Of all the moral commanding heights, there is nothing higher than "protecting the vulnerable groups". However, the simplicity of slogans can't hide the complexity of reality, which is reflected in the recent contest between the US Senate and House of Representatives on the issue of "Federal Minimum Wage Act of 2007". The federal minimum wage in the United States has remained unchanged since 1997, staying at the level of 5. 15 USD/hour. In order to adapt to the new economic situation, the Democratic Party has long proposed the goal of raising the federal minimum wage to $7.25, but the Republican Party has been slow to respond. However, in June 2006, 1 1, the Democratic Party won the mid-term election with an overwhelming advantage, breaking the deadlock. In June 2007, the House of Representatives, with the majority of the Democratic Party, passed a bill to raise the minimum wage. By rights, this matter should be over. The minimum wage has been raised and the interests of the bottom workers have been protected, so politicians may win more votes. Isn't it everyone's happiness? Unfortunately, this matter is not over. Just after the House of Representatives passed the bill in June 5438+10, many Republicans in the Senate came out to "make trouble" in February. They said that they would not approve the bill unless the tax cuts for small businesses were increased. In the end, the Senate passed the bill, but added the clause of "reducing taxes for small businesses by $8.3 billion within 10". So the house of representatives will quit again. We raise the minimum wage to "protect the vulnerable groups", and you want to give tax cuts to small business owners to "protect the powerful groups". What did you do to me? No, you can reduce taxes, up to 65.438+300 million. After two or three months of bargaining, the final result is that the minimum hourly wage will be increased from 5. 15 to 7.25 dollars, and small enterprises will be reduced by 4.8 billion dollars in five years. It is expected that its final approval is just around the corner. Seeing this, everyone may be confused and despised for * * * and the "chaos" of the party. "Spokesman of the bourgeoisie" and "enemy of the working people" ... The class education we received since childhood may convey these judgments to us in a conditioned way. But is it really that simple? We might as well take "raising the minimum wage" as the first card of the domino and see what kind of chain reaction it may cause. Suppose I am a business owner, and I employ seven people, each with an hourly wage of 5 yuan. What should I do if the government forces me to raise my salary to 7 yuan? In order to maintain the same production cost, I will probably cut seven employees into five. At this time, the interests of those five people were protected. So, what about the two people who were laid off? In fact, many economic studies show that there is a positive correlation between the minimum wage law and the unemployment rate. Although there are also "dissidents" among economists, for example, Kruger's research shows that the minimum wage law has a very weak impact on the employment rate, but most empirical studies in economics have repeatedly shown that the minimum wage increases the unemployment rate, especially for young and unskilled workers. According to the survey of the Minimum Wage Research Committee, an increase of 65,438+00% in the minimum wage will lead to an increase of 65,438+0% to 3% in the unemployment rate of young unskilled workers. The sad conclusion of this study is that the minimum wage law aims to protect the vulnerable groups, and it is the vulnerable groups that are ultimately hurt. You might say, let the government prohibit enterprises from laying off employees while raising the minimum wage. Regardless of whether this "ban" is possible in a free employment market economy, let's assume that it is feasible. What are the consequences? For enterprises, if the government stipulates that I can't fire employees, then I won't hire new employees, right? As mentioned above, it is the employment opportunities of young unskilled workers that are most affected by the minimum wage law. You may say again, then I will force you to hire new workers. Well, I have to hire new workers. What was the result? The production cost of this enterprise has increased, and its competitiveness has declined ―― American manufacturing industry has been losing ground in front of third world countries, which cannot be said to have nothing to do with its high labor cost. Then we will trade protectionism! You said it again. Well, protectionism ― we can't compete with China and India, so why not shut them out? What are the consequences? The increased production cost is transferred to the price, who will bear it? Consumers. Those who complain that American goods and services are too expensive may also advocate raising the minimum wage, but they don't want to see the connection between the two. You may have to say again, can't we reduce the capitalist's profit rate by not letting them transfer the production cost to the price? Sure, but how? If a company is not illegal, how can you enforce its profit rate? Forcing enterprises not to fire workers, forcing enterprises to hire a certain number of new workers, trade protectionism, and stipulating the profit rate of enterprises, what is this called? Planned economy. Disadvantages of planned economy, hehe, do I still need to push this domino? "Protecting vulnerable groups" eventually leads to "hurting vulnerable groups" and "moral commanding heights" become "moral traps", which is the so-called paradox. Unfortunately, the world is full of paradoxes. To understand these paradoxes, we need something higher than moral commanding heights, and that is rationality. Of course, I'm not saying that the minimum wage law is unreasonable. Actually, I support the minimum wage law. All I'm saying is that while discussing this bill, we should take into account its possible adverse consequences and take "supporting" preventive measures against this adverse consequence to prevent evil deeds with good intentions. * * * And the party's additional clause "tax reduction for small businesses that employ the poor and veterans" is based on this intention, because the minimum wage bill really affects not those multinational companies with rich profits, but those small restaurants, small department stores and small farms with meager profit margins. Once they go bankrupt because of rising labor costs or have to lay off employees to maintain low operating costs, the luck of "vulnerable groups" will go from bad to worse. The Roosevelt administration put forward the first minimum wage bill in American history in 1938, and established a series of "supporting" measures to increase employment. For example, the famous "Workers' Progress Project" increases employment opportunities through a large number of public works, thus offsetting the impact of the minimum wage law on the employment rate. Later, the welfare system in the United States gradually improved. By buffering the economic crisis brought by unemployment to individuals, it also provides a supporting system for the continuous rise of the minimum wage. Can relevant thinking be introduced into China? We should realize the essential difference between China and America. If there is almost "overprotection" for workers in the United States, the situation in China is just the opposite. The understanding that "China's greatest advantage lies in its cheap labor, and if a minimum wage is set for workers, investors will be scared away" is largely a kind of "taking it for granted". If the cheaper the labor force, the more favorable the investment environment of a country, then Africa should have the most investment advantage in the world. In fact, compared with many developing countries, China has many other advantages besides cheap labor: infrastructure, preferential policies, skilled labor and basic credit mechanism. In that case, why do investors who are afraid of slightly raising the minimum wage go to India? In fact, China's extremely cheap labor force is not the result of international competition to a great extent, but the result of vicious competition among enterprises in China. In this case, if all enterprises collectively raise the minimum wage standard through national legislation to prevent vicious competition among enterprises, foreign investors may not run away and workers will benefit. The consequence is nothing more than making American consumers spend one or two dollars more on a pair of jeans made in China. Why not? Moreover, because many studies show that the consumption rate of the poor is higher than that of the rich, raising the wages of the poor can stimulate effective demand more effectively. In a "pyramid" social structure like China, the minimum wage should play a much more significant role in stimulating demand than in an "olive" society like the United States. In other words, the negative impact on the employment rate is more likely to be offset by its positive impact when implementing the minimum wage law in China today. Of course, even so, if China really starts to strictly enforce the minimum wage law, it still needs many supporting policies to ensure the employment rate, such as reducing taxes for small enterprises, developing labor-intensive industries, strengthening the welfare system, increasing employment through public infrastructure projects, providing preferential investment policies, and strengthening labor training. In a word, protecting the vulnerable groups is not only a matter of occupying the moral high ground, but also a series of supporting policies.