How a Minimum Wage Hike Wiped Out 40% of Venezuela's Stores
Take note, "Fight for $15".
by Hans Bader
October 15, 2018
A large minimum wage increase in Venezuela has dealt a “fatal blow to 40% of Venezuelan stores,” reports the Miami Herald. The increase has closed many stores and left employees jobless. Venezuela’s government ignored the most basic law of economics in raising the minimum wage: the law of supply and demand. But laws don’t go away just because you ignore them.
The job losses will rise in the coming weeks because even “some of the stores that did [remain] open are simply liquidating their merchandise and plan to close definitively when that’s done.”
Political Pandering over Economic Principle
America may face similar job losses. In 2016, the Democratic Party platform proposed increasing the minimum wage to $15, even though such an increase would wipe out many jobs, as Hillary Clinton once admitted. The purpose of supporting such a large minimum wage hike was to pander to people who kno…
 |
|