The Racism-Based Origins Of The Minimum Wage
Jason L. Riley writes in the WSJ:
There is something sadly ironic about watching the nation's first black president call for an increase in the federal minimum wage during his State of the Union address Tuesday.Minimum-wage laws date to the 1930s, and supporters in Congress at the time were explicit about using them to stop blacks from displacing whites in the labor force by working for less money. Milton Friedman regarded the minimum wage as "one of the most, if not the most, anti-black laws on the statute books."
When you artificially increase the cost of labor, you wind up with surplus labor, which takes the form of unemployment. Younger and less-experienced workers--a disproportionate number of whom are black--are more likely to be priced out of the labor force when the cost of hiring someone goes up. Prior to the passage of minimum-wage laws--and in an era of open and rampant racial discrimination in the U.S.--the unemployment rate for black men was much lower than it is now and similar to that of whites in the same age group.
He's talking about the Davis-Bacon Act from the 30s to keep blacks out of the construction industry and other industries where they were displacing white by working for less money. In the WSJ, Jason Riley writes, from the autobiography of James Mason economist Walter Williams:
Alabama Rep. Clayton Allgood fretted about contractors with "cheap colored labor . . . of the sort that is in competition with white labor throughout the country."








This is the same thing as the Davis–Bacon Act. The prevailing wage is/was generally based off union reporting. The private contractor that weren't union couldn't bid. The unions wouldn't admit coloreds. So that was de facto discrimination.
Jim P. at February 14, 2013 2:42 PM
Leave a comment