Discrimination:The Market Always Pushes Against It
Sometimes the comments on a blog post are interesting enough to warrant a new, separate post. Here's an example.
1. A comment on yesterday's CD post "Market Forces Prevent Widespread Discrimination":
The U.S. market paid blacks far less than whites up until 50 years ago. The market clearly did not correct that inequality for many decades. The author is putting an ivory tower theory of how the market should work ahead of reality.
2. In response, Tom McMahon posted this comment:
From David Halberstam's book "October 1964":
"It was now seventeen years since Jackie Robinson had broken in with the Dodgers, and had done it so brilliantly that he had not only helped lead Brooklyn to a pennant but had also won the Rookie of the Year award. That there was a great new talent pool of black athletes was hardly a secret among the white players themselves.
The names of such great black players as Josh Gibson, Satchel Paige, and Judy Johnson had been well known to the many big league players who had often barnstormed with them after the regular season was over (and who often made more money barnstorming on the all-white major league all-star teams than their colleagues had made playing in the World Series): they knew that the Negro leagues were filled with players who could hit and pitch, and, above all, who had speed.
In the years since Robinson's historic arrival in the big leagues, certain teams had moved quickly to sign up the best black players. It was the equivalent of a bargain-basement sale at Tiffany's -- great players available at discount prices, even as the price of young, untried white players was going up very quickly."
Tom concludes: Yes, discrimination can last a long, long time. But the market is always pushing against it.
MP: Employers and businesses are often simultaneously accused of being both: a) guilty of greed and profit-seeking, and b) guilty of discrimination (gender, race, age). But you can't have it both ways.
If employers were blinded by greed and profits, they would hire only the cheapest labor group. If women or blacks make 20% less than men or whites for the same work, greedy employers would hire ONLY women and blacks, and achieve an immediate 20% labor cost savings, raising profits significantly. On the other hand, if employers are blinded by discrimination and hire only men or whites, they can't possibly be accused of being blinded by greed and profit-seeking, because they are overlooking huge labor costs savings of 20% (for example), and lowering profits significantly.
What Tom is saying (I think) is that employer greed and profit-seeking will always be a stronger force in the long-run than employer discrimination, and market forces (and greed) will work to counteract labor market discrimination.