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A Swing and a Miss: Why the Minimum Wage Law Misses the Mark

It's another swing and a miss for MarketWatch in their latest hit piece labeled Here's why these baseball players may suffer from the $1.3 trillion spending bill



In this modern melodrama of First World proportions, MarketWatch distributes yet another Leftist propaganda piece, lamenting the exemption of minor league baseball players from the federal minimum wage law. 

As it turns out, athletes pursue minor league ball not to get rich, but to prove themselves on the field in hopes of a chance to ascend to the majors and maybe eventually achieve riches. 

In fact, most athletes take a tremendous risk in pursuing their respective sports, working countless hours off the official clock to improve their strength, aptitude and performance. 

Additionally, there are millions of athletes who will never earn a penny through their respective sports, yet they have been motivated by the potential to compete at that level, and they invest their time, money and tireless efforts for that opportunity. 

Of course, if analysts were to calculate the average return on this investment, they would be astounded as they discovered negatives all across the board, as virtually every athlete will pour far more into the endeavor than he or she will ever receive in return through a contract or professional payout of any kind. 

Of course, this quantitative assessment fails to capture the value of pride, camaraderie, experience, social status and the residual benefits of health and fitness, all of which certainly afford the athlete a hefty advantage in the long run, whether monetarily, physiologically or by way of networking. 

This is perhaps the most highly overlooked consequence of the minimum wage law: a measure which interprets individuals as static subjects, effectively raising the bar for lawful employment and legislatively preventing laborers from exercising their own powers of discretion and freedom to contract to then artificially define the standard under which an employee cannot legally work and acquire the on-the-job skills and training to eventually scale the professional ranks. 

Ultimately, fewer than four percent of hourly and salaried workers in the United States are compensated at a rate equal to or less than the federal minimum wage. 

Among those who earn this amount, many receive tips, while others work part-time or in tandem with full-time schoolwork. 

Above all, after a short number of months, a majority of them will earn a promotion or they will accept a better offer from a different firm. 

After all, we are all individuals pursuing our own respective advantages. 

The same is true for businessmen just as it is for employees: we are all looking out for our better interest. 

This means that the employee who accepts an offer at or below a given wage rate, one who voluntarily consents to exchange his labor for a determined rate of pay, has freely entered into an agreement which suggests that he values that position, the rate of pay, the experience and other fringe or unquantified benefits, more than the attending effort and time expended in holding that occupation. 

This also suggests that the employer values the employee's productivity more than the funds he offers in compensation for his labor. 

In this case, it appears abundantly clear that both parties benefit, where there is a clear surplus for both the employer and the employee. 

What's more, the contract is voluntary and, as such, both the employer and the employee can terminate it at any given time. 

In the case of diminished business or underperformance, the employer may decide to terminate this contract. 

Similarly, the employee may determine that he abhors the work, that it no longer compensates him for the expense, or perhaps he has secured a better arrangement elsewhere. 

In any of these cases, both sides are better off. 

If the employer fires the employee, he demonstrates that the employee was no longer worth the expense, and he will likely pursue a better replacement while bearing the full brunt of costs: those of the search, training and transitional underproduction. 

In this case, the outcome will likely motivate the former employee to modify his work ethic, suffer the costs of it, or otherwise find another occupation which satisfies him and more closely aligns with his acumen or personality. 

In the case of the employee voluntarily terminating his own contract, he demonstrates that the arrangement is no longer worth the expense, and whether he has elected to remain unemployed or to accept another offer from a different firm, he has demonstrated preference for this new endeavor. 

In this case, the employer must either sweeten his offer to retain the employee or he will surely lose him. 

In this case, the employer will narrow his margins until a point of agreement, where the surplus remains favorable for both parties. 

Otherwise, they will agreeably terminate the contact, leaving the employer to modify his business or simply endure the costs of his mismanagement, all while searching for a replacement employee. 

Remember, just as applicants compete against each other for the benefits of employment, employees compete against each other for the product of their labor.

In life, there are always tradeoffs, and within a thick or competitive market, there are always plentiful alternatives. 

So long as we voluntarily enter into agreements, no one can possibly be exploited by the specific terms of the given contract. 

As illustrated, once the contract begins to operate to the disadvantage of either party, the contract will cease to remain in effect. 

This is the benefit of a free civilization. 

On the other hand, if a standard minimum wage were instituted between employers and employees, or across all minor league teams in this case, one would witness an automatic eradication of the best available bargaining chip for the individual who plainly wishes to seize the opportunity to prove himself. 

This also serves to artificially buoy the total costs of production, as labor costs serve as one of the contributing factors to that sum.

This unavoidably applies increasing upward pressure to those costs which are shouldered by consumers, or in this case the fans who attend the games, rendering consumer prices far more expensive than they might otherwise be, while systematically resisting the organic market propensity to drive down marginal costs and general prices.

Additionally, such a price floor unwittingly mandates that any employee, or any ballplayer in this case, ought first to become productive at such an enumerated level before he can legally qualify, or requalify, as employable. 

By definition, then, the minimum wage law is a job destroyer. 

This is precisely because wages and salaries are a function of productivity; the employer cannot pay the employee without that employee having demonstrated a level of productivity which justifies his employment at the given rate. 

By the way, employers and employees are not condemned to these titles for life. 

They can, and often do, change over time. 

This is potentially the gravest error committed most ubiquitously within the domain of statistics: surveyors and statisticians fail to characterize their conclusions as mathematical averages illustrative of neither flesh-and-blood individuals nor their mobility within the market and across different categories or groups.

And though the documented history of the minimum wage supports the nefariousness outlined here, the business of government will continue to render those statisticians as employable as ever at the expense of the opportunities and workers they neither know nor care to represent. 

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