There are always a few items we’ve read during the week that deserve more attention but don’t make it into our regular posts. So we bundle them for the Friday roundup.
Here’s this week’s bundle:
American Enterprise Institute (Perry): Exposing the minimum wage fallacy
From Henry Hazlitt’s Economics in One Lesson, we learn that “the whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence: The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.”
…It’s an ironclad law of economics that to stimulate one group with public policies like the minimum wage, protective tariffs, or farm subsidies, another group in the economy has to be equally “un-stimulated.” In the case of the 18 increases next week in state minimum wages, the EPI’s estimate of $5 billion in additional wages will stimulate low-skilled workers next year by the exact same amount that it will “un-stimulate” merchants, businesses, business owners and their families in those 18 states – by $5 billion.
Walla Walla Union-Bulletin: Washington’s Debt Level a Cause for Concern
Our nation’s debt is immense and alarming, but it’s not the only public debt we’re carrying around. In Washington, the number is both tiny — as compared to the U.S. debt — and huge: about $21 billion, more than $2,700 for every resident.
That level of debt makes Washington the sixth highest on a list of states for per capita debt…The treasurer has urged lawmakers and the governor to keep their hands off the state’s rainy day fund, noting that we are in an economic expansion, which is the time to be saving, not borrowing.
Wall Street Journal: In cities with low unemployment, wages finally start to get bigger
In U.S. cities with the tightest labor markets, workers are finding something that’s long been missing from the broader economic expansion: faster-growing paychecks.
Workers in metro areas with the lowest unemployment are experiencing among the strongest wage growth in the country. The labor market in places like Minneapolis, Denver and Fort Myers, Fla., where unemployment rates stand near or even below 3%, has now tightened to a point where businesses are raising pay to attract employees, often from competitors.
It’s an outcome entirely expected in economic theory, but one that’s been largely absent until now in the upturn that began more than eight years ago.
Seattle Times (editorial): Keep accountability in education reform
…lawmakers must resist calls to make substantial changes to the landmark school-funding plan they passed in late June and that has yet to be fully implemented.
As required by the state Constitution, and forced by the McCleary lawsuit, Washington is now transitioning to a system in which basic education is entirely funded by the state.
The linchpin is ending the use of local levies for basic education. Relying on levies for essential school needs creates inequity, with some kids receiving lesser education than those in more affluent or supportive communities.
Accountability measures are needed to ensure that Washington doesn’t revert to an unconstitutional system providing unequal opportunity to the 1.1 million children in the state’s public schools.
To churn out more workers with marketable skills, an increasing number of states are offering residents free tuition to community colleges and technical schools.
The move also is a reaction to fast-rising tuition costs — increases that stem, in part, from states reducing their financial support of public colleges and universities.
Morley Winograd, president of the Campaign for Free College Tuition, a Seattle-based nonprofit, described the movement as “the fastest-growing policy idea in the country” — one with bipartisan support.
…But the free tuition push hasn’t produced an economic bonanza for any of the pioneering cities—at least not yet — and some states have struggled to come up with the money to keep their end of the bargain.