I've changed my mind about minimum wage (or saw the light)

[Levant]

I've always supported the idea of a minimum wage.  It seems reasonable to me that a person should be able to, in exchange for working hard for whatever number of hours, earn enough on which to live.  I still think this.  I also think there is nothing wrong with choosing to be poor; it is as valid of a choice as working to get rich as long as you are poor with honor and living on your own efforts and the labors of others.

So, what's changed then?  So far it sounds like I'm still supporting minimum wage?

I heard a comment today on cable news about how easy it is to live as "American poor" compared to poor just about anywhere else in the world.  That's when I saw the light.  They were talking about a push to double the minimum wage!

You can choose to be poor and perhaps getting off work on time, not spending years in school, etc., are all valid choices.  The problem is the definition of poor.  Our poor in America are most of the world's middle-class.  If you choose to be poor, or choose not to do the things to get beyond being poor, then be poor.  It's ok. 

You should be able to afford a home on minimum wage - but there's nothing at all that says you deserve a home to yourself or to yourself and your immediate family.  Get 8 or 12 folks to live with you.  Get 3 or 4 families to live together.  Live in a a shack.  That's how the uneducated and poor of the world live.  You don't get a 5-room apartment with electricity, running water, phone, indoor toilets, and TV and call yourself poor. 

For the most part, in the US, the lowest paid workers will live in an old, run down, apartment or house  That's what you can get on 15,000 a year.  If they double minimum wage nothing will change.  Oh, sure, there will be a short period of major unemployment because employers just can't afford to pay it but after the dust settles, the work needs doing.  Doubling the minimum wage will just double the cost and value of everything and the person making 30,000 a year on the new wage will live in an old, run down, apartment or house.  And, unfortunately, still have running water, electricity, cell phones, and TV.

Just my minimum wage rant.

[Boomhauer]

Do you know the real reason behind pushing for the increase in minimum wage? Beyond the populist support from the unwashed rabble who are Dem voters? Union pay scales are often tied to the minimum wage...it goes up, union pay goes up. http://online.wsj.com/article/SB10001424127887324048904578318541000422454.html


Minimum wage is wrong because it forces an employer to pay a minimum of what the .gov believes should be paid, not what the worker is actually worth as far as what they do. An employer should be free to pay whatever it wants to an employee, and that employee can choose to accept the job or not.

[Monkeyleg]

I learned something interesting recently, which is that the black unemployment rate was lower than that of whites until about 1960. What changed? The implementation of minimum wage laws.

The biggest lobbyists for minimum wage laws have been unions and big businesses. The unions favor minimum wage laws because they drive up all wages, and thus those of union members. Big businesses favor increases in minimum wage because they can absorb the costs more easily than their smaller competitors.

The cabal of unions, big businesses and politicians have hoodwinked people into thinking that minimum wage laws are for the benefit of the working class.

[Perd Hapley]

  If they double minimum wage nothing will change.  Oh, sure, there will be a short period of major unemployment because employers just can't afford to pay it but after the dust settles, the work needs doing.  Doubling the minimum wage will just double the cost and value of everything and the person making 30,000 a year on the new wage will live in an old, run down, apartment or house.  And, unfortunately, still have running water, electricity, cell phones, and TV.

No, unemployment will rise, long term. Setting (or increasing) an artificial price floor decreases demand. If I can't sell my widgets for less than $5.00, I lose a lot of business from people who can't or won't pay $5.00 for a widget. If someone's labor is only worth $4.00 an hour, and no one's allowed to buy labor for $4.00 an hour...

[Monkeyleg]

No, unemployment will rise, long term. Setting (or increasing) an artificial price floor decreases demand. If I can't sell my widgets for less than $5.00, I lose a lot of business from people who can't or won't pay $5.00 for a widget. If someone's labor is only worth $4.00 an hour, and no one's allowed to buy labor for $4.00 an hour...

Simple law of economics. If you make something more expensive, people buy less of it. If you make it less expensive, people buy more.

[vaskidmark]

Wasn't minimum wage at one time the ceiling for welfare?  Back when I got a paycheck for checking eligibility for welfare, if you made minimum wage for 40 hours a week you made too much to qualify for ADC (Aid to Dependant Children).  Then there was a change in the fabric of the force and the Great Society emerged with the notion that at full benefit (ADC + food stamps) you would get the equivalent of 85% of the federal poverty level.  And the minimum wage shot up to almost double what it had been.

And folks on welfare did not get part-time or under the table work, yet got by while 15% short every month.

Somebody (and I'm too lazy to go looking for it) just recently released a study showing that a mother with two kids drawing full welfare benefits (TANF, Food Stamps, Section 8 housing, free lunches, and Medicaid's preventive service only) raked in the equivalent of $38,000/year.  Seems to me $38K is a bit above the official federal poverty level.  Like 200% of "official poverty", per http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Eligibility/Downloads/2013-Federal-Poverty-level-charts.pdf .

As Queen Victoria used to say, "We are not amused."

stay safe.

[Hawkmoon]

I don't think raising the minimum wage will make any significant difference. We have already exported just about all of our manufacturing to third world countries where (surprise!) they don't have minimum wage requirements. Most people working at anything useful here in the U.S. are already making more than the proposed new minimum wage. The net effect will be to double the price of a Big Mac meal at McDonalds.

[/sarcasm]

[brimic]

Raising the minimum wage just means that those on the bottom make more than they did before.
Eventually it all becomes relative and those on the bottom will have the same buying power that they did before because of the simplest most important law of economics- infinite wants/needs meeting a finite supply.
It helps the unions and big business as some have mentioned earlier, but it also hurts those on a fixed income due to their savings being eaten up by inflation.

[Tallpine]

I oppose any kind of govt intervention in the economy, but based on price increases generally compared to my first "real" (payroll with taxes coming out as opposed to cash) job in  1971/1972, the minimum wage today "should be" about $16/hr.

$1.60/hr back then was pretty good money.

[Levant]

No, unemployment will rise, long term. Setting (or increasing) an artificial price floor decreases demand. If I can't sell my widgets for less than $5.00, I lose a lot of business from people who can't or won't pay $5.00 for a widget. If someone's labor is only worth $4.00 an hour, and no one's allowed to buy labor for $4.00 an hour...

Historical unemployment rates: http://www.infoplease.com/ipa/A0104719.html

Historical minimum wage:  http://www.infoplease.com/ipa/A0774473.html

I don't see a connection in the long term.  I thought I saw a pattern of flat minimum wage correlating to high unemployment but during Bush 43 minimum wage was flat and unemployment down.  Maybe you can see more patterns than I do.

Minimum wage is wrong because it is a redistribution of wealth.  It gives wealth to those who have not earned it.

[Monkeyleg]

There's too many factors affecting the economy to try to isolate one, at least without some pretty fancy analytics.

In some parts of the country, unemployment is as high as 80%. Taking Obamacare out of the mix, don't you suppose that if employers could hire for $5 an hour, they might just have some jobs that need to be done that their $20 an hour people don't have time to do?

[Perd Hapley]

Levant, I don't know that just looking at the figures you provided will tell us much, either way. There were a lot of other variables affecting employment over all those decades.

The overall moral problem with the minimum wage is that it violates the rights of employers and employees to exchange labor for wages, or vice versa, on terms both agree to. That can take the form of preventing employers from employing unskilled labor, or, like you said, it can take the form of forcing employers to pay more than someone's labor is worth.

[Levant]

I think we're violently agreeing on the basic problem.

[Scout26]

Here's Milton Friedman's take:

http://www.youtube.com/watch?v=ca8Z__o52sk

And an even better explanation:

http://www.youtube.com/watch?v=Ct1Moeaa-W8


And then Nancy Pelosi explains how Minimum Wage works in her office or not.

http://www.youtube.com/watch?v=8pFC3LKMIQo

[Tallpine]

Imagine, there was once a time when you could hire someone for whatever you mutually agreed to, pay them in cash (or barter), and never have to worry about reporting it to the government and taking out taxes and $hit.

It's easy if you try. 

[Monkeyleg]

Imagine, there was once a time when you could hire someone for whatever you mutually agreed to, pay them in cash (or barter), and except for the Great Depression, you could always find a job.

[grampster]

Minimum wage can be condensed thusly:  1.  It's not supposed to be a "living wage". 

[Monkeyleg]

Minimum wage can be condensed thusly:  1.  It's not supposed to be a "living wage". 

Yes, but the politicians tell the masses that it should be. Some of the politicians know that raising the minimum wage will raise other wages, which will in turn raise prices, which will in turn make the minimum wage no more "livable" than it was before, but they sell it anyway. Other politicians are just too dumb to realize how it works.

[Scout26]

Imagine, there was once a time when you could hire someone for whatever you mutually agreed to, pay them in cash (or barter), and except for the Great Depression, you could always find a job.

Maybe not a long term job, but you could generally find job for a meal or a scrap of food.  As my father and uncle did when there simply was not food at home.  They would save some and bring it back to to their mother and sister.

He tells of he and his brother racing out of school ahead of the other boys to find coal along the railroad tracks so they would have heat at night.

(My grandfather died in 1929 when my Father was 4.)

[Tallpine]

Minimum wage can be condensed thusly:  1.  It's not supposed to be a "living wage". 

I managed to get along pretty well single back in the early seventies.

[GigaBuist]

Minimum wage can be condensed thusly:  1.  It's not supposed to be a "living wage". 

Ayup.

And good luck finding a minimum wage job.  When Morgan Spurlock (the Supersize Me guy) went to do a documentary about living on minimum wage he had to move to a different state just to find a job that would pay him minimum wage.  Hardly anything actually gets minimum wage pay.  We pay part time high school kids that, but they're the only ones.  They're also not allowed to use things like knives or a ladder due to government restrictions.  So, yeah, they get paid the bare minimum.  If they could legally cut open a box maybe they'd make what the adults do.

[zahc]

earned something interesting recently, which is that the black unemployment rate was lower than that of whites until about 1960. What changed? The implementation of minimum wage laws.

In an old Buster Keaton movie, there is a sign on a cafe saying "colored waiters wanted". I reasonably assume this was not because they preferred black people but because black waiters where cheaper (follow the money). Now if there is a minimum wage, initially set to the prevailing "white" wage, then your standard cafe proprietor, through his own racism or concerns over the racism of his patrons, will surely hire white people if he has to pay white wages anyway. Seems to me minimum wage laws are a great way to 'fix' this situation and make sure that undesireables get a job only once all the white people have first dibs, all while appearing to be empathetic and altruistic to the very groups being opressed. Its so politically perfect that it MUST be the original motivation.

[Tallpine]

Back in the late 1980s when I went broke and had to start over min wage was $4/hr IIRC.  There was a recession of course so jobs were hard to find.  Engineers were standing in line for truck washing jobs.

Anyway I got a temp job at a woodshop and then got hired full time (+) and shortly after offered a chance to run the spray booth evening/night shift, with a 50% raise.

There was a guy that started the same week that I did and about six months later he was complaining that he had never gotten a raise.  I told that if I was running the place that he would have been fired a long time ago  

[vaskidmark]

In an old Buster Keaton movie, there is a sign on a cafe saying "colored waiters wanted". I reasonably assume this was not because they preferred black people but because black waiters where cheaper (follow the money). Now if there is a minimum wage, initially set to the prevailing "white" wage, then your standard cafe proprietor, through his own racism or concerns over the racism of his patrons, will surely hire white people if he has to pay white wages anyway. Seems to me minimum wage laws are a great way to 'fix' this situation and make sure that undesireables get a job only once all the white people have first dibs, all while appearing to be empathetic and altruistic to the very groups being opressed. Its so politically perfect that it MUST be the original motivation.

It (the sign) assured the cafe owner that he would get the sort of employees that he wanted, who would act they way he and his customers wanted, and were willing to accept an arbitrarily lower rate of compensation as driven and controlled by a raft of social norms (of that time) that we currently describe as racist and discriminatory.  It was less about "white wages" than about Yassa, Massa/No suh, Massa along with the perception that "decent" white folks did not make a living in the servile professions.  (The contradiction posed by making a life "in the service" - butler, ladies maid and the like - was answered by the belief that one must be almost a gentleman/lady in order to do the job properly.)

With daddy waiting tables, mammy washing clothes/scrubbing floors/cooking (she had many more options than did her man), and the kids picking up the odd coin here and there the family got by.  Nobody depended on a single income when earning "the minimum wage".  My great aunt Sally got her washing done free because she gave space in her yard (cellar during inclement weather & the winters) to Esther, who was then able to get the laundry job for over five dozen families without having to lose time going to pick up/deliver or pay rent for a workshop. (Esther, her man, and 6 kids lived in three rooms with a communal bath/toilet down the hall.  There was no way she could work from home.)  Aunt Sally told me Esther told her that without the central location she might be able to do washing for three dozen families if she worked 16 hour days 7 days a week instead of her usual 10 hour days, with a half-day Saturdays.  And Esther was not going to give up church for anything - especially not for mammon.

I met Esther when I was 6 and she was somewhere between 65 and 80.  She feared integration because if she became "like white folks" she would lose money for having to charge the same as those [expletive deleted] Mick and Dago ladies who did not deliver a product half as good as hers, thus losing customers.  Esther was also very glad that the nearest Chinese laundry was a trolly ride away and that white folks just did not carry bundles of dirty clothes on the trolly no matter how much money they might save.

stay safe.

[cassandra and sara's daddy]

Back in the late 1980s when I went broke and had to start over min wage was $4/hr IIRC.  There was a recession of course so jobs were hard to find.  Engineers were standing in line for truck washing jobs.

Anyway I got a temp job at a woodshop and then got hired full time (+) and shortly after offered a chance to run the spray booth evening/night shift, with a 50% raise.

There was a guy that started the same week that I did and about six months later he was complaining that he had never gotten a raise.  I told that if I was running the place that he would have been fired a long time ago  

There are indeed folks who are not worth min wage. Many sadly

damn phone