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April 11, 2005

"Walk Away"

Thanks to Timothy Carter for his article on Free Liberal, "Alternatives to the Minimum Wage." Very thought provoking.

My gut reaction is that his conclusion: "Currently, the imbalance exists because capital can walk away, but labor cannot," is an overstatement. Johnny Paycheck told us "Take this job and shove it," and people do that all the time. People quit their jobs when they feel they are underpaid or are being treated disrespectfully or in a health-endangering manner.

Perhaps he's suggesting that on the margin labor cannot walk away. Those at the very bottom of the pay scale have fewer, or possibly no, options to meet their most basic needs. I'm not sure that's even the case, but that seems a bit more coherent. Capital may well have more options to walk away than labor, too. Capital markets are clearly more liquid than labor markets, for example.

There may well be a case for a guaranteed basic income, sort of the old "negative income tax" notion. It certainly seems to me preferable to the crazy-quilt of social services programs.

But we need to hear more about it.

-Robert Capozzi





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