Hedengren et al and Dorman Advance the Ball
By David Henderson
In an article in Econ Journal Watch, David Hedengren, Dan Klein, and Carrie Milton present data showing a sharp divide among economists who sign petitions on economic policy issues. They segment the petitions into liberty-reducing and liberty-augmenting. Economists who signed many liberty-reducing petitions were unlikely to sign liberty-augmenting ones and vice-versa. As I noted in a recent post, I was one of three people who signed a lot of liberty-enhancing petitions.
Recently, Peter Dorman, one of the people who signed a lot of liberty-reducing petitions, responded. His whole response is worth reading. He presents other views of liberty and, by these other definitions, he notes, he is not a liberty-reducer. I don’t agree with his alternate ideas of liberty–I share the views of Hedengren, Klein, and Milton. But what I want to note is that Professor Dorman has advanced the ball.
First, I like his tone. He doesn’t attack those who accuse him of being a liberty reducer and, indeed, has a sense of humor about it, titling his post, “Confessions of a Serial Liberty Reducer.”
Second, he admits that coercion is clearly involved in enforcing the minimum wage. He writes:
By this standard, for instance, an increase in the minimum wage is liberty-reducing, since it increases the number of wage offers that would be criminalized. This is not just a theoretical possibility; in Los Angeles the co-owners of a chain of carwashes were forced to pay over a million dollars to their workers for minimum wage violations, a plea bargain they made in order to avoid long prison sentences. There can be no denying that the minimum wage, whether you favor it or not, has an illiberal aspect.
It’s refreshing for someone who favors the minimum wage to admit that.
Third, Hedengren, Klein, and Milton have drawn him out so that he gives his own personal case for the minimum wage. He points out that in real terms the minimum wage was higher when he was a young man and then writes:
Thanks to the counterculture, I took time out to explore different life directions: I spent years in underground newspapers and, later, community radio to see if I wanted to be an “alternative” journalist. I spent a few months trying out the life of a professional chess player. (OK, I was no Ken Rogoff, but I did combine chess journalism, instruction, and competitive play at a lower level.) I also dabbled in other stuff that we can leave to the side right now…. How was this possible? The high minimum wage, I would argue, had a lot to do with it. I felt free to experiment because, at any time, I could find a low-labor-force-attachment job that paid enough to keep me afloat.
Two things in this passage are striking. First is his assumption that the minimum wage made his wage high. How can he know that? His post and other things he’s written show a good brain and a good writing ability. Isn’t there a reasonably high probability that he would have earned about the same wage rate he did earn even had the minimum not existed. Second is his narrow viewpoint. Let’s grant that the minimum wage made him and people like him better off. What about the lower-skilled black teenagers who didn’t have jobs because of the minimum wage and who didn’t get to feel “free to experiment?” And what about the employer who had to pay the minimum wage? Where do the teenagers who didn’t have jobs and the employers who had to pay fit in? Dorman doesn’t mention them.