"Suppose a worker’s labor is valued at $5 an hour and that he is willing to work at that rate. It doesn’t matter. The law prohibits the employer and employee from voluntarily striking a deal at that rate. The employee goes unemployed."

Are the Minimum Wage and the Drug War Racist?
by Jacob G. Hornberger

At what point can one legitimately call a government program racist? Segregation laws were obviously racist given that their expressed aim was to separate whites and blacks in public and private facilities. But what about government programs whose adverse effects, year after year, fall disproportionately on blacks? If such programs are knowingly kept in existence, notwithstanding their obvious adverse impact on blacks, can such programs be considered racist as well?

Two examples of this phenomenon are the federal government’s minimum-wage laws and drug laws.

The minimum wage is a law by which the government establishes a minimum hourly amount that employers are required to pay employees. Employers are prohibited from hiring anyone at an amount lower than the established minimum, even if the prospective employee is willing to work at less than the minimum.

The problem is that there will inevitably be people whose labor is valued by employers in the marketplace at less than the established minimum. That means that those prospective workers simply won’t be hired. They will go unemployed.

Suppose that the government were to set the minimum wage at $100 per hour. It would be plain to most everyone that there would be lots of people laid off. That’s because it wouldn’t be worth it for most employers to pay their employees $100 an hour. The value that such employers place on such employees is significantly less than $100 an hour. So, everyone whose labor is valued by employers at less than $100 would fall into the ranks of the unemployed.

The same principle though applies to a minimum wage of, say, $10. Everyone whose labor is valued by employers at less than $10 isn’t going to be hired. Those workers will go unemployed.

Suppose a worker’s labor is valued at $5 an hour and that he is willing to work at that rate. It doesn’t matter. The law prohibits the employer and employee from voluntarily striking a deal at that rate. The employee goes unemployed.

Are there actually people whose labor is valued less than the minimum wage? Yes, and that’s where the racial impact comes in. The group of people most impacted by the minimum wage consists of black teenagers. The unemployment rate for black teenagers is currently at 36 percent. Several months ago, it was a shocking 43 percent.

In fact, black teenage unemployment is always high. It is a chronic problem in America. That’s because of the minimum wage.

There are lots of black teenagers who would love to work but are locked out of the labor market by minimum-wage laws. That’s because employers place a value on their labor that is less than the legally established minimum. The reason for that is that black teenagers lack the work skills, work ethic, and work experience that would justify payment of a higher wage.

Suppose a black teenager approaches an employer and says the following: “I realize that I don’t have any experience in the work place and that I’m poor and don’t dress extremely well. But I’m willing to work for you at $2 an hour. If you hire me, I’ll work hard and I will learn things. I promise I’ll do as good a job as those guys to whom you’re paying the minimum wage. My dream is to go out and start my own business one day, and I’m willing to sacrifice now to attain that goal.”

The employer wants to hire the kid. He likes his spirit. It’s worth it to the employer to hire him at $2 an hour. He wants to strike a deal with him.

One big problem: The law prohibits the employer from hiring that black teenager at $2 an hour, even if they both want to enter into the deal. The law says: Pay him the minimum wage or don’t hire him. The employer doesn’t hire him because it’s just not worth it to him.

That’s why the unemployment rate for black teenagers is chronically high. That’s what the much-vaunted minimum wage has done to them.

So, what then? Those black teenagers want money but the law prevents them from getting jobs. Inevitably, many of them are then lured into an area where they can work and make good money, quick money. That’s the drug trade, a lucrative line of work that is a direct consequence of another government program, the war on drugs. After all, the reason that it’s possible to make an enormous amount of money in the drug trade is because the government has made drugs illegal.

So, consider the relationship: The government’s minimum-wage laws lock black teenagers out of the labor market and the government’s drug laws attract them into the drug trade.

Most everyone knows by now the enormous adverse impact that the drug war has had on blacks. America’s overflowing prisons are doing gangbuster business owing in large part to blacks who have been caught violating drug laws.

What happens when those blacks get out jail? Well, let’s see. They are now felons because of their drug conviction, which means they can’t vote, including for candidates who would repeal minimum-wage laws and drug laws. Even worse, they still also have no work experience because minimum-wage laws locked them out of the labor market in their formative years. What’s left for them? Well, there’s always government welfare, making them helpless, dependent wards of the state for the rest of their lives.

Given the horrendous effect that minimum-wage laws and drug laws have had on blacks, should we consider such laws to be racist? Well, one thing’s for sure: It would be difficult for an openly self-described racial bigot to come up with a better plan to harm blacks than what has been done to them with minimum-wage laws and drug laws.

Link:
http://fff.org/2013/12/03/are-the-minimum-wage-and-the-drug-war-racist/