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Milton Friedman on Wages, unions, and the minimum wage

The two-step rate is better than a one-step rate. At least, it would reduce the harm done by raising the minimum. But a no-step rate would be better than either.
Legislating Unemployment
Column, 1972, Newsweek (1972; the issue current on June 28, 1972); reprinted in full in the Congressional Record, Extensions of Remarks, June 28, 1972, p. 23100, Congressional Record, June 28, 1972, p. 23100
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  1. Over the period covered by these data, a drastic change has occurred in the responsibilities undertaken by the state to provide assistance to the aged, unemployed and otherwise dependent. This change has had divergent results on the particular data under discussion. The availability of assistance from the state would clearly tend to reduce the need for private reserves and so to reduce private saving—it is equivalent, in terms of our hypothesis, to a reduction in the variance of transitory components.
    A Theory of the Consumption Function
    Book, 1957, Princeton University Press for the National Bureau of Economic Research, Chapter V, “Consistency of the Permanent Income Hypothesis with Existing Evidence on the Relation between Consumption and Income: Time Series Data,” p. 123
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  2. To state this conclusion differently, there is always a temporary trade-off between inflation and unemployment; there is no permanent trade-off. ( … ) The widespread belief that there is a permanent trade-off is a sophisticated version of the confusion between “high” and “rising” that we all recognize in simpler forms. A rising rate of inflation may reduce unemployment, a high rate will not.
    The Role of Monetary Policy
    Journal article, 1968, American Economic Review 58, no. 1 (March 1968), pp. 1–17; reprinted in the House Banking and Currency Committee’s 1968 Compendium on Monetary Policy Guidelines and Federal Reserve Structure, pp. 214–224, p. 220 of the 1968 House reprint
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  3. It matters little whether the Federal Reserve is unable or unwilling to exercise its independence in deeds as well as words. In either case, let us be done with the fiction that “independence” is somehow or other a bastion against inflation. Let us put the responsibility for the rate of monetary growth—and therewith for the subsequent rate of inflation—squarely and openly on the Administration and Congress.
    Why Inflation Persists
    Column, 1977, Newsweek (October 3, 1977); reprinted in full in the Congressional Record, Extensions of Remarks, September 29, 1977, p. 31684, introduced by Representative Parren J. Mitchell of Maryland, who gives it as appearing “in the October 3, 1977, issue of Newsweek”, Congressional Record, September 29, 1977, p. 31684
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