The Militant(logo) 
    Vol.60/No.26           July 1, 1996 
 
 
Do Higher Wages Mean Less Jobs?  

BY MAURICE WILLIAMS

It's been seven years since the last time the minimum wage rose in the United States. Big-business politicians, who bickered before Congress over hiking this pittance recently, approved legislation to increase it from $4.25 per hour to $5.15. "It's a very poor way of really helping the working poor," Arkansas Rep. Timothy Hutchinson piously argued, opposing even this pathetic boost.

The Wall Street Journal editors declared that the minimum wage is a "crackpot idea" and called on the servants of capital to "end the minimum wage charade once and for all." The Journal asserted that "the minimum wage hurts the poor and the more so the higher it's raised."

Columnist James Glassman claimed, "You can't repeal the laws of supply and demand. If you raise the price of something (in this case labor), then buyers (in this case employers) will demand less of it. Hike the minimum wage and employers will fire workers and hire machines, or cut back the hours of those who do remain."

John Weston, the English workers' representative to the First International, raised similar views at special sessions of the organization on May 2 and May 20 in 1865. The First International, founded in 1864 with the participation of Karl Marx and Frederick Engels, took the name International Working Men's Association. It united working-class organizations in a number of countries in Europe and North America.

Weston argued that a general rise in wages could not lead to an improvement of workers' material and social conditions and any struggle by the trade unions to increase wages would have a harmful effect on the proletariat.

Marx answered Weston's remarks at two sessions of the General Council of the First International on June 20 and 27, 1865. "If you accept supply and demand as the law regulating wages," said Marx, it is "useless to declaim against a rise in wages, because, according to the supreme law you appeal to, a periodical rise of wages is quite as necessary and legitimate as a periodical fall in wages."

Marx explained that "the general tendency of capitalist production is not to raise, but to sink the average standard of wages." This fact was underscored by Joseph Stiglitz, chairman of the Clinton administration's Council of Economic Advisers, who stated that the current $4.25 minimum wage rate is at a 40-year low in buying power.

If a worker "resigned himself to accept the will, the dictates of the capitalist as a permanent economic law, he would share in all the miseries of the slave, without the security of the slave," said Marx.

Capitalism creates unemployment
Under capitalist society there is a universal rivalry among the capitalists for the increase of the division of labor and machinery and for their exploitation upon the greatest possible scale. In his pamphlet Wage-Labor and Capital, Marx explains how this competition "outlines the industrial war of capitalists among themselves. This war has the peculiarity in that the battles in it are won less by recruiting than by discharging the army of workers. The generals (the capitalists) vie with one another as to who can discharge the greatest number of industrial soldiers."

Norman Barber, the chairman of Britain-based Smiths Industries Aerospace, told London's Financial Times that increased international competition forced the aerospace bosses in the United Kingdom to eliminate 120,000 jobs - from 250,000 in 1980 to 130,000 today. This reduction occurred despite Britain's lower labor costs - 58 percent of those in the United States and 52 percent of those in Germany. In fact, British Aerospace official Mike Turner said productivity gains would spur the industry to drop an additional 30,000 jobs. This illustrates that lower labor costs for the capitalists do not translate to more jobs for workers - especially in a period of depression.

In the United States, striking machinists at the McDonnell Douglas plant in St. Louis are fighting cutbacks by the bosses. Employment there has dropped from 40,500 in 1990 to 23,000 today. Working people worldwide are increasingly resisting cost-cutting measures, which have eliminated hundreds of thousands of jobs.

Working people "fulfill only a duty to themselves," as Marx put it, when we fight to defend our jobs or press demands such as a shorter workweek with no cut in pay. "Time is the room of human development," Marx explained. "A man who has no free time to dispose of, whose whole lifetime, apart from the mere physical interruptions by sleep, meals, and so forth, is absorbed by his labor for the capitalist, is less than a beast of burden. He is a mere machine for producing foreign wealth, broken in body and brutalized in mind."

While waging such struggles for immediate demands, Marx urged working people "not to be exclusively absorbed in these unavoidable guerrilla fights incessantly springing up from the never-ceasing encroachments of capital or changes of the market."

"Instead of the conservative motto `A fair day's wages for a fair day's work,' " Marx pointed out, workers "ought to inscribe on their banner the revolutionary watchword: `Abolition of the wages system.' " By fighting for demands like raising the minimum wage and jobs for all, working people will see the need to struggle for precisely this goal.  
 
 
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