Twirling Signs for a Living Wage
During the summer I have been using a parking garage near my lab. The only problem is that there has been extensive road work being done on the access road that connects the parking garage to the main road. Quite frequently, the construction requires reducing the road to one lane for both sides of traffic. When this occurs, a construction worker must hold a sign up that on one side tells traffic to stop and on the other side tells the traffic to proceed slowly. Working in pairs the two construction workers control the flow of traffic.
As I was being directed a thought occurred to me. What’s the market value of a guy standing in place and periodically rotating a sign? More to the point, does this job’s market value exceed the cost of a living wage? If I were to hazard a guess I would say no. The market does not put enough value on this skill to support life. If a person were to do nothing but direct traffic all day with a sign he would eventually die of starvation because he does not make enough money doing that to live.
It’s in this scenario that liberals argue that this is precisely why minimum wage laws should be implemented. Let’s take this apart.
Free markets determine the honest value of some good or service. Thus, when the market determines that the value of twirling signs to control traffic is below a living wage we can reasonably argue that people at their most honest are unwilling to pay these traffic controllers more than what is required to survive. I wish to be very clear here. Market value represents the closest measure of what people will honestly pay for some service or good.
When liberals respond emotionally to the worker being unable to support himself by demanding the state implement minimum wage laws, liberals are distorting the honest market determined value of the labor. In this analysis, consumers have expressed their desire to pay less and liberal have expressed their desire to pay more than the living wage for this kind of labor. It’s liberal belief versus consumer belief.
In setting up the analysis in this way I wish to emphasize which group is calling on state coercion to force their beliefs on to everyone else. The consumer, working through the free market, by definition, does not call on the state’s coercion to force people to pay less for traffic control labor. The consumer simply gives their honest response to how much they are willing to pay for that kind of labor, and in the aggregate the market determines that this value is not enough to support a living wage. On the other hand, seeing that consumers are unwilling to pay a living wage for this kind of labor liberals demand that the state use its coercion to force consumers to pay a wage that exceeds the living wage. In sum, liberals unhappy with how much consumers are willing to pay for some kinds of labor, call on the state to force those consumers to pay more for their labor.
Just in case there is doubt, it really is the case that liberals want to force their belief of how much labor should cost on to everyone else. For you see there is no law forbidding one person to give money to another person. If liberals were only concerned with these workers, then all they would need to do is pool their money together and distribute it to the workers. However, this is not enough for liberals, for they want the state to forcibly make consumers, who disagree with them, to pay more than they are willing to for this labor. No matter how liberals justify using coercion at the end of the day they are forcing their beliefs on others.
I honestly can’t see how this is different from conservatives that want to force their morality on to other people. Religious folk find abortion morally objectionable. Since this procedure is open to the free market, we find that is has market value since consumers are willing to pay for the procedure. Conservatives are unhappy with some consumers being able to pay for an abortion since it will lead to the death of a human. This is similar to the outrage liberals express when our sign twirling traffic controller starves to death because he is not paid a living wage. Conservatives call on the state to force other consumers to not use this procedure, in the same way that liberals call on the state to force other consumers to pay more for traffic controlling labor.
It’s in this regard that I can’t see much difference between liberals and conservatives. They both wish
to expand state power simply to coerce people to behave in a manner they prefer.
July 21st, 2008 at 2:53 pm
The thing you always forget about is democracy.
“In sum, liberals unhappy with how much consumers are willing to pay for some kinds of labor, call on the state to force those consumers to pay more for their labor.”
Though I wasn’t able to find current figures, in 1996 78 percent of Americans favored Clinton’s proposed minimum wage increase, and in 2006, 86% of Americans favored a minimum wage increase proposed by Sen. Kennedy. If almost 90% favor increasing the minimum wage, I think we can safely assume that having the minimum wage exist at all is a fairly popular proposition among the voters (who are ALSO consumers, as you always seem to forget).
Now, clearly consumers aren’t willing to pay minimum wage for someone to hold a sign. But they ARE willing to pay minimum wage in order to keep that man and his family from starving to death. I know this is true, because they’re overwhelmingly in favor of increasing the minimum wage, which raises the prices on the goods that they buy.
As I’ve said, the free market is great, probably the best system for generating wealth ever instituted, but that doesn’t mean that it has no flaws or blind spots. One flaw (we’ve argued about several others) is that it doesn’t neccessarily supply everyone with enough to live off of. And human beings (you call them consumers) are aware of these flaws, and they use the government to fix them. That’s exactly what you, a a libertarian, should WANT the government tobe doing- fixing the few problems that a free market doesn’t handle very well (including police and military, ie coercive force, which you can’t have as part of the free market but which will always exist), and staying out of the way otherwise.
July 21st, 2008 at 3:26 pm
Here you go.
If people are so willing to pay this guy more money then why support minimum wage rather than pay out of their own pocket?
July 21st, 2008 at 4:48 pm
Because, as I’ve also argued before, charities don’t work very well in a free market system. But even if they did, no one has the time and energy to split up their income among the 10,000 humanitarian/ecological/technological programs that the government is responsible for. They choose to use the government for precisely that purpose. That’s a major part of what the government IS. If they didn’t want their incomes going to support those things, they wouldn’t vote for them.
I understand that, as a libertarian, you don’t think that government should be used that way, as a type of group-collective charity to ensure that important programs which it would be impractical for private charities to address but enjoy popular support are carried out. But the majority of Americans disagree with you, and want government to serve that function. It’s disengenuous to pretend that liberals are twisting government power to provide minimum wage at consumer’s expense, when the consumers themselves are massively in favor of it and consistently vote for it.
July 22nd, 2008 at 10:20 pm
I don’t actually want to read the Steve and Darwin’s arguments, but I did want to scoff at “charities don’t work very well in a free market system”. Yeah, because everyone knows that Saddam’s Iraq, Stalin’s USSR, Napoleon’s France, Franco’s Spain, etc, were the most giving and caring societies ever to grace the Earth.
July 22nd, 2008 at 11:26 pm
Sounds like you should read my previous arguments about charities. Also the post I just made on Personal Responsibility where I say I like to assume my audience is smart enough to understand that when I criticize something that happens in America, I’m not automatically saying it’s better under tyranical dictators. That’s like the most idiotic straw man ever.
July 23rd, 2008 at 11:29 pm
I know you mean that charities don’t work as well as they could in America (or something like that.) But you said they “don’t work very well in a free market system” which, frankly, is bullshit, because organized charity doesn’t exist in any meaningful way outside “the free market system”.
July 24th, 2008 at 1:35 pm
This is a long standing argument I’ve had with Steve that has basically no bearing on what you’re saying here. To put it sucinctly, my argument is that free markets work really well because consumers choose what goods they get, and will choose the best product at the best price, because they themselves get the benefit from that decision. Government regulated markets work poorly because the beauracrats making the decisions about the economy aren’t affected by them, therefore even if they have good intentions they’ll be ill-informed and under-motivated and end up making bad decisions.
However, charities have this same problem- the person making the purchase (the doner) does NOT receive the benefit of that purchase (the people/cause the charity is set up to help does), and therefore they do not have as strong a motivation to be well-informed and careful in their purchasing. THus, charities do not receive the most important benefit of the free market system. Instead, they are more like a government-controlled market, since their is too little feedback to the person making the decision in regards to the consequencees of that decision. Eventually, charities in a free market will tend to maximize benefits to the person donating rather than the cause being adressed, by making the person feel good about themselves or part of a cause or whatever. This is why GreenPeace, which has been TERRIBLE for the environment but which has awesome marketing and makes the people giving to it feel good about themselves, is the most successful ecological charity in the US.
July 24th, 2008 at 7:02 pm
I very much agree with you the problem charity (period) is that the customers are not the recipients but the donors meaning that sucessful charities are those that cater to donor’s vanity,
Mostly. The bad news is that this is an unsolvable problem. Carbon-based lifeforms are always going to do a what’s in it for me calculation before any action. But in the context of the modern America in the early 21st century means what I don’t know for societal or governmental ‘fixing’ I just want to emphasize that in less wealthy societies this I’d not a problem because people don’t have the resources to waste onfeeling like a decent well- meaning charitable person.
July 24th, 2008 at 11:59 pm
I’d disagree with you there, many poorer places have very important and omnipresent customs about helping out friends, neighbors, and the community in difficult times. They’re not centralized ‘charities’ because that’s unworkable in their system, but the people themselves are still charitable.
Anyway, my belief is that this problem means that having humanitarian problems adressed by the government rather than free-market charities isn’t as stupid as most libertarians would initially think, because charities don’t really benefit from free-market principals in the way you’d want. Steve still argue sthat if people want a minimum wage, they should start a charity to pay everyone in the country who earns less thanthat wage, whereas I think they should just vote for a minimum wage law and accept the increase in prices.
July 25th, 2008 at 1:37 pm
Minimum wage laws remove choice in the matter of payment, whether payment of minimum wages, or higher prices on goods handled by minimum wage workers. This removal of choice by the government is equal to the elimination of a little bit of freedom in exchange for a minimum standard of living for those willing and able to find a job.
I am reluctant to give up freedom, but more to the point I do not think the minimum wage benefits society as a whole. It artificially inflates the prices of goods, as well as making it more difficult for American companies to compete globally.
July 26th, 2008 at 10:46 am
the main problem with government ‘charity’ is the problem you point out with organized charity in general. They’re not doing it (at least primarily) to help anybody. Ninety-nine percent of the time it’s vote-buying or bullshit legacy-building. Which the secondary effects might be so positive tyt we should continue to do the governmental charity, but it’s hardly the solution to ‘free markets being bad at charity’. Because it the fredom that created the surplus for politicians to use in the first place.