There were several references to increasing the minimum wage at the Democratic Presidential debate last night. I would like to address the statement by Bill Richardson, who said that the United States Congress must pass a minimum wage of forty thousand dollars per year for ALL public school teachers. Though I believe the current system fails to adequately compensate educators, Richardson's proposal is economically irresponsible. Many of the arguments against a general minimum wage also apply to raising the minimum wage for public school teachers. Instituting fixed pay for teachers is not the proper economic means to ensure a well-educated studentry.
In some states, educators are now paid based upon their ability and tenure. Promotions and higher pay result when teachers ensure that their students are excelling in the classroom. Instituting a minimum wage would, in essence, do little to ensure that quality teachers are rewarded and recruited. In fact, Bill Richardson's proposal would result in students receiving a poorer education. Some teachers would receive significantly higher compensation from the government regardless of how their students perform on standardized tests or other educational benchmarks. The average teacher's salary is already higher than the minimum wage proposed by Richardson. According to USA Today, the average teacher earns over forty-six thousand dollars per year. In other words, the youngest, least experienced, and worst quality teachers will be disproportionately benefited as a result of such legislation. A guaranteed wage would also stifle the drive to work harder and develop new teaching techniques which will benefit students. A minimum teaching wage lowers the incentives for educators to increase their own knowledge and skills. If a teacher is confronted with a choice between thirty-five thousand dollars a year with no master's degree or forty-five thousand dollars a year with one, it would obviously pay for the teacher to pursue a master's degree. When that choice is between forty thousand dollars a year without a master's degree or forty-five thousand dollars a year with one, the impetus for improving one's skills declines significantly (since there is less reward). Simply put, the quality of teaching will decline precipitously after the introduction of a minimum wage for teachers.
In the free market, increasing the minimum wage significantly would result in greater unemployment, since businesses would take fewer risks in hiring new employees because they must pay them an artificially high wage. In addition, any employee whose productivity does not compensate his employer for the wage he earns will be fired. With our education system, however, the results will be quite different. Since teachers receive their compensation directly from the taxpayer, four possibilities emerge. The first, and most likely result, is that more students will be placed in each classroom to lessen the burden on the taxpayer. Rather than having thirty students in a class, forty may be placed in a single classroom to offset the increased wages given to teachers. Teachers will get more money as a result, but the quality of education will undoubtedly decrease as students receive less personal attention from a teacher. However, this will be a viable solution for school districts if the budget remains static after a minimum wage for teachers is implemented. This also would allow the same number of teachers to remain employed.
The second possibility is an increase in taxes. Keeping classroom size and quality identical under this new policy would require a significant tax increase. As a result, millions of dollars will be taken from the taxpayers and redirected to public school teachers. If educational quality was improved dramatically, these added taxes might be worthwhile. However, as we are continuing to see, educational quality actually decreases with Richardson's proposal. Though such a tax increase is a distinct possibility, the third or fourth possibilities are more likely to occur.
A teacher's minimum wage might also cause capital to be substituted where it would otherwise be less efficient to do so. For instance, computers may be given to every student in order to facilitate learning, even though it would be more efficient for teachers to merely teach. If this occurs, our resources paid into the system as taxpayers will be used less efficiently. What happens when resources are not used most efficiently? The economy as a whole suffers and the standard of living is decreased.
Finally, the most skilled and experienced educators will likely receive a pay decrease as a result of the new minimum wage. In order to offset the pay increases for those who are currently making less than minimum wage without increasing taxes, class size, or substituting capital, the best teachers will fall victim to wage reductions. These same teachers might now look to private schools or other employment opportunities rather than endure a pay cut (or, at the very least, stagnant wages). Even if current class sizes are maintained and the taxpayer is placated, the educational quality of our public schools will be drastically harmed as the best teachers leave the public schools in droves. Ultimately, while New Mexico Governor Bill Richardson's idea may seem like the panacea our education system desperately needs, his proposal will only move our school systems further down the road of quality deterioration.