Tuesday, September 4, 2012

Minimum Wage Laws De-Civilize America

By, Chris Rossini
Email | Twitter

Much like "the broken window fallacy," hearing about the virtues of minimum wage laws never seems to go out of style.

The other day, truthout had a whopper of a headline describing this government blessing: "Raising the Minimum Wage Is the Least We Can Do to Civilize America".

A quick look in the thesaurus gives the following synonyms for the civil: respectful, deferential, gracious, complaisant, affable, courtly.

One can reasonably come to the conclusion that in a civilized society, individuals could freely and peacefully contract and exchange with one another. Individuals could negotiate and come to terms using their own value scales.

Well, the State has a problem with that. In its twisted version of civilization, it must step in and squash the free and peaceful from the equation. It must introduce coercion and violence.

What do minimum wage laws do?

They outlaw contracts that would take place in a free society. In other words, they outlaw jobs.

In a free society, you'd be able offer your labor services for say $8/hr, and if a prospective employer likes the deal and agrees, you both have made a peaceful and voluntary contract.

However, in our 'advanced' society, if government mandates that the minimum wage is $10/hr, you (and the employer) are both out of luck. The government does not give either of you the permission to make such a contract. You are now a victim of compulsory unemployment.

Sound like a civilized situation to you?

But don't worry because publications like truthout have your back. They'll forever call for increases in the arbitrary wage mandate, pushing you further and further down the American Dream ladder.

And once you reach that bottom rung, there will be government waiting for you with its bounty of food stamps and welfare.


  1. Although I benefit from overtime wage rates (1.5x pay scale), this is also compulsory government interference. If I could have sound money and individual contracts, I would give overtime up tomorrow. It is frustrating to be subject to rules that are unjust, but were also passed long before you were born, and in which you have no say. In being a student of Austrian economics, I would never vote to expropriate from other people, on any terms whatsoever. Many of us have received government bonds as gifts throughout our childhood. You often grow up thinking that they're a good thing. Then you read Rothbard and a whole other world of truth opens up to you.

    1. I don't think overtime is covered by wage/labor legislation. Typically, it is a benefit offered by an employer. Be thankful you're receiving 1.5x which is a pretty good deal these days.

    2. Overtime is covered by labor legislation. Anything over 40 hours is required to pay time-and-a-half. Been that way since 1937 with the "Fair" Labor Standards Act.

  2. Try to tell the average person this and they look at you funny. Its common sense. If the Min wage is $8 an hour and your "marginal value product" or worth is below $8 of labor per hour, you dont work. Millions of unemployed people would be willing to work for less than the min wage rate today.

  3. Okay I'll try:

    It is impossible to legislate a wage rate.

    Laws only prohibit things, they are helpless to make things happen that otherwise cannot happen.

    Instead laws prohibit jobs that are worth less than the specified 'minimum wage' rate.

    Now you know why teenagers don't work at McDonalds anymore.

  4. As I always say to economically-ignorant people: You can ignore economics laws, but economic laws won't ignore you.