Economist awarded medal of freedom by Trump says low wage employees ‘aren’t worth $15’

·2-min read
Economist Art Laffer says minimum wage employees ‘aren’t worth $15’ (FoxNews/@LisPower1/Twitter)
Economist Art Laffer says minimum wage employees ‘aren’t worth $15’ (FoxNews/@LisPower1/Twitter)

An economist favoured by Donald Trump has triggered outraged for saying that low-wage employees “aren’t worth $15”, during a discussion about job automation.

Art Laffer, in an interview on Tuesday, told Fox News anchor Sandra Smith that groups including “the poor” and “the minorities” were not worthy of a $15 (£10.60) minimum wage for a first job.

“The poor, the minorities, the disenfranchised, those with less education, young people who haven't had the job experience – these people aren't worth $15 an hour in most cases,” argued Mr Laffer.

“When you have a $15 an hour minimum wage, they don’t get that first job, they don’t get the requisite skills to earn above the minimum wage. And after a few years they become unemployable, and after they become unemployable, they become hostile,” Mr Laffer added.

The argument – that a federally mandated $15 minimum wage would, in theory, cause unemployment – followed a warning from a former boss of McDonald's about increasing pay from $7.25 to $15, as reported by Fox Business Network.

It followed an announcement by McDonald's that it was rolling out automated drive-thrus in Chicago, which Mr Rensi argued would eventually mean automation for all of the firm’s restaurants, because workers were more expensive than technology.

“What you'll find is happening is this technology has created an underclass of people who are really just bid out of the labour market and will remain out of the labour market for most of their lives,” Mr Laffer added during the Fox News interview.

Mr Laffer, a former economic adviser to Ronald Reagan who was awarded the Presidential Medal of Freedom by Mr Trump in 2019, immediately faced criticism for his remarks about low wage employees.

“Why do you believe Americans who are minorities or who are poor are not worth $15 an hour,” tweeted California congressman Ted Lieu, “but Americans who are white or who are not poor are worth $15 an hour?”

Another Twitter user wrote: “Honestly speaking, Art Laffer isn't worth $15 an hour. Gotta love a little racism with your classism.”

The Reagan-era economist became a household name for the “Laffer Effect”, which theorised that tax cuts would increase US federal government revenue – although it is disputed by Democrats and the left.

Neither is there concrete evidence that a federally mandated $15 minimum wage would cause unemployment, with firms including McDonald’s already paying above the $7.25 minimum across the US.

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