$9/h minimum wage - Page 8

fdbrian · 19th February 2013, 06:50 PM

Originally Posted by OnlyTellsTruths

Does anyone have a chart of the price of 1 gallon of gasoline to minimum wage ratio over the course of time?

not a chart but in 1986, the minimum wage was $3.35 and I remember buying gas for 75 cents a gallon or less a lot.

TubbaBlubba · 20th February 2013, 02:50 PM

Originally Posted by WildCat

Since when are employee needs the basis for employee pay? Does the financial analyst at the bank "need" more than the teller?

OK, I definitely see your point there. Demands are important, not needs. But surely needs are an important factor of demands, at least at the lower end of the scale.

respect · 20th February 2013, 07:06 PM

Originally Posted by TubbaBlubba

I agree that it doesn't affect demand of labour. But it affects supply of labour. Suddenly there will be workers who are willing to work for less than whatever was the lowest rate labour was supplied at before because of the government subsidies (who may, for instance, be currently unemployed).

I'm still perplexed at why you would think this is as it assumes that labor is only concerned with achieving $x rather than wanting more than $x.

People don't accept pay cuts because they inherited money, won at blackjack or came into it in some other manner. And they don't accept pay cuts because of a subsidy, tax rebate etc either.

Aside from that, earned income credits have empirically been successful at lifting low income earners out of poverty, not just creating a substitution of who pays their wages.

Although I would advocate going farther with it and not tie it to work, rather replace existing redundant and ludicrously wasteful welfare schemes with a streamlined negative tax that can accomplish the same goals at much lower costs, it would just need to be phased out in a way that always encourages work. Earned income credits and welfare reforms that encourage work are smaller versions of the same idea,

TubbaBlubba · 21st February 2013, 08:30 AM

Originally Posted by respect

I'm still perplexed at why you would think this is as it assumes that labor is only concerned with achieving $x rather than wanting more than $x.

People don't accept pay cuts because they inherited money, won at blackjack or came into it in some other manner. And they don't accept pay cuts because of a subsidy, tax rebate etc either.

Hmm, I think I'm starting to get it. The marginal value of each hour worked will actually decrease up to a point because you effectively only earn 50 cents on the dollar. So if anything the labour force might demand HIGHER salaries, because they get subsidized on the dollars they don't earn.

WildCat · 21st February 2013, 08:48 AM

Originally Posted by TubbaBlubba

Hmm, I think I'm starting to get it. The marginal value of each hour worked will actually decrease up to a point because you effectively only earn 50 cents on the dollar. So if anything the labour force might demand HIGHER salaries, because they get subsidized on the dollars they don't earn.

I read that 5 times, and still can't make any sense out of it.

TubbaBlubba · 21st February 2013, 10:00 AM

Originally Posted by WildCat

I read that 5 times, and still can't make any sense out of it.

If earning a dollar gives you only 50 cents more due to the government subsidy, then you'll want more dollars for the same amount of work.

WildCat · 21st February 2013, 10:12 AM

Originally Posted by TubbaBlubba

If earning a dollar gives you only 50 cents more due to the government subsidy, then you'll want more dollars for the same amount of work.

Sorry, still not making any sense.

What happened to the other 50 cents, and what is this subsidy you're speaking about?

TubbaBlubba · 21st February 2013, 10:21 AM

Originally Posted by WildCat

Sorry, still not making any sense.

What happened to the other 50 cents, and what is this subsidy you're speaking about?

If you earn 1 dollar more, the government will pay you 50 cents less, assuming a 50% negative income tax subsidy rate and that you're below the breakpoint.

WildCat · 21st February 2013, 10:24 AM

Originally Posted by TubbaBlubba

If you earn 1 dollar more, the government will pay you 50 cents less, assuming a 50% negative income tax subsidy rate and that you're below the breakpoint.

I have no idea wat you're talking about. Is this a Swedish thing?

TubbaBlubba · 21st February 2013, 10:25 AM

Originally Posted by WildCat

I have no idea wat you're talking about. Is this a Swedish thing?

We're discussing negative taxes as an alternative to welfare/minimum wage.

WildCat · 21st February 2013, 11:29 AM

Originally Posted by TubbaBlubba

We're discussing negative taxes as an alternative to welfare/minimum wage.

Oh, I see. You appear to think that the value of any job must be at minimum equal to a living wage (however you are defining that)? It would be nice if that were true, but ultimately the value of a job is the value that employee provides to the company.

You still seem to be under the impression that employee "needs" determines the value of their labor?

TubbaBlubba · 21st February 2013, 11:47 AM

Originally Posted by WildCat

Oh, I see. You appear to think that the value of any job must be at minimum equal to a living wage (however you are defining that)? It would be nice if that were true, but ultimately the value of a job is the value that employee provides to the company.

You still seem to be under the impression that employee "needs" determines the value of their labor?

That's the side of demand for labour, but there's the supply of labour side as well. Ultimately they must meet, and exactly where, and the resulting value created, result profits etc depends on many things in the market.

What I'm trying to understand is exactly how a government subsidy would affect the supply of labour. Initially I thought that it would push down wages and increase the supply - but this is clearly absurd as the subsidy will not cause employees to place less value on their work hours.

However, up to the breaking point where the taxes stop taking effect, every extra marginal dollar earned will only bring 50 cents worth of value to the employee, as the government will subsidize 50 cents less. This should have some, however small, effect causing the labour force to actually value their labour hours higher. This of course is the case with any welfare.

respect · 21st February 2013, 12:14 PM

Originally Posted by TubbaBlubba

That's the side of demand for labour, but there's the supply of labour side as well. Ultimately they must meet, and exactly where, and the resulting value created, result profits etc depends on many things in the market.

What I'm trying to understand is exactly how a government subsidy would affect the supply of labour. Initially I thought that it would push down wages and increase the supply - but this is clearly absurd as the subsidy will not cause employees to place less value on their work hours.

However, up to the breaking point where the taxes stop taking effect, every extra marginal dollar earned will only bring 50 cents worth of value to the employee, as the government will subsidize 50 cents less. This should have some, however small, effect causing the labour force to actually value their labour hours higher. This of course is the case with any welfare.

Where are you getting fifty percent from? Can I assume you Googled up video of Milton Friedman explaining the idea? Fifty percent doesn't have to be the number, it is just very useful for illustrative purposes as it makes the math extremely easy. IIRC, the US Earned Income Tax Credit is phased out at 10-16% (it has been a long time since I looked at that, the exact numbers may be slightly different) depending on various factors. And at this level of income most people will see a significant incentive to earn more.

respect · 21st February 2013, 12:21 PM

Originally Posted by WildCat

I have no idea wat you're talking about. Is this a Swedish thing?

He is talking about the phase out of schemes like the American Earned Income Tax Credit. Empirically they have been much more successful at reducing poverty than market distorting schemes like minimum wage laws that have a tendency to create poor to poor wealth transfers.

TubbaBlubba · 21st February 2013, 12:21 PM

Originally Posted by respect

Where are you getting fifty percent from? Can I assume you Googled up video of Milton Friedman explaining the idea? Fifty percent doesn't have to be the number, it is just very useful for illustrative purposes as it makes the math extremely easy. IIRC, the US Earned Income Tax Credit is phased out at 10-16% (it has been a long time since I looked at that, the exact numbers may be slightly different) depending on various factors. And at this level of income most people will see a significant incentive to earn more.

Yeah, it was just an example I got off a webpage explaining the idea.

And, as I look closer at it, there really doesn't seem to be any problem with it that doesn't already exist with standard welfare.

respect · 21st February 2013, 12:24 PM

Originally Posted by TubbaBlubba

Yeah, it was just an example I got off a webpage explaining the idea.

And, as I look closer at it, there really doesn't seem to be any problem with it that doesn't already exist with standard welfare.

But it cuts the cost significantly of administering welfare. If a country actually adopted it they could pay more welfare at less taxpayer expense if they chose to do so.

TubbaBlubba · 21st February 2013, 12:39 PM

Originally Posted by respect

But it cuts the cost significantly of administering welfare. If a country actually adopted it they could pay more welfare at less taxpayer expense if they chose to do so.

Works for me. But it seems to be a recurring problem that the "best" kinds of taxes tend to be politically infeasible to implement.

jflower · 23rd February 2013, 09:25 PM

Has the President posted a justification for setting the national minimum wage at $9 hr? Anyone who proposes something that will interfere with the market bears the burden of proof of showing that the interference will actually work.

OnlyTellsTruths · 23rd February 2013, 10:22 PM

Originally Posted by fdbrian

Originally Posted by OnlyTellsTruths

Does anyone have a chart of the price of 1 gallon of gasoline to minimum wage ratio over the course of time?

not a chart but in 1986, the minimum wage was $3.35 and I remember buying gas for 75 cents a gallon or less a lot.

I assume no one else could find a chart either (I looked too).

Has the minimum wage to a gallon of gasoline ratio every been this high? I don't remember a gallon of gasoline ever being more than half of the minimum wage.

Except perhaps during that crisis in the 70s...

Right now 1 gallon of gasoline is $4 and minimum wage is $7.25.

psionl0 · 23rd February 2013, 11:12 PM

Originally Posted by respect

Although I would advocate going farther with it and not tie it to work, rather replace existing redundant and ludicrously wasteful welfare schemes with a streamlined negative tax that can accomplish the same goals at much lower costs...

Now we are on the same wave length.

Originally Posted by respect

...it would just need to be phased out in a way that always encourages work. Earned income credits and welfare reforms that encourage work are smaller versions of the same idea,

I guess not

Astrodude · 24th February 2013, 12:11 PM

The minimum wage shouldn't be raised because real estate and rents haven't increased.

thaiboxerken · 24th February 2013, 01:23 PM

Originally Posted by Astrodude

The minimum wage shouldn't be raised because real estate and rents haven't increased.

You believe this means that the cost of living hasn't increased as well?

respect · 1st March 2013, 10:29 AM

Originally Posted by psionl0

Now we are on the same wave length.

I guess not

I'm a bit confused by this, you would be for streamlining welfare but against having the system encourage working?

20th February 2013, 02:50 PM	#282
TubbaBlubba Knave of the Dudes Join Date: Jul 2010 Location: Communist Kingdom of Sweden Posts: 7,408	Originally Posted by WildCat Since when are employee needs the basis for employee pay? Does the financial analyst at the bank "need" more than the teller? OK, I definitely see your point there. Demands are important, not needs. But surely needs are an important factor of demands, at least at the lower end of the scale.
	__________________ Disagreement begets progress.

21st February 2013, 08:30 AM	#284
TubbaBlubba Knave of the Dudes Join Date: Jul 2010 Location: Communist Kingdom of Sweden Posts: 7,408	Originally Posted by respect I'm still perplexed at why you would think this is as it assumes that labor is only concerned with achieving $x rather than wanting more than $x. People don't accept pay cuts because they inherited money, won at blackjack or came into it in some other manner. And they don't accept pay cuts because of a subsidy, tax rebate etc either. Hmm, I think I'm starting to get it. The marginal value of each hour worked will actually decrease up to a point because you effectively only earn 50 cents on the dollar. So if anything the labour force might demand HIGHER salaries, because they get subsidized on the dollars they don't earn.
	__________________ Disagreement begets progress.

21st February 2013, 10:00 AM	#286
TubbaBlubba Knave of the Dudes Join Date: Jul 2010 Location: Communist Kingdom of Sweden Posts: 7,408	Originally Posted by WildCat I read that 5 times, and still can't make any sense out of it. If earning a dollar gives you only 50 cents more due to the government subsidy, then you'll want more dollars for the same amount of work.
	__________________ Disagreement begets progress.

21st February 2013, 10:21 AM	#288
TubbaBlubba Knave of the Dudes Join Date: Jul 2010 Location: Communist Kingdom of Sweden Posts: 7,408	Originally Posted by WildCat Sorry, still not making any sense. What happened to the other 50 cents, and what is this subsidy you're speaking about? If you earn 1 dollar more, the government will pay you 50 cents less, assuming a 50% negative income tax subsidy rate and that you're below the breakpoint.
	__________________ Disagreement begets progress.

21st February 2013, 10:25 AM	#290
TubbaBlubba Knave of the Dudes Join Date: Jul 2010 Location: Communist Kingdom of Sweden Posts: 7,408	Originally Posted by WildCat I have no idea wat you're talking about. Is this a Swedish thing? We're discussing negative taxes as an alternative to welfare/minimum wage.
	__________________ Disagreement begets progress.

19th February 2013, 06:50 PM	#281
fdbrian Student Join Date: Jan 2013 Location: small town Nebraska Posts: 30	Originally Posted by OnlyTellsTruths Does anyone have a chart of the price of 1 gallon of gasoline to minimum wage ratio over the course of time? not a chart but in 1986, the minimum wage was $3.35 and I remember buying gas for 75 cents a gallon or less a lot.

20th February 2013, 07:06 PM	#283
respect Illuminator Join Date: Jan 2011 Location: Bohemian Grove Posts: 3,517	Originally Posted by TubbaBlubba I agree that it doesn't affect demand of labour. But it affects supply of labour. Suddenly there will be workers who are willing to work for less than whatever was the lowest rate labour was supplied at before because of the government subsidies (who may, for instance, be currently unemployed). I'm still perplexed at why you would think this is as it assumes that labor is only concerned with achieving $x rather than wanting more than $x. People don't accept pay cuts because they inherited money, won at blackjack or came into it in some other manner. And they don't accept pay cuts because of a subsidy, tax rebate etc either. Aside from that, earned income credits have empirically been successful at lifting low income earners out of poverty, not just creating a substitution of who pays their wages. Although I would advocate going farther with it and not tie it to work, rather replace existing redundant and ludicrously wasteful welfare schemes with a streamlined negative tax that can accomplish the same goals at much lower costs, it would just need to be phased out in a way that always encourages work. Earned income credits and welfare reforms that encourage work are smaller versions of the same idea,

21st February 2013, 08:48 AM	#285
WildCat NWO Master Conspirator Join Date: Mar 2003 Location: Albany Park, Chicago Posts: 48,985	Originally Posted by TubbaBlubba Hmm, I think I'm starting to get it. The marginal value of each hour worked will actually decrease up to a point because you effectively only earn 50 cents on the dollar. So if anything the labour force might demand HIGHER salaries, because they get subsidized on the dollars they don't earn. I read that 5 times, and still can't make any sense out of it.

21st February 2013, 10:12 AM	#287
WildCat NWO Master Conspirator Join Date: Mar 2003 Location: Albany Park, Chicago Posts: 48,985	Originally Posted by TubbaBlubba If earning a dollar gives you only 50 cents more due to the government subsidy, then you'll want more dollars for the same amount of work. Sorry, still not making any sense. What happened to the other 50 cents, and what is this subsidy you're speaking about?

21st February 2013, 10:24 AM	#289
WildCat NWO Master Conspirator Join Date: Mar 2003 Location: Albany Park, Chicago Posts: 48,985	Originally Posted by TubbaBlubba If you earn 1 dollar more, the government will pay you 50 cents less, assuming a 50% negative income tax subsidy rate and that you're below the breakpoint. I have no idea wat you're talking about. Is this a Swedish thing?

21st February 2013, 11:29 AM	#291
WildCat NWO Master Conspirator Join Date: Mar 2003 Location: Albany Park, Chicago Posts: 48,985	Originally Posted by TubbaBlubba We're discussing negative taxes as an alternative to welfare/minimum wage. Oh, I see. You appear to think that the value of any job must be at minimum equal to a living wage (however you are defining that)? It would be nice if that were true, but ultimately the value of a job is the value that employee provides to the company. You still seem to be under the impression that employee "needs" determines the value of their labor?

21st February 2013, 11:47 AM	#292
TubbaBlubba Knave of the Dudes Join Date: Jul 2010 Location: Communist Kingdom of Sweden Posts: 7,408	Originally Posted by WildCat Oh, I see. You appear to think that the value of any job must be at minimum equal to a living wage (however you are defining that)? It would be nice if that were true, but ultimately the value of a job is the value that employee provides to the company. You still seem to be under the impression that employee "needs" determines the value of their labor? That's the side of demand for labour, but there's the supply of labour side as well. Ultimately they must meet, and exactly where, and the resulting value created, result profits etc depends on many things in the market. What I'm trying to understand is exactly how a government subsidy would affect the supply of labour. Initially I thought that it would push down wages and increase the supply - but this is clearly absurd as the subsidy will not cause employees to place less value on their work hours. However, up to the breaking point where the taxes stop taking effect, every extra marginal dollar earned will only bring 50 cents worth of value to the employee, as the government will subsidize 50 cents less. This should have some, however small, effect causing the labour force to actually value their labour hours higher. This of course is the case with any welfare.
	__________________ Disagreement begets progress.

21st February 2013, 12:14 PM	#293
respect Illuminator Join Date: Jan 2011 Location: Bohemian Grove Posts: 3,517	Originally Posted by TubbaBlubba That's the side of demand for labour, but there's the supply of labour side as well. Ultimately they must meet, and exactly where, and the resulting value created, result profits etc depends on many things in the market. What I'm trying to understand is exactly how a government subsidy would affect the supply of labour. Initially I thought that it would push down wages and increase the supply - but this is clearly absurd as the subsidy will not cause employees to place less value on their work hours. However, up to the breaking point where the taxes stop taking effect, every extra marginal dollar earned will only bring 50 cents worth of value to the employee, as the government will subsidize 50 cents less. This should have some, however small, effect causing the labour force to actually value their labour hours higher. This of course is the case with any welfare. Where are you getting fifty percent from? Can I assume you Googled up video of Milton Friedman explaining the idea? Fifty percent doesn't have to be the number, it is just very useful for illustrative purposes as it makes the math extremely easy. IIRC, the US Earned Income Tax Credit is phased out at 10-16% (it has been a long time since I looked at that, the exact numbers may be slightly different) depending on various factors. And at this level of income most people will see a significant incentive to earn more.

21st February 2013, 12:21 PM	#294
respect Illuminator Join Date: Jan 2011 Location: Bohemian Grove Posts: 3,517	Originally Posted by WildCat I have no idea wat you're talking about. Is this a Swedish thing? He is talking about the phase out of schemes like the American Earned Income Tax Credit. Empirically they have been much more successful at reducing poverty than market distorting schemes like minimum wage laws that have a tendency to create poor to poor wealth transfers.
	Last edited by respect; 21st February 2013 at 12:22 PM.

21st February 2013, 12:21 PM	#295
TubbaBlubba Knave of the Dudes Join Date: Jul 2010 Location: Communist Kingdom of Sweden Posts: 7,408	Originally Posted by respect Where are you getting fifty percent from? Can I assume you Googled up video of Milton Friedman explaining the idea? Fifty percent doesn't have to be the number, it is just very useful for illustrative purposes as it makes the math extremely easy. IIRC, the US Earned Income Tax Credit is phased out at 10-16% (it has been a long time since I looked at that, the exact numbers may be slightly different) depending on various factors. And at this level of income most people will see a significant incentive to earn more. Yeah, it was just an example I got off a webpage explaining the idea. And, as I look closer at it, there really doesn't seem to be any problem with it that doesn't already exist with standard welfare.
	__________________ Disagreement begets progress.

21st February 2013, 12:24 PM	#296
respect Illuminator Join Date: Jan 2011 Location: Bohemian Grove Posts: 3,517	Originally Posted by TubbaBlubba Yeah, it was just an example I got off a webpage explaining the idea. And, as I look closer at it, there really doesn't seem to be any problem with it that doesn't already exist with standard welfare. But it cuts the cost significantly of administering welfare. If a country actually adopted it they could pay more welfare at less taxpayer expense if they chose to do so.

21st February 2013, 12:39 PM	#297
TubbaBlubba Knave of the Dudes Join Date: Jul 2010 Location: Communist Kingdom of Sweden Posts: 7,408	Originally Posted by respect But it cuts the cost significantly of administering welfare. If a country actually adopted it they could pay more welfare at less taxpayer expense if they chose to do so. Works for me. But it seems to be a recurring problem that the "best" kinds of taxes tend to be politically infeasible to implement.
	__________________ Disagreement begets progress.

23rd February 2013, 09:25 PM	#298
jflower New Blood Join Date: Nov 2011 Posts: 12	Has the President posted a justification for setting the national minimum wage at $9 hr? Anyone who proposes something that will interfere with the market bears the burden of proof of showing that the interference will actually work.
jflower New Blood Join Date: Nov 2011 Posts: 12

23rd February 2013, 10:22 PM	#299
OnlyTellsTruths Join Date: Sep 2007 Posts: 5,787	Originally Posted by fdbrian Originally Posted by OnlyTellsTruths Does anyone have a chart of the price of 1 gallon of gasoline to minimum wage ratio over the course of time? not a chart but in 1986, the minimum wage was $3.35 and I remember buying gas for 75 cents a gallon or less a lot. I assume no one else could find a chart either (I looked too). Has the minimum wage to a gallon of gasoline ratio every been this high? I don't remember a gallon of gasoline ever being more than half of the minimum wage. Except perhaps during that crisis in the 70s... Right now 1 gallon of gasoline is $4 and minimum wage is $7.25.
OnlyTellsTruths Join Date: Sep 2007 Posts: 5,787	__________________ ________________________

23rd February 2013, 11:12 PM	#300
psionl0 Illuminator Join Date: Sep 2010 Location: 31°58'S 115°57'E Posts: 4,768	Originally Posted by respect Although I would advocate going farther with it and not tie it to work, rather replace existing redundant and ludicrously wasteful welfare schemes with a streamlined negative tax that can accomplish the same goals at much lower costs... Now we are on the same wave length. Originally Posted by respect ...it would just need to be phased out in a way that always encourages work. Earned income credits and welfare reforms that encourage work are smaller versions of the same idea, I guess not

24th February 2013, 12:11 PM	#301
Astrodude Critical Thinker Join Date: Nov 2010 Location: University of Rhode Island Posts: 360	The minimum wage shouldn't be raised because real estate and rents haven't increased.

24th February 2013, 01:23 PM	#302
thaiboxerken Penultimate Amazing Join Date: Sep 2001 Location: Portland, Oregon Posts: 20,955	Originally Posted by Astrodude The minimum wage shouldn't be raised because real estate and rents haven't increased. You believe this means that the cost of living hasn't increased as well?
	__________________ All national institutions of churches, whether Jewish, Christian or Turkish, appear to me no other than human inventions, set up to terrify and enslave mankind, and monopolize power & profit - Thomas Paine

1st March 2013, 10:29 AM	#303
respect Illuminator Join Date: Jan 2011 Location: Bohemian Grove Posts: 3,517	Originally Posted by psionl0 Now we are on the same wave length. I guess not I'm a bit confused by this, you would be for streamlining welfare but against having the system encourage working?