pipelineaudio
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not at all
Minimum Wage destroys jobs--again!
- Thread starter shanek
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not at all
burnvictim77
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pipelineaudio
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Where do you get this stuff?
Just a little bump here. I asked more than 24 hours ago:
Should I take that silence as meaning your collective answer is, "No, nobody here believes all work is worth at least $5.15 an hour."?
All I'm hearing is crickets (okay, and the lady in the next cubicle yapping with her friends).
Should I take that silence as meaning your collective answer is, "No, nobody here believes all work is worth at least $5.15 an hour."?
Last edited:
Admiral
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I'm against the minimum wage, but I disagree with your characterization that minimum wage supporters believe all work is worth at least $5.15 an hour. (After all, if everyone's work was worth at least that much, everyone would be paid at least that much).
They do, however, believe that everyone deserves to get paid at least a minimum, and that government should ensure a minimum standard of living for working people (and other similar arguments).
burnvictim77
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And what this 2nd paragraph means is this: No one's work can be worth less than $5.15 per hour. If you think the Gov't should pass a law that bananas can't be cold for less than $5 a dozen, that means you believe bananas are worth at minimum $5 a dozen, no?
What sometimes it actually pans out to is this: People whose work is worth less than $5.15 are not legally employable.
I wasn't characterizing them as such. I was asking if any minimum wage supporters believed it.
Emphasis mine. Do they? "Deserves" means, more or less, "earns," or, "has done something to become entitled to something else." There's the old Jack Benny line when he received an award: "I don't deserve this. But I also have arthritis, and I don't deserve that, either." In both cases, he was saying he hadn't done anything to merit the award, or the arthritis.
So, does everyone merit a minimum wage?
Merko
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Of course not. But I do believe that work that isn't worth $5.15/hour is not worth doing in a developed country like the US, and keeping people in such unproductive jobs is harmful for the economy as a whole. It is of course also harmful for the individuals.
We could perhaps re-state your question: Do you believe that all workers are capable of performing work worth at least $5.15/hour?
To this I would answer 'yes', with the exception of neglible groups of severely handicapped and similar.
The bottom line being that by raising the minimum wage, everybody wins. The poor win more than the rich, but the rich win too. However, I don't think minimum wage laws are a very big part of the equation. There are certainly many more important things for the government to do in order to increase job opportunities and minimise loopholes that make it profitable to exploit people in unproductive jobs.
If there were laws against employer collusion, why would players' unions need to persuade clubs to enter a voluntary agreement not to do so?
There's no 'certification of unions' here unless I'm very much mistaken. What you see as a restriction for the employer (rather than 'company' which involves the employees at least as much as the employer), I see as relief for the employees. The employers could fire the strikers, but then the unions could put them into a blockade for doing so.
I agree that there are less obstacles now than there was at Smith's time. But still, the restrictions are on the workers rights to collude - it still seems to me that employers are completely free to collude for any reason, without any restrictions at all.
You get me wrong if you think I mean nothing got better in these centuries. Everything is much, much better now. But the basic pattern still remains - government and laws function mainly to help the employers in keeping the employees in check.
Duh.
But if their work is not worth that much, then where's the money going to come from? How would the business not be losing money on them? Why would the business not decide at that point to simply do away with the job altogether?
Ziggurat
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Who are you to make that decision? Honestly, why can't an employee and an employer make a different decision?
Many of the people who would be taking such below-minimum-wage jobs would be middle-class highschool kids. They wouldn't be "kept" in such jobs, just like people earning minimum wage right now generally don't stay at minimum wage. And is it really more harmful to them to work at very low pay than to not work at all? Again, who are you to decide that they cannot have that option?
Oh, but that's NOT an equivalent question. There may not be enough of such work to satisfy everyone, even if everyone can meet the criteria. And whether or not a worker is capable of doing more valuable work for someone doesn't mean that the work a particular employer would like done isn't worth less than that. So you've posed what you may think is a more relevant question, but it is without a doubt NOT equivalent to, and not a restating of, his question.
Nonsense. There are damned few cases in economics where everybody wins, and this is most certainly not one of them. Hell, even the serious proponents of the minimum wage don't argue that: they only claim that the net benefit is worth the cost.
Yeah, far better for them to be unemployed and making no money.
Actually, as the OP shows, it's the poor and the minorities who lose.
Even though they're unable to show what that net benefit is, besides getting rid of small businesses that provide competition for big businesses who can afford to pay their employees more. A lot of small businesses can't, and a MW increase can put them under.
Ziggurat
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Oh, that's easy to show: the benefit is political power. If the intention was really to help the working poor, as I've been saying for so long, then an increase in the earned income tax credit is much more effective, and at lower cost.
Roadtoad
Bufo Caminus Inedibilis
I'm hoping this isn't too much of a derail of the thread, but one of the companies we haul for is closing its plant in Stockton, sometime later this year. The shop is union, but the union wound up pricing themselves out of the marketplace. The other plant, in Antioch, CA, is non-union, it produces more product, and they do it for less, which really helps the corporation's bottom line.
I wind up hauling the material we pick up out of both plants to a plant in Washington. This particular plant is also union, but the folks who work there complain to me (and no, I don't know why they're complaining to me), about how the union hasn't really stood up for them. They have wound up paying nearly half of their medical benefit out of their own pockets, and their pay raises are not keeping pace with inflation. (They got a whopping 25 cent raise in the last negotiation. Wow.)
It costs to maintain a family. It costs to live. Employers are paying the CEOs salaries that are more and more outrageous, offering stock options that are incongruous with their performance on the job, while employees are getting hammered right and left. Unions are not doing their jobs, but how can they when manufacturers are willing to ship jobs overseas with little provocation? I'm not sure how a MW would fit in with this, but for God's sake, do these corporations have no responsibility to the communities where they're based?
I wind up hauling the material we pick up out of both plants to a plant in Washington. This particular plant is also union, but the folks who work there complain to me (and no, I don't know why they're complaining to me), about how the union hasn't really stood up for them. They have wound up paying nearly half of their medical benefit out of their own pockets, and their pay raises are not keeping pace with inflation. (They got a whopping 25 cent raise in the last negotiation. Wow.)
It costs to maintain a family. It costs to live. Employers are paying the CEOs salaries that are more and more outrageous, offering stock options that are incongruous with their performance on the job, while employees are getting hammered right and left. Unions are not doing their jobs, but how can they when manufacturers are willing to ship jobs overseas with little provocation? I'm not sure how a MW would fit in with this, but for God's sake, do these corporations have no responsibility to the communities where they're based?
Merko
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Because, from post 241: "It is not, however, difficult to foresee which of the two parties must, upon all ordinary occasions, have the advantage in the dispute, and force the other into a compliance with their terms."
In other words, assuming that it is beneficial for the employee to enter this deal because they 'agree', is plain wrong.
There are, in my opinion, two issues here: First, are increased minimum wages beneficial for society? This question pertains to whether we should, with whatever methods are found appropriate, strive to increase minimum wages.
The second issue is whether, in an effort to raise minimum wages, it is justified to limit the freedom of contract of individuals in such a way as to ban wages below a certain limit. As a libertarian, I dislike such limitations, and I certainly would find it preferrable to find other means towards the same ends. In Sweden we do not have any MW law. However, I do believe that it is permissible to impose restrictions on individual freedom if, after careful consideration, it is found that the disadvantage caused to the parties whose freedom is restricted is very slight, while the advantage gained by doing so is very significant. Because I very much doubt that anyone really has a significant advantage from being allowed to work for less than $5.15/hour in a developed country like the US, I think such a restriction should be considered if there is reason to believe that it is efficient. Which is in fact a third issue - even among those who think that raising the minimum wage is good, there are of course many who doubt that MW laws are a very efficient or important instrument in doing so. Personally, I'm inclined to believe that in the US context, it probablyshould be a component of such a policy.
I very much doubt that many face this dilemma. In fact, as others have pointed out, even according to this study, for the vast majority the result is higher pay, not unemployment. We also have laws that say employers cannot require their employees to perform sexual services for them, and who are we to decide that pretty teenagers who want to use sex for a career boost shouldn't be able to do so? Well, we're the majority apparently, so we have such laws. Even though I do not doubt there are a few people who wouldn't mind, most of us prefer having the protection of the law in this regard. And who are you to decide that we cannot have that option?
Correct.
I think you misunderstand me. For sure, there are losers in the short run, such as those people who will (temporarily) be out of a job because their jobs become marginally unprofitable. However, assume for a moment that I am correct in saying that raised minimum wages boost the overall economy. In that case, not raising the minimum wage would similarly bereave some people of the jobs they could have gotten, given a boosted economy. Whatever we do, there will of course be some people who are winners and some who are losers. But what I mean is that statistically, everyone is a winner - no matter what income group they belong to. Everyone's expected income will increase, everyone's chance of getting a job will also increase.
Merko
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They do. Those responsibilities are in the law. As for other responsibilities, no, they don't. Their responsibility is to the shareholders. If the shareholders are not part of the communities where the corporations are based - and this is certainly something I would find regrettable - then they do not have such responsibilities, and we do ourselves no favour in fooling ourselves that they do.
Politics is always about power. Standing in the rain crying for mercy is in fact to exsert power, the power from compassion. But this power is clearly very limited.
Chaos
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They like to misunderstand Adam Smith´s old adage that, paraphrasing, if everybody just looks out for themselves, everybody is taken care of.
What Smith meant is that, if everybody maximizes his own benefits, the economy does well, as if guided by an invisible hand. It´s not surprising that those who have to gain from that misunderstanding take this to mean that, if they´re just as greedy as they can, nobody needs this whole "responsibility" stuff.
Ah, good, somebody bit. Let me add a little to the criticisms others have made:
1) "Of course not. But I do believe that work that isn't worth $5.15/hour is not worth doing in a developed country like the US..."
So if I hire Manuel's Lawn Care Service, the law dictates that Manuel pay Fernando and Raul $5.15 an hour to mow my lawn or rake my leaves, even if fifteen-year-old Stevie down the block would be willing to do the job for less. Since the market has determined, through Stevie's bid on the job, that the work is worth less than $5.15 an hour, you conclude that the work is in fact not worth doing, and I should let my lawn grow until my cats can't find their way home through the undergrowth and my neighbors get up a petition against me (FWIW, I mow my own damn lawn...).
2) Nobody is "kept" in unproductive jobs. For starts, if work is "unproductive", it contributes nothing to the economy, and an employer whose business model consists of contributing nothing to the economy soon becomes a bankrupt employer.
Second, if an employee is truly "unproductive", a wise employer will make that employee an ex-employee. Unless the employee works for the government...
Third, nobody is compelled to stay at an "unproductive" job, or even a minimum wage job. You don't even have to go to school. Just keep your eyes and ears open and learn something about the business you're working in, and you get promoted, even if you're flipping burgers at McDonald's or running a cash register at Wal-Mart.
Finally, the idea that employers should be compelled to pay more for a commodity than the free market decides it's worth is ridiculous. Imagine you decide to buy an old pickup truck and on the side, you paint the words, "Merko and Sons - Light Moving and Hauling." Gasoline is a major component of your business expenses; in fact, it is the biggest component. Gas is selling for $2.50 a gallon, and you're okay with that. You need to keep your truck protected from the elements and theft, because it's your livelihood, so you rent a lockable garage for $250 a month.
Now comes the federal government, declaring, "Never mind what the market says the price of gas should be; the price of gas will henceforth be a minimum of $3.50 a gallon, until we decide it should be raised further."
And now comes the state government, declaring, "Never mind what the market says the cost of rent should be; the cost of renting a lockable garage will henceforth be a minimum of $350 a month, until we decide it should be raised further."
You'd protest that that is ridiculous; what business is it of the government to decide what Merko and Sons should pay for the cost of goods and services it needs?
What is the justification for treating wages any differently?
Silly me.
Merko
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I'm not totally opposed to certain exceptions for adolescents or such. That's more related to the fact that lots of people simply can't be bothered - understandably - to file taxes properly for just hiring the neighbor's kid to do something, which sort of creates an entryway into black labour.
The bottom line is that while I don't mind if the neighbour's kid cuts your lawn for less than $5.15, no, it's not a real job, it should not be considered a real job, and if people are doing such things instead of working a real job, this is harmful for the overall economy. It's also a typical example of what Adam Smith would call an 'unproductive' job.
Lack of wisdom is unfortunately not limited to the government. Additionally, just because it may be profitable for the employer, doesn't mean it is productive for the overall economy. It only means they got somebody to pay for what may well be unproductive work.Second, if an employee is truly "unproductive", a wise employer will make that employee an ex-employee. Unless the employee works for the government...
That's not really true in practice. Lots of people are working well and hard without ever getting promoted, perhaps because the boss doesn't like them. There is also the incentive for an employer to keep someone who is doing well in doing what they currently do. For example, a person employing a burger flipper may not need another manager. Maybe the employer is the manager. Just because the burger flipper seems to learn fast and always flips burgers well, there's no guarantee they'll be good at something else. So better keep them flipping burgers indefinitely.
The price of gas around here is about 65% taxes, what's your point? It's because of this thing called global warming, you see.
There isn't any.