Should We Drop Minimum Wage?

Off Topic Politics & World Issues
21

[quote]LIFTICVSMAXIMVS wrote:
PonceDeLeon wrote:
My point is:

If govt. drops minimum wage, and all businesses within a 50 mile radius of an individual decide that they want to pay their employees no more than $4/hr - when they were making at least double that - do you think the cost of living will proportionately drop, too?

It won’t.

Rent won’t drop, gas won’t drop and groceries/food/entertainment will not drop.

How would the individual afford their previous lifestyle, even if it was meager to begin with?

You guys are suffering what most people suffer and that is a lack of a holistic view of the situation. You are not considering the repercussions of such changes because yelling that the “government shouldn’t get involved” is enough to make your dicks hard.

Push,

Don’t you own your own business? What good will dropping minimum wage do you?

Please pick up an economics book and read it.

The cost of living will come down if the government were to remove price controls.

Suddenly everyone will become employable, productivity will go through the roof, and prices will therefor come down on all goods and services.

In fact, as the overall capital infrastructure increases labor becomes scarce compared to those capital goods so therefore wages must also increase. The government is just punishing people by trying to help them.

Wage controls hurt productivity and thus cause wages to be lower than they actually could be.[/quote]

Read an economics book? So I can stuff my brain with nonsense THEORY?

You do understand that many concepts just don’t pan out in real life?

There is no way that, all of a sudden, the cost of living will DROP in proportion to the average wage. It doesn’t work that way.

Explain how wage control hurts productivity. Do you mean that employees will not work as hard knowing they will receive a minimum wage? I don’t buy that argument at all.

22

[quote]phishfood1128 wrote:
i am glad i could get this thread going. I am all for letting the market dictate the wages. I am by no means an expert in economics nor am i really that interested in the subject. As i said before i wish there were no governmental controls but there are and always will be. Lets be honest the government sometimes makes the hard decisions that the people cant or wont make (whether it be local, state, or national gov.). [/quote]

“The people” make decisions everyday; it is called the market. It is impossible to exist and not make decisions. Not making a decision is itself making a decision.

Besides this you miss the obvious question if the government is capable of making the best decision for every single person.

“The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.” -Henry Hazlitt, Economics in One Lesson

http://jim.com/econ/contents.html

After reading this book you will have no excuse for spouting such ignorance any more.

“It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a ‘dismal science.’ But it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance.” -Murray Rothbard

23

[quote]PonceDeLeon wrote:
LIFTICVSMAXIMVS wrote:
PonceDeLeon wrote:
My point is:

If govt. drops minimum wage, and all businesses within a 50 mile radius of an individual decide that they want to pay their employees no more than $4/hr - when they were making at least double that - do you think the cost of living will proportionately drop, too?

It won’t.

Rent won’t drop, gas won’t drop and groceries/food/entertainment will not drop.

How would the individual afford their previous lifestyle, even if it was meager to begin with?

You guys are suffering what most people suffer and that is a lack of a holistic view of the situation. You are not considering the repercussions of such changes because yelling that the “government shouldn’t get involved” is enough to make your dicks hard.

Push,

Don’t you own your own business? What good will dropping minimum wage do you?

Please pick up an economics book and read it.

The cost of living will come down if the government were to remove price controls.

Suddenly everyone will become employable, productivity will go through the roof, and prices will therefor come down on all goods and services.

In fact, as the overall capital infrastructure increases labor becomes scarce compared to those capital goods so therefore wages must also increase. The government is just punishing people by trying to help them.

Wage controls hurt productivity and thus cause wages to be lower than they actually could be.

Read an economics book? So I can stuff my brain with nonsense THEORY?

You do understand that many concepts just don’t pan out in real life?

There is no way that, all of a sudden, the cost of living will DROP in proportion to the average wage. It doesn’t work that way.

Explain how wage control hurts productivity. Do you mean that employees will not work as hard knowing they will receive a minimum wage? I don’t buy that argument at all.[/quote]

Oh, they do not really hurt productivity because all the less productive people will lose their jobs.

And some people CANNOT work so hard, no matter how hard they try.

Plus, ja, theory.

25

[quote]PonceDeLeon wrote:
Read an economics book? So I can stuff my brain with nonsense THEORY?[/quote]

No, so you can at least have a familiarity with the argument everyone here seems to understand yet you do not.

[quote]
You do understand that many concepts just don’t pan out in real life?[/quote]

Name one that does not in economics. Since you refuse to read THEORY how can you even have a basis to make such an argument?

[quote]
There is no way that, all of a sudden, the cost of living will DROP in proportion to the average wage. It doesn’t work that way.

Explain how wage control hurts productivity. Do you mean that employees will not work as hard knowing they will receive a minimum wage? I don’t buy that argument at all.[/quote]

If you tell an employer what he has to pay his employees and it is more than he currently can you understand what will happen? Productivity must drop therefore less goods are produced and therefore goods must become more expensive. This raises the cost of living – which is precisely what you attempted to combat in the first place.

The “cost of living” is a function of productivity in combination with monetary policy. As long as the money supply remains unchanged and social productivity is increased goods and services become cheaper which lowers the cost of living. Increasing the money supply (inflation) will raise prices if the supply of goods remains unchanged or is lowered – as a result of price controls, for example.

In a free society where people are free to exchange their talents and interests there is always a natural tendency for the cost of living to come down in relation to the money supply.

Price controls create shortages no matter what.

Now, can you offer a logical alternative explanation for this phenomena which I have laid out above? Probably not since you are not familiar with the logical structure of the economic sciences.

26

[quote]LIFTICVSMAXIMVS wrote:
PonceDeLeon wrote:
Read an economics book? So I can stuff my brain with nonsense THEORY?

No, so you can at least have a familiarity with the argument everyone here seems to understand yet you do not.

You do understand that many concepts just don’t pan out in real life?

Name one that does not in economics. Since you refuse to read THEORY how can you even have a basis to make such an argument?

There is no way that, all of a sudden, the cost of living will DROP in proportion to the average wage. It doesn’t work that way.

Explain how wage control hurts productivity. Do you mean that employees will not work as hard knowing they will receive a minimum wage? I don’t buy that argument at all.

If you tell an employer what he has to pay his employees and it is more than he currently can you understand what will happen? Productivity must drop therefore less goods are produced and therefore goods must become more expensive. This raises the cost of living – which is precisely what you attempted to combat in the first place.

The “cost of living” is a function of productivity in combination with monetary policy. As long as the money supply remains unchanged and social productivity is increased goods and services become cheaper which lowers the cost of living. Increasing the money supply (inflation) will raise prices if the supply of goods remains unchanged or is lowered – as a result of price controls, for example.

In a free society where people are free to exchange their talents and interests there is always a natural tendency for the cost of living to come down in relation to the money supply.

Price controls create shortages no matter what.

Now, can you offer a logical alternative explanation for this phenomena which I have laid out above? Probably not since you are not familiar with the logical structure of the economic sciences.[/quote]

In your scenario production could decline but productivity would not.

If you fire the least productive members of society you become more productive by definition.

By making human labor more and more expensive, production also shifts toward machines, making the remaining workers even more productive. They remaining do more in less time.

Which is why most European countries are more productive than the US but have a lower per capita income and a high base unemployment.

27

Ponce, what about the reservation wage? The reservation wage already creates a price floor, but unlike the minimum wage, it is dictated by the market.

You forget that there is also a market for labor. If there was no minimum wage, employers would be competing for better unskilled laborers or giving their unskilled laborers incentive to make more than $4 an hour.

If you can live off of the minimum wage, then what incentive is there to do any better?

28

[quote]orion wrote:
In your scenario production could decline but productivity would not.

If you fire the least productive members of society you become more productive by definition.

By making human labor more and more expensive, production also shifts toward machines, making the remaining workers even more productive. They remaining do more in less time.

Which is why most European countries are more productive than the US but have a lower per capita income and a high base unemployment.
[/quote]

Maybe I am misunderstanding what productivity is. What units do we measure it in?

(revenue - cost)/time?

or

goods produced/time

if goods produced is indirectly proportional to costs then they are both the same.

So it is not necessarily productivity that affects cost of living but total production?

Where am getting lost?

29

[quote]LIFTICVSMAXIMVS wrote:
orion wrote:
In your scenario production could decline but productivity would not.

If you fire the least productive members of society you become more productive by definition.

By making human labor more and more expensive, production also shifts toward machines, making the remaining workers even more productive. They remaining do more in less time.

Which is why most European countries are more productive than the US but have a lower per capita income and a high base unemployment.

Maybe I am misunderstanding what productivity is. What units do we measure it in?

(revenue - cost)/time?

or

goods produced/time

if goods produced is indirectly proportional to costs then they are both the same.

So it is not necessarily productivity that affects cost of living but total production?

Where am getting lost?[/quote]

It really depends on how you define it, I just wanted to point out that we have to be sure how we define it. Otherwise we may be agreeing anyway without knowing it.

If it is just “productivity” I immediately think of output per worker.

So it would be totally possible that overall production shrinks while productivity rises.

If wages are determined by productivity, it would follow that if you raise the minimum wage the least productive would lose their jobs first and thereby raise productivity?

30

[quote]pushharder wrote:
PonceDeLeon wrote:
My point is:

If govt. drops minimum wage, and all businesses within a 50 mile radius of an individual decide that they want to pay their employees no more than $4/hr - when they were making at least double that - do you think the cost of living will proportionately drop, too?

It won’t.

Rent won’t drop, gas won’t drop and groceries/food/entertainment will not drop.

How would the individual afford their previous lifestyle, even if it was meager to begin with?

You guys are suffering what most people suffer and that is a lack of a holistic view of the situation. You are not considering the repercussions of such changes because yelling that the “government shouldn’t get involved” is enough to make your dicks hard.

Push,

Don’t you own your own business? What good will dropping minimum wage do you?

Ponce, wage and price controls never work in a market economy. It’s a “feel good” vote getting gesture by people that “care.” But the “care” is ultimately about the votes and the power those votes produce.

In my case, my company is presently contracted on a job that falls under the thumb of the Davis-Bacon law and its mandated minimum wage (heavy highway construction category). Minimum wage is around $22 an hour for a common laborer. So where I could/should, in the instance of one particular instance on my crew, be paying three young guys say $8 each, I have to trim back and employ just one. It is an entry level position and requires a bare minimum of skill.

I would love to be apprenticing three guys instead of one. But the government insists IT knows more about the value of the employee in this position than I do. So as a result there are two 19 year olds out there in western Montana somewhere that are learning the life long skill of hamburger flipping at Wendy’s (open til 2 a.m.!) instead of watching and learning construction equipment operator skills that really could help them support their wives and children someday.

You are doing the right thing by asking these questions of someone who REALLY does own and run a business rather than some fucktard politician who only “cares” because of the current and lifelong benefits that a seat in Congress promises.

[/quote]

An excellent real life example. Thanks for that.

31

The idea of minimum wage is asinine. An employer has a certain amount he can spend on employees and stay in business. If the free market dictates the wages, then he will hire as many as he can for that amount. If he has to pay a minimum wage that is greater than free market wage, he will just get by with fewer employees and unemployment will increase. Look at unemployment levels for teenagers today. Why is it at 26%? Because of minimum wage. Employers can hire experienced people for the same cost, so teens can no longer find work.Teenage Unemployment Reaches High of 25.5% - The New York Times

32

[quote]reddog6376 wrote:
The idea of minimum wage is asinine. An employer has a certain amount he can spend on employees and stay in business. If the free market dictates the wages, then he will hire as many as he can for that amount. If he has to pay a minimum wage that is greater than free market wage, he will just get by with fewer employees and unemployment will increase. Look at unemployment levels for teenagers today. Why is it at 26%? Because of minimum wage. Employers can hire experienced people for the same cost, so teens can no longer find work.http://www.nytimes.com/2009/09/05/business/economy/05teen.html[/quote]

I wonder why the workers perspective gets never used as an argument.

After all, what does it mean?

Even if you are broke, haven’t eaten in three days and your wife is pregnant you are FORBIDDEN BY LAW to work for less than a certain sum, even if you cannot get a job above that sum.

Employers can live with minimum wages laws but the really poor?

Not so much.

33

[quote]LIFTICVSMAXIMVS wrote:
There should be no intervention in the wage by government…period.

This creates disemployment by raising costs on employers who now must lay-off of their most marginally productive employees. Suddenly, street sweepers are out of work because no one thinks they’re worth $7.75/hr.[/quote]

They should jack the minimum wage up, if for no other reason to piss Lifty off :slight_smile: On a more serious note we need a livable wage, after we have everybody that wants to work having job then we can have a minimum wage
.

34

[quote]LIFTICVSMAXIMVS wrote:
phishfood1128 wrote:
i am glad i could get this thread going. I am all for letting the market dictate the wages. I am by no means an expert in economics nor am i really that interested in the subject.

As i said before i wish there were no governmental controls but there are and always will be. Lets be honest the government sometimes makes the hard decisions that the people cant or wont make (whether it be local, state, or national gov.).

“The people” make decisions everyday; it is called the market. It is impossible to exist and not make decisions. Not making a decision is itself making a decision.

Besides this you miss the obvious question if the government is capable of making the best decision for every single person.

“The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.” -Henry Hazlitt, Economics in One Lesson

http://jim.com/econ/contents.html

After reading this book you will have no excuse for spouting such ignorance any more.

“It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a ‘dismal science.’ But it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance.” -Murray Rothbard[/quote]

Okay its ignorant to think that people should share your viewpoint that economics is the end all be all. Some people prefer other things, myself included. You can drown yourself in all the economic theory that you want so you can pat yourself on the back on an internet thread. congrats.

Its pretty clear that the government cant make the best decisions for every single person. But it is also impossible to have a pure democracy therefore we elect leaders to make decisions on our behalf and all you can do is hope that the right decisions get made. Personally until they ban “lobbying” the U.S. people will continue to get screwed.

“the people” dont make policy decisions. sorry but if that were true we would not be in Iraq. You dont get to vote on whether we should open up lines of communication with say Iran or N. Korea. Those are the decisions i was refering to.

35

What is a “living wage”?

What do you do when you have a product that has reached the threshold of what the market for it will bear, and suddenly have to pay a “living wage”?

How do you justify asking for a living wage when some employees really are not worth it?

Where and when does skill (or lack thereof), or the demands of a task come in to play?

Given the fields that I’ve been employed in, I’ve heard this living wage thing kicked around for about 20 years. The problem I’ve developed with it is that the people who want it are the last people to work for it. Always the people with empty hands and a mouth that runs overtime.

36

How do you think we could fix this, how could we get it through to the government that, say a poor man is looking for a job and is willing to pick tomatoes for $2/hr in a field to put some food in his stomach and split the cost for a low cost apartment,

but because the man has no skills that is his choice (the $2/hr tomato job), but businesses cannot hire him for more than agriculture minimum wage which is I think $3.25/hr. So he goes hungry and relies on someone else to take care of him.

I personally know of a few places in town called food banks were grocery stores, people, private business donate money or groceries so low income families can come in and spend $5 on a Monday to get a weeks worth of groceries (each box of groceries is around $120-140) so they can feed their family.

Now it is not Whole Foods, you are not receiving an $80 whole chicken, but it will get you through the week.

There is a lot of people that would be willing to hire low skill people to do things around their business.

My business is not as dangerous as Push’s, but there is opportunity to learn still and in the future take care of your family with decent wages and commission that my business offers. My business being not as dangerous as Push’s means that younger kids could get work experience, and for a decent wage at my business doing errands that take no skill.

The social effects of not being able to hire people because you do not have enough positions or you cannot hire someone because they are too young is drastic. I was glad I worked on a farm, I worked since I was young.

I am also glad my uncle was in finance so I could run errands and learn the business at a young age. Otherwise, I could have been, like Push said, learning the life skill of flipping hamburgers at Wendy’s instead of running a business and making a difference in people’s lives.

37

[quote]pittbulll wrote:
LIFTICVSMAXIMVS wrote:
There should be no intervention in the wage by government…period.

This creates disemployment by raising costs on employers who now must lay-off of their most marginally productive employees. Suddenly, street sweepers are out of work because no one thinks they’re worth $7.75/hr.

They should jack the minimum wage up, if for no other reason to piss Lifty off :slight_smile: On a more serious note we need a livable wage, after we have everybody that wants to work having job then we can have a minimum wage
.
[/quote]

Yes it will be the lowest paid person in the work force. If a person takes a job at $5/hr, then obviously that job is fine by him. Yes, he may need another job, but obviously that person is in a position that he may need two or three jobs.

Yet, if you cannot hire him at the wage the government is demanding then, he gets no job. The sad thing is that the one time I told someone the reason that I could not hire them, I told them that for the job that I could hire them for, I could not pay them. They pleaded with me to pay them under the table for a lower wage.

So, it is obvious that there is people that will work for under minimum wage and have no problem with it. The government (which does not work anywhere close to minimum wage) thinks these people should be paid more, well that’s fine but when businesses cannot even hire someone to train them to be in a position to get more money how are the businesses supposed to eventually pay them that wage the government wants them to pay.

38

[quote]phishfood1128 wrote:
LIFTICVSMAXIMVS wrote:
phishfood1128 wrote:
i am glad i could get this thread going. I am all for letting the market dictate the wages. I am by no means an expert in economics nor am i really that interested in the subject.

As i said before i wish there were no governmental controls but there are and always will be. Lets be honest the government sometimes makes the hard decisions that the people cant or wont make (whether it be local, state, or national gov.).

“The people” make decisions everyday; it is called the market. It is impossible to exist and not make decisions. Not making a decision is itself making a decision.

Besides this you miss the obvious question if the government is capable of making the best decision for every single person.

“The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.” -Henry Hazlitt, Economics in One Lesson

http://jim.com/econ/contents.html

After reading this book you will have no excuse for spouting such ignorance any more.

“It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a ‘dismal science.’ But it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance.” -Murray Rothbard

Okay its ignorant to think that people should share your viewpoint that economics is the end all be all. Some people prefer other things, myself included. You can drown yourself in all the economic theory that you want so you can pat yourself on the back on an internet thread. congrats.

Its pretty clear that the government cant make the best decisions for every single person. But it is also impossible to have a pure democracy therefore we elect leaders to make decisions on our behalf and all you can do is hope that the right decisions get made. Personally until they ban “lobbying” the U.S. people will continue to get screwed.

“the people” dont make policy decisions. sorry but if that were true we would not be in Iraq. You dont get to vote on whether we should open up lines of communication with say Iran or N. Korea. Those are the decisions i was refering to.[/quote]

Well maybe the federal government should not have that power, you said it yourself government cannot make the best decisions for ever single person, so maybe they shouldn’t be making the decisions at all. Maybe they should ask us to do stuff, since we actually are the ones paying for it.

Maybe if we cut down the Federal Government there would be no lobbying to the government because they have no power, the states would. So the lobbyist would have to lobby to the people or to the states.

If they lobbied to the states, the people would be in closer contact with the officials, leading to believe that the officials would not try anything slight of hand since you know it would be easier to lay hands on a official if they did something that was not thought of as kosher to the people of the state.

And how does lines of communication with Iran or N. Korea have to do with people not getting jobs because of minimum wage, and people not getting work experience since they are deemed to young by the Government.

39

that would get us straight back into the 1800’s.