[I]t’s well past the time to raise a minimum wage that in real terms right now is below where it was when Harry Truman was in office. (Applause) This shouldn’t be an ideological question. It was Adam Smith, the father of free-market economics, who once said, “They who feed, clothe, and lodge the whole body of the people should have such a share of the produce of their own labor as to be themselves tolerably well fed, clothed, and lodged.” And for those of you who don’t speak old-English – (laughter) – let me translate. It means if you work hard, you should make a decent living. HT: TT
Adam Smith never favored the modern minimum wage, but he did grapple with the question of what determined wages. The Mercantilists favored policies that kept wages low, while Smith seemed to prefer some kind of market determined wage. He borrowed from Richard Cantillon the idea that labor be paid at least twice their standard of living in order that children could be raised to replace the current generation of workers. Society was better off and the real wages of labor were better in the progressive economy of economic growth, not by the passage of some government decree on wages.