Let's talk about the minimum wage - Page 9 - Politics and Economics

loosbastard · 05-31-2012, 12:05 PM

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When the alternative is $3.50 an hour, I would sit on the couch and collect cans/sell blood on my schedule rather than having to actually be at a job at a set time and deal with a boss/co-workers.

And you would have that right. You would also have the right to get some skills/experience and find a better job. The point is employers wouldn't be able to pay $3.50 for long if nobody was willing to work for that. If they did, another employer could pay their employees more to attract better talent, and everybody else would be forced to raise wages to compete. That's what is currently happening now. That's why a lot of big corps don't pay minimum wage, because if they did they would lose the better employees to their competition.

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A lot of hating on the poor in this thread. A lot of hating on people that get up every day, go to work, bust their ass for next to nothing, and will keep doing that every day because they want to provide for their families.

Not hating on the poor at all, but you'd be incredibly naive to not recognize a correlation between poor and lazy/stupid.

I'm guessing you've never hired any low level employees. Some truly do bust their ass, and those are the ones I keep around and even give raises to (shocking that I would pay the poorz over what's required...I know). But there are A LOT that don't even deserve minimum wage. They show up late, high/drunk/etc, or not at all sometimes. They steal. They **** simple **** up and I have to fix it.

I truly admire the poor that do bust their ass to better themselves, but you're living in a fantasy land if you think all (or even most) poor people fall into that category.

einbert · 05-31-2012, 12:09 PM

If an employee sucks, you have the right to fire him and I suggest you do so. Give your hard-working employees a chance to pick up some overtime--the kinds of people I'm talking about would be very grateful for that opportunity.

I'm talking about people that work 40+ hours a week that do show up every day--even if they are a simple cashier, they deserve to be able to eat if they are working that much.

einbert · 05-31-2012, 12:17 PM

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JAY: Yeah, I think there's another study done by one of the scholars at the PERI institute which compared, I believe, McDonald's on two sides of the border, one being Washington, and the higher minimum wage in Washington. And on the other sides of border, in fact, the place that had the higher minimum wage weathered recession a little better than the one that had the lower minimum wage.

GALBRAITH: Well, I think that's what you would expect. One of the effects of a higher minimum wage is that people do not quit their existing jobs quite so easily. They hang on to them. They're more valuable, those jobs. And so firms save training costs and transition costs that they would otherwise incur.

So this is not the simpleminded process that economic textbooks sometimes display in a simple supply-and-demand diagram. There are secondary effects on the way businesses operate, as I've just described, and also on the incomes of the population and on their spending power. And those have to be taken into account. And they cut, in this case, very much in favor of the proposal.

Also I have seen firsthand how people who make a decent living wage tend to give a **** a whole lot more than people who make minimum wage. If you're working every day and you can't afford a basic standard of living it's not very easy to respect your job.

loosbastard · 05-31-2012, 12:29 PM

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If an employee sucks, you have the right to fire him and I suggest you do so. Give your hard-working employees a chance to pick up some overtime--the kinds of people I'm talking about would be very grateful for that opportunity.

Absolutely agree, and that's why my current employees have been taken care of.

I just think a lot of people ITT are under-estimating how many unemployable people are really out there...especially as you start to raise the required wage to hire them. Setting a "living wage" ends up slightly benefiting the employees along the margins, and people w/ lesser skills now become -EV to hire. I could be wrong, but IMO raising the minimum wage would just end up hurting the truly poor poorz even more.

loosbastard · 05-31-2012, 12:31 PM

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Also I have seen firsthand how people who make a decent living wage tend to give a **** a whole lot more than people who make minimum wage.

Totally agree as well, but is it the chicken or the egg? Is it that people making a living wage are more likely to take their job seriously, or are people that take their job seriously more likely to make a living wage?

I suspect it's a little of both.

prana · 05-31-2012, 12:32 PM

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Originally Posted by cuserounder

Your views on poor people are clearly shaped from a wealth of personal experience, combined with a ton of relationships with friends who are not particularly well off. </sarcasm>

We're talking about people making minimum wage. That's 7.25 per hour. That's $15,080 a year. A federal income tax calculator said you'd owe $259 on that income. I'm going to estimate about 1/4 of that in state taxes and round it all off to $320. $14,760 a year. That's $1,230 per month. I saw a list ranking Des Moines, IA as the most affordable city for renters in the US. Let's pretend our fictional investor is fortunate enough to live in the city with the best bargain on his/her rent.

The average rent on a 1-bedroom was $754. Let's assume our renter's getting a studio, we'll call the average there $600? Let's assume he got a great deal. We'll call it $550.

Rent: $550

I read that the USDA says the average food costs per person are $150-$300. I'll give you the bottom range, and say our poor person should even go hungry a bit in their pursuit of the good life as a stock owner.

Food: $125

The average cost of utilities in Des Moines is $150. Let's assume our fictional individual turns the lights off a lot.

Utilities: $125

A monthly bus car in Des Moines is $48. I'm going to be round this up to $50, I sure hope you don't mind.

Transportation: $50.

This fictional frugal future stockholder probably needs the Internet to buy stock, seek better jobs, etc. That's about $50 in Des Moines, as well.

Internet: $50.

Now, we'd hate for this poor person to be walking around naked. Let's say $50 a month on clothes. If you're really good at shopping for a bargain and really careful with your clothes, you might get by on that. The US average is $142 and the median is $69.

Clothes: $50

That's a total of $950 a month. But stuff happens, so I'm going to add $50 a month for a rainy day. Perhaps they need some medicine, a new toothbrush, household items. I'm also going to add $50 a month in entertainment spending, so they can see a movie or go out to eat once a month. They're living pretty frugally, so I think that's reasonable. I mean, they don't even have a car or cable television.

That's a budget of $1,050 a month. That leaves $180 a month to invest.

So, if he keeps that monthly investment up for 5 years and manages a 10% return, in five years he'll have invested $10,980 and have a total of $14,071. That's a profit of $3,091, or $618 a year.

That would take his average annual pre-tax earnings to $15,698 or (rounded up) $7.55 per hour.

But, if only those poor bastards would live more frugally and spend their money on stocks instead of 24" rims, they'd really be reaping the benefits of these big corporations cutting labor costs! A whole 30 cents per hour!

Of course, that's assuming they never sell those stocks and actually spend any of that money.

lolz - $125/month on food and $50/clothes. The ****ing IRS allows $575/month for food/clothing for 1 person when determining hardship status.

prana · 05-31-2012, 12:34 PM

2+2 The place where the poor need to suck it up and realize they are doing just fine and people making 200k need to be taxed less because they are struggling.

SaltyPickles · 05-31-2012, 12:35 PM

USA The place where you put a gun to someone's head and do what is right.

A_C_Slater · 05-31-2012, 12:47 PM

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Originally Posted by SaltyPickles

paying people more than they deserve because they will spend the extra money does not spur economic growth. That is ****ing ridiuclous and akin to the retarded keynesian crap like "Wouldn't it be great it there was a massive Earth Quake that destroyed half of the country! Think of the increased demand in construction!".. I suggest you read the book "How an Economy Grows and Why it Crashes by Peter Schiff"...

I agree with your first sentence, but you don't understand Keynes. He never said the government should always spend to boost aggregate demand. He only said to do so when in a recession. He also said government should reduce deficits during periods of growth. Europe and America are doing the opposite of this, they practice austerity during recession and spend more during boom times.

Case Closed · 05-31-2012, 12:50 PM

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Originally Posted by SaltyPickles

USA The place where you put a gun to someone's head and do what is right.

Are you a free market anarchist?

einbert · 05-31-2012, 12:53 PM

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People who occupy privileged positions within the social hierarchy become committed to the hierarchy's preservation and hostile toward demands for a more equitable social order. According to one study, upper-income people were most opposed to equality of political power for all groups, while lower-income respondents were the firmest supporters of equality. Economically deprived groups are seen as a threat because they want more, and more for the have-nots might mean less for the haves and have-it-alls.

Class bigotry is one of the widely held forms of prejudice in American society and the least examined. The plutocratic culture teaches that material success is a measure of one's worth, and since the poor are not worth much, then society's resources should not be squandered on them. In capitalist society, the poor are generally seen as personally deficient and lacking in proper values, the authors of their own straitened circumstances. Rarely are they considered to be the victims of poverty-creating economic forces: high rents, underemployment, low wages, unattended illnesses, disabilities, and other such blessings of the free-market paradise. As the American humorist Will Rogers once said, "It's no crime to be poor, but it might as well be."

In a society where money is the overriding determinant of one's life chances, the drive for material gain is not merely a symptom of a greed-driven culture but a factor in one's very survival. As corporate power tightens its grip over the political economy, many people have to work still harder just to stay in the same place. Rather than grasping for fanciful luxuries, they struggle to provide basic necessities. If they need more money than was essential in earlier days, it is partly because essentials cost so much more.

Because human services are based on ability to pay, money becomes a matter of life and death. To have a low or modest income is to run a higher risk of insufficient medical care, homelessness, and job insecurity, and to have less opportunity for education, recreation, travel, and comfort. Thus, the desire to "make it," even at the expense of others, is not merely a wrong-headed attitude but a reflection of the material conditions of capitalistic society wherein no one is ever really economically secure except the superrich, and even they forever seek to secure and advance their fortunes through further capital accumulation.

For those who enjoy the best of everything, the existing politico-economic system is a smashing success. For those who are its hapless victims, or who are concerned about the well-being of all and not just themselves, the system leaves much to be desired.

"Democracy for the Few" by Michael Parenti, pg. 30-1, 8th edition

Thinking about just reproducing this en masse and passing it out in low income neighborhoods.

TomCollins · 05-31-2012, 01:01 PM

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Originally Posted by einbert

Thinking about just reproducing this en masse and passing it out in low income neighborhoods.

You'd have to put it on TV or draw pictures for them.

cuserounder · 05-31-2012, 02:21 PM

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Originally Posted by Hero Protagonist

Doesn't this prove that the current minimum wage is a living wage?

Perhaps in Des Moines, Iowa, which I purposely chose to illustrate that even in the BEST circumstances, there isn't much money left over to invest and better ones self as was suggested.

Would you like to see how minimum wage is as a living wage in New York City?

And I'm pretty confident that the vast majority of minimum wage workers can't find that apartment deal for $400, and it also ignores people who may have a kid which makes the expenses go up AND that apartment impossible.

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Originally Posted by SaltyPickles

it is crazy ridiculous to call $400 rent. In China, you would fit 10 people into the same apartment. It seems like Americans are spoiled.

So you want to base what we're going to accept as a minimal standard of living on China, where the government is continuously coming under fire for human rights issues?

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Originally Posted by prana

lolz - $125/month on food and $50/clothes. The ****ing IRS allows $575/month for food/clothing for 1 person when determining hardship status.

I was purposely going to the low end of the spectrum AND THEN SOME. I was still criticized and told my rent was way too high and poor people should live 10 people to an apartment.

Mojo56 · 05-31-2012, 03:55 PM

I can't recommend Henry Hazlitt's 'Economics in One Lesson' enough. The best book on Economics I've ever read. Short and to the point. His chapter on the minimum wage absolutely nails it: http://www.fee.org/library/books/eco...esson/#0.1_L19

Synopsis: Wages are prices, price fixing doesn't work...You cannot make someone worth $8/hour by making it illegal for anyone to offer him anything less...The best way to raise wages is to raise worker productivity..."The question is not whether we wish to see everybody as well off as possible. Among men of good will such an aim can he taken for granted. The real question concerns the proper means of achieving it. And in trying to answer this we must never lose sight of a few elementary truisms. We cannot distribute more wealth than is created. We cannot in the long run pay labor as a whole more than it produces."

As it stands the minimum wage is intended as an entry level wage paid to an unskilled or inexperienced worker. It is really disingenuous to continue to discuss the minimum wage in the context of supporting a household. The minimum wage is NOT intended to be a living wage.

Case Closed · 05-31-2012, 04:03 PM

Mojo, worker productivity and wages rarely go hand in hand. In the united states productivity has been increasing while wages remain stagnant. Employers pay what they can get away with, not what people are worth.