What No One Will Tell You About Minimum Wage and Capitalism

I’ve been told too many times to count that I’m naive when it comes to the way I think about the world and the “liberal” views that I hold on the way things work–or at least, the way I think they should work. And I willingly admit that I am a deeply opinionated person who probably holds too many opinions on things she knows very little about. But on the flip side, everyone who’s ever told me I’m naive has just as many opinions on things that they equally know nothing about. I’m no economist, but I am living the hourly grind, and with all the fuss that comes with cities like Los Angeles and Seattle raising the minimum wage, I wanted to share something that I’ve had a lot of time to think about: My thoughts on minimum wage.

Let’s begin with the concept of “deserve” because this buzz word seems to come up a lot in conversations about minimum wage salaries. Let me breeze through this one quickly by saying if you use this as an argument for, or against, raising minimum wage–either way–just go home now. Whether a person “deserves” to be paid more or less is a totally inoperable way of thinking, as not only does everyone have differing opinions as to who deserves what, it’s invalid in its reasoning because everyone “deserves” to live, and part of living is making a living wage. (In this case, the term “living wage” is used to mean a specific income that is required to meet basic human needs.)

Speaking of the “living wage,” did you know that the living wage for Los Angeles is around $13/hr? Do you want to know how much minimum wage in Los Angeles is? $9/hr.

Huh.

Well that seems weird because that would mean that men and women who work full-time minimum wage jobs are not making enough to provide for their own basic needs. Which means that they aren’t making what they “deserve” (just to drill it home for you).

Yep.

But doesn’t that go against the whole idea of “minimum” wage? Like, there’s a minimum wage possible that you can pay your employees because they have to be able to live?

mmmhhmm.

I once took a class in college that studied the history of peace and conflict and the historical causes of certain instances of peace and instances of conflict and war. The class was amazing, and I learned so much about structural and hidden violence, stereotypes, and think tanks. However, something that my teacher told me that has not only stuck with me, but also haunted me since is this: “Capitalism was built on slavery, and survives on slavery. The only difference being that in today’s world, capitalism is functioning on less visible forms of slavery. So, sweatshops, minimum wage, unpaid internships–you know, the things you’re already used to seeing/hearing about, might have experienced yourself. If a company isn’t outsourcing, then they are acquiring source materials for a free or extremely cheap rate to keep costs low and competitive–this usually results in some form of abuse on natural resources, like bottling companies that drain community water reservoirs because they are not strictly regulated.

In other words, the “greed” which “fuels” corporations and businesses to compete and grow or die trying (the philosophy behind Capitalism) also fuels “resources” like poorly-paid sweatshop and field workers in third-world countries and creates reasons as to why minimum wage workers here can’t be paid a proper living wage.

And yes, there are arguments against increasing minimum wage because of the damaging inflation it causes and the fact that sooner rather than later inflation will catch up to the wage (probably before a new minimum wage even goes into effect) which will render the new minimum wage obsolete. It’s a vicious cycle. But it’s a vicious cycle that’s also partly fueled (again) by the desire to make as big a profit margin as possible. Yes, companies raise prices to cover larger staffing expenses. But they also raise prices to keep their profit margins the same, because they can’t accept living on a smaller profit.

Now, this obviously isn’t a perfect argument, as small business often get thrown under the bus with big corporations when they are simply trying to keep their heads above water. I’m not saying that every single business has a huge, greedy profit margin. That’s not always the case. But it does bother me that there are people who work at places like Walmart and still need public assistance, and while that’s going on, others are being ignorant assholes using the whole “deserve” argument I mentioned earlier.

The living wage is different in every city, and so perhaps $15/hr minimum wage doesn’t make sense in every place. But my bet is that with inflation the way it is now, by the time LA hits the year 2020, even $15/hr won’t be livable.

So that’s my two cents. Hate me, call me names for trying to knock capitalism off its stupid pedestal, say I’m a socialist (I’m okay with that), whatever. I don’t care. This is how I view the world.

-tlc

 

 

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