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The Minimum Wage and the Value of Labor

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DarylLloydDavis posted on Mon, Jan 16 2012 10:27 AM

 

If it may be assumed that all able-bodied, law-abiding citizens would act in defense of the sovereignty of their nation, then it could be argued that all such patriots will have earned a stake in the surviving property within that native land; for, without their compliance and support, the liberty upon which individual owners maintain any property might have been lost.  And though they ought not be permitted to extort interest or control of property from their fellow citizens, their tacit readiness to contribute to the preservation of the foundations of enterprise itself ought to be reflected by some tangible measure. I propose that the establishment of a minimum wage, set at an amount that guarantees working citizens the ability to support themselves without onerous hours worked, or inhuman conditions endured, is the recompense for maintaining the status of a law-abiding citizen in a just nation.

The argument that an artificial wage floor will in turn keep the unemployment rate artificially high, by pricing low-skill workers out of the job market altogether, makes possible a prediction that all jobs paying above the market price in a low-skill industry ought to be perpetually filled.  In other words, McDonalds would hire ten workers at five dollars per hour; but the minimum wage being seven dollars per hour, they only hire seven.  But with three workers priced out of these jobs, how is it that McDonalds cannot always fill the vacant positions at this artificially-high wage?  And by extension, with a minimum wage in place, why is the unemployment rate in every low-wage industry not always at zero, given that the minimum wage is above the market price?    

If the answer is that government provides a ready alternative to low-skill, low-wage labor in the form of welfare programs--food stamps, unemployment insurance, etc.--then the question must be asked:  In the absence of such welfare programs, if the prevailing market wage for low-skilled workers is below a level sufficient to provide a subsistence living for such workers, to what fate do we leave these workers--these presumed patriots?  In a just society must all such persons struggle under debt, deprivation, and dependency to improve their station, gaining the skills to eventually earn a “living wage”--all the while, presumably, at the ready to act in the mutual defense of their fellow citizens’ property and liberty?  Is it then still a survival of the fittest for all those citizens unfortunate enough to be born into poverty?

And when the argument is made that these citizens, if they don’t like this “deal,” are free to find a better one in some other country, is that the answer of a just society?  Is this not a form of employer extortion in its own right--knowing that the options are actually quite limited?  And if the value of money itself is subjective--as are all things--must economic valuation always determine market price, to the exclusion of a subjective moral valuation?  For it stretches the bounds of credulity to assert that the salary of a CEO is naturally 500 times greater than the company’s lowest-paid laborers, either because the market “demands” such an arrangement, where in other companies it apparently does not; or because this ostentatious disparity reflects an objectively-demonstrable, just valuation of their unique contributions toward the survival of the enterprise -- as though CEOs and their innate business acumen weren’t themselves often wrong and easily replaced.

Furthermore, is there truly no peril here?  Remember that this issue concerns the treatment of citizens who are seeking honest labor, not those who are content to free-ride off of society.  Is hungry ambition then a prerequisite for one’s very survival as a “civilized” citizen in a just society?  Is this where free markets force the hand of the invisible individual?  To control any other cost of production but labor would invariably result in favoritism for this or that industry and has led to a slippery slope of subsidies and tax breaks. The federal minimum wage is unique in several ways:   It is instituted both with a blind uniformity and a public transparency; and it helps those who are actively helping themselves.  I say that a just society places a value on labor that reflects more than its marginal economic utility--that the moral value of labor ought to be added into the final figure--or else the society isn’t worthy of the loyalty of its citizenry.  

And if the number of positions shrinks in relation to the height of the minimum wage, then one can expect that the fuller employment and the increased buying power of those who do have jobs will mitigate against any slowdown in economic activity; furthermore, in the absence of welfare assistance, the shortage of low-wage job openings will act as a disincentive for single and teenage motherhood, and an incentive for furthering education and training opportunities. Is this such a bad thing?  So I say that, somewhere between purely-economic and purely-moral alternatives, this solution, and not wages of $3 per hour, would be the most “productive” one.
 
I won't respond to every post, as I'm more interested in gathering a diversity of opinion than in defending my own.
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TANSTAAFL

if a $7.25 minimum wage is good, then wouldn't a $725 minimum wage be even better

I'm arguing that honest work has some minimum level of value to a just society, not that everyone should be rich.  In a just society one ought not pretend that the forces of a free market, and its competitive efficiencies, are so fine-tuned that no play remains with which to ensure that all productive, full-time workers earn enough to support themselves in a basic existence.  Anyone who has dealt with a mid to large-sized company, whether as a customer or an employee, knows that there are all sorts of wasteful inefficiencies throughout such businesses.  And if their payments for SSI, Medicaid/Medicare, and Unemployment Insurance--not to mention their corporate taxes--were taken off of their backs, then the minimum wage would be even less onerous.  But, ultimately, I believe that a just society owes its law-abiding, productive citizens that much--especially in light of the fact that they now pay citizens not to work--which I oppose. What you subsidize, you get more of. 

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Zerubbabel

Disingenuous. You did respond to every post and you are quirte interested in defending your own position. There's nothing wrong with that. It makes you human and not the unbiased objective thinker you pretend to be.  Welcome to the world of ideological bias

I wrote that disclaimer, not because I was planning on remaining silent and just watching, but because the first thread I started a while back I felt obliged to answer every reply, even when it wasn't necessarily addressed to me:  Like, welcome to my thread, I'll be your host this afternoon.  I didn't want to put that same pressure on myself.  

And yes, I have been defending my position, when a thoughtful, respectful inquiry or criticism was made.  But I definitely haven't responded to all posts.  And I wasn't trying to pretend to be unbiased either--if by that you mean disinterested in the truth of my assertion.  Yet I do think that it is objectively true. 

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MaikU replied on Tue, Jan 17 2012 4:45 PM

DarylLloydDavis:

I'm arguing that honest work has some minimum level of value to a just society, not that everyone should be rich.

bollocks. Minimum is like God. Either you define it or just get out of the thread and lose the argument instantly.

"Dude... Roderick Long is the most anarchisty anarchist that has ever anarchisted!" - Evilsceptic

(english is not my native language, sorry for grammar.)

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 the very LAST thing to go should be the friggin' minimum wage

This is a change of subject - we weren't discussing the priority of eliminating this versus that public policy. If that's the discussion, then we can close with what is obviously the single most important policy issue of the day: End the central banking criminal fraud system, legalize competing monies, end legal tender laws and any other laws that protect a nationalized monopoly on the production of money. No other policy issue comes close in importance to this one.

As for the supposed non-importance of MW ("very last thing to go"), I disagree. Even conservative economists will say this from time to time... "well, yeah, MW is a bad idea but it's not a pressing issue." But if you've traveled to other parts of the world where there is no minimum wage or the minimum wage is extremely low and look at how the internal economy works (i.e. forget "foreign exploitation" of "criminally low wages"), you will see that the abundance of inexpensive labor buttresses a strong and thriving middle class. A good example is India where there is a thriving industry of servants, housekeepers, nannies, tutors and so on. These household industries account for a major portion of the economic activity there. The problem is that these industries are inherently difficult to tax. And that's one of the functions which the MW performs, eliminating a significant chunk of economic activity which would escape taxation, thus forcing people to choose between idleness or working for a big-box corporate firm where regular deduction of taxes at the source (paystub) is rigidly enforced. The corporate pay department can be thought of as the front-line operational arm of the IRS.

Clayton -

 

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Clayton

This is a change of subject - we weren't discussing the priority of eliminating this versus that public policy. 

My intention was to broaden your perspective on the issue, not to change the subject.  The underlying point was that one's priorities are a reflection of one's values; and that a blanket insistence that all state interventions must end immediately does not reflect a realistic, or a refined set of priorities, or morality.

 legalize competing monies, end legal tender laws and any other laws that protect a nationalized monopoly on the production of money. No other policy issue comes close in importance to this one.

How does one then maintain a fluid exchange of goods and services, without a uniform currency--since using silver and gold, or bartering, would slow things way down; and using homemade money would destroy any objective measure of its value?

A good example is India where there is a thriving industry of servants, housekeepers, nannies, tutors and so on. These household industries account for a major portion of the economic activity there.

You forget that I don't measure the success of a society by its ability to marginally attenuate the country's scarce resources among an ever-expanding population.  I want the MW to serve as a check upon the kind of rampant overpopulation and resource destruction that one finds in India. 

The problem is that these industries are inherently difficult to tax. And that's one of the functions which the MW performs, eliminating a significant chunk of economic activity which would escape taxation

I'm proposing a system that has no income tax, personal or corporate.  For me, the MW has nothing to do with tax revenues.

 

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What imbues this value into goods? Do say. What law of nature that has existed before man and will exist long after dictates that "yes, an hour of work by such and such people is objectively worth $10 at the exchange rate of 2012."

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Wheylous

What imbues this value into goods?

We do, Wheylous.  I already told you that ALL values are subjective.  You value something this much; I will exchange it for that much, because I don't value it as much as you do.  There is no objective value for anything.  But that doesn't mean that a just society doesn't place a value on anything.  It recognizes, for instance, that life has value, even though we don't come with price tags attached.  And a just society ought to set a minimum value for honest work as well, irrespective of whether some people don't value it at all.  

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No taxes required eh? So there will be no fund from which to pay those who would police this system?

 

Anyway I have to laugh at someone that considers themself above moral reproach when they condemn adults who would consent to capitalists acts of agreeing employment at below some arbitrary rate with prison or death. 

Where there is no property there is no justice; a proposition as certain as any demonstration in Euclid

Fools! not to see that what they madly desire would be a calamity to them as no hands but their own could bring

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How exactly do "we"/"society" place a value on something?

The keyboard is mightier than the gun.

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a blanket insistence that all state interventions must end immediately

Neither do I. If we ended the government overnight by pushing a Big Red Button (h/t Rothbard), it would certainly be a colossal human tragedy - busted water mains, downed power lines, roving gangs, etc. etc.

But this is not indicative of human nature, this is indicative of the state of atrophy of the market for production of goods and services which the State has monopolized. The answer is simple: liberalization. We did it with parcel delivery and it could be done with many other industries. In fact, there is no industry that could not benefit from liberalization, including security, banking and arbitration, the Holy Trinity of State monopolies.

Liberalization permits private industry to be reinvigorated in the production of the previously monopolized goods and services without creating a human tragedy. The State monopolist will try to cling to life and will continually increase its burden on the taxpayer while delivering less and less services, as the USPS has done. But this matters less and less as consumers are simply able to choose to patronize the private producers instead of the old government monopolist.

The problem of taxation is indeed a social problem. People believe they need to be taxed/enslaved. This emotional attachment to the old system of servitude to a master called "the government" will take time to be discredited and to change people's minds... but it's not impossible. The end of chattel slavery also involved upsetting changes to popular opinions and mores but, in the end, the moral side of the argument won out. This trend will continue into the future despite the setbacks of the last century or so, thanks to the so-called "Progressives."

Clayton -

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nirgrahamUK 

No taxes required eh? So there will be no fund from which to pay those who would police this system?

Amendment X – No law enacted by electoral initiative or otherwise shall establish a debt, project or fiscal program where the financing thereof would obligate future citizens to the financial commitments of current voters.  Appropriations shall be drawn from revenues collected within one year of their appropriation through floating debt and the collection of these fees and revenues only:

                Usage fees levied upon persons whose activities degrade or monopolize public property;

                Usage fees levied upon persons enjoying exclusive use of land, in proportion to its acreage and the volume, mass and scarcity of natural resources therein;

                Usage fees levied upon foreign governments for involvement of United States military personnel, equipment or weaponry in operations outside the territory of the United States, at the request of said governments, which would otherwise be the responsibility of any sovereign nation to itself;

                Misusage fees levied upon persons whose activities, whether intentional or negligent, damage public property;

                Misusage fees levied upon persons whose activities damage the private property of another person, or impede its exclusive use by barring lawful access to it, or operation of it; physically altering it or its value; or otherwise converting or making improbable its peaceable, lawful, exclusive enjoyment; thereby necessitating the intervention of law enforcement or courts of law;

                Misusage fees levied upon persons who assume unnecessary risks or file frivolous complaints that require emergency public services or courts of law;

                Sales of forfeited, seized property;

                Sales of goods processed or manufactured by state-confined workers; or revenues from the contracting-out of their services;

                Sales of government property to allies of the United States, upon a two-thirds majority vote among the Governors and a unanimous vote between the President and the Cabinet—or the Defense Cabinet, in the case of military property;

                Duties, imposts and excises;

                Safety-inspection and handling charges;

                Any fiscal-program income deduction annually re-authorized by electoral initiative.

                All fees shall reflect the actual duration and costs of use or misuse, so that collections in anticipation of use may necessitate reimbursement.

                No law enacted by precinct electoral initiative shall institute or increase an appropriation from revenues derived in part or in full from another precinct, unless with a fifty-one percent consenting vote within the latter precinct, or unless authorized by this Constitution; nor withhold or disburse revenues lawfully collected for and due to a city, county or state government, or the federal government.

Anyway I have to laugh at someone that considers themself above moral reproach

Who said I consider myself above moral reproach?  Don't answer that.  I never said it.  I think that no one is above moral reproach.

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A)Tldr your whole list of permissible outrages.

B) you wrote

Don't stomp on my being moral, Clayton, just because we're all waiting for the big shoe to drop." 

Regardless I hope you consider yourself hella-reproached.

 

Peace-out


Where there is no property there is no justice; a proposition as certain as any demonstration in Euclid

Fools! not to see that what they madly desire would be a calamity to them as no hands but their own could bring

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I don't know how I missed this:

You impute such evil in the midst of such order and relative prosperity.  In one sense it's good that you take nothing for granted; but, for goodness sakes, stop and smell the roses once in a while.  What are the elite waiting for?  Why the protracted chirade?  Why not just stockpile what they need and collapse the system?

You don't get it. I cringe whenever I post a link to him but Molyneux explains it very well here:

The Elites aren't waiting for anything. The status quo is precisely what they want. The root problem is explained brilliantly here:

Etienne de la Boetie wrote about this centuries ago.

Clayton -

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Clayton

 If we ended the government overnight by pushing a Big Red Button (h/t Rothbard), it would certainly be a colossal human tragedy - busted water mains, downed power lines, roving gangs, etc. etc

I'm glad to read that you're aware of the risks.  

But this is not indicative of human nature, this is indicative of the state of atrophy of the market for production of goods and services which the State has monopolized

It is human nature.  I read the link from your active thread--the story on aircraft carriers; and I noted that the author made this very point as well--that they're all the same:  the Pentagon generals and the Chrysler CEO's.  You can't escape it:   Bad judgment, inefficiency and wastefulness are not exclusive to the public sector.  

Mail delivery is a relatively-simple, harmless enterprise.  Law enforcement and military defense are not.  Is your ideal America one with nothing but private toll roads, by the way?  Who pays to fix bridges?  Must all public lands then be sold off, parceled out?  No more national forests?  I agree with liberalizing/privatizing whatever can be done more efficiently in the private sector--and that's most things--but there are functions of government best left out of the hands of private interests. I know, I know, the private interests are already controlling Congress.  That's why I propose to be rid of it.  My system would clarify things quite a bit.  Direct democracy is a sort of "liberalization" of political power.

   

 

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DarylLloydDavis:
I'm glad to read that you're aware of the risks.

None of us, by the way, is really advocating "pushing the big red button". If you think we are, then you're attacking a strawman in place of our actual position.

DarylLloydDavis:
It is human nature. I read the link from your active thread--the story on aircraft carriers; and I noted that the author made this very point as well--that they're all the same: the Pentagon generals and the Chrysler CEO's. You can't escape it: Bad judgment, inefficiency and wastefulness are not exclusive to the public sector.

There's a difference between simply making mistakes and committing aggression.

DarylLloydDavis:
Is your ideal America one with nothing but private toll roads, by the way?

Nothing but private roads, yes. I don't think they'll all be toll roads.

By the way, I for one am not just concerned with "America" - I'm concerned with the whole world.

DarylLloydDavis:
Who pays to fix bridges?

Who do you think? The people who own the bridges.

DarylLloydDavis:
Must all public lands then be sold off, parceled out? No more national forests?

Sold off, parceled out, or left open to homesteading.

If there's no more nation, there's no more national forests.

DarylLloydDavis:
I agree with liberalizing/privatizing whatever can be done more efficiently in the private sector--and that's most things--but there are functions of government best left out of the hands of private interests.

I'd like you to please enumerate these functions and explain why you think they're best left out of the hands of private interests.

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