Wednesday, February 5, 2014

Dave Churvis hoisted from the comments on the minimum wage and racism

I alluded to the fact that the minimum wage/racism connection is a little weird to begin with, and Dave Churvis has an excellent response to that:
"I'm going to go out on a limb here on the third point and give the following hypothesis: the minimum wage *might* have had an effect of crowding out black labor (since black workers obviously typically made less), but this effect would have been minimal at best, and any business owner would have been firmly against something that would crowd out black labor. I say this by analogy to something similar that happened in South Africa during the early 60s. They passed a law that required wages for black workers to be set lower than wages for white workers. The result was a surge in employment for black workers (and remember, this is South Africa in the 60s, one of the most racist environments in history). Why? Because regardless of anyone's built-in prejudices, the fact was that black labor was cheaper, and therefore profits were higher. The law was repealed very quickly, and other, more effective ways of suppressing the black population were implemented.
So I am inclined to believe that, while it's feasible that there may have been racist intentions behind early minimum wage legislation, any effects that disproportionately happened to black workers would have been absolutely DWARFED by the negative effects of the general racism present in society as a whole. This is not an easy hypothesis to test, but I believe it could be done."
I think this is dead on. Anyone that knows anything about how old school racial caste systems worked in the South knows that white power brokers didn't want blacks unemployed. That's the last thing they wanted. Hell, for a couple hundred years these guys imposed a maximum wage of... errrr... zero. Even in the twentieth century, their goal was not a bunch of unemployed black people.

The goal of Southern racism was (and is) to keep blacks in "their place", not to keep them out of work.


  1. I'm confused by his argument. He says South Africa was one of the most racist environments in history, but the general racism was overwhelmed by economic legislation. He then uses then to argue that general racism in U.S society dwarfed the minimum wage. That's possible, but I don't see how the South African example does anything but undercut it!

    "Hell, for a couple hundred years these guys imposed a maximum wage of... errrr... zero"
    I know that's a reference to slavery, but I don't think it was literally true.

    You're right though that legislation in the south long focused on exploiting black labor rather than suppressing it (I don't think the white working class was organized enough in the post-war era). Legislation did things like prohibit headhunting of black labor. There were also "vagrancy" laws against being unemployed, although I think those existed beyond the south.

    1. I'm not sure where he says general racism was overwhelmed by economic legislation. The point is that racism does not equal not wanting blacks to have jobs.

      On Dave's facebook page I did note that poor whites had their fair share of demagogues and defenders in the 30s, and they'd have an interest in this. I suspect it's a mixed bag. I don't argue that guys like Williams and Sowell are wrong that there were advocates of the minimum wage who were racists and did it for racist reasons. I simply suspect that it's cherry-picking rather than being indicative of a particularly notable relationship.

      re: "There were also "vagrancy" laws against being unemployed, although I think those existed beyond the south."

      As did racism, of course! I only mention the South specifically here because it's a notable case and because it's the subject of that Schulman book I referred to in the prior post.

  2. "Hell, for a couple hundred years these guys imposed a maximum wage of... errrr... zero."

    As a purely technical point, shouldn't we have an imputed wage of the slaves' food, clothing, and shelter?

    More significantly, wouldn't it be white labor that might want to keep black labor out of the market, not business owners? If someone is making the racism argument, that's what I would assume they were aiming at: white labor unions might like the legislation, because then they can't be undercut my cheap black labor.

    1. Perhaps but it's not much of a wage if you don't set it in a transaction and you don't get any say in how to dispose of it. There were borderline cases with slaves getting hired out of course but I'm neglecting that here.

      Seems more accurate to say they were treated like livestock, and like livestock they got zero wages but got fed.

      re: "More significantly, wouldn't it be white labor that might want to keep black labor out of the market, not business owners? "

      Yes. This is Walter Williams's argument for example. My contention is that if you think about the real interests of racists in the 30s, although the unions certainly had their fair share that does not make the case that minimum wages were passed with racist intent. And not to put too fine a point on it, but the labor movement was not exactly a major force for collective action among working whites in the South (not that these issues are restricted to the South, but a lot of this goes on there). A major source of opposition to the minimum wage, though, is racist elites that wanted blacks working, and working at low wages. The Southern Democratic opposition to the FLSA was not a result of sympathy with the plight of blacks that would bear disemployment effects of the minimum wage.

      A couple times I've said that it's not that there's no racist support for the minimum wage. That is certainly plausible. The argument is that using these cases to suggest that the minimum wage had a racist intent is misleading, and that if anything the opposite is more likely true (that racism provided greater fuel to the opposition to the minimum wage). That last comment is a suspicion of mine, but like I've said I feel like I need more evidence.

    2. Mr. Kuehn,

      The Southern Democratic opposition to the FLSA mandated minimum wage was a result of sympathy with the white southern textile workers who would bear disemployment effects of the minimum wage. From Dr. Burton Folsom via the Mackinac Center ( )

      "During the 1920s and 30s, the American textile industry had begun to shift from New England to the South, where the cost of living was lower and where Southern workers produced a high quality product for lower wages. Politicians in Massachusetts, led by Senator Henry Cabot Lodge, Jr. and House leader Joseph Martin, battled in Congress for a law that would force Southern textile mills to raise wages and thereby lose their competitive edge.

      "Governor Charles Hurley of Massachusetts bluntly demanded that Southern wages be hiked so that 'Massachusetts [would] have equal competition with other sections of the country, thus affording labor and industry of Massachusetts some degree of assurance that our present industries will not move out of the state.'

      "Southerners were well aware of what Massachusetts was attempting and they scuttled all minimum wage laws before Congress during 1937 and well into 1938. In doing so, they handed President Roosevelt his first major legislative defeat.

      "'Northern industries are trying to stop the progress of the South,' Congressman Sam McReynolds of Tennessee observed, 'and they feel if they can pass this [minimum wage] bill it will really be a tariff against Southern goods.'"

      It was the federally mandated minimum wage in the Bacon-Davis Act of 1931 that was at least in part motivated by racism. From Walter Williams ( from )

      "Our nation's first minimum wage came in the form of the Davis-Bacon Act of 1931. During the legislative debate over the Davis-Bacon Act, which sets minimum wages on federally financed or assisted construction projects, racist intents were obvious. Rep. John Cochran, D-Mo., supported the bill, saying he had 'received numerous complaints in recent months about Southern contractors employing low-paid colored mechanics getting work and bringing the employees from the South.' Rep. Miles Allgood, D-Ala., complained: 'That contractor has cheap colored labor that he transports, and he puts them in cabins, and it is labor of that sort that is in competition with white labor throughout the country.' Rep. William Upshaw, D-Ga., spoke of the 'superabundance or large aggregation of Negro labor.' American Federation of Labor President William Green said, 'Colored labor is being sought to demoralize wage rates.' The Davis-Bacon Act, still on the books today, virtually eliminated blacks from federally financed construction projects when it was passed."

      Prof. David Bernstein, GMU School of Law, has more background on the Bacon-Davis Act at


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