Everything Seems Evil When You Add Sex To It

One of the lessons I’ve learned from reading Maggie McNeill’s Honest Courtesan blog for the last couple of years is that opponents of sex work will try to make even the most routine business practices sound evil. I just finished a three-part think piece about some aspects of that, and already Maggie has pointed me to another.

I remember years ago reading some feminist anti-sex-work exposé of strip clubs which revealed that many clubs don’t even pay their dancers. In fact, the clubs were so exploitative that they actually made the dancers pay them. Shocking! And also, as it turns out, unclear on the concept of how strip clubs work.

More recently, as the Wichita Eagle reports, the Kansas Department of Labor has decided to crack down on this supposed exploitation:

The Kansas Department of Labor won a victory for strippers when the state Supreme Court ruled that exotic dancers are employees of the club where they work, not independent entertainment contractors.

So now the club will be required to treat strippers as employees, withholding taxes and providing unemployment insurance.

Meanwhile, here are some of what the Eagle piece refers to as “conditions inside the club”:

Club owner John Samples bought the majority ownership in Club Orleans in 2002. Two years later, he stopped paying the dancers a nominal salary, leaving tips from customers as their only source of income, according to court records. The court decision doesn’t require the club to pay the dancers a salary, because tips can be considered as wages under Kansas law.

This is some sort of Bizarro-world labor law. All of the money paid to the dancers is coming from the gentlemen who patronize the club, yet under Kansas labor law those payments are now considered to have been wages paid by the club, even though the club never payed the dancers any money.

According to the Labor Department, dancers were required to pay non-negotiable “rent” for use of the stage and dressing rooms, as well as extra fees for the disc jockeys and bouncers.

The rent was higher during peak business hours and the women paid extra to use the more private “VIP” and “Champagne” rooms to entertain guests.

That really makes it sound exploitive, doesn’t it? Especially with the scare quotes around “rent.” Not only was the club not paying the dancers, but the dancers were being force to pay the club, and pay even more to use the special rooms.

One thing that’s notably missing from the Eagle article — and many other accounts of such supposed exploitation of women by strip clubs  — is any mention of the reason why dancers put up with such conditions. You can read all about how much the dancers are paying and what kinds of rules they have to follow without coming across any mention of the fact that exotic dancers can easily earn $1000 or more in tips every week. That’s for less than 40 hours of work on a job that has fairly flexible hours and no educational requirements.

On the other hand, I think the club’s defense that the dancers are independent contractors is nonsense that has no relation to economic reality. After all, if the dancers were independent contractors, the club would still be paying them for the work they’re doing, just not as employees. (In contracting jargon, they’d be getting paid on a 1099 instead of a W-2.) But the club isn’t paying them a dime.

So what does that make the dancers then? Well, as they said during Watergate, if you want to understand what’s really going on, you have to follow the money. And the money is flowing from the dancers to the club. You know what that makes them with respect to the club?

Customers.

That’s what you call people who pay a business for services. The gentlemen patrons are customers because they pay the club a door fee for the right to come in and see the dancing girls, and the dancing girls are customers because they pay the club a house fee for the right to come in and sell dances to the gentlemen patrons. Both the men and the dancers are customers of the club.

That may sound crazy, but it’s not an uncommon business arrangement for vendors to pay for a venue in which to conduct business. Flea markets operate this way, for example. Chicago’s Randolph Street Market charges consumers $10 to come in and shop, and they charge vendors $75 to $300 for the right to operate a display space and sell stuff to the consumers. The strip club is doing something very similar.

But what about all those rules the dancers have to follow, as if (according to the Kansas Department of Labor) they were employees?

House rules governed what the dancers could do in their shows and the prices they had to charge for specific types of dances. Employees of the club would enforce the price structure on the dancers and the customers, court records said.

The women were required to sign in with the bouncer at the beginning of a shift and weren’t allowed to leave the premises until the end of the shift, according to the Labor Department.

Again, that’s no different from how a flea market operates. The Randolph Street Market has tons of rules for vendors as well. Some of them are there to protect consumers, other are designed to keep vendors from interfering with each other’s business, and some of them are for the benefit of the venue owner.

Note that some of the club rules exist for the benefit of the dancers. When the article says “employees enforce the price structure” it means that the club does not allow dancers to offer discounts. This benefits the dancers because they don’t have to compete against each other on price. Essentially, it’s a miniature price-fixing cartel. As with all cartels, cheating is a problem. Dancers have an incentive to draw customers away from other dancers by offering lower prices, which encourages the other dancers to cheat by lowering their prices as well. But when they all lower their prices, they all lose money. The club’s rules about the price structure prevent this. Essentially, the dancers are paying the club to provide enforcement of the cartel rules.

The Eagle article doesn’t mention it, but many strip clubs enforce is a “no-touching” rule, or at least a “no handjobs, no blowjobs, no sex” rule. Again, this is cartelization to reduce competition. If some of the dancers offered “extras,” then the other dancers would be faced with the choice of either losing customers to those dancers or offering extras themselves. However, the dancers can avoid the pressure to offer extras by agreeing collectively not to do so. Again, the dancers pay the club to prevent cheating that would hurt them all.

Even the rules setting work hours are part of the enforcement services provided by the club. If too many dancers show up at one time, there won’t be enough gentlemen patrons to go around, and the short-term average per-dancer income will be low for that night. On the other hand, if too few dancers show up for some shifts, the gentlemen patrons won’t be able to get dances and over the long term they’ll stop showing up, which will also reduce the dancers’ income.

The latter situation is a real concern with the flea markets’ big brother, the shopping mall. One of the reasons consumers like shopping malls is because they can hit several stores in a single trip. If some of those stores keep shorter hours, however, the malls will be less beneficial for consumers, which will naturally reduce the number of consumers coming to the mall, which will in turn reduce the sales volume of all the stores at the mall, not just the ones that are closed. For this reason, malls set standardized hours of operation and assess penalties against stores that don’t comply.

Something similar goes on with department store makeup counters and jewelry counters. Many of them are stocked and staffed not by the department store but by the manufacturers, who have to pay the store for the right to sell their product there. The contracts include detailed rules about hours of operation and staff training to ensure that store patrons receive the expected level of service.

I’m not saying strip club owners are saints who only want to help the poor dancing girls. They’re in it for themselves, trying to make some money by mediating the transactions between the dancers and their customers. Sometimes they do this in direct zero-sum opposition to the dancers’ interests — by charging house fees, for example — but to get dancers to pay those fees, they have to offer something of value — the venue, a DJ, a stage with a pole and flattering lighting, booze, bartenders, waitresses, snacks, parking, security, advertising, credit card processing, and enforcement of standards of conduct and pricing. They’re selling a service. Just like any other business.

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