A few months ago, I was reading a fascinating paper by Thomas Leonard on “Eugenics and Economics in the Progressive Era.” The paper is full of interesting tidbits, but I was especially struck by the discussion of Progressive Era arguments for the minimum wage.
Most readers of this blog will be familiar with the argument that minimum wage laws create unemployment. And most of us, no doubt, regard this as a powerful argument against the minimum wage.
As Leonard’s paper shows, progressives like Sidney Webb were familiar with this argument. But rather than viewing additional unemployment as a cost of minimum wage laws, they actually regarded it as a positive benefit! After all, you see, the people most likely to be disemployed by a minimum wage were those who were among the least employable anyway – the drunks, the idiots, and the immigrants – especially those who were members of “low-wage races.” And, according to the grand progressive vision, anything we can do to identify such individuals and segregate them from healthy, productive white society was a step in the right direction for the human race.
Leonard’s article contains a number of shocking quotes:
“With regard to certain sections of the population [the “unemployable”] , this unemployment is not a mark of social disease, but actually of social health.” – Sidney and Beatrice Webb, Industrial Democracy
“[O]f all the ways of dealing with these unfortunate parasites, the most ruinous to the community is to allow them to unrestrainedly compete as wage earners.” – Sidney Webb, in The Journal of Political Economy
“The operation of the minimum wage requirement would merely extend the definition of defectives to embrace all individuals, who even after having received special training, remain incapable of adequate self-support…If we are to maintain a race that is to be made of up of capable, efficient and independent individuals and family groups we must courageously cut off lines of heredity that have been proved to be undesirable by isolation or sterilization ….” – Henry Rogers Seager, professor of economics at Columbia University and future president of the American Economics Association
Crazy, right? Look what a bunch of racist nuts progressives used to be! (See this short piece by Steve Horwitz and Art Carden for more) Thank God the debate about the minimum wage has evolved from that. At least today’s progressives want to help the poor, and simply disagree about whether the minimum wage is or is not an effective means to doing so.
Fast forward. Today on the way to work, I listened to Bryan Caplan’s Intelligence Squared debate on whether we should “Let Anyone Take a Job Anywhere.” Bryan and his partner, Vivek Wadwha, were arguing in support of the motion against Kathleen Newland and Ron Unz. So, Bryan’s making his usual arguments, claiming that immigration restrictions are unjust and inefficient, and that whatever concerns we have about them could be addressed in cheaper and more humane ways. And then this happened.
Ron Unz: “In other words, if we had a very large rise in the minimum wage, maybe to $12 an hour, that by itself would alleviate a lot of the problems associated with immigration because, in a sense, if you have a situation where American workers can’t be paid less than, say, $12 an hour, then even a huge amount of foreign competition would insure that ordinary American workers had a reasonable standard of living and maintained it.” (from the official transcript)
That sounded a bit fishy to me. So, curious, I looked to see what Unz has written on this topic. Turns out, there’s a lot. But his moral perspective is even clearer in his publishing writings than it was in the debate. Here’s Unz, writing in the American Conservative back in 2011:
The automatic rejoinder to proposals for hiking the minimum wage is that “jobs will be lost.” But in today’s America a huge fraction of jobs at or near the minimum wage are held by immigrants, often illegal ones. Eliminating those jobs is a central goal of the plan, a feature not a bug.
“In effect, a much higher minimum wage serves to remove the lowest rungs in the employment ladder, thus preventing newly arrived immigrants from gaining their initial foothold in the economy.”
Plus ça change… Same argument, different side of the aisle.