Progressive Radio Rants -- Minimum Wage

leftysergeant said:
In some cases, it is logarythmic.
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I suspect you're rather innumerate. Not only have you misspelled the word (it's "logarithmic"), but if that relationship was correct, that would imply that a regressive tax would be more fair, and I'm quite confident that isn't what you intended.
 
Ziggurat said:
So a person is faced with a choice: he can either not work, or he can accept a job for $1/hour.

If he doesn't prefer $1/hr to not working, then outlawing such a wage is pointless, since it makes no difference to him. So let's consider the case where he chooses to work for $1/hr.

You want to deprive him of that choices. You want to force him to not work, even though he would prefer to work for $1/hr. He has concluded that he is better off working for $1/hr than not working. But you have deprived him of this option.

I would submit that this person has more to fear from you than from his employer.
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But the fear is that in the real world, employers by tacit consent will refuse to offer more than $1 an hour to low-wage earners.

The point is simple. There needs to be a balance. Minimum wage laws are a necessary evil from the economist's point of view: they are an admission that reality doesn't actually always work according to what free-market theory predicts. But this hardly means setting minimum wage at some arbitrary high level would make everybody middle class -- it would just cause mass unemployment.
 
Skeptic said:
But the fear is that in the real world, employers by tacit consent will refuse to offer more than $1 an hour to low-wage earners.
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That isn't a realistic fear.

The point is simple. There needs to be a balance. Minimum wage laws are a necessary evil from the economist's point of view
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But they aren't necessary. Everything that they are intended to achieve can be achieved by other means.
 
Skeptic said:
But the fear is that in the real world, employers by tacit consent will refuse to offer more than $1 an hour to low-wage earners.
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Ziggurat said:
That isn't a realistic fear.
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skeptic never likes to go half way....yes, $1 /hour is not a realistic figure, but say someone offers $5/hr for a day of labour...
.is that fair exchange for labour?
that would be a resounding 'no'!

a minimum wage hold scum bag employers to a minimum standard.
is $9/ for a day of labour fair? no, it is not, but the standard needs to be set somewhere.

in alberta, the minimum is just under $9. i know young people making that.
in grande prairie, about 100 kms away, macdonald's has to pay 12 or they have no help.
our small community does not have that priviledge.
 
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bikerdruid said:
skeptic never likes to go half way....yes, $1 /hour is not a realistic figure, but say someone offers $5/hr for a day of labour...
.is that fair exchange for labour?
that would be a resounding 'no'!
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Whose labor? And fair according to whom?

If someone is willing to work for $5/hr, then who the **** are you to say that they cannot accept such a job? Fascist.

a minimum wage hold scum bag employers to a minimum standard.
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No, it doesn't. It merely prices some jobs and some workers out of the market.
 
The_Animus said:
The left wants to redistribute money from the rich to the middle class and the poor. The right wants to redistribute money from the middle class and poor to the rich. So yes, the left does tend to talk about ways to help the poor and a higher minimum wage is one of them. Meanwhile the right will say that is crazy, and teachers make too much money, while also saying that someone making $125,000+ is having a tough time in this economy and needs help.

I don't like either party, but I will say that Repubs are the Anti-Logic.
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Then of course there are those who don't think of wealth as zero sum as the theoretical left and right you speak of in the above. For those people, it isn't necessary to obsess about how to cut up the cake or worry too much about redistribution either from the poor to the rich or from the rich to the poor, but are simply pro cake as a general concept with the assumption that more cake is better for everybody, whether they are rich or poor.
 
Skeptic said:
But this hardly means setting minimum wage at some arbitrary high level would make everybody middle class -- it would just cause mass unemployment.
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Or cause inflation.

Another way to look at it is to realize that setting a minimum wage sets a maximum value on the unit of currency in which that wage is defined.

If you set the minimum wage at $10 per hour, then you are defining the dollar as having a maximum value equal to that of six minutes of labor from the very lowest-value worker who you are going to allow to be employed. In the mean time, those who were at the bottom of the employability scale at $10 or $20 per hour, now cannot buy that candy bar at all, because no one will hire them.

If, from there, you raise the minimum wage to $20 per hour, you devalue the dollar, so now it is worth no more than three minutes of labor from the lowest worker.

Raise the minimum wage to $100/hour, and you devalue the dollar to the point that it is only worth 36 seconds worth of labor from the lowest worker.

This really doesn't make anyone wealthier at all. The worker who had to work six minutes at $10/hour to earn the money to buy a candy bar that costs a $1, will find that he still needs to work six minutes at $20 to buy that same candy bar that now costs $2, or six minutes at $100/hour to buy that same candy bar that now costs $10. The value of his labor, relative to the value of the things he would buy, doesn't really change; only the value of the unit (the dollar) used to measure and exchange this value.

This is somewhat oversimplified, or course. There are some factors that won't flex completely with the minimum wage. At the higher minimum wage, the very lowest worker will be someone who, at a lower minimum wage, will have been a few steps above the lowest worker, with those below him now having been rendered unemployable. The new bottom-level worker at $100/hour will probably find himself slightly better off, at the expense of those below him who are now unemployable. Perhaps that candy bar will cost $8.33 instead of $10, so now he only has to work five minutes rather than six minutes to earn enough to buy it.
 
What you all seem to be overlooking is that it is not just the wages of the bottom level of workers that drive inflation. The amounts paid to the top executives have some impact as well.

Do you seriously believe that it has no ill effect on the ecconomy if the top executive reduces the labor force by fifty percent and pays himself an extra five million a year? Has it no ill effect on the ecconomy if all of the living wage jobs are replaced by lower-wage jobs assembling parts ippmorted from slave-wage countries? Does it do no harm that that fat slob CEO still gets a golden parachute amounting to more than the average working schlub will make in a lifetime after he runs the company into the ditch?

Don't whine about having to pay the working class too much when the investor class and managerial class are getting fat producing nothing tangible.
 
I know, Neally, he should be lobbying to protect the oppressed wealthiest of citizens and corporations.
 
thaiboxerken said:
I know, Neally, he should be lobbying to protect the oppressed wealthiest of citizens and corporations.
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It's clearly not about protecting and helping the needy for him. The seething hate he has for the well off come come out in nearly every post with his juvenile pejoratives.
 
As it stands now, the more one benefits from the structure of the ecconomy, the less he will likely pay in taxes. this is uttrerly screwed up.

I contend that, if the working class has a minimum wage, it will create more jobs because it creates more demand for goods and services locally. The healthier the middle class, the less painful the plight of the poor, because there is more work available. It is the wealthy who are failing to sustain the ecconomy now.

Most of the work I have ever held was in small businesses owned by middle class, rather than rich people.
 
You wouldn't happen to have any statistics or economic facts to back up your assertion that raising the minimum wage has a positive effect on the economy, would you? Lefty?
 
The Left and the Right in the USA reminds me of the ying and the yang where one side is after the other and each contains how the other appear externally. It seems the good and pure and well intentioned Poltiical Left in the USA are the ones who are messed up at the core.
from the OP
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Ack ack. That's got to be one of the poorest conceptions of yin and yang I've heard. yin is not messed up. yang is not good and yin evil. maybe we'll meet over in philosophy...

Anyway...

This issue came up during our last election and I voted against it. Maybe I was wrong, and I'm open to being convinced. I weighed several things, and my perspective is definitely that of an employee of a large company, not a small business. Out company however, is privately owned and we the workers all own part of the company. Our CEO earns a lot more than me, but not obscenely more. We already start employees at higher than minimum wage at our location.

My thinking -

1. It would be a mistake to think minimum wage does not impact my company. Labor is a pool, and limited geographically - there is a limit to the range we can draw 'manufacturing employees' from. If the base wage is fixed, we must offer more than that wage to be competitive. We can and do. I can see where this effect would generally raise starting wages for all businesses in the area. Small businesses definitely compete with us for employees.

2. Higher wages will to some extent raise prices, at least in a free market. This would lessen the benefit of minimum wage for commodities like food, but the benefit might remain for durable goods like refrigerators.

3. My concern, at least here in Arizona, is that we are located near Indian reservations (aka 'rez') that would not be impacted by the minimum wage law. A rez is a bit like having a country nearby instead of a county or state. Minimum wage seems to fall apart in that scenario. Workers would benefit by earning more by working in a minimum wage 'zone', and shopping in an area without the wage controls. I would expect everyday things like food to be less expensive in an area without minimum wage. My question for Arizona, was that a minimum wage would have a tendency to geographically divide the labor pool somewhat - I saw the potential for an undesired effect that rewarded workers for remaining in poverty struck areas.

I generally see minimum wages as inflationary, but not for all kinds of goods. There is probably a bell curve of benefit before it becoming detrimental. That tipping point might be linked to the current unemployment rate - if unemployment is high like now, I see little benefit coming from minimum wage. As employment rises though, a minimum wage might be helpful if done in the proper dose.
 
JUST ASKING QUESTIONS: Yes, I actually am asking if there is any research/evidence on these items... I can't find anything via the google button... Can find percentage in poverty, but no apparent comparative studies. Anyhoo:

1. Does establishing a mimimum wage have an effect on the percentage of people living below the Poverty Level (as defined by the government)?

2. What effect on the percentage of people below the Poverty Level does increasing the minimum wage have, if any? Is there a point where the percentage reverses direction?
 
If the free market worked perfectly, there would be no need for minimum wage, since an employee could move to work somewhere else. But it doesn't, and in reality employers have much more power, and can also unite (form a cartel) to control prices and wages. So minimum wage as well as anti-monopoly laws are an attempt to put the balance back.

But the idea is to put workers and employers back to a semblance of a free-market system, when both have equal power or at least some power. Not to magically decide how much everybody must have and declare the market must obey it or else suffer, er, bad words from enraged marxists...
 
leftysergeant said:
Does it do no harm that that fat slob CEO still gets a golden parachute amounting to more than the average working schlub will make in a lifetime after he runs the company into the ditch?
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But companies are evil exploitive capitalist tools of opression, Lefty! Better they ALL run into a ditch. Then we can have the communist utopia, with no fat slob CEOs getting golden parachutes.

Of course, there would be no jobs worth anything, no technology, no nothing, but hey -- screw THAT. You don't mind everybody being poor, so long as no "fat slob CEO" gets rich.
 
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