04/04/2014 02:31 pm ET Updated Jun 03, 2014

The National Minimum Wage Is a Moral Crime

It can be argued that companies dependent upon $7.25 an hour labor to be profitable are not really legitimate businesses, they are publicly supported "corporate welfare recipients."

The term "corporate welfare" is seldom used by the talking heads of radio and television because they share the spoils of subsidized labor when these "Kings of Welfare" buy advertising.

The pundits of business cable television are the worst of all. They preach against any minimum wage, pointing to "the invisible hand of the market" as the only way to determine true value.

They worship at the feet of Adam Smith, the 18th century author of The Wealth of Nations who coined the phrase, "invisible hand."

Most of these talking heads make arguments that reflect a total misinterpretation of Adam Smith's "invisible hand." It's possible they've never read anything he wrote. It's more likely they are repeating the terms and phrases other pundits attribute to Smith.

So, what did "The Father of Capitalism" actually say about a living wage and the invisible hand. Let's start with wages. This quote is from Adam Smith's 1776 book The Wealth of Nations...

A man must always live by his work, and his wages must at least be sufficient to maintain him. They must even upon most occasions be somewhat more; otherwise it would be impossible for him to bring up a family, and the race of such workmen could not last beyond the first generation.

When Smith spoke of "the invisible hand" he was discussing the attitudes and spending habits of the rich in a pre industrialized world. He was making observations. Here are the actual Smith quotes about the invisible hand...

[The rich] consume little more than the poor, and in spite of their natural selfishness and rapacity...they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species. (Quoted from The Theory Of Moral Sentiments, Part IV, Chapter I, pp.184-5, paragraph 10.)

Every individual... neither intends to promote the public interest, nor knows how much he is promoting it... he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.

It does not take a linguist to interpret those quotes. Adam Smith was making critical observations about society and especially the rich in the 18th century and this was clearly his primary motivation.

It's important to note that the term "invisible hand" was lost to obscurity until the mid 20th century when it was trotted out by folks like Milton Friedman, who did Smith a great disservice in "Free To Choose" 1980, where he projected upon Smith, an advocacy that never existed.

Now, in the 21st Century, the writings of Adam Smith are deliberately misinterpreted by those who seek to further ingratiate themselves to the most irresponsible corporations that have existed in America since the days of the robber barons. These corporations are profiting from the poverty of their workers, which is a moral crime.

We ignore the real wisdom of "The Father Of Capitalism" at our peril who wrote in The Theory Of Moral Sentiments, 1759:

The rich only select from the heap what is most precious and agreeable"... and "To widen the market and to narrow the competition, is always the interest of the dealers...The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution.

Sadly, the ill-informed pundits and the self-serving officials who populate Congress and the majority of the Supreme Court are heeding the wrong voices and nothing short of nationwide national strike will get their attention.

It's plausible to presume that Adam Smith would urge America to raise the minimum wage and ignore the voices coming from this 21st Century "order."