The altogether reasonable Viewpoint in the May 6th issue, advocating raising the national minimum wage, elicited a number of opposing viewpoints from readers, as published in the Mailbag of May 20. I would like to register my support for the position taken by Plastics News, and in the process provide a number of perspectives on this issue, all pointing to the merits of such a national policy. One of the letters to the editor contends that the whole concept of a minimum wage is invalid unless it is explicitly grounded in the U.S. Constitution. One might as well call forth even higher authority by saying that there is no explicit justification for a minimum wage in the Bible.
However, as modern scholars of jurisprudence and religion would argue, we will always have to make contemporary economic and ethical judgments based on common sense and compassion in the absence of explicit guidance from these two texts.
The second letter to the editor decries the intervention of government into this field of a minimum wage. Yet, as the Viewpoint article correctly states, the employers and employees of this country have successfully operated a minimum wage policy since 1938.
Indeed, our government and all other developed country governments have for many decades successfully regulated many other elements of employer-employee relations, based on democratically debated laws. To suggest in this day and age that the setting of a minimum wage rate is exclusively a function of the marketplace with no legitimate government (i.e., citizen) interests seems anachronistic in the extreme.
Subliminal to most arguments against the concept of a minimum wage is a philosophical separation between ethics and economics. Hence, one of the letters to the editor states that ``hiring employees is a function of a willing buyer and willing seller.''
The implication here is that whatever price (wage) emerges from such a transaction is the ``right'' price. Yet this serves to divorce the economic choices that we make from the social implications of those choices. Moreover, it ignores the relevance of striking a ``just'' price.
The earliest writers on economics - from Aristotle to the Scholastics of the Middle Ages to Adam Smith - addressed the complex issue of right and wrong economic behavior. And it is worthwhile recalling that the first teachings of economics came within the moral tripos of the English education system - namely, philosophy, ethics and economics.
The opponents of a minimum wage would respond that even if they were to grant the concept of a ``just price'' for labor services, the government should play no role in its determination. But this is to adopt a totally cynical view of government and its role in the marketplace in a mixed economy.
Albeit imperfect, the government acts as the consensus of its constituents, and its efforts to determine the ``just'' level of a minimum wage at any juncture rely entirely on the messages that we, the people, send our representatives in Congress.
Even if we were to leave the whole social and ethical dimensions of this issue to the side, the concept of the minimum wage can be aggressively defended in macro-economic terms. The classic example of the macro-economic relevance of minimum wage came in the early 1900s when Henry Ford decided to pay assembly-line workers $5 per day.
To those inside and outside his industry who questioned his sanity he responded that the automotive industry in general (and his company in particular) had become so large a part of the U.S. economy that paying the workers $5 per day generated the income they needed to purchase cars. The same applies today when wage income constitutes roughly 70 percent of total national income.
The implicit separation b-tween ethics and economics referred to earlier would be fully exposed if we asked the opponents of a minimum wage whether or not they would accept the legitimacy of inner-city ``sweat shops.''
I presume that the majority would not. And I'm certain that all of them would recoil in horror if they learned that their son or their daughter worked in such an environment. Yet isn't this an example of a set of conditions arising from the interaction of a willing buyer and a willing seller? As abhorrent as these conditions are, the federal officials raiding them don't find the workers chained to their posts.
As an economist, I fully accept that raising the minimum wage rate, which applies to groups in diverse social and economic categories, can cause unemployment among some of them. We can't suspend by government fiat the relevance of the relationship between marginal cost and marginal revenue. Yet having followed for over 30 years the debate over the pros and cons of a) having a federal minimum wage policy and b) periodically adjusting the rate for the ravages of inflation, I firmly believe that a net gain in economic and social terms emerges from any unbiased reading of the data.
I would conclude by stating that these views are not those of a ``flaming liberal,'' but rather a social conservative. For example, I would contend that in administering the minimum wage rate, we should adhere to the original provisions of the Fair Labor Stan-dards Act of 1938, which set the rate at 40 percent of the average manufacturing wage rate at the time.
Today proponents of the minimum wage would seek to adjust the rate in line with the poverty-line incomes for families of different sizes. In my view there should be no political connection between these two variables, and to make such a connection is to put the proverbial cart before the horse.
Workers earning the minimum wage and providing all or some family income must decide themselves whether they can support one, two or more children on such an income stream. Neither the employer nor certainly the government has any role in this decision-making process.
Mooney is president of Plastics Custom Research Services in New Canaan, Conn.