I am no political analyst, constitutional or labour lawyer, or specialist in modern civilization and societal norms. I am not even an economist by profession. In fact, the world is full of people smarter than me and I am fairly certain that what I say below someone has thought of somewhere. And someone else has proven it to be wrong.

But, just in case, I thought I should share my thoughts here.

I can solve almost all of South Africa's current problems: abolish the minimum wage.

"What about human rights?" I hear you scream at me. Well, tell that to the homeless guy going hungry in South Africa's streets because the bare minimum cost of employing him is simply too high for any business. Surely a man works for what he thinks he is worth and, in the homeless and unemployed persons' cases, a little bit of money is vastly superior to absolutely none?

Surely?

Perhaps, actually, it is the enforcement of a minimum wage that in fact ignores some basic human rights?

Once again, let me repeat it: most of South Africa's problems can be solved by abolishing the minimum wage.

The way I see it, the ripple effect of abolishing minimum wage would be the following (minus the political fallout...):

1. South Africa's labour costs (and, hence, our cost base as a whole) would drop significantly, thus stimulating local business, foreign investment, exports and so on.
2. As labour would cost less, more labour would be used by business.
3. Thus, unemployment would be significantly less.
4. With unemployment being significantly less, crime would also drop.
5. With greater use of labour, machine's draw-down on the local electricity grid would be less, thus solving Eskom's short-term problems.
6. With a greater number of employed workers, South Africa's workforce's collective disposable income would be greater.
7. This greater disposable income would further stimulate the local economy by increased private sector spend.
8. This greater disposable income from a greater workforce would also provide a larger tax base for the South African Government to earn tax revenues from.
9. Also, a stronger local economy and increased foreign investment also implies an even greater tax base for the Government.
10. Greater tax revenues means better public sector funding, infrastructure build, local community projects, and, just generally, a stronger and more robust public sector.
11. And #9 further stimulates the economy, which increases business, which increases employment and disposable income...

And so the cycle of positive reinforcement would spin once the minimum wage was removed...

By abolishing minimum wage, you are effective combating unemployment, stimulating economic growth, lowering crime, and improving the overall country.

As this topic will naturally be quite controversial, let me point out that I am not saying one should abolish human rights or the constitution. I am not saying that the Government should not closely regulate the conditions of employment and prevent abuse of workers, unsafe working conditions or the like. I am not saying anything along these lines.

All I am saying is the employment contract between a business and an employee should have no forced arbitrary minimum amount stipulated by the Government. Rather, the employment contract's terms of remuneration should be entirely left to free market forces and settled by a 'willing buyer, willing seller' principle.

Yes, I know there are political reasons for why the minimum wage exists, but when was the last time the politicians knew anything about economics?

In a nutshell, that is all I really wanted to say.

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