Tuesday, November 15, 2005

France, Economics, and the US

I found this interesting because it addresses both part of the problem in France and gives a partial reason for the black slide into unemployment and family dissolution that began in this country in the 50's.

People who are less in demand -- whether because of inexperience, lower skills, or race -- are just as employable at lower pay rates as people who are in high demand are at higher pay rates. That is why blacks were just as able to find jobs as whites were, prior to the decade of the 1930s and why a serious gap in unemployment between black teenagers and white teenagers opened up only after 1950.

Prior to the decade of the 1930s, the wages of inexperienced and unskilled labor were determined by supply and demand. There was no federal minimum wage law and labor unions did not usually organize inexperienced and unskilled workers. That is why such workers were able to find jobs, just like everyone else, even when these were black workers in an era of open discrimination.

The first federal minimum wage law, the Davis-Bacon Act of 1931, was passed in part explicitly to prevent black construction workers from "taking jobs" from white construction workers by working for lower wages. It was not meant to protect black workers from "exploitation" but to protect white workers from competition.
Even aside from a racial context, minimum wage laws in countries around the world protect higher-paid workers from the competition of lower paid workers.


One could make the argument that it's all very nice to be on the books as "employed" but if you don't earn a living wage then it's not terribly meaningful. I don't know if that's the case, I'm just speculating. And how ironic is it that unions, which are ardently supported by liberals, might actually hurt the underclasses? I'm starting to have a mental picture of the left going through life pouring gasoline on fires, then blaming the right when the fire expands. They seem incapable of processing information.

In any case, this article shows that nothing is every wholly good or wholly bad, and the best intentions can have unexpected ramifications.

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