Thomas Sowell and the Third Kidney

By Tom Lowe

2/8/2000
Every now and then, a right-wing columnist shows his hand so transparently, so openly, that one wonders if he is not making a religious confession, rather than a policy argument. So it is with Thomas Sowell today, February 8, 2000, in the Clarion-Ledger. He bares in no uncertain terms the basic tenet of his neoclassical, Chicago school, ideology: your value as a human being is measured by what you are paid--nothing else.

The fist half of his column consists of a bizarre story about a woman, born with three kidneys, who is prevented by law from selling one of them to a wealthy person for a large sum of money. Sowell, who in passing mentions that such a situation is quite rare, makes the story into a parable of how certain "intellectuals, politicians and other in the business of being outraged" want to control the natural workings of the market system, in which the poor woman with three kidneys had to endure a life of poverty because she couldn't sell her extra kidney. [Honest, I didn't make this up.]

Naturally, he didn't discuss several very good reasons why organ transplants are strictly regulated, or the dangers of abuse inherent in commercial traffic in human organs, because he needed the anecdotal evidence as a rhetorical justification for the rest of his article, which is a hymn to what he calls the free market. The free market is in fact Sowell's substitute for morality and justice.

Sowell asks "Why are some people paid more than others?"

His answer: "Because their work is more valuable to employers. Employers don't pay you what you 'need' but what your productivity will justify."

This is the big lie. Accept this and everything else he says follows.

Here's why it's a lie:

First, common sense and the principle of profit maximization tells us that employers pay their employees as little as they can get by with, and not according to their productivity, which is the actual measure of their value to the employer. "Buy cheap and sell dear" is the rule with labor as with goods and securities. Employers will pay a living wage only if the labor market is tight or they are made to pay it through a minimum wage law.

Second, and this is related to the first reason, wages are determined as much by the supply of labor as by the demand. If there are unemployed laborers looking for jobs, employers can fire employees who demand higher wages and replace them with someone else who will work for less, irrespective of productivity.

Third, the monetarists, who currently rule the financial structures of our nation, have virtually promised to raise unemployment when it appears that a tight labor market is pushing up wages. With more unemployed laborers bidding for jobs, the upward pressure on wages diminishes. Since unemployment keeps wages down it therefore subsidizes employers who use labor inefficiently, a fact seldom mentioned by neoclassical economists of Sowell's ilk.

Forth, worker productivity since 1980 has increased by roughly one percent per year, but the median wage has stagnated or declined over that time period, the only exception being the last several years. If wages were truly based upon the contribution employees made to the bottom line--in other words, if Sowell's proposition above were actually true--wages would have increased along with productivity. Instead, because of the manipulation of the economy and the tax structure by the Congress and the Reagan, Bush, and Clinton administrations, those gains have been appropriated almost completely by the owners of capital.

Fifth, Sowell's last argument, that "Wages imposed above the level set by supply and demand call forth more job applicants, while employers hire fewer workers when labor is made artificially more costly" is completely refuted by the history of the minimum wage, increases in which have been shown to bear virtually no relation to business recessions or unemployment.

Sowell knows that perfectly well, which leads to the conclusion that either he deliberately prevaricates or is one of those persons so well-educated that he is able to believe and preach propositions so preposterous, so harebrained and so illogical, that no reasonable person would entertain them for more than a second. If the first is true, then we would be well-advised to ignore whatever he writes. If he is sincere, then his column should be transferred to the religion section of the newspaper, for he is indeed proposing a monetary measure for everything--morality, justice, even spirit--and that qualifies as a religious proposition.

Copyright 2000, Thomas Lowe. All rights reserved. Published in The Jackson Progressive, http://www.jacksonprogressive.com. Noncommercial reproduction of this article in its entirety is authorized, provided that this notice accompanies any reproduction.