Battle Over Gender Wage Gap is Really a Fight Over the Nature Of the Free Market

In his State of the Union address last Tuesday, President Barack Obama once again tackled a highly disputed economic issue: pay equity. Citing the gender wage gap as further evidence of American income inequality, part and parcel of what Joseph Stiglitz described as "our national myth" of equal opportunity, Obama called on Congress to "declare that women should earn a living equal to their efforts, and finally pass the Paycheck Fairness Act this year." And, as is usually the case whenever the topic of the gender wage gap is raised, fact checkers were on hand to reassert that gender-based income inequality is the result of nothing more than personal choice.

The Washington Post noted, "There is clearly a wage gap, but differences in the life choices of men and women — such as women tending to leave the workforce when they have children — make it difficult to make simple comparisons."

This argument — which reduces the incredibly complex reality of "work/life balance" in contemporary America, yet again, to a "women's issue" before attributing women's lower earnings to the "choices" they make — is hardly new. And while there are certainly valid arguments to be made about the ways in which these differences in earnings are calculated, the arguments typically made about the wage gap, its causes, and its (potential) solutions are not centered on concerns over analytic accuracy. Instead, they have to do with a gendered rhetoric of "choice" which places the blame for women's overall lesser earnings on the shoulders of individual women, all the while insinuating that there can be no successful collective solution.

Anyone who has ever tried to assert something about the wage gap on the internet has likely run across the following YouTube video, put out by LearnLiberty.org, a website funded by the Institute for Humane Studies, a libertarian non-profit organization. (Other related LearnLiberty videos include "Top 3 Ways Sweatshops Help the Poor Escape" and "Is the Cost of Living Really Rising?")

The narrator in the video, Professor Steven Horowitz of St. Lawrence University, explains, "What's happening here [with the overall trend of women making 75% what men do] is not discrimination in the labor market, but differences in the choices that men and women make about investing in their knowledge, their education, their skills, and their job experience, that lead to them getting paid different salaries."

He continues by arguing that men and women invest very differently in their "human capital," providing four major axes along which women's choices lead to their lower wages: education (women opt for the social sciences while men opt for hard science or business, leading to different career paths and commensurate salaries), expectations about work (women expect to take time off to raise children while men do not), scheduling preferences (women tend to prefer part-time work because they take on child care), and tenure (women again tend to have their careers interrupted by 'taking time off,' presumably for the sake of their children or families).

"The difference between men and women's pay is not a result of labor market discrimination, but of the choices men and women make before they enter the labor market, or even when they are in the labor market, about the kinds of jobs they want to have and the way they want to balance a family and work," Horowitz concludes.

He qualifies this statement by reasserting that it is quite possible that sexism or gender role expectations play a role in many of these processes (particularly in designating whether men or women should take on child care), but suggests that the way to redress this is to encourage women to go into STEM fields, or men to take on child care.

Both are certainly popular answers to the question of how to achieve "equality" in the workplace, championed by liberals and conservatives alike. But both often fail to interrogate the structures of the labor market, assuming that the current market value of certain fields or industries is "natural," and thus uncolored by gender politics, and both implicitly discourage collective action on issues of pay equity.

And other commentors are far less even-handed than Horowitz, particularly when it comes to current proposed collective (read: federal) solutions to pay inequity.

Take, for instance, the (failed) Paycheck Fairness Act and the Lilly Ledbetter Equal Pay Act. These two pieces of legislation have often been touted as evidence of the Obama administration's commitment to "leveling the playing field" for men and women in the workplace. These legislative measures draw continual criticism from conservatives and libertarians who argue both that the gender wage gap is not as significant as it appears to be (or is mitigated by "personal choice," as Horowitz suggest above) and that further federal intervention into wages is unnecessary or even detrimental for working women and/or their employers.

Some argue that some aspects situation of working women — shorter hours (often termed 'flexibility'), less dangerous work, women's relative consumer purchasing power — outweigh any purported income discrepancies.

At the Washington Examiner, conservative pundit Hans Bader argues that the Paycheck Fairness Act "could force employers to pay people who do nasty, dangerous, unpleasant jobs as little as those who do nice, pleasant ones, if the unpleasant jobs are performed mostly by members of one gender, and the pleasant ones mostly by the other gender." Equal pay legislation, he contends, will not raise wages for the women in "less valuable" professions they "chose"; nor should it, as Bader notes, "it's up to households to compensate women for the greater work they do on average around the house, since it is households, not employers, who reap the benefits of this household labor." Rather, it will force employers to pay men less for work that is more physically arduous and time-intensive, all in the name of false equality.

But the real problem with equal pay legislation? According to Bader and others, the differences in men and women's work lives can't be blamed on their employers, nor can their employers be expected to make things more fair.

Why? Because it undermines the very nature of the free market, which theoretically privileges certain types of work because they are inherently valuable. It undermines the free market which allegedly sees neither gender, nor race, nor class.

What conservative vs. liberal commentary on the nature and importance of the gender wage gap illuminates quite clearly is the current struggle happening across America when it comes to income inequality as a whole: Is the free market the cure for America's lack of social mobility, or is it the cause? Can Americans change their economic lot on their own, in their own individual careers, or does doing so require collective action, moderated or enforced by the state?

How the Paycheck Fairness Act (which contains provisions which could potentially make it easier for workers to bargain for higher wages together) fares in 2013 may provide some of these answers. But the question of what's to blame for income inequality between men and women, between Americans, will remain.