Minimum Wage Debate

A recent post by Cynicus Economicus has sparked a debate on the merit of the minimum wage between Tiberius and fellow commentator (and prospective Conservative councillor) Steve Tierney.

For practical reasons, the exchange has been moved here.


You ask: “Do you support the Minimum Wage?” and then suggest that if I don’t I must not be humanitarian.

Well, clumsily as ever, that is not exactly what Tiberius meant to suggest: it depends on what grounds a person rejects the Minimum Wage.

In practical terms, Tiberius’ own view is that, within the current system as it stands, a person cannot both object to a ‘Minimum Wage’ and defend that objection on humanitarian grounds.

Cynicus himself accepts this moral compromise in his post on benefit reform, where he writes:

At this stage it would be easy to characterise this point of view as heartless […] as a reader you have to either accept the economic rationale behind what I have said, or condemn me as a heartless monster.

And though Tiberius wouldn’t use such emotive terms, he cannot but describe as ‘non-humanitarian’ the following sentiments:

The UK can simply not support the ‘luxury’ of a system that lets people stay idle on benefits.

So what happens to those who exceed their allowance of one year of benefits? Quite simply, they will need to fall back on charity, friends and family. In the traditional usage of the word, they will be destitute.

What about a young person who is having trouble finding their first job? I have already outlined the education system in my previous post. If a person is unable to find a job then they will have the option of continuing education, provided they can be funded for this. If they can not either find an educational opportunity or work, they will be destitute and reliant on charity, friends and family.

That, to Tiberius’ mind, is no way to set out a road to a healthy society.

[Note: What Tiberius admires about Cynicus is his intellectual honesty in this regard: he diagnoses the problem, he acknowledges that his prescription will not be popular, yet he proposes the treatment anyway.

But does Tiberius agree with him? No, the more of Cynicus’ work Tiberius reads, the more he realise the fundamentally disagreement in their outlooks – economically, politically, and socially.

This, however, is precisely why Tiberius enjoys reading CE’s blog so much: he learns far more by listening to people with a perspective so opposed to his own than he ever could visiting sites where his own political biases are simply confirmed.]

Returning to the Minimum Wage, Tiberius believes that in this system as it stands you either accept that the labour of each citizen has minimum value that cannot be undercut, or you do not. Now, at a more abstract level, he also reject a Minimum Wage – but only on the same grounds that he rejects all forms of wage-slavery: that one cannot put a price on human labour, and man should always be an ends, and not a means. But that is purely theoretical economic system and probably has no relevance for what we are discussing.

[As a (possibly) interesting side note Tiberius’ position is not even a particularly radical one; a person of a more revolutionary persuasion may would agree with the argument that we should scrap the Minimum Wage ( and other forms social security) but for the opposite reason implied by Cynicus’ example.

What such a person may argue is that all forms of forms of social benefit ultimately serve as nothing more than a States’ buying-off of it’s people’s ‘revolutionary potential’.

An analogy would be that people in the Capitalist system are born into a prison of servitude which they are ‘naturally’ averse to. Therefore, in order to keep their inmates pacified and less inclined to riot, it serves the gaoler’s interest to furnish the cells with a few ‘luxuries’ to distract the inmates from their predicament. Take these away these provisions and the incarcerated masses begin to notice the bars of the institution, and begin to fight for their emancipation.

The more pure ideologues would go further than this and say this is the only way a free, equal, ‘revolutionary society’ can be born.

Tiberius puts little stock in such “out of the ashes” rhetoric, however, he does have sympathy for the argument that anyone seeking to eliminate all kind of State subsidies, is unwittingly or not, promoting a revolutionary agenda; this is why some on the ‘far-left’ supported Ron Paul presidency ]

To return to practical matters though: removing any of the government provisions that ensure people have enough money to feed themselves, that families do not go destitute, that people are able to maintain a minimum standard of living, cannot, Tiberius believes, be morally defended. (An illustration of this point was provided last year when a Ron Paul-supporter wrote to Noam Chomsky saying that: “I really can’t find differences between your positions and his” and was politely schooled by the Professor on the vast gulf in the men’s beliefs; it is worth reading it full here.)

That being said, Tiberius is always interested to hear from others who do not believe that this is the case…