The United States Department of Labor stipulates the federal minimum wage and regulates “compliance with labor standards.” Since 1990 economists have debated the benefits and disadvantages of federal minimum wage laws, some of the most heated debate rising from David Card and Alan Krueger’s landmark research on employment and minimum wage standards.
In an article I wrote for International Studies in Philosophy, I argue for the abuses inherent within a system of neoliberal economics and the practice of outsourcing labor. In the article I argue that outsourcing support a “race to the bottom,” wherein First World corporations maximize their profit margins by outsourcing their labor and seeking the lowest international labor costs. I then discuss the practice of slavery and draw the conclusion that outsourcing, in its worst forms, differs from slavery by the slightest degree. Are First World corporations justified in paying Third World laborers .17 cents/hr for a product that is then sold for one hundred U.S. dollars? If so, to what extent does this differ from slavery?
Since outsourcing is a viable economic model wherein First World corporations export their labor to defer cost and maximize profits, should there be an international standard for the minimum amount that laborers, of any country, may legally be employed for?
Though there would certainly need to be an entire field of researchers and statisticians assessing the pros and cons of such a proposition, one can surely agree that efforts to standardize international minimum wage laws would curb corporate greed and increase the pay rate for an international body of employees. How such regulation would influence the international employment rate remains to be seen.
We live in an era of globalization and our respective leaders must acknowledge this fact. Some measures must be employed to safeguard the rights and wages of international laborers. An international consortium of bankers, financiers, auditors and regulators should assume the responsibility for global compliance and where there are violations of the law, embargoes and sanctions should be enacted.
Some may argue that if .17 cents/hour is the highest wage paid to international laborers within a given region, then it is justifiable to pay those laborers .17 cents/hour. The tremendous flaw in this reasoning is that while it speaks to the practicality of market conditions, that is, the market will invariably seek to out the cheapest labor for the highest return in profit, is does not address the moral responsibility corporations have to their laborers and the international market at large. Market conditions will approximate slavery wherever it can. It is not because of the economic viability of slavery why its practice is illegal. Slavery is illegal because of the moral arguments and contradictions inherent within a system of slavery. Thus, despite the fact that .17 cents/hour may be the highest wage paid to international laborers within a given region, the question arises, "should it be?" Shouldn't we consider the ethical benefits or determinants of enacting global minimum wage laws?
The International Monetary Fund already has measures in place to regulate international exchange rates, which is not to suggest that they should enforce international minimum wage compliance, as there are many criticisms against the IMF. Nevertheless, there are structures in place that could expedite the process of protecting the wages of international laborers.
Without the ability to standardize and enforce international labor laws, it is certain that Third World laborers will continue to be exploited by First World corporations. The attempt to enforce international labor laws will standardize global employee wages and hopefully benefit Third World laborers.