Republicans are well aware that no economist, not even Adam Smith, ever believed that a completely unregulated market would generate anything other than chaos and misery. They also recognize that the labor market in America is no more “free” than the electricity market in Texas. Labor in the United States is explicitly controlled by laws and legislatures that are much more protective of corporations than the individuals who actually generate the wealth for those corporations.
Keeping the minimum wage at a ridiculous low level allows companies to hire workers who must fall back on public support to get by. They subsidize their bottom line by externalizing the cost to everyone. Texas utilities may “hit the jackpot” when an emergency sends prices skyrocketing. But corporations employing workers at a deliberately low minimum wage are hitting that jackpot every day.
Take the difference between $7.25/hour and a livable wage and multiply that value times the number of minimum wage workers. That’s the amount of money that’s getting scooped up from the government and shoved straight into the pockets of the billionaires at the top of these corporations every day. It’s the nation’s largest not-so-hidden corporate subsidy.
There are a lot of things the government does that gift corporations with untold wealth. Access to federal lands is given away for token amounts. Companies are allowed to pollute water and air, or produce products designed to be disposable, without being subject in any way to the costs it takes to deal with the resulting pollution. They’re rewarded with loans, grants, and write-offs for everything from R&D to advertising. All of this is done because, supposedly, it creates advances for the economy and jobs for Americans.
But keeping the minimum wage low isn’t about creating jobs. It’s about funneling money. It’s about protecting the wealth concentration engine. It doesn’t just hurt the workers who are receiving those miserable salaries, it harms everyone.