Why Raising Minimum Wages Is Riskier Than Expanding the EITC

Albeit a minimum wage hike or a government handout, somebody is having to come up with the money to support those full time workers on minimum wage. Take Wallmart as an example:

Walmart workers at a single 300-person Supercenter store rely on anywhere from $904,542 to $1,744,590 in public benefits per year"

http://democrats.edworkforce.house.gov/sites/democrats.edwor...

The Forbes author applauds the Earned income tax credit as a subsidy but this again is the government having to co-pay Wallmart's employees with tax dollars.

A buisiness which cannot pay the full prrovisioning cost of labour is one which is fundamentally uneconomic. There may be reasons to choose to subsidize such businesses given net social benefit and market failures resulting infailures of prices to meet costs.

But profitable businesses, such as Walmart and McDonalds, which choose to pay below-subsistence wages are getting a handout directly from taxpayers, and are shifting risks onto the backs of workers.

That a man must always live by his wages was recognized by Adam Smith. And not just the worker himself but his family, children, and their education.