The Ugly Truth About the Minimum Wage

by | Jul 10, 2017 | Newsletter | 53 comments

The economic ignorace of the “Let’s Raise the Minimum Wage” gang is matched only by their smugness. In their confused, economically-illiterate universe, you either advocate for an increase in the minimum wage or you hate poor people.

As anyone with an understanding of basic economics can tell you, this is precisely the opposite. As economists have discussed for years and study after study shows, minimum wage laws ultimately lower the earnings of the poorest members of the working poor and force mom and pops out of business in favor of the corporate chain mega-giants.

But there is something altogether darker to this story of the minimum wage than the perversity of its effects or the smugness of its proponents. The sad truth is that minimum wage laws were first discussed and advocated for by those who knew that it would make the poor even poorer and actively wished that to be the case.

Find out the true eugenics-steeped history of the minimum wage laws in this week’s edition of The Corbett Report Subscriber.

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The Corbett Report Subscriber
vol 7 issue 25 (July 9, 2017)

by James Corbett
July 9, 2017

“OK, here’s an idea no one’s thought of before. You know how fast-food workers are organizing in the US right now to fight for a $15/hour minimum wage? That’s stupid. They’re still going to be just scraping by on a wage like that. So why not make it something that’ll really make a difference? Why not $150/hour?

“Think about it: At $150/hour, they’ll have to work only a few hours a week to make the same money they’re making working full-time right now. Or if they continue to work full- time, then they’ll be earning a six-digit annual income! Pretty soon everyone will be rich!

“Brilliant, right? Fight for $15? Pffffffffff, that’s for slaves. Fight for $150, that’s what I say!”

You might think this is a parody of the Let’s Raise the Minimum Wage school of bad economics. You might even think it’s a sophisticated meta-parody of the people who parody the Fight for $15 campaign. But sadly, neither scenario is the case. This is the actual, honest-to-goodness “argument” of genuine economic illiterates like “journalist” Matthew Yglesias, who dropped these gems on the Twittersphere last week:

Excuse me? Could you repeat that?

“Let the Fed figure out how to make it work.”

“Nobody would lose their jobs.”

“You’d have a big burst of inflation and we’d be better off for it.”


Now, to be fair, Yglesias is rather notorious for his guerilla gorilla journalism approach of throwing a whole bunch of steaming crap at Twitter and then deleting the turds that don’t stick, so take his latest droppings with a grain of salt. But the sad thing is that, as much as this line of reasoning has become the go-to reductio ad absurdum to reveal the economic stupidity of the Fight for $15 movement, it is still unironically put forward by some of that movement’s proponents as a legitimate idea.

It’s heartening that some of the responses on Twitter have accurately identified various parts of this insanity:



But for those who prefer their economics to come from economists rather than social media, you’re in luck. A brand new paper from a University of Washington team studying the effects of Seattle’s minimum wage laws has just been published by the National Bureau of Economic Research. Unlike the previous literature on the minimum wage laws (the ones that earnest socialists like to cite when arguing for the minimum wage hike), this study separated out low-wage workers from the general working population. In so doing, they found that Seattle’s recent minimum wage hike from $11/hr in 2015 to $13/hour last year “reduced hours worked in low-wage jobs by around 9 percent, while hourly wages in such jobs increased by around 3 percent.” The net result? “Consequently, total payroll fell for such jobs, implying that the minimum wage ordinance lowered low-wage employees’ earnings by an average of $125 per month in 2016.” In other words, the very poorest of the poor were made poorer by a significant chunk because loving central planners had attempted to “help them out.”

But wait, it gets worse!

A new working paper from a team of Harvard researchers found that not only do minimum wage increases negatively affect the earnings of the poorest workers, they also specifically hurt low-end restaurants that cater to those very working poor, while leaving unaffected the high-end restaurants frequented by wealthy patrons. Specifically:

“Our point estimates suggest that a one dollar increase in the minimum wage leads to a 14% increase in the likelihood of exit [i.e. closure] for a 3.5-star restaurant (which is the median rating) but has no discernible impact for a 5-star restaurant (on a 1 to 5 star scale).”

That the minimum wage laws in fact end up hurting the poorest of the working poor and the humblest of small businesses should be no surprise to those with a modicum of economic understanding or historical context. Indeed, government intervention in the market is always and without fail used to prop up mega-corporations and the already-wealthy at the expense of local mom-and-pops and their low-wage employees.

This was true when the VP of the largest healthcare insurance company in the US drafted Obamacare in order to insure the market dominance of the healthcare insurance giants.

It was true when the major meatpackers conspired to pass the Federal Meat Inspection Act in order to protect their oligopoly from small business competition.

It was true when the Morgan and Rockefeller banking interests met on Jekyll Island to conspire in the drafting of what was to become the Federal Reserve Act, which lent an air of governmental legitimacy to their banking cartel and insured that small financial institutions that were not part of their clique could never compete.

And it’s still true when minimum wage laws are passed, forcing mom-and-pops out of business, lowering the wages of the working poor, and further cementing the market share of the corporate mega-chains. Adding extra salt to the wounds of those who are fighting for $15, those corporate mega-chains are increasingly turning to a 21st-century option for ridding themselves of the low-wage worker problem once-and-for-all: automation.

We don’t have to speculate about this point or engage in complex statistical analysis. It’s right there in black and white. “Last year was tough — 5 percent wage inflation,” lamented Wendy’s chief operating officer, Bob Wright, during a presentation to investors and analysts earlier this year. He went on to note that 2017 looks just as difficult, with a further 4 percent wage inflation expected. The answer? Who needs burger flippers when you’ve got robots! Wendy’s will install self-ordering kiosks in 1,000 of its stores by the end of the year, allowing it to trim dozens of more hours from the time cards of its minimum-wage workers. This is on top of the 31 hours per restaurant that Wendy’s has already managed to cut from its payroll since it began belt tightening in response to the minimum-wage hikes last year.

Wendy’s isn’t alone, of course. The former CEO of McDonald’s USA suggested last year that the golden arches would follow suit (although the current CEO denies this). Indeed, the automation trend is taking off in every sector and industry, from industrial workers to life insurance accountants.

But we still haven’t reached the very worst part of this whole scam. The worst part is that while almost everyone who advocates for the minimum-wage hikes today is under the misguided view that they are helping the poorest of the poor, the progressive progenitors of the minimum-wage idea in the early 20th century advocated for it specifically because they wanted to hurt the poor—by making them even poorer.

No, you didn’t read that sentence incorrectly.

As economic historian Thomas C. Leonard noted in “Retrospectives: Eugenics and Economics in the Progressive Era,” a study published in the Journal of Economic Perspectives in 2005, the fact that minimum-wage laws actually increase unemployment among poor, low-wage workers was perfectly well understood by the turn-of-the-century progressive reformers who advocated for them. More than that, the fact that they increase unemployment was actually seen as a key feature of those laws. As Leonard explains:

“Progressive economists, like their neoclassical critics, believed that binding minimum wages would cause job losses. However, the progressive economists also believed that the job loss induced by minimum wages was a social benefit, as it performed the eugenic service [of] ridding the labor force of the ‘unemployable.’ Sidney and Beatrice Webb put it plainly: ‘With regard to certain sections of the population [the ‘unemployable’], this unemployment is not a mark of social disease, but actually of social health.’ ‘[O]f all ways of dealing with these unfortunate parasites,’ Sidney Webb opined in the Journal of Political Economy, ‘the most ruinous to the community is to allow them to unrestrainedly compete as wage earners.’ A minimum wage was seen to operate eugenically through two channels: by deterring prospective immigrants and also by removing from employment the ‘unemployable,’ who, thus identified, could be, for example, segregated in rural communities or sterilized.”

Did you catch that? By the logic of eugenics—the true religion of the progressives and their ilk—the poor must be made completely unemployable so they can be made wards of the state, segregated, and ultimately sterilized. After all, they had committed the crime of being born with “inferior genes”—or, in the pseudoscientific gobbledygook of that era, with “defective protoplasm.” Minimum-wage laws were actually designed to keep the poor out of the work force specifically so they would be at the mercy of the eugenicists.

As shocking as this philosophy may be to our modern sensibilities, living as we do in an era where eugenical ideas have gone out of fashion and must now be masked by a veneer of kindness and good intentions, the black-and-white statements of the early minimum-wage advocates leaves no doubt what these laws were intended to achieve.

Take Henry Rogers Seager, a Columbia economist and president of the American Association for Labor Legislation, who wrote a key paper on the minimum-wage law in 1913. As Leonard relates in his “Retrospectives” article:

“Seager wrote: ‘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.’ Seager made clear what should happen to those who, even after remedial training, could not earn the legal minimum: ‘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…’.”

Or take Woodrow Wilson’s Commissioner of Labor Statistics, a Princeton economist by the unlikely name of Royal Meeker. Of him, Leonard notes:

“Meeker preferred a wage floor because it would disemploy unfit workers and thereby enable their culling from the work force. ‘It is much better to enact a minimum-wage law even if it deprives these unfortunates of work,’ argued Meeker. ‘Better that the state should support the inefficient wholly and prevent the multiplication of the breed than subsidize incompetence and unthrift, enabling them to bring forth more of their kind.'”

This is the real history of the motive behind the fight for the minimum-wage—a history not even known, let alone understood or acknowledged, by the well-meaning dupes of the crypto-eugenic, centrally-planned technocratic slave state of our era. The entire point of the minimum wage—originally made explicitly, now implicitly—has always been to remove the poorest people from the labor pool in order to better mark them out for sterilization (or today, abortion) and, ultimately, elimination.

Think about this history the next time your socialist collectivist friends preach the morality of the Fight For $15 movement and lecture you on how people who don’t agree with their virtuous vision (read: their economic idiocy) must not care about the poor. The truth is (as always) the exact opposite of the mainstream consensus.

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  1. In the US, I don’t think education levels determine a person’s financial situation at all. Especially today, when the student is already an intellectual zombie by the time they enter college. We have many people with law degrees managing fast food restaurants, and so on. Really, all our education systems do is prepare people to work for others, rather than starting up their own businesses. To me, this only serves to create a slave market, as what free person would consent to working for another?
    While I despise anyone who would only pay you the absolute minimum they can legally get away with, this is a two-way system. After all, you don’t have to work for such a person. One always has a choice. The above arguments arguing for minimum wages as a positive really don’t make any sense at all to me. Workers are not being exploited by these wages, they choose to submit to them. There is absolutely no way that forcing employers to pay a certain level of money to someone who has no skill (or usually any desire to apply themselves to acquiring one) can benefit a society. If you want to benefit a society with wages, then that society might consider a true education in which a person can create their own income, and the prospect of working for dismal wages can help to create that desire. My own grandfather only had a 9th grade education and made millions. His story is not a singular one; history is filled with similar ones. Myself? A Master’s and far below my first million. Just my two cents worth. Either man up and make your own way, or whine about it.
    Those arguments claiming that food stamps and the like are necessary completely miss some obvious points. Those monies were stolen from the real economy. Over here, since some forty per-cent of our economy is the government, that means that we are actually only living on about 20% of the real economy. If you took away all of the government theft, our standard of living would doubtless reach unfathomable levels. And while there would obviously be poverty still, our poor would seem like billionaires to most other countries.

    • wingsuitfreak says:
      …In the US, I don’t think education levels determine a person’s financial situation at all….

      I agree completely and emphatically. I went back to college late in life getting a degree in the sciences with a 3.85 GPA.
      (I am now over 60 yrs old – )

      I would had been dynamically better off financially if I had focused that energy towards doing my own business.

      I don’t recommend college to anyone.

      Once, prior to getting a degree I applied for a job as a Federal Express driver. ha!…but then I saw the statement that one needed a 4 year degree (to drive a delivery truck).

    • Well, James and the community of followers and leaders, this is my first post.

      I am not an adulator I am an advocator and educator (of myself and others) and the way I see Jame’s reporting, and why I support it although, I believe his conclusions on a mega scale are inadequate (this for another discussion), is that Jame’s understands that thinking is a process and by this it means that we all think but we do not all think critically. Critical thinking is hard work, and is why so many never like to engage in it, preferring entertainment over education. Or, they have been warned that ‘thinking is subversive’.

      Enough of my point of view on this matter, only to say that assessing our own thinking is important in all matters of life: from washing clothes to analyzing documents and claims.

      But let us field the video presented here and the underlying assumptions. And I am posting this, as a reply, for me mind” knows nothing of computers:

      You say:

      While I despise anyone who would only pay you the absolute minimum they can legally get away with, this is a two-way system. After all, you don’t have to work for such a person”

      You don’t have to work for such a the person. This is the claim. And the seemingly vague, and correct me if I am wrong, view of the agorist is that all we have to do is open a lemonade stand and compete with the fascists?

      OK, so the first thing critical thinkng dmands is that we “define terms”. What is ‘such a person’? Never defined, but the underlying assumption is that there are persons who we work for and we do not have to work for them we can just drift here and there: juggle as they do in the streets of Ecuador, for food.

      No, they are not ‘persons’they are multinational transnational corporations, sir! They own everything. Can’t you see that? This is not like the sixties or seventies, when one could go out and shift jobs from one ‘person’to the next.

      The problem is so real: an inadequate understanding of both how economics works, historically and presently, and how societies function. I hear the ‘golden’echoes of Ayn Rand in this vagrant statement.

      Agorism, or libertarian socialism is an ideal that comes out of historical and material factors, if it comes at all. Although interactive, it cannot fight fascism or militarism. It is unorganized subjective thought devoid of historical anaysis and memory. That is a big claim, I know, but if one understands, truly understands, dialectics they can see this is bourgeoise wishful thinking.

      It seems to me, materially and historically speaking, agorism comes at the end of the dialectic, within historical moments. Or better said, the end of the dialectic between capitalism and socialism the dialectic never ends. It can produce fascism or socialism but never agorims and agorim is too weak to fight a system like we have now. We need an organized class, that is in itself and for itself.

      Living in S. America for half a decade I have seen the attempt of countries to go from feudalism to socialism and the failures. While working for one year as a reporter in Nicaragua during the war, in 1985, I saw the same attempt, the same failure.

      The attempt is to escape the material conditions of existing capitalism by avoiding the necessity of organizing as a class.. Individualism is put forth as the ideal and answer when it is the pernciious rot that got us here.

      Capitalism is the problem. Ask any wage slave, they will tell you. And now, of course it is global, financial capitalism.

      The agorist says no! Pull out, do voluntary associations, create communities, do your own currency and get out of the corporate matrix.

      I am empathic. But idealism in and of itself does not create the formidable change in the material conditions to allow the unleashing of human potential and liberty.

      OK, so we can just opt out of global capitalism and grow gardens, share subprime housing, garbage dive, etc.?

      Well, then the other point of view, and one I think is really the assumption behind this program is, when we try to create something outside the corporate capitalist matrix see what they do!!!

      Yes, this is what ‘they’ do!!! They being a surround Spectacle that controls every facet of life. They oppress, repress, kill, murder and overthrow political regimes. They do not water gardens.

      The reply, that we must create a different world and can do it through such things as Uber, now Saudi owned, is a complete misunderstanding from a material historical perspective of how the world works.

      I am for libertarian socialism, but not libertarian capitalism. Those who want o go back in time to the days of flea market capitalism have cut off their nose to spite their face.

      And, now that fascism is global, the argument for the jump to rain water or garden growing and people’s markets, from drain water and supermarkets as a solution sounds like the morbid drum beat of the after math of apocaplypse, not a prescription for change.

      Change occurs on many levels and I do not wish to çut down’ the efforts of those trying to live a post-perma life. Sorry, it won;t work.

      The struggle is a class struggle. We see the not so linear progression of history, now landing us in terminal financial capitalism. But the ‘terminal’ part is salient for when fascism, the ultimate expression of the dialectic of capitalism , impregnates societies and quaint, yet botanical garden, it is over. the struggle takes on new forms and individualism will not cut it. Only struggle with others as a class can attempt to staunch the wounds.

      Only together, only as one entity among diverse forces can we have a chance (collectivism), if that, at overthrowing the tyranny that governs our lives, threatens our children and mothers and future generations while laying savage claims on the world.

      Capitalism IS THE PROBLEM. We must get through this historical wreckage if we can, to a socialist world from which can be born real, historically birthed, agorism.

      • After reading your comment, I would like to respond. First, I completely disagree with your claim that we are powerless. While you do not state this in those terms, that is the result of your claim. Perhaps in your country, there is absolutely no way that anyone can “open a lemonade stand”, but that does not hold true in every other one. Who is this “they” you speak of? In most cases, it is yourself. This “they” is merely another excuse a person has in order to do nothing. Yes, there are people, and organizations, that would like you to think they have power over you, but they can only have power over the weak. And yes, I have traveled all over the world, to include Central America (where it seemed to me that the spirit of Agorism is even stronger than in the US).
        Now when it comes to critical thinking, I agree completely. Most people do not think. Regurgitating what they’ve been told is the closest they can get. Partly because they are lazy, but also because they are cowards. Yes, cowards. They are afraid that if they think then they will find out their life has been a lie. Which is exactly what will happen. However, you are choosing fear. You believe that you will be killed if you exercise any degree of freedom in your life. You can do nothing entrepreneurial because “they” will kill you. That was not even true in the Soviet Union. In fact, the more totalitarian the system, the more opportunities arise for those brave enough to take advantage of them. This is known as the black market (which also appears to be the main economy in many of those countries). I could go on, but the subject bores me. You are speaking from a fear perspective and I despise (and refuse to recognize) such a mind-set. Don’t tell me about how you “can’t” do something; Can’ts never got a damn thing done. Only the can’s matter.

  2. What applied in the early 1900’s might not apply now. The circumstances of the under-privileged in the days before electricity, hot water, antibiotics, education and hospitals, were appalling. Today’s skid-roads are virtual paradises compared with the desperation found in the slums of Victorian urban areas. At that time there existed little or no hope for the street people – those who were crippled, parasite-infested, syphilitic or mentally-challenged.

    One sad irony emerges when such a comparison is made. In former times, where poverty and filth were normal, humans bred successfully and the population increased steadily. In modern times however, despite the West’s prosperity and huge increase in living standards, we’re dying out. So far, I’ve been able to identify only one reason – technology. We’ve killed ourselves with our most valued invention. Few have noticed, and less care. We failed. Not to worry, let’s have bigger and better firework displays, more Award shows, pump the stock market even beyond absurdity, let’s have more fake PC news, and more hype for the late night shows. All is vanity.

    Guess I went off topic – at least I’ve got it off my chest. We failed and nobody noticed.

    • There is no irony emerging. Only the falsity of our education is emerging. Yes, electricity is great. Yes, hot water is good. However, our medical and education systems are far worse than times past. I’m not saying that our hospitals were that great back then, it’s just they are truly horrific today. Today, our medical system is thought to be the third leading cause of death. Our education system is a nightmare which only produces mindless robots incapable of questioning authority or learning. What hasn’t changed is economics. It is still the same. What you are seeing is the result of decisions made back then. To do more of what got us here is sheer insanity. I’m not calling you insane, it’s just that the system we live in is pretty sick and it’s hard to see clearly while you still believe it is something you would even want to fix.

  3. Then get a better job. I honestly don’t see how you don’t understand this concept. The article was clear and easy to read. You have been given many resources to look into. It is basic economics. While you think you are looking out for human dignity, you are insisting on destroying it. You have ignored everything that has been written, so your confusion is on you.

    • What have they done to improve their marketability? Why do they insist on working for others? How did you read this article, and all these comments and learn nothing? This is the first article/video/whatever that I have read on this site where so many people are refusing to actually read before commenting. All these concerns that are being raised by you raise the wage people have been addressed from the very beginning. You have simply ignored it. That is not my fault. That is your fault.

      • I disagree with your comprehension of the article. Also that you obviously did not check any of the resources supplied to you by Richard Ran. You are still looking for everyone to give you the answers you want to hear, not the truth. We are done. You ask stupid questions and don’t listen to the answers. They are stupid because they were already adequately addressed for even the most illiterate of economic students. All that can be gained from any further contact with you is my dumbing down. Good-bye.

      • PeaceFroggs we all understand that you are a very special snowflake. We all hope you can have everything and that you don’t have to do anything to get it. We hope you will someday become our President because of your reading and comprehension level. You deserve everything and should not have to earn it!

  4. Re: Recommended Reading – “Adjustments” Account For ‘Nearly All Recent Warming’

    I found it interesting that climate scientists and “activists” arguing that a challenge to the current “consensus” on climate science by minority opinions would be DANGEROUS to the existing climate science. Ha. It obviously would be disruptive to group-think of climate science today, but I’m unsure of why that would be a bad thing for true scientists who are interested in finding the objective truth on scientific phenomena.

    “Secretary of Energy Rick Perry also came out in favor of red-blue team exercises, which are used by the military and intelligence agencies to expose any vulnerabilities to systems or strategies. Environmental activists and climate scientists largely panned the idea, with some even arguing it would be “dangerous” to elevate minority scientific opinions. “Such calls for special teams of investigators are not about honest scientific debate,” wrote climate scientist Ben Santer and Kerry Emanuel and historian and activist Naomi Oreskes. “They are dangerous attempts to elevate the status of minority opinions, and to undercut the legitimacy, objectivity and transparency of existing climate science,” the three wrote in a recent Washington Post op-ed.”

  5. I agree with you PeaceFroggs, and notice that you are presenting logical arguments while wingsuitfreak is simply insulting you. Almost like an attempt to bully you out of disagreeing.

    I’d like to hear what Corbett considers an alternative to a minimum wage. If not that, then what?

    • and another person I won’t speak to. If you had read the article, you wouldn’t ask the questions you are asking. Your ignorance is yours, not mine. Or go up to Richard Ran’s comment and check out his resources that he offered. But that would take time and effort. Both of which are too much for you. Personally, I would rather buy a robot than hire you. Which is probably what your boss is also thinking. I say your boss, because those concerned with getting a minimum wage are far too interested in putting forth minimum effort to be an entrepreneur. Since you were too lazy to read the article, why would anyone respect your opinion? Don’t bother answering as I won’t bother reading your response. You’ve already proven it’s not worth reading.

      • wingsuitfreak,

        You don’t have to agree with PeaceFroggs or myra’s point of view, but why don’t you try debating the actual idea instead of using ad hominem attacks. You aren’t promoting any healthy discussion here, but rather trolling this comments section.

        The argument you keep using in your replies is not sound. You suggest by your comments that James’ article is the ultimate authority on this topic and that all someone needs to do is simply read it and the debate will be over. You are assuming that James’ conclusion is correct in the first place, without discussing the ideas themselves. Your argument also assumes that Richard Ran’s resources are an authority and are correct, when there is much debate regarding those ideas presented.

        • I did. He had been given numerous references and chose (and admitted) that he did not utilize them. Instead he chose the childish route of insisting that his ignorance be validated. Read the whole thing over again. Or not. I don’t care if you agree or disagree. I don’t care if you think that people should just waste other people’s time. That is exactly what that snowflake did. Everyone else put more time into him than he was willing to do himself. For that, I have absolutely no respect. In turn, I decided to discontinue any further conversation with such a beast that has no respect for anyone else’s time. If that bothers you, let me know and I will just ignore you as well. No skin off my back when ignorant time wasters get upset at me.
          Also, your argument is false. I did not say that Jame’s article was the one source. I pointed out others, but the snowflake didn’t bother reading those either. On further reflection, I will make the call to no longer communicate with you as you are obviously not of a sound mind.

    • Myra we all understand that you are a very special snowflake. We all hope you can have everything and that you don’t have to do anything to get it. We hope you will someday become our President because of your reading and comprehension level. You deserve everything and should not have to earn it!

      • My oh my. Look here. Buck Wild simply has a canned response he cuts (probably from right wing “talking points”) and pastes onto posts he dislikes. Identical canned responses to both me and PeaceFroggs, almost like a bot, complete with the overused right wing insult du jour “snowflake.”

        Clearly Buck Wild and wingsuitfreak got the same right wing memo.

    • @myra, Peacefrogs’s are logical arguments????????????????


  6. Explain to me why it’s not inevitable that in a godless technocratic society the dollar value of human labor will tend toward ZERO automatically. If humans are nothing more than fungible economic units, and if they have no cosmic significance or inherent value AS HUMANS, then why SHOULDN’T they be allowed (or forced) to become extinct by automation as technology becomes available? Explain to me what “moral imperative” requires economically useless people to be kept alive or supported in any way, e.g., by a “Universal Basic Income” paid for by economically productive people? Without a world view that sees human beings as having inherent dignity, why SHOULDN’T “useless eaters” be exterminated? It seems clear to me that the big debate among the world’s elite is how to get rid of a large part of the world’s population at the least cost to their (the elite’s) perquisites. Not one of these Godless f*cks gives a crap about human life that is not their own, and even if they have to sacrifice a good portion of their own “lower echelons” (say, the 2 to 5 percenters) to keep the game going for the top 1%, they will gladly do so as long as the bottom 2 to 5 percenters are around to cater to their whims and aberrosexual desires. Absent a widespread global reversion to a world view that sees all human life as having intrinsic value regardless of economic productivity, I don’t see much hope for humanity before most of us have shuffled off this mortal coil. Just sayin’.

  7. James, excellent article. Thank you for the links. I’ve just been embroiled in this minimum wage argument at Wolf Street. Richter seemed like a smart guy, but he doesn’t get the minimum wage issue. He even said that the higher minimum wage hasn’t caused unemployment in SF because the unemployment rate there is only 2.9%. ?!? Did it occur to the guy that the minimum wage workers don’t live in SF? There unemployment stats would likely be on the books of a nearby city. Actually, I think most of them have been chased out long ago.

    This argument is just as stupid as the “health care” argument before Obummer care. At that time, my nephew self-righteously posted on his fb page, “No one should die for lack of health care.” I wanted to ask him to name one person who did. For family peace, i didn’t.

    This emotionalism trumping common sense is so frustrating and damaging. wingsuitfreak is 100% correct. It’s depressing to see this nonsense on

  8. “As the wage rate falls the hours needed to earn a specific sum *rises*!!!”

    But the wage rate is adjusted for inflation, correct? So if the wage rate falls then the price of goods and services should fall as well (vice versa for wage increase), meaning no ground was gained or lost, and you still work the same amount of hours and receive the same amount of goods and services for those wages earned.

  9. In the 1960’s I remember making 75 cents an hour as a busboy at a Texas Holiday Inn restaurant. At 15 years old, I would ride my motorcycle to work. A year or two later, at the Officers Open Mess (Officers Club) of a Helicopter Training Base (Vietnam War era), I was making $1.25 to $1.75 an hour. With my pass for the 10,000 personnel military base, I would seek out adventures…for example: just walking into the Vietnamese barracks with my dictionary and strike up conversations, or paying a Captain late one night to teach me how to win at poker.

    With many servicemen shipping out, cars would often be in the newspaper “Want Ads”. At age 16, I begged and begged my Dad to let me buy one of two used Corvettes (’63 & ’64) which were selling for $600 and $900. My Father allowed me a long leash when it came to adventure, experience, experiments and education, but here he said “No. No way son. Don’t ask again.”

    Very Nice Large Texas Homes on large lots for Sale in the 1960’s might cost between $8,000 to $15,000.
    See examples of Homes in the 1960’s…
    See the “unadjusted” statistics…

    The Big Silver Melt by Henry Merton is a fascinating book with photos and many anecdotes which I read in the 1980’s after the Hunt Silver market manipulation.
    Around 1965, LBJ pushes to change the amount of silver found in U.S. coins. Henry Merton claims that about 1.24 million ounces of US coins were melted between 1966 and 1969. I believe him.

  10. The above argument by Paul6 is completely shot out of the water by fact. In the UK. The almost instant result of the minimum wage being implemented was the Zero Hour Contract.

    The workforce lost the security of the 16 Hour and 35 Hour contracts they had and many though not all workers have had a reduction of hours under the new contract.

    They are financially in a worse position compared to before the minimum wage.

    Have a look at the figures.

    More people receive Government support in the UK Today than before the Minimum Wage.

  11. Federal increase of minimum wage has never ever worked (to help the average guy).
    It has worked to help the very rich get richer and to help politicians get elected.

    • PeaceFroggs,
      You personally can EASILY increase minimum wage within your local area.
      It is no problem.
      It is simple.

      The next time you go to buy a burger, after you pay for it, tip everyone working there on a prorated hourly basis.

      Anytime you purchase anything, just tip the employees.

      If you spend 30 minutes talking to someone in a store, then tip everyone working there “30 minutes worth of time”. So, if they are making $10 hr, but you think they should be making $20 per hour…then tip everyone $5. Even if you don’t purchase anything, because you used their time.

      Put your money where your mouth is.

      (However, I think what you really want… is to ENFORCE others to tip under duress and penalty. You personally don’t want to, but you are willing to make other do it even at threat of jail or gunpoint.)

      • And by the way, I often tip in “non-tipping” environments.

      • PeaceFroggs,
        Put your money where your mouth is.
        You, right now, immediately can increase hourly pay for workers who you come in contact with.

        If you don’t go tip every employee (regardless of service) in every venue which you come in contact, then you are full of hot air…
        …you wish to be a dictator who mandates with threat to impose your rules on other people.

        • He has no money. He won’t even invest in himself so he is working for minimum wage. Which is the result of putting minimum effort into yourself. And the reason why I quit trying to help him. He refuses to listen. He asks for help and then refuses to accept it. Call me simple, but I sort of consider that type of behavior delusional.

      • PeaceFroggs,
        I make just over minimum wage at the hourly jobs I have had in recent years and in years of the distant past. It is not a living wage.
        Most of my neighbors also make close to minimum wage.

        When minimum wage was 75 cents an hour (for restaurant workers) (which I was making), it wasn’t a living wage but much better of an “average guy” situation than now.
        Over the decades, minimum wage has been raised but the “average guy” situation has progressively gotten worse.

        In the 1950’s when I was growing up, a father could support his stay-at-home wife and kids and own a house. Even the delivery milkman who left milk on your doorstep could support his family.

        For 6 decades I have watched and experienced the deterioration for the average guy.

        • I should open up a psychic hotline! After all, I did say he worked for minimum wage. And even gave the reason why. And it is the same reason he will never really stay out of sight of it. Because he does not put any effort into himself. Which he has already admitted when he wasted everyone’s time by asking for clarification and then refusing to look at any of the information gathered expressly for his benefit. It is insane to expect others to care more for you than you do. Which explains a lot.

        • “the Dutch government is allowed to put you mandatory at work at a big corporation and the first 3 a 6 months the company don’t pay you anything”

          They have a similar scheme in UK as well, I remember reading about free workers for Walmart and other retailers. I think it was 350 pound/mo for a full time low end employment.

          I’d wager that this system could zap a semi intelligent person back into reality and make them want to make things better for themselves. When upgrading from “slave” I guess everything is better so stuff like this may work out.

          Recently, political geniuses in my failed state introduced a 50% minimum wage state subsidized “jobs” in the private sector for people with no previous work experience and younger than XY. Minimum wage is less than 400€ and these guys got to “work” for about 210€. For comparison purposes, a 30km commute and a sandwich will net you some 100€ per month. We’re talking basic sandwiches here, no soda nor yogurt.

          There was a lot of talk about this “measure” which in my opinion failed on several fronts.

          1. the “program” would run out of money very quickly since many a private business owner wanted a free “worker” of their own

          2. people who work for nothing can be expected to pretty much amount to nothing. Not only will they be given demenial tasks, but won’t be on the receiving end of any intellectual investment either.

          3. Low pay, low experience accumulation, low intellectual stimulation; one has to wonder how stupid is the average private entrepreneur in this country for thinking they can benefit from hiring such workers. Mighty, mighty stupid.

          4. while increasing job availability velocity should be good no matter how you look at it, state FUNDED and ADMINISTERED slavery isn’t the way to go forward

          I bet there were some people who benefited from this program, but looking at the matter as a whole, peoples’ reappropriations cash (a.k.a. taxes) funded some slaves for the private sector while providing some screen time for politician idiots who came up with this idiocy.

        • Pablo Mkey et al,
          Geez! I did not know about these work programs with corporations via the government handouts.

          What a prison planet!

        • I doubt you’re surprised, though.

      • Muchas gracais Pablo de Pretencioso.

  12. i don’t see many solutions offered here. i do have real world experience. back in 1980 i started a job at roughly $5.50 and remained in that same job with the same title till 2013, making $18.50. during those years we got a “cost of living”raise which was half of the announced inflation rate, so never any way to actually catch up. in 1980 inflation was %18, we got %9, which sounds good but actually lost %9 of spending power. on and on thru the years. i won’t even go into how the announced inflation rate is usually understated. along with the insane increase in percentages of CEO and upper management salaries, further stratifying the wage disparity. i don’t see $15 as way out of line. it would just be drowning in a little less water.

    • Good anecdote. Thanks.

      I remember the 80’s. The inflation and loan interest rates were way, way up there.

    • One of the reasons we haven’t had any solutions is because this comment section began in a degraded state. We have yet to advance that far because there are so many commentators here who are not even close to being able to converse on that level. There are solutions, they are legion and well-known. But they won’t be found here. The level of understanding of the most basic points of economics aren’t up to it. That is truly sad.
      On a lighter note. I remember getting a “good” deal on my first loan (where I learned to never take out loans) for a motorcycle. It was 1981 and I was able to get a $2,000 loan with only 21% interest! Wow! Since the entire oil embargo was basically a state controlled affair, one can only bless the powers that be for their benevolence in granting me such a great deal. Long live the state! Now give me my freaking soma! 🙂 Jim

      • Jim, I remember those interest rates. In 1981 or 1982, I took my stationwagon title to get a loan so I could try a business venture. The business venture of selling pictures on the side of the road paid off. I used the loan money to buy inventory. Some weeks I was making $1,000 – $2,000 cash profit after I built up my inventory.

        • That’s funny! Not the story itself, but in 1989. just after my divorce, I did pretty much the exact same thing! I had a job (Army), but didn’t use that money. Also, it was an all cash business, so there were no taxes, just real business costs. Errr, did I just say I didn’t give up my money to the armed robbers? 🙂

    • Thanks. This comment section is so amazingly confused that I had forgotten that the solution has been presented so often!

    • Like I said, this comment section is so confused that I keep forgetting it has already been offered. And rejected by those least capable of understanding what a market is.

    • To me, the solution is very simple and can be done immediately. (And is something which I often do.)


      For the folks who feel that every hourly worker must make more money, then give them more money. Tip every hourly laborer in every store or venue with which they interact, regardless of service or quality.

      Starbucks has a tip jar. Many establishments do. But giving money away to others is not against the law. It can done easily.

      Personally, when I run across wonderful service, I try to exchange. It might be a survey, a smile with voiced appreciation, a compliment to the manager or cash or gifts or free 9/11 DVDs.
      Just last week, I tipped a fin to an hourly overweight clerk at the dry cleaners. I needed some recycled coat hangers for a garden project. She was more than helpful. She lit up on the tip.

      But I will punch any guy who mandates that I must tip everyone.

    • There is only one real solution–free market. If you want to know why, read everything at Short of that, it’s constant govt meddling that screws the little guy, and we are left to trying to game the system.

    • “Market failure” is a socialist myth. There is no such thing. What you may be calling market failure is the result of govt meddling, specifically in this instance, in the labor market. Minimum is only a tiny part of the meddling.

    • You should really study economics before you start lecturing everyone about it. That way you won’t look like an ignorant baboon. Sorry baboons.

      • Yup, wingsuitfreak continues to bully those he disagrees with. Guess that’s all he has to offer.

    • That’s not a solution, that’s simply an inverse.

  13. i also had trouble with the idea that we ‘have to listen to the “economists” on this one’. are these the same economists that have been running and guiding this system in the first place? i don’t have the answers but i see the MW staying the same while every other level of the stratified economy rocketing skyward. the whole modern economic model is based on monetization.. of everything.. every product, service, money itself. everything has been bought up and used by the wall street, hedge fund operators.. think “Pharmaboy” etc… precious metals was the first (cornering the markets), but now every business chain is owned and controlled by nameless people who’s only interest is the bottom line and their profits, so they ship the good jobs overseas, the jobs that are left are turned into part time jobs, that may pay over MW but are not livable… they have a huge out of work labor pool to resupply the PT jobs as people come and go, the people suffer, the work itself suffers, the consumers suffer, but the billionaires are at least “making a living”, except for those who have to take part time jobs running the government…

    • Agreed. Corbett was unconvincing on this subject. At best.

  14. I mentioned the robots. Or rather how I’ rather buy one than hire you. You state that private citizens couldn’t develop robots, but you don’t give any reason why. Do you think it’s because it’s too expensive? It’s not. It only looks that way due to government waste. It was developed in the private sector, or did you not hear about automation in factories? Also note how all the cool robots are being developed in Japan. The private sector develops robots that build things and that you can have sex with. The robots you refer to as government developments seem to be preoccupied with killing people. That’s a government specialty. If I had a choice between sex and killing, I’d choose sex. If you are going to make an assertion, please give us a reason as to why you believe this is so. Just saying it is, doesn’t make it so.

  15. I wandered into this video thanks to obviously broken youtube suggestion system.

    What I learned working in a UK job centre #WeAreAllDanielBlake

    This is a very packed 22 minute video focusing on experiences of a man who comes from a background in which it is “normal” to get entangled in the social net in the UK, with a break down of what that meant prior and post 2008.

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