4 ms·

What I find important to remember about minimum wage is that it constitutes a restriction on the freedom of workers to negotiate for their labor. The existence

What I find important to remember about minimum wage is that it constitutes a restriction on the freedom of workers to negotiate for their labor. The existence of a meaningful minimum wage implies that there are people in the society who desire to negotiate for lower compensation (because they are more motivated to get the job for whatever reason), but they are disallowed from doing so. It might be our opinion that it is undignified or exploitative to work for a certain wage, but we should not have the right to bar others from doing so if they wish. As individuals, we should demand the freedom to negotiate the terms of our employment without government influence, including wages, benefits, and even working conditions. Using the government to coerce employers into giving greater compensation is appealing in the short term, but ultimately it disenfranchises others by blocking them out of jobs and results in long term economic stagnation. Mandatory minimum wage significantly above the "natural" level dictated by prevailing economic conditions unquestionably causes harm, mostly to workers who, if they choose to continue to work for less money, are now doing so illegally. Mostly they just don't get work. This is why politicians tend to let minimum wages lapse behind the market rate - economies work better without this restriction. And when a significant minimum wage hike is imposed, like $15/hour in some places today, the economic harm to workers quickly becomes apparent.

eesmith 6y ago
Indeed we should - demand the repeal of Taft–Hartley Act and other laws which have nerfed collective bargaining power far from any "natural" point. Jurisdictional strikes, wildcat strikes, solidarity or political strikes, secondary boycotts, secondary and mass picketing, closed shops, and monetary donations by unions to federal political campaigns are all part of the freedom to negotiate the terms of our employment, which we are currently disallowed from doing.
- flyingfences 6y ago
  I can't tell if you're saying that sarcastically, but I do agree unironically.
  - eesmith 6y ago
    You can see my relevant comment history - https://hn.algolia.com/?dateRange=all&page=0&prefix=true&query=hartley%20eesmith&sort=byPopularity&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que...
- Discombulator 6y ago
  On the other hand, employers are also barred from colluding to keep wages artificially low, which arguably would be considered a “negotiation strategy” if one follows your interpretation. I agree though that employers have naturally more negotiation power in the vast majority of cases.
  - eesmith 6y ago
    You'll notice that when Adobe, Apple Inc., Google, Intel, Intuit, Pixar, Lucasfilm and eBay colluded for years to keep wages artificially low, their final penalty was far less than they saved in costs, and none of the corporate people involved faced jail time for their illegal actions. In other words, that collusion was profitable for those companies and for upper management like Eric Schmidt who participated but face no real ostracism for their illegal actions. That law has no real teeth. Compare that to, say, UC filing charges against UAW Local 2865 following wildcat strikes at UCSC claiming that UAW Local 2865 didn't do enough to prevent the strike UAW Local 2865 didn't authorize in the first place.
rconti 6y ago
I tend to find the libertarian argument appealing, as well, but you're making a whole lot of assumptions. I think your worst unchecked/unstated assumption is that "unemployed people are all looking for a job below the minimum wage but are unable to find one". That's simply untrue. "Unemployment" in the US is defined as people who are actively searching for a job (not merely those who do not HAVE a job), but there is no requirement that they accept any job at any (legal) wage. Presumably, the vast majority of unemployed people, even in good times, would not accept work $1 below the minimum wage, even though they are actively searching. IOW: You are assuming that the entire reason these folks are unemployed is because they are not allowed to contract their labor for a lower wage.
Sohcahtoa82 6y ago
Without a minimum wage, the "market rates" for what is currently minimum wage labor will create a race to the bottom, not just in wages, but in standards of living. There will always be someone more desperate for any amount of money, and eliminating the minimum wage won't create significantly more jobs, as businesses only hire enough people to satisfy demand for their products. Wal-mart won't suddenly hire more cashiers just because they can now pay $2/hour to someone living in a cardboard box. When it comes to negotiating wages, people in current minimum wage jobs have zero leverage. Minimum wage is a necessity to keep people out of cardboard boxes or packed into tiny apartments like sardines. It is necessary to keep a decent baseline standard of living.

eesmith 6y ago

Indeed we should - demand the repeal of Taft–Hartley Act and other laws which have nerfed collective bargaining power far from any "natural" point. Jurisdictional strikes, wildcat strikes, solidarity or political strikes, secondary boycotts, secondary and mass picketing, closed shops, and monetary donations by unions to federal political campaigns are all part of the freedom to negotiate the terms of our employment, which we are currently disallowed from doing.

flyingfences 6y ago
I can't tell if you're saying that sarcastically, but I do agree unironically.
- eesmith 6y ago
  You can see my relevant comment history - https://hn.algolia.com/?dateRange=all&page=0&prefix=true&query=hartley%20eesmith&sort=byPopularity&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que...
Discombulator 6y ago
On the other hand, employers are also barred from colluding to keep wages artificially low, which arguably would be considered a “negotiation strategy” if one follows your interpretation. I agree though that employers have naturally more negotiation power in the vast majority of cases.
- eesmith 6y ago
  You'll notice that when Adobe, Apple Inc., Google, Intel, Intuit, Pixar, Lucasfilm and eBay colluded for years to keep wages artificially low, their final penalty was far less than they saved in costs, and none of the corporate people involved faced jail time for their illegal actions. In other words, that collusion was profitable for those companies and for upper management like Eric Schmidt who participated but face no real ostracism for their illegal actions. That law has no real teeth. Compare that to, say, UC filing charges against UAW Local 2865 following wildcat strikes at UCSC claiming that UAW Local 2865 didn't do enough to prevent the strike UAW Local 2865 didn't authorize in the first place.

rconti 6y ago

I tend to find the libertarian argument appealing, as well, but you're making a whole lot of assumptions. I think your worst unchecked/unstated assumption is that "unemployed people are all looking for a job below the minimum wage but are unable to find one". That's simply untrue. "Unemployment" in the US is defined as people who are actively searching for a job (not merely those who do not HAVE a job), but there is no requirement that they accept any job at any (legal) wage. Presumably, the vast majority of unemployed people, even in good times, would not accept work $1 below the minimum wage, even though they are actively searching. IOW: You are assuming that the entire reason these folks are unemployed is because they are not allowed to contract their labor for a lower wage.

Sohcahtoa82 6y ago

Without a minimum wage, the "market rates" for what is currently minimum wage labor will create a race to the bottom, not just in wages, but in standards of living. There will always be someone more desperate for any amount of money, and eliminating the minimum wage won't create significantly more jobs, as businesses only hire enough people to satisfy demand for their products. Wal-mart won't suddenly hire more cashiers just because they can now pay $2/hour to someone living in a cardboard box. When it comes to negotiating wages, people in current minimum wage jobs have zero leverage. Minimum wage is a necessity to keep people out of cardboard boxes or packed into tiny apartments like sardines. It is necessary to keep a decent baseline standard of living.