When you look at the performance of the American economy over the entire term of Reagan's presidency, there is little to brag about. The 1982 recession was the worst in our post WW II history and really hollowed out our industrial base, especially in the Midwest.

Another important point is that the minimum wage was never increased during Reagan's two terms. Congressional Democrats share some of the blame for this. The minimum wage has never caught back up from that erosion of purchasing power. Contrary to Republican myth, making sure that all workers have a reasonable minimum standard of living helps the economy by increasing aggregate demand. Keynes still has some of his mojo.

Are you sure about the minimum wage? I started working about that time, and the minimum wage was $3.35 per hour. I know I got a nickel an hour raise sometime around 1983, and I'm confident it wasn't because the skinflints I was working for felt generous (but maybe Missouri increased its minimum wage -- I don't know. I was 20 and interested in beer and girls, not politics).

The one thing that isn't mythological about the minimum wage is that it is a price increase on that commodity that is given the label "labor." If you increase the price of something, people buy less of it -- which is why tourist destinations are worried this year. People are predicting that the public will travel less so as to buy less gas, because the price of gas is high. If employers are forced to pay too high a price for labor, they will also buy less of it, and replace it with technology where possible (how much did they pay you the last time you used an ATM, or checked yourself out of the grocery store using a self-checkout stand?). I'm all for making certain workers have a reasonable standard of living, but the minimum wage in no way guarantees this. It guarantees job cuts, in the same way high gas prices guarantee people will try to buy less gas. Keynes may have mojo, but Adam Smith is still the law.

Your confidence in your employer's skinflintedness is misplaced. There was no increase from 1981 until 1990.

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If you increase the price of something, people buy less of it

All else being the same, that's true. But the point is, all things are not necessarily the same. The same corporations that find labor more expensive will also find more demand for their goods because more people are earning a decent wage.

All else being the same, that's true. But the point is, all things are not necessarily the same. The same corporations that find labor more expensive will also find more demand for their goods because more people are earning a decent wage.

That is true at some level, but not at the minimum wage level. The minimum wage will always be too low for someone with minimum skills to earn it and own their own home, or a new car, or put away meaningful retirement savings. More than 80 percent of people who earn the minimum wage are teenagers, who live at home and are either using the money earned to have fun, or are putting it away for more advanced schooling. McDonald's isn't going to see a huge increase in sales if you raise minimum wage from $6.75 to $8.75 -- but what will happen is that McDonald's may go from working 10 people on a shift to working eight.

The minimum wage also propagates up the wage earning chain -- and what this means is more expensive goods. If McDonald's has to may a minimum wage of $8.75, then somone who was formerly paying that rate has to raise it, or suffer from having workers with only minimum wage skills. The only way the business can then maintain its profit is to make more money, and typically this is done by raising prices.

Bottom line, minimum wage increases mean there will be fewer jobs, and more expensive goods -- this is known as "inflation," as it ultimately means the same dollars buy less than they did yesterday. It's not the only way inflation can be caused, of course, but it is a contributing factor.

This is inevitably what happens when governments interfere with the law of supply and demand. It would be interesting to see what the real minimum wage would be, absent government price controls.