Wage Suppression and the Minimum Wage Deception

If we examine the issue of the minimum wage, which I covered last week, a bit more closely this week, we can see more clearly how the state apparatus views capital and the laborer. Specifically, by guaranteeing that the wage cannot be lowered below the level determined by a commission that includes labor representatives, the state gives the appearance of providing protection to labor against capital. Here, the following question can be asked: Since both labor and capital sides are present in the commission, why is the result sought through negotiations in a commission where government representatives are also present, rather than through market bargaining? One reason for this is to prevent the army of the unemployed, which follows behind the laborers, from driving wages down significantly, and on the other hand, to ensure capital is reconciled to this wage level. When considered together, the state's intervention in the minimum wage is aimed at preventing wage anarchy on one hand and social unrest on the other. However, the problem of job creation and preventing unemployment, which should be among the state's primary duties, remains unresolved and has been swept under the rug. 

Issues of labor, wages, and the minimum wage are not only in the realm of the labor-capital conflict within the capitalist system, but also in the political maneuvering space of capitalist governments trying to politically ensure the survival of the system. While the capitalist state, which aims to partially soften and partially legitimize the exploitative behavior of capital, opens the door for the exploitation of labor by capital, it displays an image of taking labor under its protective shield through minimum wage rhetoric and practices.

Our dear friend Dr. Murat Özveri's newly released Turkish Labor Law in Terms of Individual Labor Relations The introduction to the work titled [Title] reveals this situation with complete clarity. Specifically, “Labor law is the product of a compromise. It is a set of rules within the system. In this respect, it does not have radical goals such as changing the order or eliminating the exploitation of man by man. On the contrary, labor law is a set of rules that the exploiters endure, and are forced to endure, in order to maintain the capitalist order—in which man exploits man—by providing those at the very bottom with an opportunity to breathe. The fact that labor law is the product of such a compromise does not mean that it is a field of law that exists to provide a balance between the worker and the employer.

Addressing labor law within the concept of balance is an approach that contradicts the very reason for its existence. Labor law exists to protect the worker by pushing the boundaries of the capitalist system as much as possible. The compromise was not reached in providing a balance between the worker and the employer, but in the protection of the worker. In every historical period when the organized power of workers weakens and capital feels secure, the protective purpose of labor law is diluted and eroded through the concept of balance, in the literal sense of the word. Today, labor law is in a process where the employer, seeing the balance of power in society in their favor, tries to neutralize it, where its rules and principles are stretched, and where an attempt is being made to create a labor law without workers.”

The issue of minimum wage, alongside the state's function of legitimizing the system and its own reason for existence, also serves to prevent the obstruction of the market volume necessary for capital to secure surplus value, all under the guise of protecting labor. This is why, as clearly stated in the passage above, labor law, “is a set of rules that the exploiters endure, and are forced to endure, in order to maintain [the system] by providing those at the very bottom with an opportunity to breathe” while being defined as such, the state ensures its own legitimacy through the maneuvering space it provides between labor and capital. Especially in periods of widespread unemployment, the wage level—which prevents wages from falling below the subsistence level and is sometimes determined by taking into account social living conditions above biological living conditions—can cause the state to be perceived by the laborer as “the paternal state” In order for the system to be maintained smoothly, the capital sector also signs off on the minimum wage level, agreeing to act in cooperation with the state and labor in the continuation of the capitalist exploitation order.

The minimum wage is not a welfare state policy. Under normal conditions, there are two different forces that influence the level of the minimum wage. One of these is periods of economic crisis. During times of crisis, capital, which suppresses labor, knows no bounds. Especially in conditions where an army of the unemployed is widespread, as is the case in Turkey, the minimum wage can be suppressed. While the state setting the minimum wage level and imposing it on capital in such conditions may seem positive at first glance, this situation opens the door for capital to export labor. Indeed, when layoffs intensify during crisis periods, the state, which displays an image of being on the side of labor regarding minimum wage issues, actually sides with capital, effectively doing a favor to the capital that consents to the minimum wage, while it can ban the workers' right to strike but does not impose a ban on the export of workers. 

The second condition that forces the issue of the minimum wage is price increases. In conditions where price increases outpace minimum wage hikes, capital gains an advantage because real wages will have declined despite the wage increases. Minimum wage hikes create a money illusion among workers, and the worker, who cannot immediately perceive that they are becoming increasingly impoverished, may welcome the minimum wage increases and side with the decisions of the political authority. As the most unjust tax, inflation sides with both the state and capital in determining the minimum wage, leading to the victimization of the worker. The political power, exploiting the worker's money illusion, may resort to wage determination based on past inflation during periods of rising inflation. The political power, which bases its decisions on the TÜİK (Turkish Statistical Institute) distortions we experience in our country, may also choose to determine the minimum wage or the general wage level based on official data, both to directly suppress the labor side of capital and to indirectly increase the allocations to be made to capital from the budget. 

In the context of the relationship between the laborer and the state, wages and the minimum wage are just one of a series of elements. While unemployment, layoffs, flexible employment, and precarious conditions work in favor of capital and against labor, the state intervenes in almost none of these, attempting to appear as though it is fulfilling its duty toward labor solely through the implementation of the minimum wage. However, even if implicitly, both the wage level and the minimum wage level are actually determined with capital being dominant over labor.