JavaFox

Indeed.

Not unlike the "third rail of politics" status once afforded to Social Security, minimum wage laws are the new thing politicans can't try to repeal or discuss without risking political suicide.

On the surface, minimum wage laws, like many liberal ideas, don't sound too bad. Everybody ought to get enough money to survive, right? Nobody should get exploited by big bad corporations, who want to enslave all of America and forces us to work in coal mines for a mere $0.45 an hour! But --and again this is characteristic of liberal doctrine-- minimum wage laws are more ideological than they are pragmatic, and have negative consequences.

This is pretty simple. If the price of something goes up, what happens? Less people buy it. So, if a law forces companies to pay their unskilled workforce more than that company feels those workers are worth, what happens? Why, less people are hired, of course! When the government tells a company what it must pay to its workers, the company has to decide: do I hire more workers for a price that is not profitable to me? Or do I hire less? Minimum wage creates unemployment. And who is on the receiving end of this government-induced layoff? Usually unskilled teenagers! Or minorities. In fact, Nobel Laureate Milton Friedman called the minimum wage "one of the most, if not the most, anti-black laws on the books." The laws were crafted to help disadvantaged, unskilled, poor workers. Yet by forcing a company to pay workers more than they should, or can feasibly do, poor workers are back out on the street. And they don't get a chance to LEARN new skills, or build a resume`, since minimum wage laws effectively legislated their jobs out of existence.

And besides, doesn't fewer employees mean... uh, reduced productivity?

It is no wonder that 90% of economists oppose minimum wage laws. It is similarly no wonder that our liberal media never questions the validity of these laws, only praises them as progress. As Libertarian Larry Elder said, "If 90 percent of cardiovascular surgeons opposed triple-bypass operations, wouldn't [the press ...] mention this in a story about triple bypasses?"

JavaFox

Lovswr, welcome to DH! You seem to be very diplomatic -- I'm sure we'll all get along very well, even though some of us are pretty partisan when it comes to politics.

lovswr

Yes the minimum wage. Quite the conumdrum, isn't it? On the one hand, those who have basically no tradeable skills are carried along by this. On the other, property owners should be able to set their own "costs" for the care of said property.

Allow me a little personal anecdote if you will.

In 1985 I worked at McDonald's (like apporx 70% of the working public at some point in their careers) for the minimum wage. $3.35US if memory serves. There were, non-manegment older persons (I grew up in Dayton, Oh..a GM town if there ever was one, when the plants started closing , they went fast & a lot of people close to retirement were totally unprepared) also there who worked for slightly higher than minimun. No minimum wage & these people & some other signinficant minority would have been on the street.

Now I am not against eliminating the MW in theory. As I understand it, only about 2 million people work for the MW & as stated above most of them are teenagers. But there is some % of the extreme working poor adults who are at that level. No MW & they become defacto wards of the government at all levels. I would contend that the artificial cost on business becuase of the MW would be less than the cost added to government to house/feed these people at the margins.

But I digress. JavaFox. Your statement above would tend me to think that you would let capitalism run to its extreme end in this particular matter. Some people will starve. If the MW were repealed tomorrow, two things would happen right away. Many businesses would see just how low they could go. Also unionism would come back in a big way mighty quick. Economic Darwinism is fine for those who already have capital & several hundred years ago it was called Feudalism. There are way too many people in this country (lazy or not) that have become accustomed to a certain lifestyle for that to happen without vigorous opposition. (remember, we, & that especially includes the poor, are the fattest group of people on the planet )

JavaFox

Lovswr, I don't know if you read conservative books (actually, having "talked" to you only twice, I have no idea what end of the political spectrum you identify with), but Dinesh D'Souza, who worked under Reagan as a policy analyst, recently put out a book called "What's So Great About America." And your comment regarding our country's weight problem reminded me of a passage. An acquaintance of Mr. D'Souza (a native of India) wants to go to the United State and become a citizen. When asked why, he replied (paraphrased), "Because it is the only country in the world where the poor are fat!"

Think about that statement. Our poor can be fat. Doesn't that mean, on some level, there is something different about the poor of American and the poor of Africa? This is a discussion for another time and another thread, but I feel that America's poor are poor not because of strife or lack of resources, but rather because of, largely --not completely-- poor lifestyle choices, such as childbearing out of wedlock, or addiction to drugs and alcohol. But this is an argument for another thread.

Actually, you seem to have missed my point. While I did say that property owners ought to be able to set their own price (and that is certainly true), that was not my focus. I was merely making the case that minimum wage, for all its rhetorical value, actually does a disservice to the poor, disadvantaged, and the young. By forcing companies to pay people what they may not be worth, we perpetuate ineradicable unemployment. In other words, the minimum wage law HARMS those it was supposed to help.


Actually, the people on the street who tried to find a job but couldn't probably were put there because of minimum wage laws.


Contrary to your characterization of me as a strict Social Darwinist (which, I must admit, I do come across as), I do care immensely for the plight of the poor, particularly the homeless. But, as I see it, these people have problems that are much bigger than minimum wage. There are bigger root problems behind poverty than merely the amount of money a person gets an hour. I do not believe in unrestrained welfare programs, for example. Welfare should exist, but on an extremely limited level, in my opinion. The poor should be encouraged not to create large families. The addicts among the poor --and the statistics suggest that the VAST majority of, say, the homeless fall into this category-- should undergo coerced rehabilitation programs. And so on. So, in response, I guess what I am trying to say is this: yes, there are poor people, and yes, most Americans agree that there should be some sort of framework to help these people. But their condition stems from so much more than the fact that they only get X dollars an hour, and they will continue to be disadvantaged irrespective of what the minimum wage is.

Yes, it might be turbulent at first, but you are also forgetting one thing that would happen right away: unemployment would probably dissapear. Businesses would pay people what their labor was worth, and, because of that, would be able to hire more people. See, one cannot say that American companies should continue to operate only in the United States, and yet regulate them to the point where they have to leave to be profitable.

Feudalism of the past, although it is a loaded word that makes it effective as a "shock-value" word in a debate, is kind of irrelevant to this conversation. Feudalism's focus was military might and protection. You pay the knight, he pays the lord, who pays the King, who commands everyone under him to defend... well, you... in theory. Unrestrained capitalism (I never said I was for unrestrained capitalism) is actually quite different. It operates on an economic level, works towards efficiency, and creates prices that are not inflated by external forces. It is very different in that regard.

digitalwanderer

Sorry, I got a headcold so I can't argue you much tonight...but I had to at least pop-in and tell ya how you're wrong.

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WTF is up with the sigs?

JavaFox

LOL

ToshiroOC

If you don't mind Javafox, I'm going to make a bad excuse and leave this one alone I personally have a deep hatred for Ann Coulter and Rush Limbaugh, and posting is only going to make my indigestion worse Maybe some other time... Oh, and have you notived how the eyes on your fox turn blue when you aren't looking? Just check out of the corner of your eye every once and a while - either my eyes are mesing with me, or Wyre was extremely subtle and has fading eyes (and made me think that I needed an eye checkup)

EDIT: Oh, and I'm going to go over to democraticunderground.com and see if I can get a few of those posters interested in a 9500 and maybe some political posts

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Vampyromaniac

Yeh, it's an animated .gif. Just noticed it now that you mentioned it . . . looks real nice

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lovswr

Thank you very much for explaining your position. I can agree with everything you say except for the following...

Businesses would pay people what they are actually worth. At the MW level, I would think that most of these people would quit, as I am sure most of them would be offerred wages below the MW for doing the same job as before. Then I would forsee the usual suspects coming around to do what they usually do. Taking advantage of the less fortunate/ill informed for their own political ends.

Now I would suppose that you would argue (forgive me for taking the liberty of "thinking for you", but I guess that is a by-product of non-realtime debate) that MW earners would now have an incentive to upgrade their skills, but alas they were already accepting the MW, so I would contend that it would not be so straight forward as that.

As to my politics? I am fiscally conservative & mostly socially conservative as well. Except for some "hotbutton" issues, like the MW & the American manufacturing base.

Malus

I say one thing and the topic turns in a whole other direction. . .

You really couldn't just get rid of the minimum wage. If it does occur, it will have to be done in a slow process, one that will account for the economic instability caused such a ruling and one that will account for the fact that there really aren't that many factory jobs and such ni America in the first place. Not to mention that you would still have to have a reason for companies to move their operations back to America.

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barney gumble

Yeah, but what you gonna do.

Highwood

Maybe minimum wage laws do cause unemployment, however I am concerned that getting rid of minimum wage laws would only widen the gap between rich and poor.
Maybe instead of getting rid of minimum wage laws the government should introduce maximum wage laws, and laws that would cap a person’s maximum net worth.

ToshiroOC

Laws that cap a person's maximum net worth? That sounds dangerously close to communism buddy, and if it isn't weak communism, it is at least perverted capitalism - success of the best, until they get too good... I really think that that is not a good idea at all - a lot of rich people EARN their money and deserve it, and capping their worth isn't going to be very just. While lots of people really don't deserve their wealth, its a sore part of capitalism that I feel that nearly everyone is willing to pay for it's benefits.

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JavaFox

A surprising statement, Toshiro! Is it possible that you are actually fiscally conservative?

But isn't that what we live under now? When a company gets too successful and too dominant, don't other companies cry foul? Doesn't an SEC probe usually follow? Don't we try to litigate and grab money from large, sucessful corporations (Phillip Morris, McDonalds, etc.)? Don't we tax our people until they bleed? Haven't we erected a system that says "Look, don't worry if you fail -- we'll catch you!" and then provide little incentive for these people to get back on their feet? Don't we tell companies how much they can pay people and property owners how much they can charge (rent control, anyone?)?

Don't THOSE things affect capitalism?

Actually, I'd disagree. Incentive is a POWERFUL force that most liberal ideas tend to forget about. People now only accept minimum wage because they can -- because they are guaranteed it. But rid them of that "security" (if that paltry hourly wage can indeed be called "security") and what happens? Do people, robbed of their crutch, simple fall over and die? No, they go out, they bust ass, and they make things work. See, in my eyes, liberal ideas such as minimum wage give the working class far too little credit.

Here is what would probably happen if minimum wage was repealed. First, people would complain. Second, wages among the unskilled would drop. Unemployment would similarly drop. New charities would spring up to assist people not capable of making a living off of lowered hourly wages. People would protest. Companies, seeing the labor shortage, would have to think of ways to attract workers. Some companies increase wages. Workers flock to these companies. Other companies would increase wages. Workers flock to these companies. Virtually every company that can afford to will raise wages. Wages eventually reach equilibrium -- workers are getting paid what they are worth. Teenagers, minorities, and unskilled workers, equipped with new skills they learned from virtually no unemployment, move up the corporate ladder. After all, aren't minimum wage laws more about gaining experience than they are making a living? I mean, a majority of minimum wage workers are either teenagers fron non-poor families, or a family's supplemental earner.

Listen, this question is posed by every anti-minimum wage proponent, and I'd like to ask it of you all: if minimum wage doesn't affect employment, and is merely about giving poor Americans a liveable wage, then why don't we increase minimum wage to $15 an hour? $50 an hour? $150 an hour? Let's ALL be prosperous!

I'll tell you why we don't. Because the inevitable economic laws of supply and demand kick in. If I have to pay you, say, $50 an hour, and you aren't worth that much to me, I am going to make you work less! And I am NOT going to hire your friends. It just isn't feasible for me. And with the decline demand for labor, there will invariably be an increasing supply of unemployed laborers! That is how economics work. And this same phenomenon occurs whether the minimum wage is $4.25, $5.15, or $500, albeit on varying levels! There are even some studies that suggest that every 10% minimum wage rises, 100,000 jobs are lost!

And if this weren't true, when why did teenage unemployment rise so much in 1990 - 1991 (minimum wage was increased from $3.35 to $4.25 )? Why, in that same time period, did nonwhite employment also rise, hitting a peak of 13%? And why was black and white employment basically the same before the minimum wage law existed? These laws HURT people they're supposed to help. They cause unemployment among the the unskilled, the young, and the minorities.

Minimum wage doesn't help anybody; it just helps rich Americans feel less guilty about being so rich.

Now, all that said, I want to say that I am not totally against minimum wage, I'm just kicking some ideas around. If anything, this forum should allow people to express whatever opinion they want, just to see what people say in response, so they can learn about the issue. That's what I'm doing. I am begining to see minimum wage like I see welfare: a crutch that robs people of incentive. But that opinion is not solidified yet. So, as some of you might be thinking, there is hope for me yet.

Highwood

Instead of getting rid of minimum wage, would it not be better to put pressure on corporations who exploit cheap labor in foreign countries, and on the governments who allow it, to improve the wages and working conditions of their sweatshop workers?