Myth Pro and Con about the Minimum Wage

[HeavyAaron]

I guess it's all about personal choice - you either believe it's the responsibility of the privileged to help the under-privileged, or you don't.

Okay, let me try another tact here.

You believe that first world citizens are entitled to some minimal living standard. But you aren't really sure what that standard should be.

I've pointed out that if you have a mailing address in a first world nation in the broadest sense such a person is already rich. You've agreed that this is so.

And I presume you and I can agree that ideally everyone would have at the very least a mailing address which is not condemned. (Thus is structually sound, has indoor plumbing, electricity, and refrigeration.) The difference here is that while you use the term "entitled" I will not.

Now, assuming you do agree with the above we have agreed that ideally every citizen of a first world nation should live a materially rich life in the broadest sense.

You, of course, are welcome to believe that whatever the minimum standard is should have even more than that. But that's as far as I'm likely to grant.

Now, in your oppinion, should that minimal standard of living increase along with the average standard of living, or is this minimum somehow a perminate minimum?

See, to me, I feel that society is obligated to feed, clothe, provide emergency health care for, and shelter (not neccessarily house) all of its citizens. They are not entitled to it, but society is morally obligated to provide it. (Thus the poor are in no position to expect it but should instead be grateful for it.) So long as the physical needs of the population are met, I feel it's up to the people themselves to strive for better. I don't believe we can make them strive for better. I'm not convinced that providing more would make them more likely to strive for better, but less likely.

I also feel that the best way to maximize the available no-skill jobs for people who want a starting point to get beyond handouts is to repeal the minimum wage law. Day layborers seem to be the most common, but right now that has to be done under the table so doesn't become official job experience to build on. I'm sure other examples exist as well.

Aaron

[gnome]

If the physical needs of the population are guaranteed, I would consider abandoning minimum wage laws.

But, doesn't that just allow a business to underpay its employees and rely on the government to make up the difference? Seems like a form of corporate welfare.

[slingblade]

Would you care to explain why anyone with a high school diploma and no criminal record who generally shows up to work when scheduled wouldn't be able to beat $5.15 an hour if they seriously tried?

I can explain how it happened to me, with my high school diploma, my good work ethic, and my total lack of criminal behavior. But since that's anecdotal, it doesn't count as evidence. It also can't be made to apply to everyone who works for minimum wage.

The best thing my story would do is confirm that there are as many reasons for being in that place as there are people in it. Reducing all of those people to four generic reasons isn't really a good argument for anything.

So take my word for it, and please try to expand your reasoning. There are reasons you haven't yet considered. There are combinations of reasons, unique to each person, you haven't yet considered. There are age/race/gender issues you haven't yet considered.

But don't do me any favors.

Do yourself a big favor and realize that if you can sum up any large, convoluted, confusing, controversial issue having decades of history behind it with four short, simplistic reasons, you might have a little more thinking to do about said issue, yes?

Maybe?

[BPSCG]

If there's one thing I despise below all others, it's jumped-up little rednecked plutocrats who see the poor as deserving of their lot in life.

You are clearly one of these, yet despite my utter contempt for you, I'll expand on my statement, since you're obviously too ignorant or too simply being too obtuse to give the answer to yourself.Excellent. Invective as a substitute for argument.

I recommend you either look up the definition of "plutocrat" or find out more about me before using the term.
The wages are too low to enable people to have a standard of living to which they are entitled in the developed world. You've painted yourself into a corner here.

If one is entitled - to use your term - to a minimum wage, how much work must he do, and at what level of competence?

The answer is "none." If you are entitled to something, you don't have to do anything to possess it, because you own it. I am not entitled to the use of your car, because you own it. If I buy it from you, you are no longer entitled to the use of it, because I now own it.

You now claim that people are entitled to a certain standard of living. If that is true, then they need do nothing to receive it. HeavyAaron asked you why you believe people are entitled to a certain standard of living, and you gave a shrug-of-the-shoulders answer, "because I'm a Kiwi, I guess." Let me rephrase the question to ask what I believe he intended: Where does this entitlement come from?

"Work harder" "Train more" "Don't have kids". I bet you're the type of filth Can you make your case without getting insulting?
who comes out with those same tedious platitudes when it comes to people starving to death in developing countries - People starving to death in "developing countries" (I hate that term) are starving generally not because of their own failings, but the failings of the thug governments that rule them. Stop trying to claim I believe things that I do not.

No doubt you'd do away with all publicly-funded policies and just leave people to their own devices. "All humans are equal but some humans are more equal than others".Stop trying to claim I believe things that I do not. Instead, defend your position that people are entitled to a certain standard of living.

[The Atheist]

Okay, let me try another tact here.

You believe that first world citizens are entitled to some minimal living standard. But you aren't really sure what that standard should be.Probably my poor explanation. I know what the standard should be, the amount I'm not sure of. The standard should be pretty much as you espouse futher on.I've pointed out that if you have a mailing address in a first world nation in the broadest sense such a person is already rich. You've agreed that this is so.Just an aside here, I actually believe that all people on the planet should be entitled to that minimum standard, not just those in first world countries. I realise the impracticality of that, so I support third world kids separately.And I presume you and I can agree that ideally everyone would have at the very least a mailing address which is not condemned. (Thus is structually sound, has indoor plumbing, electricity, and refrigeration.) The difference here is that while you use the term "entitled" I will not.100% fine by me.Now, in your oppinion, should that minimal standard of living increase along with the average standard of living, or is this minimum somehow a perminate minimum?Not so much the average, but a system like the one we run here - an annual incremental increase in the MW is made to cover the amount of inflation.See, to me, I feel that society is obligated to feed, clothe, provide emergency health care for, and shelter (not neccessarily house) all of its citizens. They are not entitled to it, but society is morally obligated to provide it. (Thus the poor are in no position to expect it but should instead be grateful for it.) So long as the physical needs of the population are met, I feel it's up to the people themselves to strive for better. I don't believe we can make them strive for better. I'm not convinced that providing more would make them more likely to strive for better, but less likely.I'd have to agree with all that. I'm not asking that the MW be increased to a stage where it's attractive to work at, but an amount which covers all of those physical needs you mention.
I also feel that the best way to maximize the available no-skill jobs for people who want a starting point to get beyond handouts is to repeal the minimum wage law. Day layborers seem to be the most common, but right now that has to be done under the table so doesn't become official job experience to build on. I'm sure other examples exist as well.

AaronYou could even be right here, but I know for a fact that there are some terribly unscrupulous employers around and many could not be entrusted not to pay slave labour wages. Just going back to the teachers again, that's where I see the similarity with MW law - it isn't ideal, but because there are divisions of wealth between people and areas, there needs to be legislative requirements for things to be done for the good of all, which helps to protect those who can't protect their own interests.

I said before that I'd be the first to line up and kick the abusers of the system, but there are people out there who are capable of doing a good, honest day's work, but for reasons of lack of brainpower, learning difficulties or family responsibilities, just can't break out of the cycle of poverty. Those are the ones deserving of our help.

[HeavyAaron]

If the physical needs of the population are guaranteed, I would consider abandoning minimum wage laws.

But, doesn't that just allow a business to underpay its employees and rely on the government to make up the difference? Seems like a form of corporate welfare.

There are ways around this. First off, get rid of the weird tax incentive for employer paid benifits. Then bingo, it makes no difference if the employer pays them or simply raises the base salary by the premium costs and you by them yourselves. This simplifies the situation greatly.

Then let's suppose we've determined how much it costs to provide this minimum livable conditions... then simply give EVERYONE a check for that amount every year (and raise taxes such that it's revenue neutral.) Then your problem also doesn't exist. Likewise disincentives to working disappear.

Of course... people might just blow those checks and then starve themselves. So, if you want to avoid that...

Provide free government soup kitchens and cotts in a big hall to sleep in that ANYONE is welcome to use regardless of income or wealth. This also resolves the problem without allowing people to die of stupidity.

Keep in mind, however, that it's not coorperate welfare to pay employees less than it costs to keep them alive. How much it keeps a person alive is completely independant of pay rates. What could be coorperate welfare, however, is to intentionally set wages just below what's needed to collect welfare checks or food stamps, or the like and then provide classes to the employees on how to obtain these government benifits.

Aaron

[Ace_of_Sevens]

I can explain how it happened to me, with my high school diploma, my good work ethic, and my total lack of criminal behavior. But since that's anecdotal, it doesn't count as evidence. It also can't be made to apply to everyone who works for minimum wage.

Since I was making a broad claim, reasonlyably recent anecdotes that don't include extraodrinary circumstances certainly would count. As for age, poeple who are below a certain age are unlikely to have a high school diploma, but almost certain to have certain support structures, and above a certain age, they can draw social security, which isn't a lot, but better than minimum wage. A similar principle applies to the disabled. If I'm so wrong an uninformed, inform me.

[The Atheist]

Can you make your case without getting insulting?Not when I'm dealing with selfish scum, no.

[The Atheist]

I recommend you either look up the definition of "plutocrat" or find out more about me before using the term.I know precisely what the term means. If it doesn't apply to you, feel free to correct me.

I see you didn't dispute the "redneck" at least.

[HeavyAaron]

I'm not asking that the MW be increased to a stage where it's attractive to work at, but an amount which covers all of those physical needs you mention.

I'm still flummuxed by the desire to connect these two things.

What our system currently is, and is sounds like yours is too, goes something like this:

1) welfare and foodstamps; no work required
2) minimum wage law guarentees minimum payment for wages; lose stage 1 benifits (potentially)

I'm proposing you get minimum physical needs provided for REGARDLESS of income. Then let wages float naturally.

There is no natural tie between wages and costs of physical needs. Why try to create one?

Aaron

[Ziggurat]

Not when I'm dealing with selfish scum, no.

What a great example of the Fundamental Attribution Error: the idea that behavior is determined simply by character, not by context. Since BPSCG disagrees with you, it must be because his character is flawed (he's "selfish scum"), not because he has arrived at his conclusions in a different context than you have.

That's quite pathetic of you.

[HeavyAaron]

You could even be right here, but I know for a fact that there are some terribly unscrupulous employers around and many could not be entrusted not to pay slave labour wages.


I don't believe there is such a thing as "slave labour wages." In a free market economy, by definition all transactions are agreed upon by all parties. If the wage rate is too low then they would find no one to employ. If there are people willing to work for a given wage, then they are better off working at that wage than not. Again, the employee is made better off, or they would not have accepted the position. In fact, it's probably the best wage he/she could get, or he/she would change jobs to the better available wage. (This discounts the reality that some jobs are more appealing to given individuals than others.)

Aaron

[slingblade]

Since I was making a broad claim, reasonlyably recent anecdotes that don't include extraodrinary circumstances certainly would count.

And who is arbiter of "extraordinary?" My anecdote might count as extraordinary on several points.

As for age, poeple who are below a certain age are unlikely to have a high school diploma, but almost certain to have certain support structures, and above a certain age, they can draw social security, which isn't a lot, but better than minimum wage. A similar principle applies to the disabled. If I'm so wrong an uninformed, inform me.

No, you're not wrong about those three things: kids still in school usually have parents who support them; people over 65 can usually draw Social Security retirement; those who can prove disability can usually draw SS disability "income." (Not sure just what that's called.)

But I'm not sure what all that is supposed to say about someone who is 20 to 60 years old, doesn't get support from the parents anymore, but isn't old enough yet to get SS retirement, or disabled enough to get SSI, and who still makes minimum wage, has always made minimum wage or a little more, and the reasons why this is so. And I'm not sure what all that has to do with the issue of raising the minimum wage a few dollars.

I'll try this again, shall I?

You stated that there are only four reasons why anyone would work for years at minimum wage jobs: lazy, stupid, criminal, and/or personality defects.

I am telling you there are more reasons than those four, and that when you maintain these are the only four reasons for the entire issue, you are limiting, deliberately, it seems, your own opportunity to educate yourself and learn more.

If you're okay with that, then I guess I have to be okay with it, as well.
But I think it's lazy, stupid, a crime against critical thought, and shows a definite personality defect.

[The Atheist]

I'm proposing you get minimum physical needs provided for REGARDLESS of income. Then let wages float naturally.

There is no natural tie between wages and costs of physical needs. Why try to create one?

AaronThe reason I differentiate is simply because welfare dependence isn't usually helpful to anyone, so there needs to be an incentive to work as opposed to being a beneficiary.

[The Atheist]

I don't believe there is such a thing as "slave labour wages." The bad news is that I know there are people who pay slave labour wages. Usually to illegal immigrants, but not always. I have been involved in a couple of cases where employers have cut wages illegally below the minimum at the threat of losing the job.

[Ace_of_Sevens]

And who is arbiter of "extraordinary?" My anecdote might count as extraordinary on several points.

Extraordinary circumstances woudl be somethign like working for less than your worth because of blackmail. People who have had a lot of bad publicity (for soemthing like criminal charges for instance) fall under this category as well, because while massively unfair, both situation are quite rare and really dealwith societal faults entirely seperate from minimum wage.

[HeavyAaron]

The reason I differentiate is simply because welfare dependence isn't usually helpful to anyone, so there needs to be an incentive to work as opposed to being a beneficiary.

And you are absolutely right that there needs to be... and under my system there would be.

Let's use the simplist example of my system. Everyone gets a check for say, $10,000/year regardless of income. That money is designed to keep you from starving or begging on the streets. (I've already noted that in such a simple system stupidity can still kill... just trust that there are more complex systems that have the same effects here.)

So in our thought experiment let's suppose that an unskilled, unemployed person living in this society has only one possible job offer. And it pays a measely $3/hour for 40 hours/week.

He's already eating and he has a safe place to sleep. Why work?

Well, under this system working won't cost him any of his benifits. His choices are:

1) don't work for an annual income of $10,000.
2) work for an annual income of $16,240.

That's $6,240 in incentive to work. Maybe it won't be enough. If it weren't enough for the local employer to fill his/her positions then they'll raise the pay to more than $3/hour. But even at $3/hour there IS incentive. (Incentive enough that MANY people on this planet are willing to work for those wages.)

Aaron

[American]

What a typically arrogant and ignorant comment. I'd be very surprised if anyone on the minimum wage was even on the internet, let alone in here.

What are you the Lorax? You think you speak for those without tongues?

Nobody nominated you to cry in place of people who are supposedly too busy or otherwise incapable of complaint due to their lowly job or other constraints placed unfairly upon them by The Man.

"Advocate"... Speak for yourself, worry about yourself, and let others speak and worry about their own affairs. You are not their surrogate whiner.

[HeavyAaron]

The bad news is that I know there are people who pay slave labour wages. Usually to illegal immigrants, but not always. I have been involved in a couple of cases where employers have cut wages illegally below the minimum at the threat of losing the job.

Maybe I wasn't clear. I don't believe any wage is inheriently immoral. If the employee is willing to work for $0.30/hour then he should be allowed to. It is not a slave labor wage because he is not a slave. He is not obligated to take the job.

Aaron

[Ziggurat]

What a typically arrogant and ignorant comment. I'd be very surprised if anyone on the minimum wage was even on the internet, let alone in here. Maybe, if you ever manage to pull your head of its self-rectal examination you'd understand that.

Understand that you'd be surprised if someone on minimum wage figured out how to use the public library? Well, maybe that would surprise you.

Wouldn't surprise me, though.

[slingblade]

I don't believe there is such a thing as "slave labour wages." In a free market economy, by definition all transactions are agreed upon by all parties. If the wage rate is too low then they would find no one to employ.

"Federal minimum wage" is the wage rate under discussion, and it does qualify as "too low" under several criteria. Here is one:

Minimum wage is $5.15/hr. At 40 hr/wk that equals $206.00 before deductions (FICA, etc.). For a 4-week month, it equals $824. Gross, not net.
If rent where you live is $500 and up, how do you pay for transportation, food, utilities, medical, dental, clothing, hygiene, and emergencies with less than $300 each month?

If there are people willing to work for a given wage, then they are better off working at that wage than not.

How so?


Again, the employee is made better off, or they would not have accepted the position. In fact, it's probably the best wage he/she could get, or he/she would change jobs to the better available wage. (This discounts the reality that some jobs are more appealing to given individuals than others.)

Not everyone lives in an urban area in which jobs are plentiful and competition favors higher wages. If, just for instance, you live in an area in which there are 15 restaurants, and you wait tables, it is possible to work at every one of those restaurants in turn and make the same wages in each. No one pays better, because no one has to pay better. The labor pool is limited, as are the opportunities.

New people move into the community, and are willing to accept the low wages because they need a job now. They don't have much choice, and no real choice is offered. People who are fed up with the system leave town. The newcomers merely take their places. Nothing changes. Nothing has to change.

It becomes a system in which the profitable business owners never change, but the unskilled minimum wage employees change constantly.

How would the "free market" operate in such a place to make the wages go up instead of remaining at minimum wage as they have always done?

[The Atheist]

What a great example of the Fundamental Attribution Error: the idea that behavior is determined simply by character, not by context. Since BPSCG disagrees with you, it must be because his character is flawed (he's "selfish scum"), not because he has arrived at his conclusions in a different context than you have.

That's quite pathetic of you.People are welcome to disagree with me and I'm perfectly capable of holding a nice, abuse-free, rational discussion with them. Those people don't come out with this BS:
how many people get paid the minimum wage who don't deserve even that?Someone explain to me why this pimply-faced, slack-jawed knuckle dragger deserves to be paid minimum wage to do something I can do just as well and twice as fast, despite my complete lack of formal training in the lucrative field of gas pumping.Hmmm... I wonder if NJ has some statute that requires a human being actually pump your gas for you...Uh, yeah, right. Learning how to pump gas takes months of training. It's a grueling education, and a lot of people can't handle it. That's why they change careers to something not as taxing on the brain - like being a New Jersey State Assemblyman.To which I ask, if having three kids puts your finances so close to the edge, why did they have three kids to begin with? Why didn't they improve your job skills and marketability before deciding they needed to repopulate the earth?Yep, I'm pathetic for thinking that someone coming out with all that - and more - could possibly be selfish.

[The Atheist]

Understand that you'd be surprised if someone on minimum wage figured out how to use the public library? Well, maybe that would surprise you.

Wouldn't surprise me, though.Sure they use internet at libraries. I just think it's incredibly unlikely that they'd be spending time in here talking to a bunch of rednecks who are telling them they aren't even worth $5 an hour.

[WildCat]

"Federal minimum wage" is the wage rate under discussion, and it does qualify as "too low" under several criteria. Here is one:

Minimum wage is $5.15/hr. At 40 hr/wk that equals $206.00 before deductions (FICA, etc.). For a 4-week month, it equals $824. Gross, not net.
If rent where you live is $500 and up, how do you pay for transportation, food, utilities, medical, dental, clothing, hygiene, and emergencies with less than $300 each month?
You can't, which is why minimum wage jobs are not career jobs. Best left to teenagers and retired folks looking to supplement their income.

Now, why people have kids they can't aford to feed or clothe is a question for another thread.

How would the "free market" operate in such a place to make the wages go up instead of remaining at minimum wage as they have always done?
The free market around here is already well above the minimum wage. Even McDonald's starts you at $7.50/hr, unskilled illegal aliens on construction sites even start at $10/hr or more. Reason is no one will take the job if it doesn't pay more than that.

[HeavyAaron]

"Federal minimum wage" is the wage rate under discussion, and it does qualify as "too low" under several criteria. Here is one:

Minimum wage is $5.15/hr. At 40 hr/wk that equals $206.00 before deductions (FICA, etc.). For a 4-week month, it equals $824. Gross, not net.
If rent where you live is $500 and up, how do you pay for transportation, food, utilities, medical, dental, clothing, hygiene, and emergencies with less than $300 each month?

I'm getting tired of refuting this. There is no connection between what a person might minimally need and wage rates. Trying to connect the two makes no sense. You've call this a "criteria." It's a dumb one as it's founded on a bad assumption.

Me: "If there are people willing to work for a given wage, then they are better off working at that wage than not."

How so?

Because if they weren't then they wouldn't have taken the job. All transactions in a free market economy are agreed upon by all parties by definition. Therefore at the end of any given transaction all parties are better off than had the transaction not occured or otherwise they would have not agreed to the transaction.



Not everyone lives in an urban area in which jobs are plentiful and competition favors higher wages. If, just for instance, you live in an area in which there are 15 restaurants, and you wait tables, it is possible to work at every one of those restaurants in turn and make the same wages in each. No one pays better, because no one has to pay better. The labor pool is limited, as are the opportunities.

This is an argument AGAINST minimum wage law. The number of jobs (especially low wage jobs) would RISE if the minimum wage law were repealed. Besides, this is the information age. Don't tell me your geography limits your job oppertunities. A large portion of the population telecommutes.

New people move into the community, and are willing to accept the low wages because they need a job now. They don't have much choice, and no real choice is offered. People who are fed up with the system leave town. The newcomers merely take their places. Nothing changes. Nothing has to change.

You've got part of the model correct. You seem to realize that the liklihood of a person moving away is impacted by the job oppertunities. Has it not occurred to you that low job oppertunities discourage people from moving in?

It becomes a system in which the profitable business owners never change, but the unskilled minimum wage employees change constantly.

Oh, of course. The US economy is one of the most stagnant in the world :rolleyes: .

How would the "free market" operate in such a place to make the wages go up instead of remaining at minimum wage as they have always done?

I'll assume you mean "real wages" not "nominal wages".

Formula for raising wages:

Short term:
1) Increase demand for labor. This would happen if industry output increased. (Firm expansion or new firm entries.)
2) Decrease of labor supply. People die, retire, move away and are not replaced.

Needless to say the opposite of those two things would lower wages.

Long term:
Increase productivity. This is done through one of two things: increased capital (new plant and equipment) or increased human capital (better educated work force) **** this has a secondary effect of lowering the costs of goods at the same time as raising wages i.e. SUPER GOOD

Super long term:
Increase in the savings rate. This allows for more investment in capital which leads to increased productivity which leads to increased real wages.

Aaron

[slingblade]

The free market around here is already well above the minimum wage. Even McDonald's starts you at $7.50/hr, unskilled illegal aliens on construction sites even start at $10/hr or more. Reason is no one will take the job if it doesn't pay more than that.

That doesn't answer my question, though.

The free market in the place I described keeps wages at minimum, becasue there is no reason to raise them. Rent, food, and all that keep going up, but the wages don't. They don't have to. The residents work the jobs at minimum wage because they can't afford to leave town yet, and can't afford not to work. As soon as they can afford to leave, they do, but their places are just filled by newcomers who will also work for minimum as it's the only wage paid, and they, too, have to have a job or two.

There is no reason for employers in this town to increase wages, so they don't. "Going elsewhere" in this place means either working for someone else who pays the same wage (no choice), or leaving town. From what I can tell, the "free market" doesn't, or can't, apply there.

[slingblade]

This is an argument AGAINST minimum wage law. The number of jobs (especially low wage jobs) would RISE if the minimum wage law were repealed. Besides, this is the information age. Don't tell me your geography limits your job oppertunities. A large portion of the population telecommutes.



You've got part of the model correct. You seem to realize that the liklihood of a person moving away is impacted by the job oppertunities. Has it not occurred to you that low job oppertunities discourage people from moving in?

Okay, let me think about this some more. I think I'm understanding what you're saying, and I'm getting dangerously close to changing my mind.


Oh, of course. The US economy is one of the most stagnant in the world :rolleyes: .

No, I didn't mean the U.S.; just that particular town. But it's moot now.

Give me some time to do my own research and give this more thought. Some of my opinions are changing (yes, it hurts :p ), but I'm not sure all of them are.

I still worry that removing the minimum wage would do some damage to real people in real time. I worry that not raising it is hurting people now who are doing the best they can. And I realize we're all looking at one aspect of a multi-faceted issue.

But some of what you've said really has me thinking and re-thinking.

Thanks.

[HeavyAaron]

The free market in the place I described keeps wages at minimum, becasue there is no reason to raise them. Rent, food, and all that keep going up, but the wages don't. They don't have to. The residents work the jobs at minimum wage because they can't afford to leave town yet, and can't afford not to work. As soon as they can afford to leave, they do, but their places are just filled by newcomers who will also work for minimum as it's the only wage paid, and they, too, have to have a job or two.

There is no reason for employers in this town to increase wages, so they don't. "Going elsewhere" in this place means either working for someone else who pays the same wage (no choice), or leaving town. From what I can tell, the "free market" doesn't, or can't, apply there.

Ah, I see. You're simply mistaken. Wages rise FASTER than costs.... not slower.

As for minimum wage jobs I described this earlier in the thread.

Suppose that a job SHOULD pay $3/hour one year. But it's covered under minimum wage so it pays (assuming that it still exists) $5.15/hour. Next year it SHOULD pay maybe $3.05/hour, but it's still covered under minimum wage law. So it stays at $5.15/hour. Minimum wage law isn't the solution to the fixed wage... IT'S THE CAUSE.

Aaron

[Ace_of_Sevens]

There is no reason for employers in this town to increase wages, so they don't. "Going elsewhere" in this place means either working for someone else who pays the same wage (no choice), or leaving town. From what I can tell, the "free market" doesn't, or can't, apply there.

You're assumign some sort of monopolistic cooperation among employers. Some employees, even unskilled ones, are better than others. One employer will raise wages to get the better unskilled workers. Also, they're competing against the societal safety net. Someone who pays too little will find the jobs they have impossible to fill.

[HeavyAaron]

I still worry that removing the minimum wage would do some damage to real people in real time.

It would. I don't deny that. Minimum wage laws absolutely benifit some people. Don't let anyone tell you otherwise, myself included. The problem is that they hurt other people, some directly by depriving them of job oppertunities, and everyone a little by raising costs and inflation (as well as even more trivial concerns which I won't go into.)

Please don't misunderstand me on this. A number of people would be directly hurt by a repeal of the minimum wage law(s). But I sincerely believe that on balance people, especially the impoverished, would be better off without it.

I worry that not raising it is hurting people now who are doing the best they can. And I realize we're all looking at one aspect of a multi-faceted issue.

Again you're right. Undoubtably some people would benifit by a raise in the minimum wage law... unfortunately at the expense of others, and not just others that can afford to take a hit.

But some of what you've said really has me thinking and re-thinking.

Thanks.

I'm glad to hear it.

Aaron

[Rob Lister]

...The residents work the jobs at minimum wage because they can't afford to leave town yet, and can't afford not to work. As soon as they can afford to leave, they do, ...

but their places are just filled by newcomers who will also work for minimum as it's the only wage paid, and they, too, have to have a job or two.


Gee, you'd think the ones leaving would tell those that are coming to not bother.

Seems to blow your whole theory Slingblade...not that it wasn't blown well before.

[slingblade]

You're assumign some sort of monopolistic cooperation among employers. Some employees, even unskilled ones, are better than others. One employer will raise wages to get the better unskilled workers. Also, they're competing against the societal safety net. Someone who pays too little will find the jobs they have impossible to fill.

You're assuming, I think, that this is a hypothetical place. It isn't, I assure you. There is no industry there, save for the tourist industry. The employers are limited to the state (it's the county seat) and bars, restaurants, hotels, and gift shops. Each of those is owned by an individual.

There is no reason for any business owner to raise his wages above $5.15 ($2.24 for tipped employees) to get better unskilled workers. There are always a certain number of them. Who they are changes constantly, but slowly.

There's no competition for them. There's no real shortage of them, and one isn't necessarily any better than the other in the eyes of most of these employers. They keep it pretty simple actually: they think we're all scum. Easy enough.

In the rare event your employer in this town does value you, he may pay you a little more, sure. But there is no way to advance in any job in this town. There are few manager's positions; the owners manage their own places. If you want to be anything besides a bartender, a waitress, or a cashier, you're going to have to leave town sooner or later. And sooner or later you'll be replaced by someone a lot like you, but younger, who will work for the same minimum wage.

My husband went back there for a visit in the spring. We used to know over 400 people there, low estimate, when we lived there 8 years ago. He could only find a couple of guys he knew there now.

Everyone else moved on. A whole bunch of new people moved in. The going wage is still $5.15/$2.24.

[Rob Lister]

Jeez, I can't refute Slingblades argument against raising MW any better than has Slingblade. She makes a great argument for lowering it or getting rid of it all together. Of course, she doesn't get that.

[BPSCG]

I know precisely what the term means. If it doesn't apply to you, feel free to correct me.Consider yourself corrected.
I see you didn't dispute the "redneck" at least.Mrs. BPSCG heard and enjoyed Midori (http://www.gotomidori.com/) playing the Brahms violin concerto (http://en.wikipedia.org/wiki/Violin_Concerto_%28Brahms%29) with the Alexandria Symphony (http://www.alexsym.org/concert1.shtml) last night. I was surprised how thin her sound was, especially in the first couple of minutes after her entrance, since it's an erupting, passionate volcano of music (the late David Oistrakh (http://en.wikipedia.org/wiki/David_Oistrakh), on an old Heliodor vinyl recording I once had, set the standard for me for that entrance). I think she soon figured out that she wasn't projecting, and after spending the first couple of minutes being swamped by the orchestra, held her own thereafter. Lovely tone, spot-on intonation throughout the first movement, in a slow, but passionate and loving performance. The contrast between the sturm und drang of most of the movement, and the lyrical repose after the cadenza (http://en.wikipedia.org/wiki/Cadenza), was striking and touching.

During the intermission, she stood out in the lobby of the concert hall, mising with the concertgoers. I got an opportunity to personally thank her; I've loved that piece for almost 40 years, yet had never heard it performed live before. She's a tiny woman, barely over five feet tall in heels, and I guarantee she doesn't weigh 100 pounds. Really says something good about her that an international concert star of her stature doesn't jet off back to Paris or Tokyo the minute her part of the concert is done.

After the intermission, the orchestra performed Beethoven's Ninth Symphony (http://en.wikipedia.org/wiki/Beethoven%27s_ninth_symphony). Uneven performance, IMHO; while competently executed, the piece lost a good deal of its drama and passion in the outer movements due to excessively fast tempos, similar to the critcism I had of a May performance we attended of the same piece by the Delaware Symphony Orchestra (http://www.desymphony.org/new/). The conductor, Kim Allen Kluge (http://www.alexsym.org/musicDtr.shtml), omitted the first repeat in the second movement scherzo (http://en.wikipedia.org/wiki/Scherzo). Of the soloists in the last movement, the baritone was light-voiced and had a little trouble with the bottom part of the register. The tenor had a true heldentenor (http://www.vocalwebsites.com/neilhowlett/articles/heldentenor.php) voice, actually singing his solo, rather than barking it, as some tenors do. The alto didn't have enough voice to stay with the rest of the quartet, and when she and the soprano sang together, she tended to get swamped. Very good choral singing.

Mrs. BPSCG and I, rednecks that we are, very much enjoyed sitting there at the concert in our bowling shirt and tank top, chewing and spitting tobacco (http://en.wikipedia.org/wiki/Chewing_tobacco) and popping a couple of cold PBR's (http://en.wikipedia.org/wiki/Pabst_Blue_Ribbon) between movements. Yee haw!

[BPSCG]

Okay, let me think about this some more. I think I'm understanding what you're saying, and I'm getting dangerously close to changing my mind.

(...snip...)

Give me some time to do my own research and give this more thought. Some of my opinions are changing (yes, it hurts :p ), but I'm not sure all of them are.

I still worry that removing the minimum wage would do some damage to real people in real time. I worry that not raising it is hurting people now who are doing the best they can. And I realize we're all looking at one aspect of a multi-faceted issue.

But some of what you've said really has me thinking and re-thinking.

Thanks.Slingblade, you constantly surprise and baffle me. We all know here that you've had - and apparently still have - things pretty tough, economically.

Yet, you consistently strike me as one of the most thoughtful, intelligent, open-to-reason people here (the fact that you write surpassingly well doesn't hurt in my reaching that conclusion).

I'm trying to reconcile the two and I just can't get there. Best explanation I can come up with is that you live in the middle of the Arizona desert and the only job within 25 miles is pumping gas at the Last Chance Before Death Valley gas station.

:confused:

[HeavyAaron]

Slingblade, you constantly surprise and baffle me. We all know here that you've had - and apparently still have - things pretty tough, economically.

Yet, you consistently strike me as one of the most thoughtful, intelligent, open-to-reason people here (the fact that you write surpassingly well doesn't hurt in my reaching that conclusion).

I'm trying to reconcile the two and I just can't get there. Best explanation I can come up with is that you live in the middle of the Arizona desert and the only job within 25 miles is pumping gas at the Last Chance Before Death Valley gas station.

:confused:


Indeed, baring anything totally unexpected I'm fairly convinced that she could easily get an office job squarely in the middle income range even without prior experience if she so chose. I know that were she ACTUALLY in Arizona I would certainly recommend hiring her to my firm.

Aaron

[Just thinking]

Mrs. BPSCG heard and enjoyed Midori (http://www.gotomidori.com/) playing the Brahms violin concerto (http://en.wikipedia.org/wiki/Violin_Concerto_%28Brahms%29) with the Alexandria Symphony (http://www.alexsym.org/concert1.shtml) last night.

You lucky dog! --- too bad the 9th didn't come off well. Actually, it sounds like a bit of a mis-match; the 9th being so long should have been paired with 2 shorter works instead of another lengthy one, such as is the Brahms. But, hey -- still a great evening of music.

And, BTW, anyone at all going to take a nibble at this (http://forums.randi.org/showthread.php?postid=1965069#post1965069)?

[HeavyAaron]

You lucky dog! --- too bad the 9th didn't come off well. Actually, it sounds like a bit of a mis-match; the 9th being so long should have been paired with 2 shorter works instead of another lengthy one, such as is the Brahms. But, hey -- still a great evening of music.

And, BTW, anyone at all going to take a nibble at this (http://forums.randi.org/showthread.php?postid=1965069#post1965069)?

Sure, you may not like it however...

What other people make has no bearing on what you make. Simply because the law forces a raise for some folks doesn't mean other folks deserve to be paid more.

This is one time I'm going with Jesus! Mathew 20:1-15 http://www.nccbuscc.org/nab/bible/matthew/matthew20.htm

Sorry, had to do it. I really do agree with him in this point.

Aaron

[Just thinking]

Sure, you may not like it however...

What other people make has no bearing on what you make. Simply because the law forces a raise for some folks doesn't mean other folks deserve to be paid more.

This is one time I'm going with Jesus! Mathew 20:1-15 http://www.nccbuscc.org/nab/bible/matthew/matthew20.htm

Sorry, had to do it. I really do agree with him in this point.

Aaron

Who's to say I disagree, or wouldn't like it? I was merely interested in seeing how some may approach the issue, as I'm sure it comes up now and again.

[slingblade]

Slingblade, you constantly surprise and baffle me. We all know here that you've had - and apparently still have - things pretty tough, economically.

Yet, you consistently strike me as one of the most thoughtful, intelligent, open-to-reason people here (the fact that you write surpassingly well doesn't hurt in my reaching that conclusion).

I'm trying to reconcile the two and I just can't get there. Best explanation I can come up with is that you live in the middle of the Arizona desert and the only job within 25 miles is pumping gas at the Last Chance Before Death Valley gas station.

:confused:

Hee. No. I'm in Colorado.

Thanks for the kind words. I'm just trying to learn, and sometimes you fellows say stuff that facilitates that.

[BPSCG]

You lucky dog! --- too bad the 9th didn't come off well. Actually, it sounds like a bit of a mis-match; the 9th being so long should have been paired with 2 shorter works instead of another lengthy one, such as is the Brahms. But, hey -- still a great evening of music.Well, actually, the first half of the program also had a symphonic synthesis of William Walton's music for the movie Hamlet.
And, BTW, anyone at all going to take a nibble at this (http://forums.randi.org/showthread.php?postid=1965069#post1965069)?Sure. The fair solution is to pay Joe - and everyone else - exactly what he is worth, and for Joe - and everyone else - to provide services to the employer of a value equal to what he is paid. And damn the minimum wage.

Ideal world, of course.

[BPSCG]

This is one time I'm going with Jesus! Mathew 20:1-15 http://www.nccbuscc.org/nab/bible/matthew/matthew20.htm

Sorry, had to do it. I really do agree with him in this point.
Jesus, well-known capitalist plutocrat redneck scum...

[Dancing David]

By "you" I presume you mean a CEO of a company that he is not a stockholder (i.e. owner of)? It's true that when the person(s) running a company are not the same as the person(s) owning the company, than there is a potential for disaligned objectives. And of course economists have studied this extensively. So extensively, in fact to have a name for it. It's called "the agency problem." http://cbdd.wsu.edu/kewlcontent/cdoutput/TR505r/page6.htm

There are a number of known solutions. And the present day market incorperates a number of them.

I don't know of any perfect solutions. But for your assertion to hold true you must believe that no solutions exist or are used. You'd be wrong. Of course there are some stunning examples of people getting away with this sort of thing. How'd they do it? They circumvented the solutions, usually in criminal manners. The solutions continue to evolve and improve. It's a current area of research.

Aaron
Where on earth did I say there were no solutions? I thought my statement was neutral. I merely stated what i stated, my implication was not that strong, I felt.
I doubt that I implied any absolutes in my post, and ownership is not always the solution, if the owner has the potential to sell the shares before they skedaddle.

And the free market does seem to be addressing the issue.

[Dancing David]

Wow. I live in Cedar Rapids, Ia. The industry around here is dominated by software, information services and food-processing. A factory wage at Amana a few miles outside town starts at $14. A few factory jobs start as low as $10, but they're laughably unskilled things like stuffing Oatmeal packets into the variety packs for Ralston. Amost all are $12 and up. Hardly anyony actally gets minimum wage here. As far as I know, that would only apply to things the the concessions operator at the swimming pools, who's pretty much always a high schooler. Even simple jobs like grocery stores and fast food will start at $6-$6.50. Broader retail outlets like K-Mart and Target start at $7.50/hr for day workers and more at night. I believe that we have one of the highest export/import ratios of US cities though, which probably has a lot to do with it.

My area of Illinois is actual very booming and prosperous, and there has been a huge building boom going on. the county I live in has a very low unemployement rate and provides jobs to all the more rural counties around it.

There are very high paying factory jobs and they have xtensive wait lists for employment. Most factory or warehouse work starts around $8.00/hour, some less. I think the main issue is because of the economic changes in the farm indistry there is a large population of people who need employement and can live at a lower wage while they find a better job or get raises.

[Dancing David]

That's actually already a lot easier to do than is commonly believed. In fact, all it really takes to break free from multi-generational poverty is following some basic rules:

1) Don't do drugs or abuse alcohol
2) Don't commit crimes
3) Don't get married before you're 20
4) Don't have kids before you're married

Almost nobody who follows these four simple rules stays in poverty in this country, and almost everyone who remains in poverty broke one or more of those rules.

You forgot the other one!

5. Don't let your worthless relatives live with you because they have screwed up thier lives, do not bail people out more than once.

The only one I don't agree with is 4), the biological imperative to have sex is high, but there are social and cultural pressures to not use brth control when you are 14 and horny.

[Dancing David]

Is that sarcasm? If true, it's certainly backwards of most of their ideologies.

Aaron


Well, as an independant who often does vote democratic, it is because politics is often backwards in general.

[Dancing David]

Wrong. Most community colleges will allow students to enroll with a G.E.D. -- Oh wait. That's too hard? Well, then maybe you really are retarded.

Which brings me to this:



I know a number of people with learning disabilities who earn well above the minimum wage. I know even more people who had crappy home environments, including myself, who earn well above minimum wage. Of course, they are motivated individuals who don't use either as an excuse to stay in dead-end jobs.

I am not making excuses, and I believe my tone reflected yours. But the people who are in middle class families and have reading and comprehension difficulties struggle to graduate from high school, much less the ones who come from families incapable or unwilling to help.

I was not saying a crappy home life is the determining factor, but if you drop out after getting Ds & Fs, and then work at a low wage then it can be very hard to get into a community college.

But there are things other than motivation to why people do what they do.

i agree , no excuse , which made people often upset with me when i was a socials ervice provider. It continues to frustrate the kids I work with now as well.

I am glad that you have succeded, that is great. operhaps your path is harder for others, perhaps not.

When did you get a loan that covered your living expenses/ i would like my daughter to have one.

[Dancing David]

If the physical needs of the population are guaranteed, I would consider abandoning minimum wage laws.

But, doesn't that just allow a business to underpay its employees and rely on the government to make up the difference? Seems like a form of corporate welfare.

Thanks Gnome, but that would be another thread about why we have a free market for the poor and socialism for the rich. (Soundbyte from Gore Vidal).

[Dancing David]

I'm still flummuxed by the desire to connect these two things.

What our system currently is, and is sounds like yours is too, goes something like this:

1) welfare and foodstamps; no work required
2) minimum wage law guarentees minimum payment for wages; lose stage 1 benifits (potentially)

I'm proposing you get minimum physical needs provided for REGARDLESS of income. Then let wages float naturally.

There is no natural tie between wages and costs of physical needs. Why try to create one?

Aaron

samll correction, you only get cash if you have children, you only get reasonable food stamps if you have no income.

The cash and carry model of welfare has changed, in essence you now have to have children or a disability to get benefits.

I feel that we do have to be careful how we provide benefits, having worked with those who benefits and those who exploit.

The one thing I feel would help the US is to have some sort of universal health plan, similar to the single payer but with the ability to continue supplemental insurance, that way we can have the economy of scale for the low end coverage for all, and the capital incentive for those hwo want to pay, or can pay for better coverage.

With an imporatant caveat, people who go to the Emergency department for routine car should be charged a penalty or made to do community service. And a requirement that no large office or agency can deny the universal care. but that means then that the universal care would have to compensate the provider at a high rate, as opposed to 50% or 25% as well.

[slingblade]

HeavyAaron (or anyone, really), I thought of a couple of questions:

I see that the minimum wage came into effect in 1938. I'm assuming that's Depression-related, but haven't done my reading yet. So what made it necessary to institute minimum wage in the first place? Why wasn't the wage market regulating itself--was it largely the Depression? Or was it regulating itself according to the conditions at the time?

There must have been millions of unemployed, so supply and demand kicks in. 100 men for 10 jobs...no need to pay competetive wages. They'll take what you offer, and damned lucky to get it, too. And if the first ten don't want it, there are 90 others who do. So wages go into the dirt, and the government has to step in and say "Look, you have to pay people a certain wage. Maybe not a living wage, but something fair. And if you won't, we can make you." Is that roughly it?

Okay, so right now, especially compared to then, the situation has 180'd. Not that many unemployed, and a fair number of jobs to fill. Wages have to go up; businesses need the workers worse than workers need the jobs.

Now, this is probably simplistic, but, if that's so...why are there still employers paying $5.15? In writing that, I realize that this wage is most often reserved for new hires. I know that businesses that don't offer at least some kind of raise to employees end up with a high turnover rate as people move on, and that such a business is relatively rare, as high turnover ends up being damned expensive pretty quickly. Constantly training new hires means output/production stays near toilet-level, yes?

So I guess that leaves me asking, if most businesses aren't paying min. wage...why raise it? Is it symbolic? Is it recession insurance for the poor?

Or are there more still paying it and trying to keep people near it than we think?

[Ziggurat]

So I guess that leaves me asking, if most businesses aren't paying min. wage...why raise it? Is it symbolic? Is it recession insurance for the poor?

I think largely because there are a LOT of people who don't understand basic economics, and simply believe that raising the minimum wage must be unequivocally good for the poor. There's also the problem that the positive benefits are felt directly but the negatives are felt indirectly. People who get raises because of a minimum wage hike know who to thank, but people who remain unemployed because they've been priced out of the job market (directly through their labor not being worth the higher cost or indirectly from reduced profitability for businesses) typically won't know who to blame. That dynamic makes it politically far more attractive than it should be.

[HeavyAaron]

HeavyAaron (or anyone, really), I thought of a couple of questions:

I see that the minimum wage came into effect in 1938. I'm assuming that's Depression-related, but haven't done my reading yet. So what made it necessary to institute minimum wage in the first place? Why wasn't the wage market regulating itself--was it largely the Depression? Or was it regulating itself according to the conditions at the time?

I am not qualified to answer your question. I have not the specific historical knowledge being requested. Sorry.

Now, this is probably simplistic, but, if that's so...why are there still employers paying $5.15?

Because some labor still has a market value of $5.15/hour or less. I know that's not really a helpful answer, even if accurate. Sufficive to say that there are more people willing to work no-skill jobs for $5.15/hour than there are people willing to pay $5.15/hour for no-skill jobs.

So I guess that leaves me asking, if most businesses aren't paying min. wage...why raise it? Is it symbolic? Is it recession insurance for the poor?

You'd have to ask a supporter of minimum wage instead of me. I think the short answer, though, is that many people (probably most people) believe it would help the working poor to do so and believe the only losers are nameless cooperations.

Recession insurance it most certainly is not. During a recession companies have a choice to lower wages or have layoffs. If you've just tied a company's hands on the first option, well... I'll let you reach your own conclusion. Btw. our culture causes the same problem with non-minimum wage employees. Even though most employees and virtually all employers would rather reduce wages then have a layoff during recessions, we instead have layoffs. Paycuts run so against the grain in our culture that the damage to employee morale would be enormous. I fine this a truely tragic reality.

Sorry I couldn't address all of your questions,
Aaron

[The Atheist]

..... but people who remain unemployed because they've been priced out of the job market (directly through their labor not being worth the higher cost or indirectly from reduced profitability for businesses) typically won't know who to blame. That dynamic makes it politically far more attractive than it should be.I'm not so sure that increasing the minimum wage results in any more unemployment, which is one of the reasons I am so vehemently in favour of increasing it.

While the economic model in NZ isn't a clone of USA, the way it's worked here must have some relevance to USA. Here, we have a vastly smaller economy and we are hampered by the distance from our markets, which makes our goods dearer than yours on an adjusted basis, meaning that our economy is more susceptible to minor adjustment than yours will ever be.

Current US minimum wage is $5-15, current NZ minimum of $11-00 (and some cents) equates to USD7-30 on today's exchange rate. The cost of living is about 15% higher here, so we could say that the buying power of our minimum wage is actually USD6-21.(20% higher than yours) Despite that, we have the lowest unemployment rate in the OECD.

Now, I'm not suggesting that US' unemployment will follow in our footsteps by increasing the minimum, but it doesn't mean that an increase in the US' minimum will necessarily result in more unemployment either.

[HeavyAaron]

I'm not so sure that increasing the minimum wage results in any more unemployment, which is one of the reasons I am so vehemently in favour of increasing it.

While the economic model in NZ isn't a clone of USA, the way it's worked here must have some relevance to USA. Here, we have a vastly smaller economy and we are hampered by the distance from our markets, which makes our goods dearer than yours on an adjusted basis, meaning that our economy is more susceptible to minor adjustment than yours will ever be.

Current US minimum wage is $5-15, current NZ minimum of $11-00 (and some cents) equates to USD7-30 on today's exchange rate. The cost of living is about 15% higher here, so we could say that the buying power of our minimum wage is actually USD6-21.(20% higher than yours) Despite that, we have the lowest unemployment rate in the OECD.

Now, I'm not suggesting that US' unemployment will follow in our footsteps by increasing the minimum, but it doesn't mean that an increase in the US' minimum will necessarily result in more unemployment either.

Please keep in mind that measured unemployment has a very small bearing on actual unemployment. So, comparing two nations unemployment numbers is silly. It's akin to comparing the cost of gas in the US in gallons versus the cost of gas in NZ in liters. I guarentee they are different measures, btw, because the US measures it based on our own, unique, unemployment insurance system.

So another thing one needs to be careful about is using a known, heavily flawed measuring device, to infer causal relations between things.

Aaron

[Rob Lister]

Now, I'm not suggesting that US' unemployment will follow in our footsteps by increasing the minimum, but it doesn't mean that an increase in the US' minimum will necessarily result in more unemployment either.

Preface: I stand by my humble opinion that raising MW will have no long term impact on either poverty or the economy in general...that said

Raising MW may actually INCREASE employment in many non-public, zero-skill sectors, in the short term, but not necessarly employment at minimum wage rates.

Raising it will put at least some 'mom&pops' over a moral/legal threshold.

I have emperical -- yet admittedly anecdotal -- evidence of this.

BUT THAT'S ILLEGAL!

Yea, well, so is speeding.

[boooeee]

HeavyAaron (or anyone, really), I thought of a couple of questions:

I see that the minimum wage came into effect in 1938. I'm assuming that's Depression-related, but haven't done my reading yet. So what made it necessary to institute minimum wage in the first place? Why wasn't the wage market regulating itself--was it largely the Depression? Or was it regulating itself according to the conditions at the time?Here's what I found on Wikipedia.

The first attempt at establishing a minimum wage in the United States came in 1933, when a $.25-per-hour standard was set as part of the National Industrial Recovery Act. However, in 1935's Schechter Poultry Corp. v. United States (295 U.S. 495), the United States Supreme Court declared the act unconstitutional, and the minimum wage was abolished.

The minimum wage was re-established in the United States in 1938 (pursuant to the Fair Labor Standards Act), once again at $.25 per hour ($3.22 in 2005 dollars.) It had its highest purchasing value ever in 1968, when it was $1.60/hour ($9.12 in 2005 dollars.) The current federal minimum wage is now $5.15 an hour.
link (http://en.wikipedia.org/wiki/Minimum_wage)

The first attempt at establishing the minimum wage was part of the National Industrial Recovery Act (also known as NRA) which was a very wide-ranging attempt to regulate business and commerce within the USA. In a nutshell, it was central planning. The act was struck down by a 9-0 Supreme Court decision in 1935.

So, it looks like the minimum wage was a part of Roosevelt's general policy of attempting to affect positive change in the economy through government control of pricing and production.

Off topic: That little bit of research cleared up something that has always puzzled me. During the opening of the Marx Brothers classic Duck Soup, they display an embelem of an eagle clutching a gear with the initials "NRA" at the top. I always thought it was odd that the Marx Brothers would stick a plug for the National Rifle Association into their movie. It looks like that was a plug for the National Industrial Recovery Act.

[The Atheist]

Please keep in mind that measured unemployment has a very small bearing on actual unemployment.No, unless US has a vastly different means of calculating unemployment, that is completely wrong. Our unemployment figures from both household labour surveys and the officially registered unemployed are so close as to be considered identical.So, comparing two nations unemployment numbers is silly. It's akin to comparing the cost of gas in the US in gallons versus the cost of gas in NZ in liters. I guarentee they are different measures, btw, because the US measures it based on our own, unique, unemployment insurance system.Which is exactly why I said that they can't compared, but has some relevance to the situation in USA.So another thing one needs to be careful about is using a known, heavily flawed measuring device, to infer causal relations between things.

AaronSee point 1.

[HeavyAaron]

Rather than try to address point by point, maybe some simple facts are useful.

Unemployment as defined by an economist, is the portion of the eligable population which is willing to work for the going wage rate but is unable to find an employer. Note that there is no known means of actually determining this value. All we have are proxies.

The measurement used in the US is particularly bad. We use the number of people collecting unemployment checks. This is a bad means for a number of reasons. First off, those checks only last so long. Even if you were actually unemployed for longer, you drop off after a set time frame. Next, many people drawing those checks are not actually looking for employment. They're taking a break between jobs. How do we know? Because there are two times during the drawing of checks people are likely to find work. Very early on and just before the checks stop arriving. Next, a person may simply be unwilling to work for the going rate. According to economists, this person is voluntarily not working, and thus is not unemployed.

ETA: forgot another major catagory. An unknown (but large) number of people never file for unemployment.

Asking a person if they qualify as unemployed also results in incorrect results. Most people don't distinguish voluntarily not working with unable to find a job. Moreover, it's likely that people who's minimum acceptable wage rate is above the market rate, may not know it. But this method that you say NZ employs would definately come up with different results then our method (better data, no doubt.)

Does that help?

Aaron

[Ziggurat]

Current US minimum wage is $5-15, current NZ minimum of $11-00 (and some cents) equates to USD7-30 on today's exchange rate. The cost of living is about 15% higher here, so we could say that the buying power of our minimum wage is actually USD6-21.(20% higher than yours) Despite that, we have the lowest unemployment rate in the OECD.

Apples to oranges. NZ isn't the US, and you don't have huge numbers of immigrants looking for work. Mexico, I believe, has higher unemployment than the US, but I'd bet good money any minimum wage they have is lower than ours.

Now, I'm not suggesting that US' unemployment will follow in our footsteps by increasing the minimum, but it doesn't mean that an increase in the US' minimum will necessarily result in more unemployment either.

If the price of something goes up, consumption goes down. If the price of labor goes up, consumption of labor goes down. Now, that might not get reflected in official "unemployment" figures. For example, if highschool kids can't get minimum wage fast food jobs because the job market shrinks, they don't count as unemployed.

The irony to this all is that if progressivity is really what you want (and that's really what minimum wage advocates argue on the basis of), there's a MUCH better tool for achieving that: the earned income tax credit. It doesn't discourage work, and it targets only those who supposedly need help, the working poor. Raising the minimum wage also boosts the earnings of a lot of middle-class teenagers who, let's be honest, don't really need the help.

There really is no good argument in favor of minimum wage. It distorts markets, it discourages employment, it prices people out of the workforce, and everything that its advocates hope to achieve by it can be better and more directly achieved through other means.

[The Atheist]

....The irony to this all is that if progressivity is really what you want (and that's really what minimum wage advocates argue on the basis of), there's a MUCH better tool for achieving that: the earned income tax credit. It doesn't discourage work, and it targets only those who supposedly need help, the working poor....Yep, I agree with that - my understanding of the US tax system is that it would be nigh impossible to institute a national tax credit system, but if I'm wrong and it's possible, you;re quite right. We have a national credit system here, but it only cuts in for people with dependents as the MW is [almost] enough on its own for singles.


& Thanks Aaron - I guess that's why Mark Twain loved statistics so much, USA doesn't have very accurate ones!

[Rob Lister]

Yep, I agree with that - my understanding of the US tax system is that it would be nigh impossible to institute a national tax credit system, but if I'm wrong and it's possible, you;re quite right.

We have such a system. Have for years. Forgot when it started.

[Ziggurat]

Yep, I agree with that - my understanding of the US tax system is that it would be nigh impossible to institute a national tax credit system, but if I'm wrong and it's possible, you;re quite right.

It's already there, and it's called the Earned Income Tax Credit. Upping it shouldn't be any harder for Congress to pass than upping the minimum wage. In fact, I suspect it would be easier, since it would be hard I think for the Republicans to really unify in striking it down, since it could be marketed as a tax cut (which it isn't, really, but it happens when you file taxes). So dems interested in helping the poor (as oposed to just rallying the union vote) should press for EITC increases, NOT minimum wage hikes.