Mr. PC: Which market would you want to decide wages? The consumer market or the job market? In a free market society you're probably right, people could be paid according to market demand. But we are not in a free market. The cost of goods and services in our market is rarely determined solely by demand. And most certainly between government regulation and corporate greed, demand has very little to do with worker's wages. Even companies with high demand for their goods and services are focusing on reaping the highest possible profit for their owners/executives, investors etc. So the consumer market has little effect on how some companies treat their employees. The state of the job market certainly can't assure people a fair wage, as people are desperate for jobs as it is. There are very few if any business out there which are subject to minimum wage laws where you would actually see workers gain any benefit from the death of the minimum wage, even at it's current low rate. As to the respect issue, forget about students... you have adults with families working at minimum wage who don't get any respect from their employers. Minimum wage pay vs. off-the-books pay is not going to be the determining factor in the level of respect one gets from their employer.
Mr. M (me): In a free market society it works just fine. A cursory analysis of post industrial USA until about the end of the 1920's (when Hoover and FDR started intervening even more than the Treasury and the FED intervened during the 20's) bears this out. "We are not in a free market" - you've got that right. Demand plays a role, but yes, in our Corporate / gov't alliance against the middle class and the Regular Joe, demand is a smaller factor than it should. This is a testament to the free market, as consumer demand would determine prices and wages, and the laborer could take his labor somewhere else if he wished, and if Greedy McScrooge Corporation got a bad greedy rep, or sacrificed quality for quantity, the consumer would take his gold and silver somewhere else.... Yes, in this toxic environment there would be few firms to benefit from the abolishment of the minimum wage. The black teenagers I work with would benefit in about 12 hours because it is the only thing keeping them from finding work. Unemployment is rampant in neighborhoods like mine (I'm in Mt. Vernon) as the latest #'s are horrific. I never said off vs. on book pay was the determining factor with regard to respect from the employer.