a given period of time.