The $15 Minimum Wage
What do you think of Nick Hanauer's suggestion that we have a $15 minimum wage?
His article suggesting this can be found here:
http://topinfopost.com/2014/06/30/ultra … are-comingI think we should go ahead and do it. And double my SS payments at the same time, and let government intervene in the wages of my children and get them all doubled, too. Then, to prevent all business from going under, we can have government force the doubling in price of every product and service in the country.
And when it's all done and over, we'll all be exactly where we are now but with a massive increase in government controls. Which is always a good thing, right?I think they might have been testing the waters on this premise when they raised the gas prices 100% over the last 6 years. Their so innovative and proactive!
?? According to http://www.eia.gov/tools/faqs/faq.cfm?id=247&t=10 the average price of a gallon of gas 6 years ago (July 7,2008) was $4.11. My area is going for $3.75 - a decrease of 9%, not a twofold increase.
Looks like lots of numbers fly around this topic. Throw this in your mix for what it is worth:
http://www.gasbuddy.com/gb_retail_price_chart.aspx
Set it to a 6 year time period and create a graph. This supports the doubling argument. I have to run premium and I remember paying half as much, (and complaining about it).
The motto of this country USED to be ask not what your country can do for you but what YOU can do for your country; it is now ask not what you can do for your country but what YOUR COUNTRY can do for you and OWES you. America is becoming the big welfare state.
No, minimum wage should not be raised to $15 hourly. The context of minimum wage is that the job is a step off to better jobs. Minimum wage jobs are for those with no experience nor skills. That is why it is called MINIMUM WAGE. When one gains the prerequisite experience, wages increase. People earn according to their skills and education. People with little skills and education earn....well, LESS. That is the way it should be. To raise minimum wage is, in essence, rewarding people with little or no skills nor education. That is not good business practice nor sense. Hell, keep minimum wage the way it is, adjusted to inflation of course! Welcome to ENTITLED America, not hard-working America!We're talking about a living wage. Minimum wage is not a living wage. When minimum wage is not a living wage, then those people must turn to government for basic needs and we all pay for that. Raising the minimum wage is posed in the article (if you read it) as a possible solution for helping us all STOP paying for those who need that government help.
Did you read the article, Wilderness? He's arguing for less government and that raising the minimum wage will actually reduce the size of government because people will need fewer services. Certainly, all those Walmart employees on Medicare might be off the government dole.
I'm sorry, but the terms "less government" and "raise minimum wage" are the antithesis of each other.
And providing higher wages does NOT take people off charity. All it means is that the so called poverty level must again be raised so that people can still get their free money and luxuries.Yes, everybody knows that it essential for many to live in poverty so that others can claim their rightful heritage, more of the money.
Or at least it is essential to claim it is so. If we don't claim that people rich beyond anything our grandparents dreamed of is actually poverty stricken and starving to death, it means we can't collect and give away vast sums of money. And that means politicians lose control over the people and their votes. Obviously unacceptable.
C'mon, Wilderness. You must understand the basic concept of this.
If we raise the minimum wage, working people on the minimum wage will be able to get off food stamps and Medicare, thereby lessening your burden for having to pay for these services that they use.
By raising the minimum wage, we increase their ability to purchase goods, thereby helping businesses. In any business, there are two ways to make more money: increase margins based on flat sales (raise prices) or increase marketshare (sell more goods with the same prices). Raising the minimum wage suggests that the people who benefit purchase more goods, thereby increasing the profits of the businesses they frequent.
All the states where the minimum wage has been raised in the last year have above average job growth too.And how will they be able to get off welfare (in all it's forms) when prices will rise right with their wages? That IS what happens, you know, unless there are severe extenuating circumstances (such as nearby competition that did not raise it's wages). Prices go up commensurate with the wage increase and the people are no better off. We've seen it a thousand times, and it is THE reason unions have about destroyed themselves; the constant requirement for wage increases to be better off than non-union workers result in the same kind of inflationary pressure you are proposing by government setting labor prices without regard as to the value of the work being done.
No, there is no "suggestion" that people getting a doubling of minimum wage will purchase more goods; they won't have the money to after the prices rise.
And you're "putting the cart before the horse", confusing cause and effect. When business is great, misguided politicians decide it is time to buy some "poverty votes" and force business to pay for something they don't get. But when business is poor and the same thing happens things fall apart quickly - we just don't talk about that end of it so as to pretend that the forced artificial wages is causing the business to boom. It isn't.All through history an increase in demand has resulted in a decrease in price.
The claim that prices rise when the minimum wage rises is not true. If the result is that more goods are purchased, then prices do not have to go up. Also, if a corporation like Walmart, which made something like $25 billion dollars, could accept $15 billion in profit instead, prices would not have to rise.
Again, the idea is that people who benefit from a rise in the minimum wage will purchase goods with that extra money.I've been telling him that for months with absolutely no effect!
The reason Unions have destroyed themselves has more to do with excessive pensions (see GM) than with price increases. That being said, unionization is good for workers seeking fair labor standards provided that they are reasonable just as capitalism is good provided that capitalists are somewhat reasonable in their quest for profits. Regulation occurs when people are not reasonable.
Maybe to stop the corporations turning us into another third world country?
This is a great question. If you don't believe in raising the minimum wage or having a minimum wage that offers a minimum standard of living that does not require government help, why mandate one at all. Why not just let corporations dictate what they will pay? In fact, what do you think would happen if we abandoned a minimum wage? Any guesses?
I wish someone would explain to me what the big deal is. I truly don't understand how places like Denmark and Germany (and many more) pay such high wages to their employees yet businesses are thriving. The average Mcdonalds employee (adult worker) is paid $20 an hour. Even after crazy taxes on the employee they still make more than USA employees. So if there is someone who can rationally explain to me why this is so successful in other countries but would be catastrophic to USA business I'd appreciate the explanation, because I truly don't understand the difference.
Can only guess, but some thoughts:
Average income for the Danes is around $2600, only $600 more than the effective minimum. In other words, income is shifted from those jobs worth more to those jobs that are not worth what they are being paid. If you like socialism but not work it's a great deal.
Taxation is huge in Denmark, over 50% for the average person and there is no minimum amount to pay taxes on. The VAT alone is 25%! Again, nice for the socialist that has little income as someone else will pay to run the country. For the worker, trying hard to improve their station in life, it would be very difficult and lowers actual income to something more in line with the US.
Many prices are huge compared to the US. Car ownership is enormous, many times that of the US. Home ownership is over $200 per sq ft, as opposed to well under $100 in the US. The extra income, then, buys less than a lower income in the states.
All is not as rosy as it seems at first glance.We must be looking at some seriously varying information. The multiple articles I have been reading show a net income monthly ( average in dollars after taxes) between $3500 and $4300 NET. They have repeatedly been named the happiest place in the world. They have far less corruption. The crime rate is SUBSTANTIALLY lower. So all that providing for the poor (all people there are provided the same benefits from the government) must be doing something right. In USA income is directly correlated to intelligence, unplanned pregnancies, education, crime, and several other things. Is it possible that their higher incomes are in correlation with all the things there that are better than here?
Can't find where I got mine, but here is a wiki set of charts from various sources. In all of them, the US is higher than Denmark, and that's gross, not net. With higher prices and much higher tax rates the difference will be even greater in terms of buying power.
http://en.wikipedia.org/wiki/List_of_co … erage_wage
As far as a better place to live, higher living standard, etc., I've had this argument before. All the studies indicating that place high value on socialism and the things socialism produces such as common health care, subsidized housing, lots of freebies at the expense of high taxes. Americans (as a group) are not as interested in that, preferring big houses, lots of (long distance) travel, big toys, etc. In other words, standard of living is extremely subjective and you can "prove" whatever you want.
Making a causal relationship out of a correlation (giving to the poor causes less crime) is a logical fallacy. You cannot make that connection; the crime rate could be low because penalties are severe, because there are 2 policemen per resident, because the country is high on drugs and doesn't care, because a lot of different possibilities. You just cannot declare that giving money away reduces crime rates.Yeah, it lists the U.S. at $55047. That may be the average wage, but it's not even close to what the average American makes (billionaires tend to skew these things). Try reducing that number by 20-25 grand, and then it'll be much more representative.
EDIT: $4537 monthly average wage?! What the hell are these people smoking?! It would take everyone in the house combined two months to make that!The median wage in the US is $27519.10 in 2012. Note that that means half the people made less, half made more. Don't forget that a decent percentage work part time by choice, such as homemakers, retirees and kids. http://www.ssa.gov/oact/cola/central.html
So you've exaggerated just a big - two wage earners, including kids, homemakers and retirees working part time by choice, can make that monthly wage. Statistically, anyway; obviously two people working minimum wage for 10 hours a week won't make it.
And don't forget that the $$$ in the check are only part of the wage - paid time off, SS payments, unemployment insurance, medical insurance, life insurance, LTD insurance, bonuses, free day care or gyms and a host of other things all enter into it. Sounds about right to me, for an average - 20 years ago the normal "bennie" value was around 30% of the $$ wage and it's gone up since then.What about those working part time not by choice but because there are no available full time jobs?
Oh and they are probably on zero hour contracts as well.They lower both the median and average. Simple arithmetic - you should have been able to determine that as well as I can.
What is a "zero hour contract"? That's something we don't have and I've never heard of it.It most be great comfort for those trying to get by on part time work that they lower both the median and the average! It still doesn't mean that they choose to work part time though does it?
You don't have zero hour contracts! Good, that's one up to you.
In a zero hour contract you are not guaranteed any work although you are expected to be available at your place of work if you are needed. Of course if your "employer" has no work for you you don't get paid.The closest we have to that zero hour would be temporary work agencies that require to you check in first thing in the morning to see if there is work. It is illegal in the states to require you to be at the job without pay.
As far as comfort to the poor, I'm not sure what that has to do with the arithmetic used to calculate averages and medians.It was in response to your comment "working part time by choice".
Ah. But that was simply a reminder that millions do just that, work part time by choice, AND those numbers will absolutely sway both median and average earnings. That's undesirable; we aren't interested in some kid working 10 hours per week for some spending money. Our interest is more of what a full time worker earns, on the average (or median) in the US.
And the figures are equally swayed by those who don't work part time by choice.
You can't claim that because some don't earn enough others earn plenty!
Oh I suppose you can. Look these millionaires earn masses, everybody must earn masses.
Why stop there? Since so many people think that raising the minimum wage is the answer, why not make it $20 an hour, or $50, or $100?
I can't understand how so many, seemingly otherwise intelligent people, can fall for, what is at its heart, such a stupid argument. So many people, especially those in my party, seem to think that the only thing standing between a strong middle class and economic prosperity for the poor, is raising the minimum wage.
The simple Economic reality is: raising the minimum wage does not "boost the Economy, and it doesn't "lift people out of poverty", all it does is hurt low-skill, uneducated workers, the very people the minimum wage was designed to protect.OK if raising the minimum wage doesn't help to boost the economy by the same reckoning paying 50c an hour would not have a detrimental affect on the economy either!
That's like saying "Since aspirin doesn't cure cancer, it must be fatal".
Your comments are always entertaining John, but they're simply not based in any kind of Economic reality.
Since however you seem to believe I'm wrong, answer my question: Why stop at $15? Why not make it $20 an hour, or $50, or $100? If, as you seem to believe, boosting the minimum wage is nothing but good for workers and the Economy overall, why stop at $15?Probably a much better idea than setting artificial numbers that have nothing to do with market value received, wouldn't you say? When prices are mandated according to the perceived needs of the seller for necessities+luxuries it kind of throws a monkey wrench into the whole concept.
What? The whole concept of getting something for nothing?
How about economic theory. Finance. Money. Value.
No other product sets price according to the personal needs of the seller; why should labor be any different? When the grocer sells me a loaf of bread he doesn't ask how many people are in my home, or how much my medical bills are - why should a potential laborer get that option? Just because he's in the business of selling labor instead of manufactured items?But that is different, the grocer gets to set the price of the loaf of bread that he's selling, the person buying the labour gets to set the price he's paying.
Fine. The grocer sets a price of double what the competition is asking - do you think he will sell any? And when the laborer sets a price of double what the work is worth, do you he'll sell any?
John, you simply cannot pretend that labor costs aren't subject to the same kind of cost/price pressures that every other product is. Because it IS subject to competition, and trying to artificially force a price isn't going to change that. Crying out that the laborer needs more to support his lifestyle, that he has little kids to feed, that if he isn't paid you'll blackmail society by requiring charity for him; none of that is going to change the value of his product (labor). And when you force the price up by law, the only real result is that everything is going to rise too - it's called competition.But the labourer does not set the price of his labour, the buyer sets that.
Labour is not just another commodity.
So increased demand results in increased prices! How does that work?
See, just as I was saying: entertaining, but no grasp of Economics.
No, being smart isn't answering the question.
If I ask for the experience of your superior knowledge and you respond with sarcasm how will I ever learn?It's not sarcasm John, it's simple fact: you're a very clever, and entertaining commenter, but you don't seem to have any grasp of Economics.Now while normally that's not a problem, it's a bit of a hindrance in a discussion about Economic Policy.
I'm not avoiding the question John, you're dodging my question with a glib response. I know you're active here on the forums, so just in case you've forgotten the question you've been dodging:
Why stop at $15? Why not a $20, or $50, or $100 minimum wage?And my question was why not 50c of even zero?
You've made your views on a higher rate quite clear, why won't you tell me your views on a lower rate? You must have one!
.....Why stop there? Since so many people think that raising the minimum wage is the answer, why not make it $20 an hour, or $50, or $100?
Because it is the lowest calculation based on inflation, expenses and living standards currently understood in the US.
Raising the minimum wage is not the only thing that will spark the economy. Why is it that with these conversations people like to point to the silver bullet, one thing cure for a problem?
The whole shooting match went out the door when the NAFTA and TPP agreements came to maturity in the '90's and more recently the TPP as late as 2013. The corporations have been after the low wage labor pool to reduce their cost while pocketing the difference. A raise in the minimum wage is one way of putting the consumer end of the process back in the process. Basic economics does not account for all out greed and the favor it has bought. Perhaps with more money to be made there may be some competition between the retailers when more money is available. I agree it may be temporary but it will spark a change. I always thought the best scenario in the bank debacle was for the government to give the money to the people to pay off their debt. The banks would have become flush again and the people would be out of debt. But that is another topic completely. We now trade on debt and not assets.
Eventually if people can pay their bills and buy products the economy will move right along. So far the recommendations from the economists is work hard (as if that is not an option), save your money (what money if you can't get a job), invest in sound market choices (again with what money) and get more education ( again with what money).
....all it does is hurt low-skill, uneducated workers, the very people the minimum wage was designed to protect.
And I really need you to explain this!What will doubling minimum wage do to the millions of college grads out there, working in their chosen fields, at $15-$20 per hour? Think there might be a little inflationary pressure for all of them to double their wages, too? And of course doubling what is often the single largest cost of a business won't affect the price charged for the product, not at all.
It's fascinating to see people claiming that huge labor cost increases absolutely will NOT result in rising prices, an inflationary circle that has driven Detroit and Chicago to their knees. That has virtually wiped out town after town as the unions drove the major employers out of business with continual wage increase demands. We've all seen it happen and now want to do it to the entire country, all the while pretending that inflation is just a bogey man that will never happen. How quickly we forget the double digit inflation of the 70's and 80's - or is it just those that didn't live through it, paying 20% interest for a home mortgage, that think inflation can't happen? As it did when payments on a $200,000 home were $3300 per month for 30 years?But a small rise in the minimum is not a huge increase!
And why do you expect the low paid to subsidise your lifestyle?100% is not a small increase. Neither, in this country, is a $7 per hour raise. It is massive in both cases - I never got anything like that in 50 years of working.
I don't expect subsidies and have a problem with people that do. Expect them, that is, not necessarily get them. Some need, and deserve, some help back on their feet.But by insisting on a low minimum wage you are expecting a subsidy!
Why? School kids don't need more, and even youngsters just starting out can get by just fine with minimum wage. They may need a roommate, they may not be able to have the newest cell phone or cable TV, but I have absolutely zero desire to subsidize such things for them.
Anyone with a family expecting to make it on minimum wage needs their head examined. And a new job, one suitable for an adult with some experience under their belt.Something tells me you haven't been on the job hunt in the past, say, 11 years. Guess what? Minimum wage jobs are the only jobs out there anymore.
My sister had to look for three years--THREE YEARS--to finally land a job that pays more than minimum wage. How much more? She gets $9.25/hour instead of $7.25/hour. And landing this job took, as I mentioned, THREE YEARS.If you really believe that only school kids and youngsters are paid the minimum wage you are really out of touch. Guess what, my 40+ year old friend is on the minimum wage and she's no exception.
Ok Mr. Holden, now here are the questions regarding your 40 year old friend. What level of education does she have? Does she have a speciality, instead of a general education? What is her skill level. if any? Does she have relevant work experience? Other questions include: If she was fired for cause from a job? If so, where the reasons unethical? If the latter reason is true, companies are loathe to hire people who were fired for unethical reasons such as misconduct, violence, and other egregious work place acts. Such people, although qualified, will be relegated to minimum wage as companies will be hesitant to place such a person in a high wage job as he/she is deemed as untrustworhy/unprofessional in addition to being damaged goods. Just sayin'.
What has any of that got to do with anything? She's on a minimum wage.
In the interests of clarity, I'll take this point by point:
First, it's not a simply question of the cost of U.S. Labor Vs. [Insert Country Here]'s Labor. When companies outsource, what they're actually saying is: "We can manufacture, package, ship, insure, pay import fees and tariffs, and still come in cheaper than if we produce the product in the U.S.". You can't blame the company for that.
There was an article a few years ago that showed how much an iPad would cost if it were made in the United States, the difference was a 57% jump in price (from $729 to $1,144).
As I've said before, increasing the minimum wage doesn't add money to the Economy, it redistributes it. Wages right now are not a product of "Corporate geed" or some nefarious right-wing plot, they're a result of the supply of labor far exceeding the demand. Until something is done to reduce the supply of labor, wages will not rise, and mandating higher wages will only make a bad situation worse.
When we talk about minimum wage workers, it's important to know who we're talking about. Right now, roughly 3.3 million workers are paid at or below the Federal Minimum wage, that's 4.3% of the workforce (about 1% of the total population).
Half of that 3.3 million is under the age of 25, included in that are teenagers who make up 20%. These are students and people just entering the workforce.
Only 2% of minimum wage workers are people getting paid minimum wage for full time jobs (more than 35 hours a week). Minimum wage workers are 2.5 times as likely to not have a high school diploma, and 5 times as likely to not have a college degree.
Now let's look at the minimum wage itself.
Right now, the Federal Minimum Wage is $7.25 an hour; but that doesn't really tell us anything. The two most important questions are: "Why do people make minimum wage", and "What will happen to those workers if we increase the minimum wage".
The second question is easy to answer: a lot of them are going to lose their jobs. Raising the minimum wage to $15 an hour would be an increase of 107%. You don't need to be an Economist to recognize that, more than doubling the cost of unskilled labor, is going to reduce the demand for unskilled labor; this will lead to higher unemployment, which will add to the existing surplus of labor, which will only serve to compound the problem of low wages which are caused by... a surplus of labor.
As for the first question: "Why do people make minimum wage", that's also a simple answer: because that's all the job is worth. You'll notice I said "the job" not "the employee"; Progressives love to play the emotionally manipulative "people are worth more than $7.25 an hour" card, and they're right: the people are worth more than $7.25 an hour, but the job isn't.
Every job has both a cost, and a value to the company. If the cost is equal to, or greater than the value, then it doesn't make sense to have that job. Why is that important? Because when you set a wage- any wage, what you're saying is: Value > Cost. If you increase the cost (by raising wages), then the value needs to increase with it, or eventually you'll get to a point where: Value = Cost, and it no longer makes sense to have that job.
If you double the cost of labor, you're then placing a burden on the workers to double their value, or it doesn't make sense to keep employing them. So what you end up with is a situation where only the best minimum wage workers keep their jobs, and the rest are terminated, and (as is becoming more and more common), replaced by technology:
McDonald's Is Quietly Testing Its Own Order-Ahead And Payments App
Tablets Are Making Waiters Obsolete
100,000 Applebee’s Tables Get Tech TreatmentYou're arguing that if we raise the minimum wage, then jobs will be lost.
However, in the 13 or so states that raised their minimum wage, all are seeing increased job growth. That doesn't mean increasing the minimum wage creates jobs or necessarily increases job growth, but it does seem to suggest that it doesn't kill jobs either.First, you'll need to provide sources on that one.
Second, one doesn't necessarily have anything to do with the other. Raising the minimum wage kills "minimum wage" jobs; it's entirely possible for a state to have a net gain in employment after raising the minimum wage, but that doesn't help the low skilled, uneducated workers that lost their jobs because of the increase.
As I said, minimum wage workers only account for 4.3% of the workforce.4.3% is not the only ones making below $15.00 per hour. It raises all the in-betweens as well. $2,400 a month is not a lot of money in this country and barely gets you by. But it is a start on a long recovery for the poor.
No answer Shawn? Why not 50c or even zero?
Sure! A biased source, but let me know what you think:
http://www.huffingtonpost.com/2014/07/1 … 71412.html
No worse than deriving policy direction from The Washington Times.The problem with the study they cite is the same with people who say the Unemployment Rate is 6%... they're using the wrong number. I'm not going to go so far as to assign motive and say that they're doing it intentionally, but the mistake is the same either way. They're taking those numbers from the Household Survey, which is the wrong number for what they're trying to prove. The number they should be using is the U-6, which is the "real" unemployment number.
What they're doing is juicing the number by cutting off the back end of the sample.
False assumption, that raising the minimum wage won't cost jobs because states where business is booming, and raised their wage, it didn't happen. You are failing to account for a whole myriad of factors.
I know a lot about analytics and I basically agree with you Wilderness that people draw assumptions from data sets that don't give them the answers they want.
...."We can manufacture, package, ship, insure, pay import fees and tariffs, and still come in cheaper than if we produce the product in the U.S.". You can't blame the company for that.
As referenced in my first reply the NAFTA and TPP agreements are what caused the fleeing of jobs to other markets. The blame is on the government who was coerced by the corporations to do it. In effect they have circumvented the natural progression of wage increases here to account for a rise in minimum wage requirements and inserted that of a third world standard of living to base those wages on. It really isn't rocket science. If you take somebody's money away and give a mere pittance of it to somebody who lives near or below the poverty level where it is an exorbitant amount under their standard of living, you have essentially made a killing as the manufacturer. The problem lies in when you try to sell the product back to the guy who lost his job. He now makes the same wage as the foreign worker in a grossly inflated living standard with all its costs and responsibilities and has to pay dearly for anything. The corporations have pocketed the difference for all this time and now when it has effectively thrown the labor pool into poverty there is no correction?
....There was an article a few years ago that showed how much an iPad would cost if it were made in the United States, the difference was a 57% jump in price (from $729 to $1,144).
How much did it cost to manufacture it under the slave labor and what was the mark up? I produce a product that is made in China and the tooling costs are ridiculously low. They make their money on the back end providing the product. If I could take the hit that tool manufacturers want for the same tool I could well afford the product made here in the US. Before you flame me for having the product made in China, AAAAALLLLLL of my competition has their product made in China. When the computation is made of the difference it is pennies that make the decision as retailers want the bottom line.
....As I've said before, increasing the minimum wage doesn't add money to the Economy, it redistributes it.
A very true statement! But what it does account for is the money being put back into the US economy so that US citizens have more to spend. Then jobs are created to account for demand and supply catches up quickly putting people back to work.
....Wages right now are not a product of "Corporate geed" or some nefarious right-wing plot, they're a result of the supply of labor far exceeding the demand.
Absolutely!, because the job went where? Corporate greed in order to show growth to their shareholders has essentially replaced the US labor market with the Chinese labor market. What is left for US workers now is service oriented jobs that are in extreme competition with each other and therefore pay the bare minimum wages they can.
....Until something is done to reduce the supply of labor, wages will not rise, and mandating higher wages will only make a bad situation worse.
One is not related to the other. What would you have us do? Relocate the US labor force to China therefore effectively reducing the surplus of workers here so that the wages can rise? Corporate America has already done that without the move. The only thing left is to get rid of these pesky US labor drones so that wages can rise? Mandating higher wages is the only option as the trade agreements are keeping those jobs overseas.
....."We can manufacture, package, ship, insure, pay import fees and tariffs, and still come in cheaper than if we produce the product in the U.S.". You can't blame the company for that.
Why not they paid for it when they lobbied congress to put the trade agreements into motion. Absolutely they can accomplish all of that but at a cost to their customers ability to pay for anything. It is quite simple. It was not the smaller companies but they have to compete with the corporations so they are in the same boat. If you have a goose that produces eggs for a certain amount and then you take the goose away, how will you get your eggs and better yet pay for them with what? You are holding the manufacturers harmless irrespective of their past actions. They wanted to circumvent their costs at the cost of the consumers ability to pay.
....And I really need you to explain this!
YES! Because none of your figures explain all those who are out of work because they can't get a job. Two thirds of new jobs created are part time and most of those are minimum wage jobs. I am talking about creating demand by putting more money in their pockets. More money in their pockets means that manufacturers will be able to hire because demand has risen. Forget the short term cost to employers if there is more work!
....The second question is easy to answer: a lot of them are going to lose their jobs. Raising the minimum wage to $15 an hour would be an increase of 107%. You don't need to be an Economist to recognize that, more than doubling the cost of unskilled labor, is going to reduce the demand for unskilled labor; this will lead to higher unemployment, which will add to the existing surplus of labor, which will only serve to compound the problem of low wages which are caused by... a surplus of labor.
Not according to the US Department of labor. It has no effect on the loss of jobs.
http://www.dol.gov/oasam/programs/histo … ts/pay.htm
And I quote!
"The standard criticism of the minimum wage is that it raises employers' costs and reduces employment opportunities for teenagers and disadvantaged workers. However, several studies have found that the last two increases in the minimum wage had an insignificant effect on employment. Furthermore, an extension of the time-series studies that had previously been used to claim that raising the minimum wage decreases employment, no longer finds a significant impact.
In a recent review of the literature, Professor Richard Freeman of Harvard, a widely respected labor economist, wrote: "At the level of the minimum wage in the late 1980s, moderate legislated increases did not reduce employment and were, if anything, associated with higher employment in some locales."
In discussing the minimum wage, Robert M. Solow, a Nobel laureate in economics at the Massachusetts Institute of Technology, recently told the New York Times, "The main thing about (minimum wage) research is that the evidence of job loss is weak. And the fact that the evidence is weak suggests that the impact on jobs is small."
....As for the first question: "Why do people make minimum wage", that's also a simple answer: because that's all the job is worth. You'll notice I said "the job" not "the employee"; Progressives love to play the emotionally manipulative "people are worth more than $7.25 an hour" card, and they're right: the people are worth more than $7.25 an hour, but the job isn't.
As based on what? A wage you can pay a foreign worker In a depressed state of living. That is the real comparison as all jobs are inter-related to each other as trade labor or goods for money. You cannot remove one from the other without an impact.
....If you double the cost of labor, you're then placing a burden on the workers to double their value, or it doesn't make sense to keep employing them. So what you end up with is a situation where only the best minimum wage workers keep their jobs, and the rest are terminated, and (as is becoming more and more common), replaced by technology:
We have already doubled our value. Have you not heard that the production of the American worker. We are second only to Asia in productivity in the world.
http://www.nbcnews.com/id/20572828/ns/b … 76y2SJOW00
You are dealing with outdated and stick in the mud economics. The big picture evades you because of the short term solutions you don't even have. Eliminate the surplus of workers should be eliminate the competition to our standard of living as the only result of the course we are taking is a race to the bottom. What that may look like I hazard to guess.It's the same misguided arguments over and over. There always has to be some big conspiracy, whether it's Corporations or Republicans, there always has to be some "Boogyman" out there causing all the problems.It couldn't possibly be because the of the terrible Economic policies from politicians? No, that couldn't be it. I mean why wouldn't a group made up predominantly of professional Politicians and Lawyers be qualified to craft complex Economic Policy?
Let's go through this one more time...
First, you're not talking about a "moderate increase in the minimum wage", you're talking about doubling it; 107% is not, by any measurable standard, a "moderate increase". If you were talking about bumping the minimum wage to $7.80, or even $8, that would be one thing, but you're talking about going from $7.25 to $15. That will cost a lot of minimum wage workers their jobs, period.
Second, wages are entirely a product of Supply and Demand, and anyone who tells you they aren't is either lying, ignorant, or selling something. If wages had nothing to do with Supply and Demand, then everyone would be paid the minimum wage, since there would be no market forces in play compelling them to pay more. Since less than 5% of the workforce is paid at, or below, the minimum wage, we know that there are market forces in play... Supply and Demand.
Third, raising wages does not "boost" the Economy. The money for that increase has to first be taken from the Economy and given to workers. If you take $1,000 from a business and give it to the workers to spend, you're not adding $1,000 to the Economy, you're putting back the $1,000 you just took out. The best case scenario is a $0 net change. If those workers decide to take some of that $1,000 and, oh I don't know, pay off credit card debt, then you'll actually lose money.
As for the productivity of American workers, that's due, in large part, to technology. We're rapidly getting to the point where technology is going to stop augmenting worker's productivity, and start replacing it. A prime example of this is the new "Google Car". Most people see it as a cool, Knight Rider-esque style toy, I see it as 30,000 out of work Cab drivers in New York City.
Pretty soon, your cell phone is going to replace fast food workers, doubling their labor cost is just going to speed up the process.
See the one thing that people forget when it comes to mandating higher wages, is that the Government can't mandate employment. Yes, the Government can tell McDonald's it has to pay it's workers $15 and hour, but it can't force McDonald's to actually hire people.
And before you think I'm exaggerating, trying to "scare people", they had this 50 years ago...
https://www.youtube.com/watch?v=FmXLqImT1wE....It's the same misguided arguments over and over. There always has to be some big conspiracy, whether it's Corporations or Republicans, there always has to be some "Boogyman" out there causing all the problems.It couldn't possibly be because the of the terrible Economic policies from politicians? No, that couldn't be it. I mean why wouldn't a group made up predominantly of professional Politicians and Lawyers be qualified to craft complex Economic Policy?
No boogeyman here as history speaks for itself. Why did Clinton, a democrat by the way, push to enact the NAFTA agreement. Was it out of benevolence to foreign nations to cash in on the capitalist bonanza here in the US? Of course not. It was his campaign donors the PAC's were loaded with them. The lobbyists and lawyers were his top donors. And absolutely the terrible economic policies that ensued that created the biggest exodus of jobs this country has ever seen.
....First, you're not talking about a "moderate increase in the minimum wage", you're talking about doubling it; 107% is not, by any measurable standard, a "moderate increase". If you were talking about bumping the minimum wage to $7.80, or even $8, that would be one thing, but you're talking about going from $7.25 to $15. That will cost a lot of minimum wage workers their jobs, period.
Your logic is over ridden by the references I made in the last post. The US labor department says it will have no significant effect on job retention. Period. Just because you keep telling me the same thing does not make it so. Yes basic economics tells us that labor is a cost of manufacturing an item and that when the cost goes up it is passed onto the consumer. Your reasoning is that to remain competitive the employer would have to lay off the employee. Guess what the employers sales will increase because his demand will increase due to the increased buying power that was created.
....Second, wages are entirely a product of Supply and Demand, and anyone who tells you they aren't is either lying, ignorant, or selling something. If wages had nothing to do with Supply and Demand, then everyone would be paid the minimum wage, since there would be no market forces in play compelling them to pay more. Since less than 5% of the workforce is paid at, or below, the minimum wage, we know that there are market forces in play... Supply and Demand.
Look above.
....Third, raising wages does not "boost" the Economy. The money for that increase has to first be taken from the Economy and given to workers. If you take $1,000 from a business and give it to the workers to spend, you're not adding $1,000 to the Economy, you're putting back the $1,000 you just took out. The best case scenario is a $0 net change. If those workers decide to take some of that $1,000 and, oh I don't know, pay off credit card debt, then you'll actually lose money.
Since when does a business give $1000 away with out marking it up in their product. Dumb analogy. If the production increases because of demand the costs will go down as mass production decreases cost.
....As for the productivity of American workers, that's due, in large part, to technology. We're rapidly getting to the point where technology is going to stop augmenting worker's productivity, and start replacing it. A prime example of this is the new "Google Car". Most people see it as a cool, Knight Rider-esque style toy, I see it as 30,000 out of work Cab drivers in New York City.
Absolutely so why did we ship the skilled jobs overseas? The jobs in the manufacturing segment were where the money for the middle class came from. So why did we ship them to cheaper labor pools. The bottom line and short term gains were required. Now if you are a corporation who has invested heavily in robotics and such technology as the jobs come back over here you can make a killing.
....Pretty soon, your cell phone is going to replace fast food workers, doubling their labor cost is just going to speed up the process.
What world do you live in. Who will cook the food and clean up the facility and deliver the product?
WalMart is even feeling the pinch of the out of work and underemployed. They have recorded several quarters of negative gain. They are looking to downsize more into a large 7-11 type store. Guess who is going to run those?Why couldn't it be the terrible economic policies of government? They are after all in the pay of the money men.
Why? What evidence do you have to make that claim?
When they introduced a minimum wage in the UK those who opposed it predicted huge job loses. It didn't happen.
You are not of course so naive as to believe that those earning a dollar or two over the minimum wage are sorted are you? The minimum wage isn't an approximation, it is an absolute and will exclude everybody earning even just a few pence over.
Do you really believe that money is one trip, use it once and it's gone? You do know why yhey describe money as being in circulation don't you, and you do realise that there is not actually any less money around than when times were better. There is as much money, it just isn't circulating as quickly.
Take a business like Wal Mart with profits of c$35 billion, if they paid $10 billion to their workers they would get most of it back within weeks and make even more profit both from their employees and from those others that their employees spend their money with.
Those paying off their credit cards are again increasing the money in circulation.
A cell phone that can flip burgers! I must see that.
No, the increase in employment comes with the increase in available money in circulation. Instead of dad being able to take the kids for a big mac every month or so, taking them every week or so.
We in the UK have had a minimum wage policy for some time, all it has done really is increase the amount of people on minimum wage and those whose wages are topped up from the taxpayer.
Maybe government should state what the minimum percentage rise should be each year rather than setting minimum wage? Mind you that would probably have just the same effect on the employment market.
Maybe there should be restrictive immigration policies, reducing the flow of low paid low skilled throw away workers and then maybe companies would pay more for the limited labour available.Here is another peek at the not too distance future for min wage jobs, when that becomes too expensive:
http://espn.go.com/mlb/story/_/id/11185 … r-machinesNot to bad a future then.
I suppose the entitled will be complaining they haven't enough left out of their welfare check to use them though!Soon you'll be able buy a beer using your Obamaphone. Sweet!
Still not as bad as the UK though, where they give extra welfare to alcoholics so they can buy more alcohol.
First I've heard of that and I know a couple of alkies who are on benefits and would be on that like shot.
I think you should post a reference, and not the Daily Mail.Don't need a reference John, my own mother in law was in receipt of Disability Living Allowence at the higher rate, she is and has been a full time alcoholic since the age of 35, the alcoholism has caused any other problems and she receives the benefit to deal with the effects of the alcoholism. She has had the new PIP and we all thought that ATOS would refuse her. It seems alcohol addiction is a legitimate complaint and as such she receives a tidy sum as they have awarded her the higher rate.
It doesn't equate to me either John but that's what happened, I even commented on it to her mental health nurse who gave me the evil look and said alcoholism is a mental illness you know, I replied I know I have to keep picking up the prices when she drinks 2 bottles of vodka a day.
Maybe she is the exception to the rule then John but I don't think so.But she's not getting the money to buy more alcohol is she?
She's getting the money to help her to cope with the effects of alcoholism.And she is buying more alcohol with it.
Give a man a bottle of vodka he will get drunk for a day, give him money to buy the vodka and he will drink himself to death.I know people who are not getting money for alcohol but still spend their money on it.
And I am sure we could discuss the diner points of who pays for the alcohol and who it hurts most.
However I am sure we will have different opinions about that as well.Taxpayers should have a way of assuring money distributed is utilized in accordance with the purpose for which it was allocated.
The liberal left here are dead against such things a food stamps and direct landlord payments, apparently it's against the welfare recipients human rights.
So you think those forced to live off welfare should forfeit their human rights!
No John I don't believe receiving welfare in the form of food vouchers or direct payment of rents has anything to do with human rights.
I don't believe it says anything about protection from being embarrassed.
Let's face it your kids are being fed and your bills are being paid what have you to be embarrassed about?It was you who brought up "human rights". And you've now introduced embarrassment into the discussion as well!
Is there no end to your ducking and diving?
Says the master of ducking and diving!
So John do you think it would be wrong to give welfare recipients food vouchers as part of their benefit?
And what's wrong with paying their landlords directly?Housing payments (section 8, we call it) are paid directly to the landlord here. That way the tenant can't use it to buy drugs and them stay for months through the eviction procedures. Landlords are pretty much guaranteed their money.
Food vouchers restrict what food you can buy and from whom. Not every food outlet will accept vouchers.
Landlords already can be paid rent directly if the tenant has history of not paying.How do you know they wouldn't accept them John? As it doesn't happen how could you know!
There is a specials Asian supermarket / off licence not to far from me tag has been done for accepting milk tokens in return for boozel. Maybe your right it would create a whole new monetory system for the fraudsters to exploit.
Are you suggesting benefit recipiants don't pay their rent?
It's mostly councils who get direct payment though.Let's twist again like we did last time!
I didn't suggest anything other than if you had a record of not paying your rent then your rent could be paid directly to your landlord. Notice, I did not mention benefit recipients at all.No twist there john just a comment on your comment. And we were talking about benefit recipients because who else would receive housing benefit?
Well I suppose you are correct, recipients of housing benefit are benefit recipients as housing benefit is a benefit!
That does not alter the fact (that we were discussing) that those in arrears with their rent CAN have their rent paid directly to their landlord. That is contrary to your claim that landlords could not be paid directly.
You are also correct in saying that all tenants of social landlords can elect to have their rent paid directly whether they are in arrears or not.
You did actually start by asking why landlords shouldn't be paid directly.What I said John was that the liberal left were dead against food stamps and direct landlord payments. That's not the same as saying they don't happen.
With local aurthority social housing there is no choice, the payments are made directly from housing benefit to the council.
As for food stamps there are such a thing still as milk tokens, which I believe can be spent on milk or fruit and veg.Do you actually know anybody of the liberal left? I don't know one that opposes direct payment of rent.
Yes, milk tokens which may be accepted for things other than milk, or not accepted at all.Yes John I do, but that's another discussion.
They think it's demeaning that benefit claimants should have that trust taken away from them, some would like itbuf the landlords were not informed that indeed their tenants were in recur put of benefit at all.
I have never heard of anywhere that don't take milk tokens john, I have heard of a few corner shops exchanging them for cigarettes and booze but again that's another topic for discussion.First para makes no sense at all, would you like to edit it?
Yes John I do know some liberal left wingers. Etc, etc........
Well actually it was the rest of that para that made no sense. I don't understand "itbuf" and "were in recur put of benefit"! I'll try and interpret it but I may totally miss your meaning, much better if you told us what you actually meant.
Some would like it if the landlords were not informed that their tenants were in receipt of benefits at all.
Sorry John I am using my phone as I am laid up in bed after an operation which has left me a little invalided. I shall endeavour to proof read but I apologise for any mistakes.Heck no apology needed, the explanation covers it all.
The reason for not informing landlords is that some landlords object to people who receive benefits. Look in your property to let section of your local newspaper you'll see lots of "No benefits".I know why they do it John, as I said a friend owns a few houses and he doesn't like Benefit recipients but does take them if it's direct payment, which he had said the housing benefit office is reluctant to do.
The reason why the HB office is reluctant to make direct payments to landlords is that some landlords don't bother to tell when their tenants have left and rob the councils of millions.
But John it is the responsibility of the benefit claimant to tell the HB office of any changes. I do believe it is a criminal offence to not inform any benefit agency of any changes.
It isn't a criminal offence not to inform HB of changes. All they can do is try to make you repay the over claim.
It is a criminal offence for landlords to accept rent that they are not entitled to.If you don't tell the HB that you don't need it anymore you are committing fraud. Is fraud not a criminal offence anymore then?
And I agree that's will be some unscrupulous landlords but I doubt if it is many.The thing is that unless you are really lucky and in a position to no longer need help with your housing costs you can't avoid telling HB that you've moved.
If it were "not many" landlords why should the HB be at all bothered about who they pay the benefit to?
BTW How are you today?My point was John is that certain people have decided that it would be demeaning to benefit claimants.
My sister was lucky enough to get out of the benefit system, the HB took her to court to repay £2000 overpayment, fortunately the court realised that it was the council who received money not my sister. It amazed me that even wit all the evidence they still went to court!
I am about the same thanks John, possibly less painkillers and was able to get out of bed and make the chair. It has thrown my world a bit upside down as I am non weight bearing for at least 12 weeks and will be off work for at least a year.
Thanks for asking.The fact that certain people have decided something does not make that thing fact. As I have pointed out there are good reasons (unconnected with claimants feelings) for not paying rent directly to landlords and there are equally good reasons for not paying people in food vouchers, some of which you yourself have pointed out.
Bad luck on your sister but it really wouldn't have made any difference who they had paid the rent to. If they are going to mess it up, they will do.
I'll do my best to make sure you're not too bored during your enforced sojourn
So they have the right to do whatever they please with money allocated for a specific purpose? It's not their money to use. They should be given food, or given rent assistance, not cash to buy alcohol or drugs. How does it infringe on someone's human rights to make sure the gift they receive is the one you intended to give?
You mean like a place where an ever increasing amount of your money or time is confiscated and used in ways even the majority doesn't agree with?
bBerean, the middle class (what is left of it) ARE the ones living in a so-called police state, being TAXED, TAXED in order to pay for social and welfare entitlements. It is the middle class being inundated with paying for these social entitlements which will soon bankrupt America!
Yes, how dare people demand to not starve! HOW DARE THEY!!
How much do you spend on your poor, most of who are not poor by choice, and how much do you spend on killing foreigners, most of who are not your enemies?
What, like killing people to build your empire?
C'mon now John, if one is on the public dole, he/she is on the behest of the government. It is the government's right to DECIDE for them after all, the GOVERNMENT is footing the bill on behest of the working person's TAX DOLLARS! With welfare, the person has to follow government mandates. If he/she wants MORE CHOICES, he/she have to work to gain such choices. A person more or less forfeit his/her choices when he/she accepts welfare. Choices are for those who WORK.
Silver, rest and feel better soon. Don't stress yourself, relax, remember you had an operation. Time to rest and heal, my friend. God bless.
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