How Special-Interest Groups Benefit From Minimum Wage Laws

Tyler Durden's picture

Submitted by Gary Gelles via the Ludwig von Mises Institute,

Those campaigning for a substantial jump in the minimum wage all assert that the purpose is to help working families. Unfortunately, careful students of the evidence come to a different conclusion. As Mark Wilson summarized it, “evidence from a large number of academic studies suggests that minimum wage increases don’t reduce poverty levels.”

Some workers lose jobs (high minimum-wage states have among the highest unemployment rates); others have hours cut. The least-skilled get competed out of the jobs that remain (e.g., the minimum wage hits teenage employment hardest). It crowds out on-the-job training, impeding workers’ ability to learn their way out of poverty. And those effects are worse in a recession. It also raises costs and prices that workers pay as consumers.

How can we explain support for a policy that harms many of those supporters say they wish to help? We explain it by focusing not on low-income workers, but their substitutes.

Consider an analogy. If the price of ice cream was pushed up, earnings of ice cream producers might go up or down, depending on how much less was bought as a result. But producers of frozen yogurt, a substitute for ice cream, will definitely benefit, because a higher price of ice cream will increase demand for frozen yogurt, clearly benefiting its producers.

Similarly, increasing the minimum wage will raise the cost of hiring low-wage workers. And while it might actually hurt low-wage workers, it will help each substitute for low-wage labor by increasing its demand. Thus, the narrow self-interest of those offering substitutes for low-skill labor, rather than compassion for the working poor, may best explain support for higher minimum wages.

Unions top that list. A higher minimum wage increases the demand for union workers by reducing competition from lower-skilled workers. For instance, if the minimum wage was $8 and the union wage was $40, employers give up 5 hours of low-skilled work for every union worker-hour utilized. But increasing the minimum to $10 means employers give up 4 hours of low-skilled work for every union worker hour.

Union employers benefit as well, because the higher costs imposed on non-union competitors raise the prices they must charge, increasing demand for union employers’ output.

This can also explain why other “altruists” support higher minimum wages.

Non-union workers and employers in high cost of living areas, where virtually everyone earns above the federal minimum wage, benefit, by raising the cost of production imposed on rivals where wages are lower (Which is why many in high-wage areas favor higher federal minimum wages, while those in low-wage states — the alleged beneficiaries — often oppose them). Workers and producers where state minimum wages exceed the federal minimum also gain because it raises the cost of production where the federal minimum is binding, relative to where they are located.

Because all these substitutes for minimum-wage workers will see increased incomes, businesses and politicians in those locations will also benefit, and so join the bandwagon pushing for “doing good” in a way that directly benefits them.

Even Wal-Mart benefits from this effect. Because Wal-Mart already pays more than the federal minimum, in low-wage areas a federal minimum-wage increase raises competitors’ costs, but not theirs. In high-wage areas, supporting a higher federal minimum wage is a costless way for Wal-Mart to demonstrate compassion for workers.

Virtually everyone who supports higher minimum wages asserts their intent to help working families. But it may frequently be a false compassion whose common denominator is advancing one’s own self-interest while harming working families. That would also explain why so many are unwilling to seriously consider whether such compassion actually works, rather than just sounding good.

The same mechanism is at work in the depression-era Davis-Bacon Act, which is still in force. It required the payment of “prevailing wages” on any project that received federal money. But its genesis was the explicitly racist intent to exclude lower-cost southern firms employing black workers from underbidding local white workers for construction projects, by forcing them to pay their workers more.

A similar illustration came from South Africa, under apartheid. White labor unions backed “equal pay” laws for blacks and whites in the guise of helping black workers. But what it really did was raise the price of hiring blacks, who had less education and fewer skills on average, as well as being discriminated against, relative to the price of hiring whites. Whites gained, but black unemployment jumped as a result of that “compassion” on their behalf.

Another illustration from outside the labor market is the support of corn farmers, corn syrup processors, and those in their communities for restrictions on sugar imports from other countries. By substantially raising the price of sugar in the U.S., the policy has driven many candy makers and the jobs they create outside the U.S., harming those workers and their communities. But it has raised the price of a substitute for corn syrup, increasing demand for corn syrup and the inputs that go into making it, benefiting those in corn-producing states.

Most people don’t seem to recognize this clearly self-interested mechanism behind support for supposedly compassionate or altruistic policies to benefit others, which is why it typically stays under the political radar. But once a person thinks through it, the connection becomes obvious. Further, it suggests the appropriate test that should be applied in such cases: Whenever someone claims an altruistic reason to support a policy, but it clearly advances their narrow self-interest, the latter effect can explain such support regardless of whether it actually helps the supposed beneficiaries. Therefore, a great deal of cynicism is justified. And when their “story” for how supposed beneficiaries are helped cannot stand the slightest real scrutiny, as with the current minimum-wage campaign, there can be no doubt that such cynicism is justified.

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RaceToTheBottom's picture

I seem to be having trouble getting my point across, but I doubt you will listen to anything not brownosingly positive of Mises.....

I am mad at Mises for wasting precious bandwith with an issue that is not of the same magnitude.  You say they have covered it years ago. 

Wage minimums have not really changed as a plan in 40+ years. 

WS Corruption has increased 100 if not 1000 fold in those years, so it would make sense to say that Mises has not had any positive effect on that.


Bob's picture

Yes, it's clear that the whole lot of them are either well paid propagandists or psychopathic cunts in it for the thrill. 

I'd guess it's both.  The oligarchs are circling in for the kill and these fucks are their sharks-for-hire.  The money must. flow. upward.  All of it, if possible . . .  to "the deserving."  Every fucking Mickey D franchisee fancies himself another Galt. 

Of course, that makes the parasite mega-rich financiers Gods. 

Scorn the grubby money-grubbing little man. 

It's pretty much all sentiment and group think.  Slap the "Liberty" label on it and it's done. 

Marco's picture

Their supplemental income program (WIS) has had huge expansions in the last couple of years though (especially in the amount of money it pays out in cash, before most of it went to social security). Seems the free market needs a little help after all.

artless's picture

@ MagicMoney

"Singapore does not have any minimum wage laws" 

Correct me if I am wrong but neither does Germany.

Best fucking post on this thread by far.

ThroxxOfVron's picture

Advocates for higher wages are not being precluded from simply paying those they do business with more.

Avoid sales.   Pay full price.   Never haggle.  

Tip every cashier, every waiter, every delivery person, every doorman, every...

No One is stopping YOU from raising wages by paying more VOLUNTARILY.


tip e. canoe's picture

exactly, wage/price fixing of any kind is simply another way to assist individuals in avoiding personal responsibility.

TimmyB's picture

What a stupid comment. If I paid more for a Big Mac, McDonalds corporation would make more profit. Why exactly do you think the guy making fries would be paid more?

Jack Burton's picture

Slaves never suffered from unemployment, and the master provided food, shelter and religious instruction. Sundays the slave could lay about and enjoy their hobbies, with never a worry about job security, layoffs or being forced to pay union dues. In fact, many maintain, even today, that slavery was a much maligned economic system. History has shown that the higher a wage the slaves are paid, the fewer jobs are available, as you see, the slave south had no unemployement for those willing to work in the free slave market.  Modern neo-liberal economics, which is practiced by Republican and Democratic politicians, is trying to return to a free market for labor, where government does not intervene in the labor and capital wage equation, where illegal unions are not allowed to bully and threaten the negotiations between an individual and the owners. Wages are to be set by what the market will determine, and today, for the unskilled, that labor market rate is under $7.00 and hour, left to free negotiation, unskilled labor probably would command $4.25, because that is about where it would all shake out given a real free market. That is still much, much higher than the world standard for unskilled work, so the US citizen still enjoys a heavy premium for being American.

Since employers in the retail and fast food business can only get so many illegal immigrants, and workers must reside near enough to the job to be able to ge there, the pool of willing labor to flip burgers in limited, this is what commands the wage premium over foreign labor. Burger flipping comes in at around what $7.00 an hour and up to $8.00 where workers are scarce?

By all means, free markets in labor should be allowed to work. The only question left then is "Should other markets be free?" Or is this reserved for labor?  I suspect, from reading the above article, and many responses, that the answer is no, and that labor is too demanding, while capital is over regulated and over taxed, compared to say 50 years ago. That too much of corporate income is diverted to labor and managers, bond holders and stock owners are short changed by greedy American labor.

Since all income growth goes and has gone, for many years to a small 1% of Americans, the owners, I would think that the neo-liberal school of economics is working, the lower and middle classes have had a shrinking income and lowered benefits package for decades now, while the fruits of higher productivity have gone, and this is provable, to that 1% of the owner class. My only question is, is labor really ripping off capital? Are they truly greedy and grasping and killing job creation by their demands? What would be an acceptable wage and an acceptable income growth distribution, or is there, as neo-liberals contend, no such thing as too small of a share to labor.

In the end, corporate America can earn money three ways. They can get government contracts and thus leech off of the tax payer, this is one way to make good earnings. The second is to go into financial engineering, we saw this with many corporations pre 2008, many dumped manufacturing overseas and replaced their US operations with finance divisions. The third is to produce a product for the market place, produce it at lowest input costs and distribute it to the market place where consumers buy the items, the difference between production and distribution costs and price and volume determine corporate profits. Smart money like Goldman, does financial engineering, smart money produces weapons and spy machines and services the military/spy complex that encircles the globe via US government tax revenue financing, the third way requires consumers to come into the stores and by the corporate products, those things you see advertized all over TV. To my way of thinking, the third way to profit is the one under threat, as consumers making between $5-$10 dollars and hour are going to be piss poor consumers, of anything but basic food, clothes and shelter, not much disposable income to harvest there!

This is why I see future corporate profits as being military industrial complex related, this spending is well north of 1 trillion dollars a year, and profit centers based on finance and insurance, here the gains are unlimited because of money printing and QE. The third way is a sink hole and wages are now in terminal decline, and myself, the consumer is a dying breed, the graph of income data and income growth show this beyond any debate, the comsumer is now in the top 1-10%, the 90% are losing consumer spending abilities. America is headed even more so into being a vast military/spy camp and financial and insurance fraud machine. How long we can last without wealth creation and consumer spending is anyones guess.

Wait What's picture

"profit centers based on finance and insurance"

it seems you had an epiphany about why most of the money in the world goes into financial products. it's the easiest money you can make.

1. get money from fed

2. lend it at interest/sell insurance

3. sit back

4. count your profits

5. rinse and repeat

why do you think a failed business model like the US Post Office wants to become your payday lender? it has access to taxpayer capital and wants to make some easy money.

Musashi Miyamoto's picture

I agree with you that real marker price for unskilled labor in the US is ~$5/hr. At 40 hours a week it is just barely enough to afford a SRO, a bus pass and a stedy diet of rice, beans and pennutbutter.

But hey, at least we don't get whipped on the job...

Fowards to the free market paradise...!

MagicMoney's picture

Yet, you have people living on food stamps still with no job....I know people who don't own a car, they ride their bikes here in the USA. This was much more common in China, but now the Chinese are having more cars.

Musashi Miyamoto's picture

at the $200 a month level the only difference is the lack of daily beating. Am i better off here harased by the pigs ever single day panhandling for bread?

The rich get richer and the poor stay poor. if minimum wage was abolished tommorrow i fail to see how things would get any better. Moar jobs? how is a 5X7 with a cot, ramen and a bus pass any better than european serfdom? because you get to watch TV at the end of the day? is that it?

etienno's picture

"A similar illustration came from South Africa, under apartheid."

How can an apartheid example be relevant as an argument against minimal wage?! Oh wait, not so long ago, in 1860, 13% of the US population were also slaves.

Knowing that, I understand some might think that rising the minimal wage is criminal. Who wants to pay its burger 10 cent more when they can simply steal the work force of an entire "race"?

The mimimum wage in Ontario Canada is 11$ per hour, and for most canadian it's not such a big deal.

billwilson's picture

More BS. Unreal how ZH keeps posting this drivel

Its_the_economy_stupid's picture

Since the FED was made law, inflation has gobbled everything. Minimum wage laws are a feeble attempt at abating the effects of monetization of DEBT. Something must be done.

sangell's picture

I would also bet a lot of non profit social service agencies benefit. If you run a homeless shelter, foodbank, job counseling you name the 'good cause' and receive government grants the more unemployed, incomeless, destitute people you serve the more grant money you can request and since an agency director serving 5000 people has more 'responsibility' than one serving 1000 people he/she can be paid more for helping the poor. Don't think that non profit organization managers don't make good money. They do.

Musashi Miyamoto's picture

In this city the big mission gets its funding through an unholly alliance of city government and large cristian groups...

2 decades ago it was moved to the shittiest, cheapest, industrial part of town inconviently located far away from any public transportation...

In companion with strong vagrancy and panhandling laws, Doing the city a service of keeping the underclass away from the "hardworking normanl people" its program is specifically designed to keep you there all day long. Here homeless are litterally stuffed into rooms at firecode cappacity all day long, rows and collums of stiff seats facing ever fowards preached to by merciful undestanding pastors. You see, in this house of refuge it is Jesus who protects us from the cold and the knawing bite of hunger. In line for food the loving staff shuffles us fowards by the hundreds to recieve, i kid you not, a bowl of gruel and a slice of bread. togeather we are alloted 10 silant minutes to consume gods meal before herded back into the day room, staring blankly into the distance until the next sermon...

At night we are provided rows of bunks of prison cots with a sheet to keep us warm. we keep our shoes under the mattress for neck support but also because shoes get stollen all the time...

You see the director of the mission makes more than the mayor of the city because creating such an atmosphere of love and healing takes tireless work and compassion so rare it brings tears to your eyes...

How many people read oliver twist? "Please sir, can i have s'more fucking porige?"...

falak pema's picture

I know how special interest groups benefitted from NO labour wage control in the past : They went and saw Foxconn.

The whole Chindia meme since 1980s is a debasement of labour wages in first world to serve the 1%.

The world needs to move out of globalization of US NWO to reset the world trade on a global model where we not only use WTO guidelines but also those that have been neglected in the past : the ILO** guidelines.

The Reagan and Thatcher mantra totally bypassed all ILO guidelines when they REframed GATT (created 1947), now called WTO, that "non regulates" the Oligarchy world and gave China its favored status as world factory; all to the benefit of the Nike-Apple-Walmart model in China and Microsoft-Citibank model in India.

** : The ILO was founded in 1919, in the wake of a destructive war, to pursue a vision based on the premise that universal, lasting peace can be established only if it is based on social justice. The ILO became the first specialized agency of the UN in 1946.

artless's picture

Just for the record who gave China its Most Favored Nation Trading Status.

That would be Bubba (Clinton for the unwashed). Just one election after explicitly saying he would not. And when was that? Oh, yeah the 90's. When even "conservatives" say were "good times" And everyone piled on and got theirs (yes all you fucks in the financial world) and now bitch and moan about "jobs being sent overseas".

Now due to technology much more than TVs and Ishit can be done "offshore" Shit BMW "offshored" the building of cars to Tennessee for fucks sake! Why? PRICE. What about all the poor Germans who lost their jobs? 


Sorry but this country, or Germeny for that matter does not owe you a job. If you CHOOSE to be a laborer in order to aquire you wants and needs in life it is up to you to make yourself valuable to those in need of that labor. And you are at the mercy of what the market decides the value of that labor is worth just like any other producer of a commodity is.

Of course if you do not like that price then you can at any time you so choose find another market for your labor or modify your skill set to increase the value (and hence price) of your labor.

It's that simple folks. Continue to muddy the waters with all the 99% vs 1% talk, income inequality, living wage crap, etc. Raise the fucking min wage to $20/hr. It will make no difference.

And for the record I am a lifelong wage earner.

goldhedge's picture

Who is John Galt?


BobRocket's picture

Ha, Ha, Ha,


what fuckin idiots you are to equate a 'minimum' wage to any economic disinvestment.


The 'minimum wage' downsizes current wages to the minimum (ie. the market rate, bitchez)

The minimum wage is the target wage.


Before the minimum, the minimum was higher than the minimum. (how f'in hard can this be)


Why can the POTUS raise the minimum, it is because he will print so that the minimum is a pay cut.


(what kind of a fucked up bubble do you people have to be livin' in where the Man says YES, it means NO and you cheer anyway)



artless's picture

Once again every last fucking comment on this topic displays the time honored tradition in our dumbfuck nation's politics to profoundly miss the most important aspect of the debate and argue the mnay sides with worthless platitudes based on crackpot economics, pointless staitics, and hyperbole.

Okay now everyone let's all just let this sink in. No individual, group of individuals, government, or what have you has the right to dictate the price at which a FREE PERSON sells his labor to ANYONE so long as that transaction is voluntary.

Every other point all y'all want to make it irrelevant.

But since we're on that note I'll continue by responding to both idiotic sides of the debate. I can get charts, graphs, or statistics that empirically demonstrate that when the min wage is raised umemployment-especially in low skilled workers- rises. I can also get charts, graphs, and staitsics that emprically state that when workers take home more wages they consume/spend more.

Big fucking deal. Argue it all you want. I'll refer to the beginning of this post. Nothing else matters. And along that line no group of people have the right to deny another group of people or an individual of selling his labor or engaging in voluntay trade/contarcts with another. Union folks, non right to work states that's you. Syndicates, unions, trade guilds and the like are ANTITHETICAL to a free society. Indeed they are hallmark to the very most unfree societies throughout history. Just look at the wage law and union/guild history of the US and you will find the genesis of these ideas as racist, exclusionary, etc in order to exclude either unfavored immigrant classes or unfavored hereditary traits. And unlike all the bullshit monetrayist at best / Keynesian at worst economic analysis written here regarding this topic, this history is fact and does not depend on some irrelevant micro/macro chart slapped together by another academic holed up in some ivory tower with a bunch of formulas and theories.


falak pema's picture

utopia : the ivory tower is yours.

In your world Don Corleone (feudal) rules according to "possession 9/10 of the law" since the beginning of history. "Free man"..."free labour"...tell that to the Apaches, friend. They were free in an empty continent no longer empty today.

Its the COUNTER model of bottom up revolution that brought a semblance of democracy and republic to Don Corleone's world in post industrial urban civilization, not your hopium. That power struggle of class is the basis of the social contract we call democracy and republic (in England since 1215).

So please wake up. The world has moved back to the Don Corleone model in a big way and "freedom" is now an illusion. 

artless's picture

Falak Pema:

See the posts below. I have no illusion that The United States is a free country. That went away long before you or I were born.

I do however maintain that I am a free man and regardless if the current environment is to my liking or not, I still have choices. There is always a choice. Might not like em all but...

The feudal analogy is just fine. Correct in many ways. But the opposition is directed at the wrong parties and focusing on the wrong solutions. Until we address the moral and philosphical basis for these problems they will continue to evelve in a circular logic and get nowhere.

I don't quite understand the Apache comment but at no point did I, do I, or will I endorse the use of violence, force, or coercion in achieving anything unless in the action of self defense. That would be immoral. Hence why minimum wage laws are immoral. Ultimately they are enforced at the tip of a nayonet or the barrel of a gun. Good with that? Sorry, I'm not.

We cannot change History. The genocide of the Apache and many other tribes cannot be undone just like we can't have a do over of Nagasaki or Hiroshima. We can only make sure it never happens again.

Oh and for the record I find the vanted god of democracy a sort fo failure and I've yet to see this social contact fo which so many speak. I certainly never signed it.

Marco's picture

Property rights are enforced at the barrel of a gun as well ...

FreeMktFisherMN's picture

not in an anarcho-capitalist society. There would already be reverence for private property and recognition of contracts and inherited property. Yes more private defense agencies would be the case but they would have to compete on effectiveness and integrity, etc. and it would be better than a monopoly with moral hazards galore as it's not business done at voluntary but by the point of a gun. 

Harry Dong's picture

Listen jerk. Give me a level playing field and I'll bury the competition with my 20/hr helpers. Cut the billionaire's subsidies and let's hear them cry, that's not fair!

You couldn't handle a free world if it hits you in the face.

artless's picture

@ H Domg

And in response to the "real world" crap ad hom attack: I h\ave lived in the real world for all of my 45 years. I began working at 13. I have never taken a dime from anyone, any government or the like. I have never had any sort of job security, retirement plan, benefit package, scheduled wage, or any other lala land employment standard considered normal in this ass backward country. I have been part of the wage earning population all my life.

At what point did I ever support any sort of subsidy? At what point did I suggest that you should or should not pay whomever you want 20/hr?

I have no illusion that this is a free country. The Unted States is a Neo-Fascist Police State wholely owned by the politically and financially connected. Your statement regarding "a level playing field" suggests you either believe in no government interference in the voluntary trade between men or you want that armed third party to grant YOU favors or a boost so that you are on that perceived "level playing field".

Which one is it?

Reducing that principle to the individual, namely me let's say, should I demand a "level playiong field" when I was trying for contracts as a footballer in Germany as an American goalkeeper? SHould the Germen born goalkeepers with whom I was competing have been required to not speak Germen with the other teammates since MY German ws not up to par? Or should the other German born gaolkeeers have had their knee blown out with a double MCL/LCL tear so that we'd be "on a level playing feild" when I tried out with their club?

Shall I go on? I think I shall. Sinec the whole fairness and level playing field thing is a bif meme right now I'll give you another anecdote. After spending two decades perfecting my skill as a master printer (photgraphy) Epson and HP decided that they could make glorified copy machines into "printers" and compete with the century old skilled profession oif darkroom printing and graphic art printing. As my tiny little portion of the market and my livlihood was eliminated should I have received some sort of benefit or the like to "level the playing field"? Or perhaps some law or restriction should have been placed on Epson-perhaps they only produce color images maybe, leaving me the "market" on B&W-from bringing their product into the market?

I think not. Sure I got slammed. By that's REALITY. No one has any right to any subsidy. PERIOD.

But on that note their is no "level playing field" It's a fucking fairytale for those who do not live in Literalville or as you say the real world that hasn't apparently hit me in the face. You know the one that kept colege out of my reach. The one that eliminated my business market. The one that kept me from playing professional sports. The one that buried me with personal debt because of a socialized/cartelized medical system in the US when I had an accident. The one that grossly inflates my rent in Brooklyn because of fascist rent control and rent subsidies that distort the market price system.

The very same reality about which I do not complain as do so many others with their cries for fairmess and equlality.

Shall I go on?

Maybe you should stick to the actual debate and not throw out ad hom attacks at those whom you do not know.

BobRocket's picture


Yest Artless, but that transaction isn't voluntary is it.


The fucker in charge won't sell you the goods and because he owns All the goods there is no free market, can I kill the fucker now ?

The fucker deserves it.

You don't agree (some shit to do with property) can I kill you now ?


In any fair transaction where both buyer and seller come to the market with good will then the transaction should hold.

Where one party tries to hold some kind of leverage over the other party, all bets are off and the death of one party and the legitimate takeover of assets by the winner should hold fair(wild west)


There are very few posters here who understand what the true free market means (I'm in favour of free markets actually, but then I'm a socio and I like to watch you normals kill each other)


artless's picture

@ Bob Rocket

"Where one party tries to hold some kind of leverage over the other party, all bets are off and the death of one party and the legitimate takeover of assets by the winner should hold fair(wild west)

The fucker in charge won't sell you the goods and because he owns All the goods there is no free market,

can I kill the fucker now ?"


So when I was offered a job and the leverage the potential employer held over me was I NEEDED THE JOB TO FEED AND CLOTH MYSELF and he was offering terms I did not quite like...I could kill him in your world? If it works in the scenario you propose it should work in the reverse, no? Actually I wrote a number on a piece of paper for which I would consider taking the for then laughed at him and went and found another form of employment. I figured killing him was a bit severe I guess.

The "fucker in charge" who "owns all the goods". Haven't seen that one in my life. Maybe when this house of cards comes down and there is societal collapse you might find pockets of that. But then the blame of that collapse can be placed at the foot of coercive government and a fascist montery sytem so...

"In any fair transaction where both buyer and seller come to the market with good will then the transaction should hold."

This is not English. Please rewrite this sentence and I can respond to it.

The POTUS printing money and making the min wage increase pointless that you mentioned above is spot on. But here you lost me. Sorry I do not view free markets as necessarily The Wild West. Indeed the actula WIld West wasn't really all that wild in real terms. Much of it was fairytale. In many cases the criminal and violent behavior was FAR LESS than what we see today and all without much of any form of "supervison", "regulation" or "police".

Sorry but I think that in the abscence of the eveil that is government you will be lacking in the entertainment value you seek as a "socio" by watching us "normals" kill each other.

And just for the record I took that etst to and I'm a very, very high scoring "socio". It's a bunch of horseshit.

BobRocket's picture

'he was offering terms I did not quite like...I could kill him in your world?'


No, he was not stopping you touting your wares to any other prospective employer, you and he retained the rights to negotiate in a free market (where other participants were free to offer other terms)


If the prospective employer, knowing your skill set, tried to gain a monopoly purchaser position in order to exploit that position then that is fair enough, that employer must also understand that your position as prospective employee should in the same market be to disable his monopoly thereby ensuring the freedom of all participants. That one of your skills that you are not currently marketing is as a sharpshooter should not overly worry this wouldbe monopolist.


The short answer is Yes.


Life is common and the price is low, when life becomes scarce then the price will rise


free market bitchez




Marco's picture

Lets assume government didn't grant unions special rights for a moment.

Joining an union is voluntarily entering into a contract. An exclusivity agreement between that union and a company? Again simply a voluntary contract.

You can only outlaw unions by government cohercion ...

BobRocket's picture


'No individual, group of individuals, government, or what have you has the right to dictate the price at which a FREE PERSON sells his labor to ANYONE so long as that transaction is voluntary.'


If they own all the means of production, they can offer you a wage they dictate or you can starve, no coercion here.


You seem to believe that they gained the monopoly on the means of production by fair methods, they didn't.

Them and their kind got them firstly by theft and favour, they secured them by legislation and monopolise them by regulation.

They would rather see you die from sartvation and privation than allow you one red cent.

They hold their cattle (that they must feed and fend for) in more esteem than you 'free' people, they  had more regard for you when they owned you.


So believe what you will about your rightful place and value in the free market, the truth is (not that it will do you any good to know this) You are a resource, a bit like gold but more trouble and less durable.


You are either making money for them or you aren't and if you aren't then you are invisible (starving or not)



TimmyB's picture

"All hail allegiance to contracts." What utter bullshit.

Please explain how two unequal parties can reach a voluntary contract. If I don't work I starve. So on what planet is my contracting to sell my labor "voluntary?" It's actually mandatory that I contract to sell my labor, or I die.

So now that we have put the lie to the "voluntary" part, let's look at contracts between unequal parties. Go pull out a cell phone, cable, or credit card contract. What terms did you bargain for as an equal party to the contract?. I'll tell you, "fucking zero." You didn't bargain for one term in any of these multi-page contracts. Read any of them. The other party can do what it wants, and you have even given up your right to sue them.

The "contract" stuff might sound great, but in the real world, it means you are a slave to the corporations that already control everything.

Toolshed's picture

Hey Artless, what you spew only makes sense in a FREE MARKET. Please enlighten us all and tell us where this free market exists. Certainly not in the USA where regulations and subsidies of all kinds abound. So, unless you can tell us where a free market exists on this planet, your words of wisdom are anything but.

Harry Dong's picture

What a load of tripe.

Australia min wage is 16,.88 per hour. Need I say more?

artless's picture

Australia is also about to go off the fucking cliff.

MArk my words.Bubble inflationary economy that's going to blow up. The min wage fairy tale is just a symptom. Price controls have never and will never succeed over time.


PhilofOz's picture

It might go over a cliff, but it is certain to be after countries such as the USA.

TimmyB's picture

Over half the posts on ZH are of "the sky is falling" variety. No one knows the future for either Australia or the US. However, in the present, a $16 dollar an hour wage doesn't seem to have hurt Australia in the slightest. And I'm sure it has helped millions of workers escape poverty.

Here in the US, the people who rule would rather keep low skilled workers in poverty and have taxpayers supply these workers with food stamps, Medicare, subsidized housing, ect. They claim it is unjust to make their employers pay them enough to live on, because shifting the cost onto taxpayers doesn't hurt the employers' bottom line.

And whores like the fuck who wrote the original article above are paid to make you believe it is moral for things to continue the way they are, with working people needing taxpayer help to survive.

mumbo_jumbo's picture

"if the minimum wage was $8 and the union wage was $40"


I'm gonna stop reading right there, wild exaggerations only dilute the point you're trying to make. my point is if min. was to have keep pace with bogus government inflation numbers min. wage would be over $10 an hour.  the reality is that wages have simply not kept pace with the cost of the American lifestyle.

as an example, i moved to California in 1983 and by 1984 i was making $14 an hour in my profession with 3.5 years experience. adjusting that wage for inflation puts that number at $31.40 an hour, my counter part at my best customer is making $34 an hour with 10X the experience i had in 1984 and yet he barley make more income than i did then AND THAT MY FRIEND IS WHY AMERICA IS CIRCLING THE DRAIN.

there's no money for the workers AND is it any wonder why 47% of Americans don't make enough money to even pay taxes??

i find that most people who give financial advice don't really understand how little money most Americans earn

BobRocket's picture

You Z/Hers should read this because this is the UK today


This will be the US tomorrow

The Joker's picture

If you are posting on ZH, doesn't that make you a ZHer too? 

Sechel's picture

Rising minimum wage and  a zero interest rate policy just means more automation and layoffs hitting non-skilled and semi-skilled labor the hardest.

Rising Sun's picture

Fucking goobermint.  Fucking Barry.  Fucking cocksuckers!!!!

BobRocket's picture

It's Gary Galles

Submitted by Gary Gelles via the Ludwig von Mises Institute,



He is a paid shill


He can hide behind a different name but the payer remains the same.


I can't quite understand why these idiots are paid for, thier arguments are weak and dicovering they are paid shills only undermines the promoters goal.


Are people so fuckin stupid so as to be taken in by spurious studies authored by bogus professors (these people are no better then quack doctors selling 'instant' remedy)



MeBizarro's picture

Because Ludwin von Mises Institute isn't even a 3rd-rate conservative think tank and the evidence is clear as day that marginal increases in the minimum wage in Canada, UK, Australia, NZ, and individaul  US states don't lead to detectable increases in unemployment even among small businesses.  The data on business investment and profitability is mixed and to be honest we have enough data to know one way or the other because it hasn't been studied enough. 

Any idealogue or zealot is an a-hole and everyone who tells you this is 'common sense' that it leads to great unemployment regardless of studies is an idiot.  Same kind of thinking that stomach ulcers are caused by 'toxins' and stress and not bacteria.