The following is a letter written in response to a post from my friend Brad Littlejohn on the topic of the minimum wage.
Thank you for your thoughtful and substantive engagement on the question of the minimum wage. I don’t think the conversation we had on Twitter earlier did justice to your work here, so I’m offering this response in hopes of furthering the conversation. I hope you find it fruitful. I certainly have. I should also note that I have been assuming the context of policy proposals to increase the minimum wage at the federal level in the United States. There are certainly aspects of what we’re discussing that apply to a greater or lesser extent in other contexts and at other levels of government, but at the level of individual states, for instance, the stakes are somewhat reduced and ameliorated by the realities of federalism.
You write that you “want to reflect a bit more fully on what’s wrong with one of the common conservative arguments against the minimum wage: that the laborer is only worth his productivity.” I have significant concerns with equating someone’s worth with the economic value of their labor in the marketplace. I do not argue that the laborer is only worth his or her productive work. I argue that a worker’s work is only valuable in a market setting insofar as someone is willing to pay for it. I agree that there is a subjective element to work that is in some ways intimately identified with and inseparable from the person doing the working. But I do maintain that the worker and the work can, and indeed must, be distinguished. Perhaps what we disagree about is that you think the wage someone is offered is primarily a signal about how much that person is valued. I think that the wage someone is offered is primarily a signal about how much that person’s work is useful to others.
“Labor is always attached to a person, and persons are more than mere economic functions,” you write. I do not deny this. In fact, I affirm it, which is why I am loathe to simply identify what a person’s labor commands in the marketplace with his or her value as a person. You go on to call the distinction I draw between the worker and the work as a kind of dodge. What you consider a dodge I consider to be a necessary distinction.
You also note in connection with the observation that “labor is always attached to a person” that it cannot be reduced to a mere commodity. This is true, in a sense, in part at least because a person’s work is not simply a material matter. The working person applies and mixes his or her creative energies with the elements of the created order to bring out something new. But in this sense what we are used to calling “commodities” are not really mere commodities either. Anything that isn’t left in a completely natural state has had some element of human labor applied to it and has therefore been touched by the creative handiwork of the worker laboring as a divine imagebearer. In that sense, why should anything be a mere “‘commodity’ subject to the supply and demand pressures of the market”? Your identification of the commodification of something with being “subject” to market forces suggests that you do not think that human labor should be subject to market forces. But I do not think that a person’s labor can simply be divorced from market forces. A good chunk of what makes our labor worthwhile is that it is something that actually serves someone else. As Lester DeKoster has written, the “salability” of our work, so to speak, is an important signal about how much and to what extent we have served others through our labor. Work for the sake of work as such doesn’t mean much.
Forgive the absurdity of this example, but if I decided that what I really wanted to do was to become a styrofoam farmer, what would a case for a minimum wage mean? If I spent 8 hours a day, 6 days a week faithfully planting styrofoam cups in the ground planning to reap a harvest of styrofoam three months later, what claim would my labor have on others? Would there be a moral obligation for others to buy my sterile (and dirty) styrofoam at what would amount to a living wage? Styrofoam farming is hard work, I’ll have you know. Are you really doing me a favor affirming my lifestyle choice as a styrofoam farmer by purchasing my dirty styrofoam? Or, rather, do I as a worker have to take into account the utility of my work in service of other people before undertaking it? If the latter is true in any sense, then the market price of labor communicates something significant that should not be ignored or disdained, economically or morally. I think one application of the 8th commandment below is that my styrofoam farming is a violation of the commandment; we are to work productively and profitably so that we may share with those in need. There are imperfections, flaws, and sins, certainly in the market system. No doubt the fall into sin and specifically the curse with respect to human labor have something to do with this. Prices in this fallen world are not sacrosanct in that sense. They communicate what is valued, but perhaps not always or often enough what ought to be valued. But neither are prices simply fictions that can be done dispensed with without deleterious effects. If all that matters is the work apart from its utility for others, then I am reminded of the salient observation often attributed to Milton Friedman about the laborers digging holes with hand shovels rather than machines: “If it’s jobs you want, then you should give these workers spoons, not shovels.”
You proceed to invoke the case of a “person incapable of generating sufficient wealth by their labor” to survive and flourish as subject to market forces. I think the Christian tradition is clear in this case: those who can work productively are called to do so in order that they might create wealth in order to share with those in need, those who cannot work in that way. Both the Heidelberg and Westminster catechisms make this point in connection with the 8th commandment. It is not clear to me why such a description of the duty incumbent upon Christians should be described as “an optional extra.” You go on to characterize charity as seemingly unavoidably “demeaning and dehumanizing to those receiving it.” But this is only the case if you one has simply conflated a person’s value with the wage their labor commands in the marketplace. As I have said earlier, this is a very dangerous and problematic identification, in part because it tends to reinforce a kind of materialistic worldview. There are plenty of people called to pursue worthy callings that do not command great wages. There are those who are even called to voluntary poverty and to rely specifically on charity for their well-being. Charity need not be demeaning and dehumanizing but is a moral obligation precisely because the person in need has dignity and value as an imagebearer of God regardless of what he or she might or might not earn in the marketplace. I therefore obviously do not accept your Darwinian reductio.
I wholeheartedly agree with you that businesses as well as charities should seek work that ennobles, or better, respects the nobility that everyone already possesses. As you put it, we should argue for “a sense of commitment on the part of employers to find some way in which the less skilled, less productive, may contribute.” I think this is in some significant part to be achieved by means of moral suasion. I do not think that minimum wage legislation is an effective way to inculcate this sensibility on the part of employers. It may, in fact, contrary to the intended purposes, reinforce the sense that minimum wage labor is undifferentiated and replaceable. We are, in fact, primarily here in the realm of moral suasion rather than legislation, although Brian Dijkema’s point about minimum wage legislation as “a means of curtailing vice” with a pedagogical element is well taken and ought to be considered.
You ask, “And if moral suasion utterly fails, what then?” First, I will not grant that it is possible for moral suasion to “utterly” fail, if this means that it never accomplishes anything. It may take a great deal of time and effort and we may not see results during our lifetime, but the task of moral suasion never should be abandoned. And second, I would connect the moral suasion teaching our duties before God toward others the same way that Kuyper does in his speech on the problem of poverty. He has very strong words about the Christian duty to give (assuming already a Christian duty to justly compensate workers), such that “all state relief for the poor is a blot on the honor” of Jesus Christ. But he adds that in the failure of Christians to live up to their obligations, there is room for recourse to state action, albeit only of a certain kind (e.g. “quickly and sufficiently”). “We may let no one starve from hunger as long as bread lies molding in so many cupboards,” he says. But this is not a license for any kind of state action whatsoever regardless of consequence. It must be state action designed to make itself redundant.
Your point about the worker as an individual as opposed to a human person embedded in a social fabric is well taken. Again, I think this is a reality that employers as well as employees need to be aware of and responsible for. This highlights the primacy of this relationship, as they are the moral agents most directly responsible for and involved in the agreement to provide work for pay. They are the ones most invested in and knowledgeable of all the details and intricacies of the “family and social units” in which they are embedded. There is at least a hint of paternalism in the idea that an external authority might decide for you what you can agree for your labor to be compensated for. Each of us best placed to decide for ourselves what our various interests and obligations are and what they demand of us in concrete circumstances. It is easy to conclude in the abstract that the minimum wage would not inhibit exercise of choice, but things are often rather different in the concrete. As Paul Heyne put it in a somewhat different context, people tend to take risky or relatively low-paying jobs “only because they have such poor alternative opportunities.” The calculus of choice needs to take into account what the actual opportunities are in a concrete situation and not remain satisfied with abstract theorizing about alternatives that we would hope or imagine them to be.
You invoke the phenomenon of wage stagnation, and here I think it is appropriate to at least mention the dynamics of what Röpke called the “wage-price spiral” which “presupposes continual injections of new money.” There is a connection between the inflationary policy and the stagnant and even reduced purchasing power of waged work. In this way I find discussions of minimum wage policies that occur in a vacuum and outside of a recognition of the broader fiscal and spending policies that create such tensions to be inadequate and unproductive.
I appreciate the point you raise about the worker as a dynamic force. Again, I’m not willing to grant that paying someone minimum wage communicates disdain for the worker as a person, but it does communicate that the work that person is doing is not of a sufficiently productive or qualitative caliber to command higher compensation. Rather than seeing this as an inherent insult to the dignity of the person, it is also possible to see this as a kind of motivating signal to workers, that if they desire to make more then they should seek ways of improving their work (e.g. I should stop being a styrofoam farmer and do something of some utility). There are lots of options for this, some of which are mentioned (e.g. education, training, greater attentiveness to efficiencies and innovation in the workplace, and so on). The minimum wage worker is not simply a static block that will necessarily sit and work at the same job for the rest of his or her life. Low pay can be an incentive to better oneself, which is in part why I think we agree on the value of young people, especially teenagers, taking jobs as they are able to learn the discipline required of and meaning attending to a hard day’s work. And you are right, too, that higher wages can spur increased productivity, and there are firms that have shown this to be true. We should highlight and praise those positive examples.
As to your points about different models of distribution of wages across a firm, I think there are some important and valid points here. This gets into all sorts of other complex concerns related to corporate governance, the value of middlemen, the role of executive and middle management, executive compensation, and so on. I also do not think there is a single ideal distribution of wages within a firm that sets an immutable standard of justice. It is not obvious to me prima facie that either one or the other of the instances you put forth are either moral or immoral apart from particular circumstances. But I agree with you, that if the point of minimum wage policy is to try to equalize wages within firms, then it is at best a very crude instrument to do so.
There are, in fact, lots of other potential policies and practices that in my view stand a much better chance of actually improving the lot of minimum wage workers who have families to support. The EITC is one example. A decrease or elimination of payroll taxes is another. But in many ways that takes us into broader discussions about social policy beyond the specific question of the minimum wage. It is, as I have tried to point out here and in other places, a very blunt instrument that often has significant unintended side effects. I appreciate what many proponents of increasing the minimum wage are attempting to do, but I am dubious that it will actually accomplish those things. Minimum wage laws tend to achieve by artificial and mechanical means the kind of justice that can only be achieved by spontaneous and organic relationships of free persons acting as responsible moral agents.