Say Anything Blog

IMO the group that get’s hurt the most when Congress raises the minimum wage are the folks that are one step above that.

Many of these people are in line for a raise.  When Congress raises the minumum the money that would have gone to the experienced folks goes to the new hires.

Since several cities and states already have minimum wages legislated above the federal minimum wage, what’s the problem? Why the heck can’t the people who want it increased complain to their local governments. It doesn’t belong in the hands of Congress.

Steve:

Since several cities and states already have minimum wages legislated above the federal minimum wage, what’s the problem? Why the heck can’t the people who want it increased complain to their local governments. It doesn’t belong in the hands of Congress.

That’s an excellent point.

Our system works best when we remember it was designed to distribute the decision making, rather than centralize it.

A single “one-size-fits-all” minimum wage hike makes much less sense than just having each region regulate where that wage should be set at (or if at all).

The problem with that is that jobs can be moved around.  If town A raises their minimum wage that town will lose jobs pretty fast to town B.

When that increase happens over the entire country it takes longer for organizations to adjust.  Of course prices will rise, jobs will disappear and there will be more outsourcing. 

But that doesn’t matter because in the short term politicians can feel good about themselves by spending other peoples money.

The House just gave itself a pay raise of $3100.00 and will vote down a pay raise for the poorest workers. Sheer hypocrisy on the part of the House Republicans.

As to the reasons for Cato’s recommendations that you cite, Rob:
1.  Prove that the last minimum wage increase did this.
2.  Worker’s benefits are already being reduced while CEO compensation continues to increase. So using this excuse is a red herring.
3.  So what?

“It doesn’t belong in the hands of Congress.”

It doesn’t belong in the hands of government at all… at any level.

will vote down a pay raise for the poorest workers.

Puzzle:  You may have a hard time understanding this but Congress doesn’t pay everyone’s wages.  See what happens is that employer A offers a job to person B at a certain amount of money.  If person B decides that isn’t what they are worth they are free to take another job.

I know this free market stuff is tough to grasp.

Of course if the goal is to make the most vulnerable members of our society unemployable than it’s a pretty effective tool.

The Whistler,

When you explain it like that I bet ever diane could understand it.  Good show!

Regards…

TW:

The problem with that is that jobs can be moved around. If town A raises their minimum wage that town will lose jobs pretty fast to town B.

That’s not entirely true of course.  McD’s is pretty well stuck having their restaurant in town A & town B.

What will happen over time, as we both know, is that more jobs will be created in town B, and town A will go into decline.

Steve,

Since several cities and states already have minimum wages legislated above the federal minimum wage, what’s the problem? Why the heck can’t the people who want it increased complain to their local governments. It doesn’t belong in the hands of Congress.

Union pay is based upon Minimum wage.  If the MW goes up then Unions demand a like increase.  The whole chain flows upward.  Thus the cost of everything goes up and the dollar is worth less than it was.  You might have MORE $s but the buying power is reduced.  As it is, companies are hiring illegals for the cheap labor.  If MW is increased, businesses will be further enticed to look at cheap labor rather than raise the price of their product.

LTM:  I don’t read Diane’s comments so I assume she doesn’t read mine. 

Carrick:  Agreed.  Not all jobs are portable.  By the way have you noticed how much it costs to eat at McD’s nowdays?

Btw Puzzlefeet.  Just out of curiosity, what does the House giving itself a raise have to do with the merits of whether to increase the minimum wage?

Regards…

Thomas Sowell who I greatly admire thinks we should pay Congress $1,000,000 a year because that’s what the job’s worth.

I, on the other hand, (who I also greatly admire) think that we should pay for the job Congress is actually doing which is about $1/year.

I know you’re being a bit tongue in cheek, TW.  But it would be interesting if all of us involved in politics (at one level or another) actually spent some time in the office of a Senator or member of the House.  I haven’t done so myself, but my bestest friend had a summer internship with Senator Lugar, who relayed in great detail his experiences to me.  Quite an eye-opening experience into the workings of congress.

I came away with a lot more respect for these guys, how hard they work, and how hard their jobs really are.

well I guess I don’t disagree Carrick that the job is an hard one.  Very very hard for those that actually are trying to do a good job.

However if we’re paying for what’s actually being accomplished we shouldn’t be paying much.

TW:

However if we’re paying for what’s actually being accomplished we shouldn’t be paying much.

Have you reviewed what’s gotten accomplished, or are you just PO’d that your own pet projects (e.g., immigration) haven’t gotten accomplished yet? 

Seems to me like they’re pretty hard at work doing mostly what they’re paid to do, which is write legislation that controls how the country gets run.  We’re right in the middle of the House & Senate spending authorization cycle right now, so don’t expect them too go off topic. 

Now would be a good time for people who genuinely care on one side of the other of this issue to write their congress critters.  Even if it’s just a complaint that it’s not being given enough attention…

Carrick:  There’s a number of issues that could be done a whole lot better.  Certainly immigration is one, but that’s a Senate issue, not a House problem (at this point).

One thing they could do and should do is to cleanup on all of these stupid little pork projects that add up to some real money at the end. 

Reforming the entitlement programs is something that probably can’t be done now due to the obstructionists on the Democrat side.  But the pork stuff which is small potatoes could be fixed.

I think Congress also shouldn’t be piling law on top of law expecting us to somehow keep track. 

If Congress didn’t take it upon themselves to involve the government into so many areas they have no business doing there job wouldn’t be so complex, would it?

Thomas Sowell says that if we paid $1 million a year we’d have better candidates.  I don’t know if we would have better candidates or if these better candidates would be elected.

Why don’t we just make everyone who earns over minimum wage and wants it raised pay half of the differnce between their pay and minimum wage into a special fund to be divided between those less fortunate so they can prove for once and all that they care? The minimum wage earners will get an increase and surely those lefties who want it raised will be happy as can be to put their money where their mouths are instead of making others pay for what they want. Wouldn’t they? Wouldn’t they???

Bullwinkle:  I hope you’re including those members of Congress voting for the minimum wage your great plan.

Thomas Sowell says that if we paid $1 million a year we’d have better candidates. I don’t know if we would have better candidates or if these better candidates would be elected.

Was it Will who said our Congress would be better if we just picked the first 100 names in a phone book? It takes a great deal of intelligence to advocate something as reprehensible and ineffectual as a forced minimum wage.

I am Whistler, because people who comment in favor of raising it here are all minimum wage earners, thye’d be getting a raise to even more than they are worth.

Had a few to drink, Bullwinkle? 

Nope, was using a handheld from the beach. Hard to type anything on it and hard to read in the sun.

Am I the only to notice you could hear a pin drop as soon as someone mentioned the liberals picking up the tab for their plan?

Where’s the hard numbers of causality between raising the minimum wage and, unemployment etc?

Woof: In a demand economic system, the relationship between the supply of something(labor) and the demand for it(labor) determines the price of it(labor).  You can’t legislate the price without distorting the supply/demand relationship.  That could take any one or more forms, one of which is unemployment of workers whose market value(as labor) is less than the mandated wage.  If, on the other hand, there is a temporary situation where the demand for labor in a particular market is less than the supply for that market, low wages cause(unless interfered with) labor to move into another market where it is in more demand.  As a result, the supply decreases, and the existing demand creates a higher wage.  Interfering with this process institutes a permanent underclass of low-wage workers, which is exactly what socialists want. Illegal immigrant labor in the border states is a perfect example of this.  Minimum wage laws are not the cure;  they are the disease.  They also retard mechanization and modernization of that market.

that is theory , minimimum wage has been around since 1938. Where are the numbers for the negative consequences you theorize.

Min Wage History

Woof: It’s not theory; it’s fact.  You should run a business for a few years before you shoot off your mouth about such matters.

Perhaps the problem isn’t merely WOOF’s lack of experience running a business, as several of us have done.  Perhaps instead, this is his first real experience with this argument.  After all, there has been, thankfully, no raise in the federal minimum wage for over a decade.  I suspect that he simply has not experienced this argument both practically and theoretically before.

WOOF,

I will hunt up the numbers you’ve asked for tomorrow, but in the meantime please think this thru carefully.  Assuming all else to be equal: sales (in units and dollars), costs (besides labor) both fixed and variable, etc., where then does the money come from for the increased wages mandated by law?  If the most inexperienced, apprentice workers now cost me more money per hour, week, or month, or per unit sold if you prefer, how then am I able to afford the increase itself… never mind expanding my workforce by hiring more workers?  If my labor costs now go up by 30-40%(FICA, Workman’s comp, etc.) or more, where does that money come from, and how can I afford any more employees?

Bat: You are probably right about the genesis of Woof’s position on minimum wage laws.  He undoubtedly thinks, like marxist theorists do, that all the work product belongs to labor, and that wages are arbitrarily set by the “management” to exploit the workers, so that minimum wage laws right an existing wrong.  This 19th century economic ignorance still survives because we don’t have economic education in schools, but we do have marxist principles being taught.  Woof is probably another unknowing victim of the socialist public education system.  You know, it’s the job of the govt to rescue the workers from the rascally capitalists.  Don’t know how we can get all this wealth from poor people.  Even Robin Hood robbed the rich.  Only politicians rob from the poor.

Robert108,

Even if we are right, and WOOF has not yet been thru this argument, that still does not vitiate his own lack of thought on the matter.

One of the advantages of having a paper route way back when, is that it taught many of the same lessons, (per unit costs, profit margin, sales and profit volume, economies of scale, etc.) on a very practical level which we could understand even at a tender age.  By the time Econ 201 came around, the lessons were already learned and all that was needed was to fill in the correct vocabulary.

As in so many other areas today (history, financial basics, civility and manners, to name a few) it’s a real shame what we don’t teach kids any longer.

Bat: I totally agree.  Notice that, while pressing us for numbers, Woof offers no numbers in support of his position.  It’s an old trick of the lefties.

Bat: He doesn’t even give an argument of any kind for his position.  He is trying to prevail without entering the debate.  Very interesting.

Ah, but that’s WOOF’s style:  Hit and run, snide (or cryptic) comment, condescending tone, but never ever actually debate anything.  You can’t fire the weapon if you don’t have the ammunition.  He’s just another troll, albeit a more polite one than most.

Regards…

WOOF: Even if we discovered irrefutable evidence that, despite the absolute irrationality and impossibility of it, raising the minimum wage actually decreased unemployment, we should still reject it, for it involves coercion: the government is forcing men to pay a certain salary. If we remove their suits and ties, is this any different from robbery?

The purity of supply and demand theory supported by free rational markets is an ideal. The world is more complicated than a simplistic ideal and effected by forces not so easily calculated.

What should be obvious effects governed by Supply/Demand ain’t necessarily so. Studies of minimum wage and employment sometimes show gains and other times losses in employment. What should be obvious results from classical theory is not apparent in reality.

WOOF offers,

The world is more complicated than a simplistic ideal and effected by forces not so easily calculated.

That sentence sounds even more profound than it is.  I congratulate you.  Be aware, however, you are likely to see that same profound sentence hurtling back at you the very next time you offer up some “simplistic ideal” from the left side of the spectrum.

As for “easily calculated” forces, I will have some numbers for you to support the notion that the private sector does not, can not, manufacture money to pay for government mandates, as does the federal government.

Meanwhile, perhaps you’d offer some citations for those “studies of minimum wage and employment” to which you referred.  If you could actually document those instances when “what should be obvious results from classical theory is (sic) not apparent in reality” I would really appreciate your effort.  Thanks.

Ther are lots of numbers , I have seen none that are definitive. Minimum wage increases are probably marginal compared to greater economic forces.
Minimum wages and youth unemployment

One of the first things you learn if you own your own business is that the only cost you can control is labor and your control of that is very limited. You can’t decide what insurance, utilities, fuel, or raw materials cost, those are set by the suppliers. That a minimum wage exists at all takes some of that control away, raising the existing minimum wage takes away more control and makes expanding your business (and creating more jobs) much more difficult. The end result will almost always be fewer starting level jobs for the people advocates of raising minimum wage claim to want to help. If you can’t control the per-hour cost of entry level employees the only option is to limit the number of them. It’s that simple. Raising the minimum wage means that the costs on everything else your business uses (insurance, utilities, fuel, or raw materials) also rise when minimum wage goes up so it hurts entry-level job opportunities twice. Argue all you want about how unfair it is that minimum wage hasn’t been raised but which is fairer to young workers, low wages or unemployment rates in the 20%+ range, like they have in France? The policy of most businesses there is to fill entry-level jobs with workers in their mid-late 20’s.

So let me ask this,

If any sort of min wage is unfair to business owners than what mechanism besides supply and demand exists to insure that the lowest level jobs in our country are paid a living wage? If the supply of labor is high then what prevents McDonald’s from paying $2.00 an hour? 

I’m disgusted by the 19th century capitalist economic garbage quoted by the people in this thread.  The world has seen the negative effects of capitalism run amok.

Considering most min wage jobs are in the service industry, I find it very hard to believe that any given service business can afford to cut the number of service positions they have.  These are not manufacturing jobs, these are jobs at Arby’s.

1. Minimum wage increases have never increased unemployment. As a matter of fact they have done the opposite

2. In the last 20 years the minimum wage has not kept pace with inflation. During the fifties sixties and seventies minimum wage increases were regular and were increase to offset inflation. But when Ronald Reagen and the greedy generation took control that stopped. For today’s low income worker to be at the same level as that same worker in the sixties the minimum wage would have to be close to $10.00 per hour.

3. If a business can’t afford to pay it workers a livable wage then they should look seriously at whether they are economically viable.

4. when businesses don’t pay a livable wage there employees can receive food stamps and other government benefits. In actuality the business is the receiving the welfare benefits and the tax payer is paying for the mismanagement of the business owner. IE A very high percentage of Walmart employees receive government benefits even though they work full time. While the Walton family members are worth $40 to $50 billions each. And have incomes that are in the 100’s of millions dollars annually. If they were required to pay a livable wage the tax payers in states where they operate would save millions.

If there were no minimum wage laws companies like Walmart would pay their employees as little as 1.50 per hour, as they have been caught doing. And the states would have no choice but to pay welfare payments to these people.

JD: Thanks for the Marxist talking points.  No one holds a gun to the heads of those workers;  they can find jobs elsewhere if they don’t like the pay.  You need to get your head out of the nineteenth century.

And the states would have no choice but to pay welfare payments to these people.

Sez who?

“The purity of supply and demand theory supported by free rational markets is an ideal.”

This is false.  Marxist ideas of an enlightened elite deciding everything for the proletariat and providing equal outcomes is an ideal.
Free people making free choices is what people do when they are not oppressed by a totalitarian govt.

Does The fact that I believe in this statement make me a Marxist? “To form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity.” 

  And the states would have no choice but to pay welfare payments to these people.

Sez who?

I direct you back to the beginning of my reply
Is fascism better than Marxism?

JD: “...promote the general Welfare…” doesn’t refer to welfare payments, which didn’t exist at that time.  It means to enable the greatest good for the greatest number, as in the accomplishments of the free enterprise economic system.

The only difference between fascism and Marxism is who is running the totalitarian govt.  They are both into central control; neither supports free people making free choices.  So, my answer is that neither is good.  Fortunately, in the US, we made a better choice than either of the two you name.

The good part of that is that people who want to improve their lives and themselves and their families can do so;  the bad news is that the ones who choose not to do that get less.  It’s called meritocracy.

JD: BTW, I never called you a Marxist.  I said you recited Marxist talking points.  Maybe you don’t know that you were doing that.

Woof: It’s the Law of Supply and Demand, not a theory.  It isn’t based on purity, but on human difference, unlike Marxist theory, which is based on an unattainable ideal of equal outcome for everyone(except the ruling elite, of course, who get much more).  Thought you might like to know.

Not even Marxism is immune from the Iron Law of supply and Demand - it is the main reason why it failed so miserably.

Those were not marxists talking points. Actually those were my own words based on facts and experience. Apparently you haven’t experienced the Marxism that was rampant in the ‘40s, ‘50s, ‘60s and ‘70s when the us governement shot and killed it’s own citizens, The most notable characteristic of a fascist country is the separation and persecution or denial of equality to a specific segment of the population based upon superficial qualities or belief systems. Marxism and Fascism are two very different things

Meritocracy: If they don’t like it they can get a job elsewhere.

Uh, I don’t know if anyone told you or not, but the min wage jobs are kinda the bottom of the barrel.  Those people can’t get jobs elsewhere, if they could it would not be an issue.

The most amazing thing to me is you radical right wing capitalists, who by and large identify yourselfs as Christians are so quick to throw people away; to be as UN-Christian as possible. 

Amazing how your economic theories stand in stark contrast to your moral ones.  At least be consistent in your application.  Just say you hate poor people and minorities and you would be happier in a world without them. 

hundreds of years of capitalism has proven no better a socio-economic system than pure socialism yet you still stand there and defend it.  Where has capitalism left us?  With a poluted environment, a pornographically wealthy 5%, a struggling middle class and a poor lower class that is doomed to propegate itself because its members have virtually no chance to improve their condition thanks to the work of people who hold to an outmoded, debunked economic theory.  Combine that with an advertising industry AND a government that promotes economic consumption as a virtue as opposed to compassion and reason.

Careful now Jon, the longknives are about to come out.  Be prepared for the following names to be used on you:  Commie,  Socialist, Leftard,
wingnut, stupid, oh what else.  Be prepared for R108’s lecture on Econ 101, logic and Guttermouth 2h9’s berating namecalling commentary.  Oh and there will be others. 
Hang on, it’s a wild ride on this blog.

Oh, and how could I forget the old meme “Marxist talking points”,oh never mind that’s already been used here as has “free people making free choices.”  Woo-Hoo!

My obvious mistake?  Your glaring error would be in assuming that Marxism and Leninism/Stalinism/Maoism are the same thing. 

Most right-wingers make this same error of reasoning.  Marxism is a 19th century debunked political theory which was modified by Lenin in the early 20th century to include the idea of an elite marxist oligarchy to rule. It was later used as a justification for a police state by Stalin in the 1930’s and then used by Mao to justify his own totalitarian revolution in China in the 1950’s.  Marxist theory(if you can actually get through Marx which my degree required I did) actually says that in response to Capitalism, workers will rise up violently and create socialist reforms.  Socialist reforms will one day lead to a “communist” state in which there is no government at all (Something true conservatives should really like!)

Saying that marxism = centralized government and a totalitarian state is the same as saying that a capitalist system is always marked by facism (hmm, maybe you ARE onto something!)

True Capitalism with no government control leads to abuses that are just as bad as the pratical applications of Marxist politcal theory that we have seen in the Soviet Union, China and other “communist” dictatorships.  Socialist reforms in Europe, the United States and Canada have met with great success however, when combined with a free-market system.  Thus: MINIMUM WAGE!!!!!!

Puzzle: Namecalling aside (which I don’t like and is unnecessary), if you don’t want to be called a socialist…don’t advocate socialist ideas.

Jon: All socialist reforms lead to communism.  Whether we get there through red revolution or get there through the creeping of socialistic programs and legislation into our society, the end game is communism and totalitarianism.  It all leads to the same place, the only difference is how fast we get there.

Free people making free choices is the best policy.  That is what should be embraced.

The purpose of government shouldn’t be to do good, but simply to refrain from doing evil.

Puzzle: What have you got against free people making free choices?

The purpose of government shouldn’t be to do good, but simply to refrain from doing evil.

Just too much freedom, right?  Can’t let the people be that free.  Goodness knows they can’t make all of their own choices…

The purpose of government shouldn’t be to do good, but simply to refrain from doing evil.

Jon,

The thing that you miss in your commentary is that people are free to employ themselves.  You seem to assume that if you can only be employed by others and that if you have a “minimum wage job” you can only work for that one employer because you can’t work elsewhere, or that once you hold a minimum wage job, you are stuck there eternally. 

Most minimum wage jobs are entry level positions.  Most corporations are not willing to employ people at minimum wage because they have little or no skill.

The most amazing thing to me is you radical right wing capitalists, who by and large identify yourselfs as Christians are so quick to throw people away; to be as UN-Christian as possible.

What’s wrong about this is: Christianity wants people to prosper on their own.  The “Teach a man to fish…” parable is applicable here.  Christians are looking for people to empower themselves in their lives.  Minimum wage gives the man a fish…

Amazing how your economic theories stand in stark contrast to your moral ones.

As I just noted, it’s not…  but you seem to assume that the conservatives here are all Christian…  an unwise assumption.

At least be consistent in your application. Just say you hate poor people and minorities and you would be happier in a world without them.

I strongly dislike people who do nothing to better themselves then whine to the Govt to do things FOR them…  Most of the “Poor” in the US fall into this group.  Of course, our poor live like royalty compared to most third world countries and like the middle class of most European countries…

hundreds of years of capitalism has proven no better a socio-economic system than pure socialism yet you still stand there and defend it.

Wow…  Misguided.  Prior to our free market capitalism, the Romans developed a system much like ours.  When Rome fell, they were nearly as industrious and innovative as we are.  Rome had medicine, architecture, and many other technologies that would not be reinvented for 1500 years.  Capitalism creates innovation.  Where did the computer come from?  Would it exist today without capitalism?

Where has capitalism left us? With a poluted environment, a pornographically wealthy 5%, a struggling middle class and a poor lower class that is doomed to propegate itself because its members have virtually no chance to improve their condition thanks to the work of people who hold to an outmoded, debunked economic theory.

Are you serious?  Our poor are better off than 90% of the rest of the world and you state that they are hopeless to improve their lives? 

Combine that with an advertising industry AND a government that promotes economic consumption as a virtue as opposed to compassion and reason.

More problems with your logic.  It’s the socialists that want Government to “Promote” anything.  Us free-market conservatives want the Government to regulate for safety…  but get out of the way for everything else.  We don’t want the Government to “promote” anything…  That’s for the people to do.

Look at that PuzzleFoot…  I didn’t call him a name… 

Puzzle,

Just a friendly observation, for what it may be worth.  You are beginning to sound way too much like Diane.  That is, long on rhetoric and way short on any sort of substance. 

Leave the snide insults to her.  She already has a well-deserved reputation for exactly that and precious little else.  I’ve read enough of your commentary to realize that you are capable of a lot more than merely belittling those who disagree with you.