Bainbridge on Minimum Wage

THat IS a very interesting comment thread over at ProfBainbridge, and well worth reading.  I have a nit to pick, though, with the nit Stephen is picking with the Nit Picker (you'll have to go to his site to understand that line).  Stephen takes issue with the minimum wage on the following ground:   "By setting a floor below which employers may not go, the minimum wage fails the just wage condition of individual determination."  It's true that the Catechism says that in determining what is a "fair" or "just" wage, there must be an individual determination, and I think it is plausible that, as Stephen obsreves, a college student working for beer money might be entitled to less of a wage than a father of two working to put food on the table.  But that does not mean, that, as he puts it, "the minimum wage fails the just wage condition of individual determination." 

This might only be true if you thought that (1) the floor and the ceiling of the just wage calculation could be determined with precision such that paying someone any more than their just minimum would be an injustice to the employer AND (2), assuming the first to be true, the state intended to do an injustice in the case of the overpaid college student rather than accepted the overpayment as an unintended side-effect of its efforts to ensure the just compensation of the father of two.  Law can never perfectly track the demands of justice, but that does not mean that we can't have any laws.  In other words, I think Stephen is conflating the need for a case by case determination of the JUSTICE of a particular wage with the state's legitimate need to operate on the basis of generalities when constructing prospective legislation that it intends to operate to eliminate injustice in the wage market. 

We can all think of exmaples of situations in which the minimum wage might indirectly contribute to injustice (in both directions, since there will also be cases where someone's needs are GREATER than what a realistically state-imposed minimum wage could provide without, say, damaging the labor market and leading to a great deal of unemployment).  But, confronted by the even graver injustice of the laissez faire labor market, the state is permitted to do the best that it can in combatting wage injustice, even to the point of formulating a compromise, best-guess minimum wage that overpays a few and underpays a few others but does justice in the vast majority of cases.  Clearly, the state cannot do it all through the minimum wage.  The minimum wage is, after all, just one tool in the quiver, and, for that matter, the state cannot be expected to perfectly guarantee economic justice.  The state will, however, have other ways to make provision for those who are underpaid, minimum wages notwithstanding.  But the minimum wage is certainly one of the state's key tools, and I do think it's incorrect for Stephen to suggest that its generality somehow runs afoul of the Catechism's teaching on just wages. (I understand that Stephen brackets the question of whether CST calls for a minimum wage and is more interested in taking apart the Nit Picker's argument, but he does so by arguing that a minimum wage law violates the Catechism's teaching on just wages, and so he seems to be answering the question he brackets or at least pointing to an apparent inconsistency within CST.  I, on the other hand, see no inconsistency; not even a tension.)

I do agree with Stephen's complaint that the Catechism passage cited by the Nit Picker does not do the work the NitPicker says it does:  that is, it does not, by itself, rule out Catholic opposition to the minimum wage.  But I think that at least some of that work is done by the many, many magisterial statements over the years on the insufficiency of the unregulated market in this area and the responsibility of the state to work for economic justice.  Here, for example, is what the Pius XI said about unregulated markets in Quadragesimo Anno: 

"[T]he right ordering of economic life cannot be left to a free competition of forces. For from this source, as from a poisoned spring, have originated and spread all the errors of individualist economic teaching."

And:

"But free competition, while justified and certainly useful provided it is kept within certain limits, clearly cannot direct economic life - a truth which the outcome of the application in practice of the tenets of this evil individualistic spirit has more than sufficiently demonstrated. Therefore, it is most necessary that economic life be again subjected to and governed by a true and effective directing principle."

And:

"Free competition, kept within definite and due limits, and still more economic dictatorship, must be effectively brought under public authority in these matters which pertain to the latter's function. The public institutions themselves, of peoples, moreover, ought to make all human society conform to the needs of the common good; that is, to the norm of social justice."

More specific to the minimum wage in the U.S. context, the US Bishops in Economic Justice for All said that:

Because work is this important, people have a right to employment. In return for their labor, workers have a right to wages and other benefits sufficient to sustain life in dignity. As Pope Leo XIII stated, every working person has "the right of securing things to sustain life" [56]. The way power is distributed in a free market economy frequently gives employers greater bargaining power than employees in the negotiation of labor contracts. Such unequal power may press workers into a choice between an inadequate wage or no wage at all. But justice, not charity, demands certain minimum wage guarantees. The provision of wages and other benefits sufficient to support a family in dignity is a basic necessity to prevent this exploitation of workers. The dignity of workers also requires adequate health care, security for old age or disability, unemployment compensation, healthful working conditions, weekly rest, periodic holidays for recreation and leisure, and reasonable security against arbitrary dismissal [57]. These provisions are all essential if workers are to be treated as persons rather than simply a "factor of production."  . . .

In recent years the minimum wage has not been adjusted to keep pace with inflation. Its real value has declined by 24 percent since 1981. We believe Congress should raise the minimum wage in order to restore some of the purchasing power it has lost due to inflation.