World Wide Minimum Wage (WWMW)

Corporations romp around the world searching for the cheapest labor in developing countries, usually close to slave wages. That's what "Free" trade means today. The people that work to provide the world with cheap goods can not purchase what they make. At the same time they displace a consumer from the ranks of the employed to welfare. That's a lose-lose situation for workers that will inevitably lead to an oversupply of products and very few consumers. It represents a short sighted immediate-profit strategy of corporations and governments.

Here's an idea - a world wide minimum wage (WWMW). Of course not everyone would agree to it, but that doesn't mean it won't work. Let's say a country like the US which has a minimum wage says, "If it's good enough for us, then it is a fair wage for someone sewing clothes in an Asian sweat shop, or toiling in a plant in the Maquiladoras". Then the cost of all imported goods will be adjusted to this minimum wage. Add to that adjustment a $2 per hour cost for health insurance, safety and environment that is typically avoided.

The WWMW would not be a tariff but a variable global leveling factor. Companies could either pay their employees or pay the adjustment. Raising income for the impoverished would create markets for everyone's products. The adjustments collected would not enter the treasury, but all or part of the money collected would be available to the producing country for the purchase of products from the importing country - hopefully products that will help the ordinary people and not military goods. The WWMW would help balance trade deficits, open protected markets and slow the movement of capital.

This World Wide Minimum Wage system only takes the will of a single consuming nation to implement. Maybe we'd end up with Fair Trade over Free Trade. Hopefully it would become a global standard.

Recommended reading:
   Why American Trade Policy Has Failed
       By Congressman Sherrod Brown



copyright© 2005, Ted Schaefer, All rights reserved