Because history shows that business will exploit labor, even collude to exploit labor in the absence of collective bargaining or a minimum wage. This is good for business but bad for the national interests.
Nobody wants to work for $5/hour. In what fantasyland does that happen? If business gives them no options but to work at $5.00, far below equilibrium wage, it is exploitation.
Sorry. I have attempted to post the cover page below so that you can read the abstract. The citation is . . .
Card, David and Alan B. Krueger, 1994, Minimum Wages and Employment: A Case Study of the Fast Food Industry in New Jersey and Pennsylvania, Department of Economics, princeton University, The American Economic Review, Vol. 84, No. 4, Sep. 1994
Another fantasy--that both parties can get what they want when the business is holding all of the cards. Entry-level jobs don't get to negotiate for a salary and you know it.
That is not their basis. The government only wants that there be a fair and equitable arrangement that is consistent nationally.
Of course not, the fox doesn't get put in charge of the henhouse.
Nobody has suggested this. They have suggested $10/hour and I already pay students that much. What I said is that a fair and equitable arrangement (perhaps based on equilibrium wages as you have suggested) be implemented that protects the interests of both sides and the nation.
You make the unproven assumption that wage costs must always go down when your own formula suggests that it be allowed to float with the equilibrium wage market conditions. This by definition would mean that the wage would both fall and rise as the market conditions indicate. And history indicates that markets steadily grow. So the equilibrium wage would grow as well.
In fact you have ignored my comments concerning equilibrium wages and seem to have forgotten it, once it has been pointed out that it inherently allows for equilibrium wage increases.
You seem to be suggesting that minimum wage can NEVER be raised but this is in direct contradiction with your equilibrium wage model. You also seem to think that "equilibrium market conditions" can be whatever the business feels is good for them, rather than a true equilibrium based on objective conditions.