playing devils advocate

Let’s assume for the sake of the argument that minimum wages did not exist. What would happen, and would Smith be in support of this? Ok, I am a poor worker with a family of my own. The amount of money in wages is ridiculously low---it would not support me let alone my family. What are my options…a) I can leave my job and search for a new one. b) I can form a union of other workers and go on strike for higher wages. c) I can enter entrepreneurship, make my own company. What is the likelihood of these things happening? In one view of society, the smallest government possible theory, the above solutions would be a practical substitute for minimum wages. After all, Smith does reason that, “every individual is continually exerting himself to find out the most advantageous employment for whatever capital he can command.” In theory this would be a wonderful thing. Have the government govern as little as possible and allow the freedom of the free market to dictate the wages. The employers versus the employees…both need each other, and both have demands. To a certain extent, these demands can be compromised to please the two parties. There is one objection to the theory that Smith has considered, however. If I was the poor worker, and I did one of the above options, how would I be able to sustain myself in the mean time? I would be in a worse position for a period in time---a period when I would earn no money as opposed to little money. In this way, I would say to myself, “It is better to be paid little than nothing at all,” and I would go back to work with the same wages. As Smith pointed out, if the employer and the employee were to wage war on each other, the master would always win because he can afford to hold out longer. In this way, I believe that Smith would support a means that I the poor worker, would not have to starve---maybe a loan of some sort. There does not necessarily have to be a “minimum wage.” Compromise just has to be encouraged. If there was no such thing as a minimum wage, I can always do one of the 3 options---I just have to receive temporary support that I could repay. If Smith was to stick to the ideals of a capitalist society, he would not be in support of minimum wage.