AOC’s Denmark Comparison On The $15 Federal Minimum Wage, Debunked

The congresswoman’s US-Denmark comparison is misleading in multiple ways.

Rep. Alexandria Ocasio-Cortez recently took to Twitter to once again call for raising the federal minimum wage. She argued that $15 an hour, if anything, is a “deep compromise,” especially in light of the fact that, “McD’s workers in Denmark are paid $22/hr + 6 wks paid vacation.”

This argument doesn’t hold up. Here’s the key consideration: A sharp increase in the minimum wage will almost always cause unemployment, but it will cause more unemployment the higher it is relative to market wages.

So, Ocasio-Cortez’s US-Denmark comparison is misleading in multiple ways.

Image credit: Wikimedia

First of all, Denmark does not have a national minimum wage.

Instead, specific industries have different wage rules set through collective bargaining with trade unions. On average Danish fast food workers do earn more than their American counterparts—approximately $27 vs $11. But Denmark is a bad example to use to push for an across-the-board hike in the national minimum wage, because Denmark does not have one.

In European Union countries that actually have a national minimum wage, it is lower than $15 an hour. For example, France’s and Germany’s minimum wages are equivalent to $11.46 and $12.42 an hour respectively.

Also, the US is much bigger and more economically diverse than any single European country. Ocasio-Cortez’s proposed $15 federal minimum wage would be much more comparable to an EU-wide minimum wage, which doesn’t exist—and for good reason.

France’s minimum monthly wage is €1554, while Poland’s is €614. If France’s minimum wage (or higher) were imposed on Poland by EU mandate, it would inflict much more unemployment on Poland (where average wages are lower) than on France.

Similar regional differences exist in the US and should not be ignored.

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Zilvinas Silenas became President of the Foundation for Economic Education (FEE) in May 2019. He served from 2011-2019 as the President of the Lithuanian Free Market Institute (LFMI), bringing the ...

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