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      "permlink": "price-floors-the-minimum-wage-and-the-misguided-fight-for-usd15",
      "title": "Price Floors, the Minimum Wage, and the Misguided “Fight for $15”",
      "body": "![image.png](https://cdn.steemitimages.com/DQmXRwZDTXRMN3CuQvUunk89kEwbFEukKNPaRcCUMA8vUgK/image.png)\n\nAmong Joe Biden’s calls for more centralized control over the lives of Americans came [the incoming President’s stated intention to push for a national wage of $15 per hour](https://www.cnbc.com/2021/01/14/biden-calls-to-raise-the-federal-minimum-wage-to-15-per-hour.html). This is nothing new, of course. The “Fight for $15” first began over eight years ago, and [several municipal and state governments have significantly raised their minimum wages](https://www.usatoday.com/story/money/2020/12/31/minimum-wage-base-pay-set-rise-20-states-15-floor-spreads/4083623001/) to well over the Federal minimum of $7.25, which has remained at that level since 2009.\n\nMany advocates of Biden’s initiative, in typical progressive fashion, frame the argument almost exclusively in moral terms: “No one who works 40 hours a week should be living in poverty,” they say. Adhering to [a flawed Labor Theory of Value](https://fee.org/articles/were-still-haunted-by-the-labor-theory-of-value/), they insist that greedy “capitalism” is the reason why those making minimum wage aren’t compensated “fairly” by employers. They utilize oxymoronic terms like “wage slavery” to sway those who lead with their hearts and seek social justice for those who have found themselves unable to get ahead because their wages leave them living from paycheck to paycheck, at best.\n\nThe conservative response generally looks as heartless as progressives portray it. Quite often, the canned response is to blame the low-wage employees themselves for life decisions that they made that led them to the level of financial stagnation that they are experiencing. Conservative criticism of the working poor is often blaming or condescending in tone, dripping with moral judgment and disregarding the emotional crisis that such people find themselves in.\n\nA libertarian can make a compelling case for why the best minimum wage is $0, without derision or insensitivity toward those who find themselves economically struggling in low-wage jobs. It involves conveying economic truth, while at the same time pointing the way to economic freedom.\n\n# Your wages are a price you set with an employer\n\nAs an employee, you are engaging in commerce with your employer. Whether you are a part-time menial worker without a diploma or a captain of industry, you are literally selling the end result of your time and efforts and expertise to an employer, in exchange for some agreed-upon form of compensation. That compensation may take the form of an hourly wage, or an annual salary. or a specified commission, or a contractually fixed amount, along with any other “benefits” that your employer extends as a condition of employment. You voluntarily agree to provide a service that is valuable to the employer, and the employer voluntarily agrees to provide you things that you value in return.\n\nTherefore, for business owners, wages and salaries and benefits (along with the taxes associated with each) are prices they pay for services needed to make their businesses run more efficiently and to maximize revenue. Without paying those operating costs, meeting the demand of their customers would be more difficult (or, in many cases, even impossible).\n\nTaking this economic reality into account, minimum wage laws are price controls.\n\n# Minimum wages are “price floors”\n\nWhen the government steps in and starts setting prices, it throws the entire market out of balance. Contrary to a lot of popular opinion, prices in a free market are not arbitrarily chosen amounts set by producers; rather, they result from a host of variables, such as the scarcity of the product, demand for the product, the cost of providing the product, and alternatives in the market to that product. Ultimately, as economist F.A. Hayek indicated, prices are <i>information</i>, telling all parties engaging in commerce what the “value” of that product is.\n\n[Just as artificial price ceilings in order to prevent so-called ”price gouging” result in shortages of necessary goods](https://truthonthemarket.com/2020/03/24/prices-are-information-even-during-a-crisis/) , the minimum wage is an artificial price floor that results in a surplus of a good or service in a market — in this case, labor. Think of it in terms of other products: if the government legislated that one could not legally sell a gallon of milk for under $30, one might think that would make millionaires out of the average dairy farmer. However, very few of us would be willing to buy milk (or nearly as much milk, anyway) if we had to pay that much for every gallon. <i>Price floors that are too high actually kill demand</i>, resulting in an excess supply of the product in question, and eventually to a reduction in production to match.\n\nThe best case scenario for a price floor is that it has no effect at all on the demand for a good. If the government decreed that it were illegal to sell a gallon of milk less for 10¢, milk producers and consumers alike would shrug it off. Why? Because the value of a gallon of milk already exceeds that price floor. People already pay more for milk, because it is worth more than a dime a gallon for milk buyers to have it. Therefore, the price floor is meaningless and might as well not even exist.\n\n\n![image.png](https://cdn.steemitimages.com/DQmQTymeJoyx8rSmmftXCfdf6WJGfZjM3yqK2fThNZay5nV/image.png)\n\nTaking into account that wages, for employers, are prices that they pay to optimize their business, a legislated minimum wage has the same effect as any other price floor. If the cost of hiring someone full-time is so high that it becomes unprofitable (or even a net loss) for the employer, that employer is going to seek alternatives. That may take the form of reducing or eliminating non-wage benefits (which is one reason why so many low-wage jobs have shifted to part-time positions where it is not required to provide insurance benefits), hiring fewer workers and putting more responsibility on the ones who are hired, or automating the job. In cases where there is not a feasible alternative available, the business may have to cut back its unprofitable sectors or even shutter their doors completely. Whatever course of action the employer decides to take in order to avoid wages that are artificially higher than the market can sustain, the end result will be the same: a surplus of available labor on the market — also known as unemployment. Hardest-hit by this unemployment will be the ones whose low-skilled or low-specialized labor have a market value under the higher minimum wage: young people and the working poor whom the laws were intended to help in the first place. Once again, the government allegedly “helping” would instead price the labor of millions out of the market.\n\nObviously, human beings are not gallons of milk. We can’t simply be poured out and no longer produced when the demand for our labor is killed by artificially high minimum wages. Eventually, something has to give in order that we survive. That may take the form of a labor “black market,” in which people work and get paid “off the books,” or it may result in higher taxes to redistribute that money through government welfare programs. The latter vastly increases the numbers of those financially enslaved by the state, and it also increases resentment and enmity between those who are involuntarily funding the redistribution with higher taxes on their labor and those who are receiving the benefits without laboring, themselves.\n\n# What about those CEOs?\n\nThe progressive typically counters that this problem can be solved by marginally raising prices (“I’d pay an extra 50¢ at Taco Bell so their employees don’t starve!”) or by companies slashing the salaries of their CEOs in order that the entry-level workers can get that $15 an hour. Some even go so far as to say that a business owner that cannot pay every worker at least $15 an hour shouldn’t even be running a business in the first place.\n\nWhat these people fail to take into account is that only major corporations could conceivably cover the increased costs of a $15 minimum wage by small price increases across the board and by shaving tens of millions off of executive salaries. Excessively high price floors kill off small businesses far more quickly than they do the “big box retailers,” because the owners of these businesses are not typically among the “0.1%” and actually keep themselves out of poverty with the profits from their respective endeavors. It is not out of charity that companies like Amazon are completely behind a higher national minimum wage:\n\n\n![Screen Shot 2021-01-20 at 8.38.54 PM.png](https://cdn.steemitimages.com/DQmeaqtfcAhkuGuysHYPJH2kLsGf84NrZXj9av42a3zjHqS/Screen%20Shot%202021-01-20%20at%208.38.54%20PM.png)\n\nUnless those progressives are suddenly in favor of the “little guys” being knocked out by the mega-corporations, their proposed solution is not a feasible one.\n\n# So, what <i>is</i> the solution?\nThe solution rests not on artificially inflating labor costs and pricing low-wage laborers out of the market, but in assisting those laborers in producing labor of a higher economic value.\n\nThe first step to that is eliminating the minimum wage entirely. Since everyone has to start somewhere, let the invisible hand of the market determine what that starting point will be. That way, there are no barriers to entry at all for those who are young and without skills or specialization.\n\nThere are a lot of libertarian approaches to helping the low-wage worker become more economically valuable. There are a number of organizations like [America Works](https://americaworks.com/) , which train people not only in specialized jobs, but educate others in the “soft skills” necessary to thrive in any work environment. There is no reason why charitable organizations like this cannot be completely funded by the voluntary contributions of individuals and companies that would benefit from the workers provided by them.\n\nhttps://youtu.be/QqlFW28uQh4\n\nLarge and small business owners alike who provide training for those interested in taking on responsibilities of greater economic value also help to solve this problem, as long as they raise the wages of employees to accurately reflect the market value of their new skills and specialization. Otherwise, they will be in danger of losing them to someone who will make them a better offer.\n\nFor those who are self-employed, providing apprenticeships in exchange for useful low-skill labor would be a way to equip someone with valuable skills while receiving some economic benefit in return.\n\nLastly, it is important not to overlook those who would successfully run their own businesses if they had the initial capital to do so. Finding such individuals and bootstrapping them (either through microlending or investing your money in exchange for a share of the business) might just be the kick-start that some need to produce value for others as entrepreneurs in their own right.\n\nAt the end of the day, the key to raising wages is to raise the value of the labor of those working for those wages. Government regulation does nothing but send false economic signals throughout the free market and throw everything out of balance. Ultimately, the individual worker has to make the decision on whether to take those opportunities that open up, but that the compassionate libertarian can see the potential in others and be an active part of creating more overall value in our economy by helping to liberate those who want to work toward that freedom.",
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      "author": "joereform",
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      "title": "The Pandemic Response: Our New State Religion",
      "body": "For the better part of a year, an entire belief system has arisen around the world’s response to COVID-19. This new religion is unmistakably statist, but has taken forms far beyond the typical worship of democracy and the social contract and the offices of heads of state; it has established its own priesthood, its own doctrines and catechism, its own sacraments and rites, and its own take on “saints” and “sinners.” It even goes so far as to take the coronavirus, the actual enemy of humanity, and to transform it into an instrument of judgment for those who do not abide by the new creed.\n\n\n![culofcovidfaithful.png](https://cdn.steemitimages.com/DQmPmwCFBpuhq6KnLWE2iuxKWgqZYqYQoFhca33ftWS5VYY/culofcovidfaithful.png)\n\nThis is the first in a series I will release in the coming days on the different ways that the pandemic response has become a widely accepted religious movement, and how we “heretics” who do not subscribe to all of the pervasive dogma can respond to the pressure to convert. In this first installment, I want to lay the groundwork by making the case that the “Cult of COVID” is indeed is not merely a religious movement, but specifically a statist religion. Whether we examine it from my perspective as a citizen of the United States or not, the foundation of this cult is that complete central planning is the only means by which we shall be saved. Any other solution is insufficient — or even detrimental — and the end result of any other approach would be a catastrophic loss of life.\n\nBecause government is seen as holding the only solution, it has become an article of faith that government cannot be held responsible for anything other than a failure to act quickly enough. While it can certainly be shown that [government red tape and bureaucracy prevented private industry and other innovators to respond more quickly to the threat of COVID-19](https://www.nbcnews.com/think/opinion/coronavirus-testing-delays-caused-red-tape-bureaucracy-scorn-private-companies-ncna1162476), what the Cult of COVID insists is that state-imposed lockdowns came too little, too late. In the eyes of the faithful, the lockdowns themselves, however, are in no way responsible for the economic and social calamity that we face today.\n\nBack in late February and early March, when the confirmed cases of COVID-19 in the United States began to take off, many businesses took initiative to close their doors in order to protect their clientele and staff, and to determine how best to respond to the growing pandemic and continue to stay afloat. The state, at every level, soon meddled in its typical fashion by taking away the right to engage in commerce and putting over 30 million Americans out of work. The end result, as we have begun to see, is a calamity anyone with any basic understanding of sound economics predicted back in March: businesses closing for good, persistent unemployment and poverty and hunger, eviction and homelessness, increased death from non-COVID causes — along with all of the mental health issues that accompany these things.\n\nOne would think that the government officials responsible for creating those conditions would be held accountable. But, wait! That would collide with one of the principal tenets of the Cult of COVID: \n\n> \"Government is society’s only savior. The ultimate sin that the state can commit is inaction.”\n\nSo, whom can we blame for the economic tragedy the world is now facing? Every response can be summed up as one of the following:\n\n<ol>\n<li>those in government who did not act quickly enough, or provide enough economic aid (for they must not acknowledge that it was the direct actions of state central planners that created the very problems they face);\n<li>the coronavirus itself (because they have ruled out non-governmental approaches to navigating the pandemic, even by those with actual “skin in the game” and much more expertise in managing their own lives and businesses); or\n<li>free-market capitalism (for, if subsistence were not connected to labor and individual effort and economic production, everything would not have gone off the rails when the economy was put into a coma by the government, right?).\n</ol>\n\n\n![crayons.png](https://cdn.steemitimages.com/DQmaau7nEBygb1SYS5U4FgToUzxwkZ6Hhw55CFb6DzK1YhP/crayons.png)\n\nNowhere in the dogma of the followers of this religion is any room for blaming the government for lockdowns. It was only doing what was necessary to protect us all from the one thing that matters in this whole public issue: avoiding transmission of a contagion.\n\nTherefore, the Cult of COVID would not exist without a blind, unquestioning adherence to the notion that responding to a pandemic requires the involvement of an active, intrusive, authoritarian government every step of the way. It is, in all respects, our new state religion.",
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      "body": "For the better part of a year, an entire belief system has arisen around the world’s response to COVID-19. This new religion is unmistakably statist, but has taken forms far beyond the typical worship of democracy and the social contract and the offices of heads of state; it has established its own priesthood, its own doctrines and catechism, its own sacraments and rites, and its own take on “saints” and “sinners.” It even goes so far as to take the coronavirus, the actual enemy of humanity, and to transform it into an instrument of judgment for those who do not abide by the new creed.\n\n\n![culofcovidfaithful.png](https://cdn.steemitimages.com/DQmPmwCFBpuhq6KnLWE2iuxKWgqZYqYQoFhca33ftWS5VYY/culofcovidfaithful.png)\n\nThis is the first in a series I will release in the coming days on the different ways that the pandemic response has become a widely accepted religious movement, and how we “heretics” who do not subscribe to all of the pervasive dogma can respond to the pressure to convert. In this first installment, I want to lay the groundwork by making the case that the “Cult of COVID” is indeed is not merely a religious movement, but specifically a statist religion. Whether we examine it from my perspective as a citizen of the United States or not, the foundation of this cult is that complete central planning is the only means by which we shall be saved. Any other solution is insufficient — or even detrimental — and the end result of any other approach would be a catastrophic loss of life.\n\nBecause government is seen as holding the only solution, it has become an article of faith that government cannot be held responsible for anything other than a failure to act quickly enough. While it can certainly be shown that [government red tape and bureaucracy prevented private industry and other innovators to respond more quickly to the threat of COVID-19](https://www.nbcnews.com/think/opinion/coronavirus-testing-delays-caused-red-tape-bureaucracy-scorn-private-companies-ncna1162476), what the Cult of COVID insists is that state-imposed lockdowns came too little, too late. In the eyes of the faithful, the lockdowns themselves, however, are in no way responsible for the economic and social calamity that we face today.\n\nBack in late February and early March, when the confirmed cases of COVID-19 in the United States began to take off, many businesses took initiative to close their doors in order to protect their clientele and staff, and to determine how best to respond to the growing pandemic and continue to stay afloat. The state, at every level, soon meddled in its typical fashion by taking away the right to engage in commerce and putting over 30 million Americans out of work. The end result, as we have begun to see, is a calamity anyone with any basic understanding of sound economics predicted back in March: businesses closing for good, persistent unemployment and poverty and hunger, eviction and homelessness, increased death from non-COVID causes — along with all of the mental health issues that accompany these things.\n\nOne would think that the government officials responsible for creating those conditions would be held accountable. But, wait! That would collide with one of the principal tenets of the Cult of COVID: \n\n> \"Government is society’s only savior. The ultimate sin that the state can commit is inaction.”\n\nSo, whom can we blame for the economic tragedy the world is now facing? Every response can be summed up as one of the following:\n\n<ol>\n<li>those in government who did not act quickly enough, or provide enough economic aid (for they must not acknowledge that it was the direct actions of state central planners that created the very problems they face);\n<li>the coronavirus itself (because they have ruled out non-governmental approaches to navigating the pandemic, even by those with actual “skin in the game” and much more expertise in managing their own lives and businesses); or\n<li>free-market capitalism (for, if subsistence were not connected to labor and individual effort and economic production, everything would not have gone off the rails when the economy was put into a coma by the government, right?).\n</ol>\n\n\n![crayons.png](https://cdn.steemitimages.com/DQmaau7nEBygb1SYS5U4FgToUzxwkZ6Hhw55CFb6DzK1YhP/crayons.png)\n\nNowhere in the dogma of the followers of this religion is any room for blaming the government for lockdowns. It was only doing what was necessary to protect us all from the one thing that matters in this whole public issue: avoiding transmission of a contagion.\n\nTherefore, the Cult of COVID would not exist without a blind, unquestioning adherence to the notion that responding to a pandemic requires the involvement of an active, intrusive, authoritarian government every step of the way. It is, in all respects, our new state religion.",
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      "author": "joereform",
      "permlink": "the-pandemic-response-our-new-state-religion",
      "title": "The Pandemic Response: Our New State Religion",
      "body": "For the better part of a year, an entire belief system has arisen around the world’s response to COVID-19. This new religion is unmistakably statist, but has taken forms far beyond the typical worship of democracy and the social contract and the offices of heads of state; it has established its own priesthood, its own doctrines and catechism, its own sacraments and rites, and its own take on “saints” and “sinners.” It even goes so far as to take the coronavirus, the actual enemy of humanity, and to transform it into an instrument of judgment for those who do not abide by the new creed.\n\n\n![culofcovidfaithful.png](https://cdn.steemitimages.com/DQmPmwCFBpuhq6KnLWE2iuxKWgqZYqYQoFhca33ftWS5VYY/culofcovidfaithful.png)\n\nThis is the first in a series I will release in the coming days on the different ways that the pandemic response has become a widely accepted religious movement, and how we “heretics” who do not subscribe to all of the pervasive dogma can respond to the pressure to convert. In this first installment, I want to lay the groundwork by making the case that the “Cult of COVID” is indeed is not merely a religious movement, but specifically a statist religion. Whether we examine it from my perspective as a citizen of the United States or not, the foundation of this cult is that complete central planning is the only means by which we shall be saved. Any other solution is insufficient — or even detrimental — and the end result of any other approach would be a catastrophic loss of life.\n\nBecause government is seen as holding the only solution, it has become an article of faith that government cannot be held responsible for anything other than a failure to act quickly enough. While it can certainly be shown that [government red tape and bureaucracy prevented private industry and other innovators to respond more quickly to the threat of COVID-19](https://www.nbcnews.com/think/opinion/coronavirus-testing-delays-caused-red-tape-bureaucracy-scorn-private-companies-ncna1162476), what the Cult of COVID insists is that state-imposed lockdowns came too little, too late. In the eyes of the faithful, the lockdowns themselves, however, are in no way responsible for the economic and social calamity that we face today.\n\nBack in late February and early March, when the confirmed cases of COVID-19 in the United States began to take off, many businesses took initiative to close their doors in order to protect their clientele and staff, and to determine how best to respond to the growing pandemic and continue to stay afloat. The state, at every level, soon meddled in its typical fashion by taking away the right to engage in commerce and putting over 30 million Americans out of work. The end result, as we have begun to see, is a calamity anyone with any basic understanding of sound economics predicted back in March: businesses closing for good, persistent unemployment and poverty and hunger, eviction and homelessness, increased death from non-COVID causes — along with all of the mental health issues that accompany these things.\n\nOne would think that the government officials responsible for creating those conditions would be held accountable. But, wait! That would collide with one of the principal tenets of the Cult of COVID: \n\n> \"Government is society’s only savior. The ultimate sin that the state can commit is inaction.”\n\nSo, whom can we blame for the economic tragedy the world is now facing? Every response can be summed up as one of the following:\n\n<ol>\n<li>those in government who did not act quickly enough, or provide enough economic aid (for they must not acknowledge that it was the direct actions of state central planners that created the very problems they face);\n<li>the coronavirus itself (because they have ruled out non-governmental approaches to navigating the pandemic, even by those with actual “skin in the game” and much more expertise in managing their own lives and businesses); or\n<li>free-market capitalism (for, if subsistence were not connected to labor and individual effort and economic production, everything would not have gone off the rails when the economy was put into a coma by the government, right?).\n</ol>\n\n\n![crayons.png](https://cdn.steemitimages.com/DQmaau7nEBygb1SYS5U4FgToUzxwkZ6Hhw55CFb6DzK1YhP/crayons.png)\n\nNowhere in the dogma of the followers of this religion is any room for blaming the government for lockdowns. It was only doing what was necessary to protect us all from the one thing that matters in this whole public issue: avoiding transmission of a contagion.\n\nTherefore, the Cult of COVID would not exist without a blind, unquestioning adherence to the notion that responding to a pandemic requires the involvement of an active, intrusive, authoritarian government every step of the way. It is, in all respects, our new state religion.",
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      "body": "Enjoyed reading your post. I have been researching the paleo diet for a while now. There are a lot of paleo books online that have some great healthy recipes :)",
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