Capitalism and the Race to the Bottom

Is the minimum wage good or bad?

A few years ago Chipotle announced that it had partnered with the City of Denver to provide low-rent housing to its employees. Some people, who I suspect are not habituated to reflecting, cheered the move, even though 1) it was a clear admission that Chipotle does not pay a living wage to some of its employees, and 2) it had ensnared the city on a scheme to use tax-payer money to pony up for the difference.

Evidently, the minimum wage is not sufficient. The threat from employers, however, is that fewer workers will be employed if the minimum wage is raised. Employers will always go for the lower-cost alternative–be it AI, overseas workers, dumb machines, etc.–because they're optimizing for profit. This is a race to the bottom.

From minimum wages to the Glass-Steagall act, it's all patches for the unstoppable machine that threatens to keep degrading our way of living and our environment. Socialism is dead and capitalism is a blind killing machine. We need to imagine and implement a third alternative before the black hole swallows us.

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