How racist is the minimum wage?

1. Gary Becker argued that the minimum wage exacerbates the employment disparity between White and Black workers when employees discriminate against Black employees in favor of White employees. A minimum wage greater than the equilibrium wage, creates a surplus of labor and allows employers to discriminate against Black workers without having to pay higher wages to White workers.
2. Jason Riley writes that the origin of minimum wage legislation is, in fact, racist (WSJ, Feb. 2021).
1. “The federal government got involved in setting wage levels in the 1930s and did so at the urging of unions that excluded blacks as members. During debates in Congress, lawmakers complained openly about the ‘superabundance’ and ‘large aggregation of Negro labor’ and cited complaints by whites of black Southerners moving north to take jobs.
2. “As Congress increased the minimum wage periodically over the decades, these same arguments were put forward as a justification. When he was a U.S. senator from Massachusetts, John F. Kennedy backed minimum-wage hikes as a way of protecting New England industry. ‘Having on the market a rather large source of cheap labor depresses wages outside of that group, too—the wages of the white worker who has to compete,’ he lectured an NAACP official at a hearing in 1957. ‘And when an employer can substitute a colored worker at a lower wage—and there are, as you pointed out, these hundreds of thousands looking for decent work—it affects the whole wage structure of an area, doesn’t it?’”
3. "We provide a comprehensive analysis of the effects of minimum wages on blacks, and on the relative impacts on blacks vs. whites. We study not only teenagers – the focus of much of the minimum wage-employment literature – but also other low-skill groups. We focus primarily on employment, which has been the prime concern with the minimum wage research literature. We find evidence that job loss effects from higher minimum wages are much more evident for blacks, and in contrast not very detectable for whites, and are often large enough to generate adverse effects on earnings. We supplement this work with additional analysis that distinguishes between effects of an individual’s race and the race composition of where they live. The extensive residential segregation by race in the United States raises the question of whether the more adverse effects of minimum wages on blacks are attributable to more adverse effects on black individuals, or more adverse effects on neighborhoods with large black populations. We find relatively little evidence of heterogeneity in effects across areas defined by the share black among residents." (NBER working paper by David Neumark and Jyotsana Kala)

Are education vouchers anti-racist?

"In pre-pandemic California, only 32% of fourth-graders were at or above proficient for their grade in reading. Only 19% of eighth-grade Hispanics read at grade level, and only 10% of eighth-grade blacks did. Those who find disparate impact everywhere should be screaming from the rooftops that public education is racist" (Kessler, WSJ, Nov. 2021).

The state of public education for many students is deplorable. The problem is especially acute for children of color living in large urban school districts. 

A common saying is, "If it ain't broke, then don't fix it." The correlate is, "If its broken, then fix it." Public education in too many parts of our country is broken.

I support wide-spread availability of education vouchers to give parents the opportunity to send their children to better schools. I live in the Richmond VA metropolitan area, commonly called RVA. I am convinced that many good "private" schools would appear in RVA if parents had vouchers for $10,000 per year. A good private school near me charges less than $7,000.

Vouchers would enable parents to pursue more options for their children, in contrast to the desire of some politicians and commentators.

1. "I don’t think parents should be telling schools what they should teach."
2. “Parents claim they have the right to shape their kids’ school curriculum. They don’t.”

Here are some facts on Richmond City public schools from US News and World Reports.

    Average expenditure per child = $14,000.

Has discrimination created a profitable business opportunity for Shaq?

Shaquille O'Neal is co-founding an ad agency that promises to be "strive for a talent pool that’s 75% “black, brown, women and LGBTQ." (WSJ, March 2021) Perhaps he is has found a competitive advantage. If discriminatory employment practices by other firms make the wages of black, brown, female, and LGBTQ employees less than the wages of white, cis-gendered, straight males, Shaq's firm would have lower costs than its rivals. His statement that most firms struggle to hit a 25% target makes me wonder if discrimination is reducing wages for the employees he seeks. One way to increase the employment of minority workers is to increase the wages paid to them. I also wonder if clever lawyers are preparing to sue the firm for discrimination against white, cis-gendered, straight males. 

Is plywood boarding conducive to cooperative exchange?

The 7-11 next to where I work covered its windows with black plywood following nights of protests and destruction prompted by George Floyd's death, BLM, and calls to defund the police. The plywood made the entrance much less appealing and made me reflect on how much social order helps people cooperate voluntary. When we and our property are secure, we reduce our private expenditures on protection of life, limb, and property and have a greater incentive to invest in ourselves and our assets, and are more trusting and eager to engage in cooperate exchange.

Is racism systemic in the USA?

The Great Society failed to reduce disparities between white and black income and wealth

"The historical data also reveal that no progress has been made in reducing income and wealth inequalities between black and white households over the past 70 years" (Income and Wealth Inequality in America, 1949-2016). The Gini coefficient = 0 if everyone has the same share and = 1 if the richest person has everything.