Just price calculation principle

There are many ideas about how to calculate the just price of things according to the natural law. Here I rule out some of them, with the following proposition:

No concrete claim about the just price of something can be founded on the current actual prices of anything, since it is not known if those prices are, themselves, just.

This is certainly true, when all the things being calculated are under subjection to just laws. It may be that, sometimes, the price of obliging some unjust demands must enter into the calculation; but such demands could only be required to be obliged by the laws of an unjust nation.

Illustration with wages

For illustration, take, for instance, the just wage. It is unclear what the just wage requires, but suppose, for the sake of this argument, that it must require that the employer provide the means of the worker’s achieving some definite standard of sustenance, through buying some definite quantity of food.

Since the worker is required by justice to pay exactly the just price to the food seller, and no more or less than that, the quantity which should be paid to the worker for the reason of his sustenance should, accordingly, be exactly equal to the just price of food.

If the food seller is charging a price above, or below, the just price, a buyer is not required, by justice, to oblige the seller’s unjust demand. The buyer is obliged to pay the just price; if the seller asks him to pay more than that, or less than that, the buyer may rightly sue the seller under the natural law, for charging an unjust price.

Since no just state would require a buyer to comply with the unjust demand of a seller, then accordingly, under no just state can the employer be required to finance such compliance. So, the actual prices of food cannot enter into the calculation of the just wage, which must instead take into account only the just prices of food.

The exception I had mentioned applies as follows: if it be deemed required that the employer finance the purchase of food from a seller that lives in a foreign nation, which is ruled by unjust laws and will require, by force, the payment of an unjust price, then in that case, the actual price of food may enter into the calculation of the just wage; but in no other case.

Consequences

Setting a minimum wage different from the just wage, without knowledge of the just wage, is dangerous, since the state may be commanding an injustice, by requiring that employers pay an unjust price for labor. It follows that no country has any right to calculate the minimum wage from the actual cost of living, since it recklessly risks commanding an injustice. Only just prices may be used to calculate just prices.

Furthermore, the government will almost certainly be wrong if it attempts to determine the just wage by guessing – in fact, certainly wrong, if we assume that the just wage is a definite number, which may be any of the infinitely many values within a continuous range of possible wages.

This doctrine does not forbid legal prices from being set upon some other basis than actual prices, if such a basis can be found. In fact, I hope that such a basis can be found, which would be a great aid to all moralists. But actual prices cannot be the basis of just prices, nor of legal prices.

While it allows for the theoretical possibility of completely objectively determined prices, this doctrine is, in one way, a stronger claim than a libertarian ethic would make. For this doctrine also forbids the hypothetical private law society, with the consent of the governed, from setting, by contract, any minimum or maximum price calculated in terms of any actual prices. This is because one cannot, in justice, even by voluntary contract, command an unjust practice.