The Eugenic Effects of Minimum Wage Laws [2005]

During the second half of the Progressive Era, beginning roughly in 1908, progressive economists and their reform allies achieved many statutory victories, including state laws that regulated working conditions, banned child labor, instituted “mothers’ pensions,” capped working hours and, the sine qua non, fixed minimum wages. …

Progressive economists, like their neoclassical critics, believed that binding minimum wages would cause job losses. However, the progressive economists also believed that the job loss induced by minimum wages was a social benefit, as it performed the eugenic service ridding the labor force of the “unemployable.” Sidney and Beatrice Webb (1897 [1920], p. 785) put it plainly:

“With regard to certain sections of the population [the “unemployable”], this unemployment is not a mark of social disease, but actually of social health.”

“[O]f all ways of dealing with these unfortunate parasites,” Sidney Webb (1912, p. 992) opined in the Journal of Political Economy, “the most ruinous to the community is to allow them to unrestrainedly compete as wage earners.”

A minimum wage was seen to operate eugenically through two channels: by deterring prospective immigrants (Henderson, 1900) and also by removing from employment the “unemployable,” who, thus identified, could be, for example, segregated in rural communities or sterilized. The notion that minimum-wage induced disemployment is a social benefit distinguishes its progressive proponents from their neoclassical critics, such as Alfred Marshall (1897), Philip Wicksteed (1913), A. C. Pigou (1913) and John Bates Clark (1913), who regarded job loss as a social cost of minimum wages, not as a putative social benefit (Leonard, 2000).

Columbia’s Henry Rogers Seager, a leading progressive economist who served as president of the AEA in 1922, provides an example. Worthy wage-earners, Seager (1913a, p. 12) argued, need protection from the “wearing competition of the casual worker and the drifter” and from the other “unemployable” who unfairly drag down the wages of more deserving workers (1913b, pp. 82–83). The minimum wage protects deserving workers from the competition of the unfit by making it illegal to work for less. Seager (1913a, p. 9) wrote:

“The operation of the minimum wage requirement would merely extend the definition of defectives to embrace all individuals, who even after having received special training, remain incapable of adequate self-support.”

For these progressives, race determined the standard of living, and the standard of living determined the wage. Thus were immigration restriction and labor legislation, especially minimum wages, justified for their eugenic effects. Invidious distinction, whether founded on the putatively greater fertility of the unfit, or upon their putatively greater predisposition to low wages, lay at the heart of the reforms we today see as the hallmark of the Progressive Era.

Progressives were drawn to eugenics by the same set of intellectual commitments that drew them to reform legislation. Paramount was the reform idea that laissez-faire was bankrupt. Sidney Webb (1910–1911, p. 237) said flatly, “[N]o consistent eugenicist can be a ‘Laisser Faire’ individualist unless he throws up the game in despair. He must interfere, interfere, interfere!” Similarly, Frank Fetter (1907, pp. 92–93) pronounced at the AEA meetings: “Unless effective means are found to check the degeneration of the race, the noontide of humanity’s greatness is nigh, if not already passed. Our optimism must be based not upon laissez-faire,” said Fetter, “but upon vigorous application of science, humanity, and legislative art to the solution of the problem.”

Progressive opposition to laissez faire was motivated by a set of deep intellectual commitments regarding the relationship between social science, social scientific expertise and right governance. The progressives were committed to 1) the explanatory power of scientific (especially statistical) social inquiry to get at the root causes of social and economic problems; 2) the legitimacy of social control, which derives from a holist conception of society as prior to and greater than the sum of its constituent individuals; 3) the efficacy of social control via expert management of public administration; where 4) expertise is both sufficient and necessary for the task of wise public administration.

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