Hi,

trying out this forum I thought. So, the minimum wage - I think has been decided in Germany. I don't know if it passed parliament, but it should soon. (8,50 Euros, no exceptions!)

Here is what I think:
a) I thought the minimum wage was a way of social contribution. I mean, as a society, we do rely on jobs like carrying stuff around in a warehouse, waitering etc. I mean, it is sort of weird, we do rely on them! If these people do something else, society would collapse, right? I thought this is the first argument concerning this minimum wage. When jobs are really irrelevant, this is one thing, and it is true some jobs don't need such a high qualification, but still, everything we find essential we should pay this minimum wage vor.
b) All the wages surrounding the minimum wage, up to 15 Euros maybe, will increase. (They will think, heck, they earn 8,50, so I want more etc.)
c) It is simply unusual for politics to set wages. As politicians and as society, "we" do a lot to encourage companies to raise wages, but we don't enforce so much, I thought.
d) I think you also have to think about unemployed people. When you are unemployed for a while, or for a long time, or even when you are really poor, when you get into work - and when you are immediately "well-paid", could be a lot worse after all - you are really sort of back on track again, "work" is suddenly higher valued and that is really good.

So, I was sort of for it, but I do know companies will have to pay. In addition, it could either stop companies from creating jobs, it could even destroy some. But maybe, this just doesn't happen.

I really thought, to be honest, it would be sort of "a good step for humanity". I think it is strange to pay 2 or 3 Euros for work, whenever someone works, it should be valuable, it should be rewarded, I think it would much rather be a clear minimum line, a clear understanding of work and its value.

Greetings,
Pete

[turtle777]

Bottom line: there's little evidence that minimum wage destroys existing jobs, but it slows down economic growth in the future.

Read here, one of the most recent and widely accepted papers:
http://econweb.tamu.edu/jmeer/Meer_W...nimum_Wage.pdf

Anyone who disputes that there is a net negative effect in the long run is seriously confused.
If there were no long-term net negative consequences, we should raise minimum wage for everyone to $1,000,000 per hour. Good luck with that.

-t

[ebuddy]

@ PeterParker; it sounds as though your representatives in Germany are giving you the same line we're being sold in the US about how raising minimum wage raises the wages around it. The problem is, I've yet to find any politicians who can put any hard data around that. I think our representatives are sorrowfully out of touch with how businesses operate and where money comes from as if it can just materialize from the vapor of good intentions.

Many businesses set budgets for annual increases to ensure a predictable, controlled overhead expenditure. What this means is that an average increase is set either for departments of a company or the entire company on an annual basis, often contingent upon how well the company fared that year. My employer for example, set its annual increase last year @ 3%. This means if you give Jane a 4% increase for doing a good job, John or someone else is going to have to get only 2% to make the average come out to 3%. In the US, the minimum wage is $7.25/hr and the politically left-wing here are generally pushing for a raise to $10.10/hour. That is a 39% increase.

Using the above model of how businesses control their overhead expenditures, how is it a company can immediately fund a 39% increase for an entire base of workers and still expect to give the standard average 3% increases for the remainder of their staff let alone "raise all the wages of those around the minimum"? Answer: they cannot and this is exactly what the remainder of staff will be told in their annual review; that there simply isn't enough left in the coffers for them due to the minimum wage increase.

Ask yourself if the market isn't already addressing this problem to determine whether or not a solution is necessary. In the US for example -- The proportion of hourly paid workers earning the prevailing federal minimum wage or less declined from 5.2 percent in 2011 to 4.7 percent in 2012 and remains well below the figure of 13.4 percent in 1979, when data were first collected on a regular basis. This is a substantial decline in the total number of those earning the minimum wage without the government telling them they have to pay more. Raising the minimum wage is merely a solution looking for a problem that doesn't exist.

Trust me, a minimum wage will only address the wages of those currently earning it which are going to be your teens and those living in homes well above your poverty line with the part-time job for a little extra spending money. $20/hr isn't a "living wage" working part-time, but politicians aren't interested in that which is truly good, only that which they believe might get them back into office. The left in the US are hemorrhaging young voters due to our new health insurance reforms and they're now trying to buy that vote back.

[ghporter]

I think it's important to keep the magnitude of changes in any minimum wage system relatively small. When minimum wage requirements go from $5 to $7.50, that's a pretty big jump, as is the much discussed potential jump to $10-ish. Instead of arguing all of this stuff over and over again, why hasn't anyone just set up a plan to keep minimum wages adjusted for inflation? That seems to be a reasonable and workable concept.

I'd also point out that while something on the order of $8/hour can provide a "living wage" in some areas (Central Arkansas and South Texas, for exmple), it's not even close for other areas - the SF Bay Area is a good example of this.

The Federal Government provides thoroughly researched per diem and locality cost tables for both federal employees and GIs. I can see using this stuff to craft a workable minimum wage system that simply takes costs and inflation into account.

[OldManMac]

The bottom line; all America prospers when all Americans are working. When the least among us can at least sustain themselves, and buy the things necessary to take care of themselves, we're all better off! A cheap gallon of milk at Walmart isn't really that cheap when you and I are subsidizing the health care of Wally World employees.

[Uncle Skeleton]

No, the bottom line is numbers. Turtle nailed it: why not a hundred $/hr? Why not a million? The bottom line is that it matters what number you put on your platitudes. It mattes a lot. In fact, it's the only thing that matters. You can't just wave a magic wand and make everyone be above-average. That wealth comes out of somewhere else, and that somewhere-else is going to react. The magic wand carries unintended consequences, and until you describe how you intend to account for those consequences, your platitudes are meaningless.

[Snow-i]

Originally Posted by Uncle Skeleton 

No, the bottom line is numbers. Turtle nailed it: why not a hundred $/hr? Why not a million? The bottom line is that it matters what number you put on your platitudes. It mattes a lot. In fact, it's the only thing that matters. You can't just wave a magic wand and make everyone be above-average. That wealth comes out of somewhere else, and that somewhere-else is going to react. The magic wand carries unintended consequences, and until you describe how you intend to account for those consequences, your platitudes are meaningless.

[BadKosh]

What happened to the mindset that to get higher wages you need more skills? Sitting on the couch, playing with your iPad and smoking pot IS NOT the way to get higher wages. They call it "Work" for a reason.

[Snow-i]

Originally Posted by BadKosh 

What happened to the mindset that to get higher wages you need more skills? Sitting on the couch, playing with your iPad and smoking pot IS NOT the way to get higher wages. They call it "Work" for a reason.

Thats not how it works anymore BadKosh. Now work is choice. Don't worry. Someone else will do the work or Obama's magic wand will create the wealth through multiplier effects and government intervention.

Either way, this nation will figure out sooner or later, and for better or worse the basic economic principles that drive our economy. I just hope its before too many good, hardworking people lose everything or are stripped of opportunity they may have otherwise had.

[OldManMac]

Originally Posted by Uncle Skeleton 

No, the bottom line is numbers. Turtle nailed it: why not a hundred $/hr? Why not a million? The bottom line is that it matters what number you put on your platitudes. It mattes a lot. In fact, it's the only thing that matters. You can't just wave a magic wand and make everyone be above-average. That wealth comes out of somewhere else, and that somewhere-else is going to react. The magic wand carries unintended consequences, and until you describe how you intend to account for those consequences, your platitudes are meaningless.

And your platitudes about making everyone else above average are just as meaningless. No one's talking about making everyone else "above average." We're talking about paying people a sustainable wage, so that Walmart workers don't have to go to government subsidized health care facilities. There is, IN FACT, plenty of money in America; it's just concentrated in the hands of too few. Your platitudes about magic wands illustrate how little you know of the subject.

[ebuddy]

Originally Posted by OldManMac 

The bottom line; all America prospers when all Americans are working.

Show your work, please. You may respond with the number of jobs expected to be created by an increase in the minimum wage and at least one source to substantiate the claim.

I'm skeptical because if you had truly put more than feelings into this, you'd find that continuous extensions of unemployment benefits for example, only lengthens unemployment and yet somehow I'm certain you're not opposed to extending them in spite of this desired American prosperity.

When the least among us can at least sustain themselves, and buy the things necessary to take care of themselves, we're all better off! A cheap gallon of milk at Walmart isn't really that cheap when you and I are subsidizing the health care of Wally World employees.

No job will produce a living wage working part-time. That's the painful reality here. You understand that our current "sock it to business" regulatory environment and measures like mandated minimum wages further distort the labor market and ensure only the Wally-Worlds would survive, right? I've never understood the bunch who champion the demise of the Walmart unwittingly, repeatedly support the same measures Walmart supports.

[turtle777]

Originally Posted by OldManMac 

We're talking about paying people a sustainable wage, so that Walmart workers don't have to go to government subsidized health care facilities. There is, IN FACT, plenty of money in America;

You bring up good points, but they can't be fixed by raising the minimum wage.

The culprits are the Federal Reserve (debasing our currency and killing savings by keeping interest artificially low), in addition to our politicians not willing to really fix the health care cluster*ck. (ObamaCare is just another handout to big insurance and healthcare providers).

-t

[BadKosh]

Originally Posted by OldManMac 

And your platitudes about making everyone else above average are just as meaningless. No one's talking about making everyone else "above average." We're talking about paying people a sustainable wage, so that Walmart workers don't have to go to government subsidized health care facilities. There is, IN FACT, plenty of money in America; it's just concentrated in the hands of too few. Your platitudes about magic wands illustrate how little you know of the subject.

Walmart and McDonalds have lots of ENTRY LEVEL JOBS. They are for part time workers with a few full time managers. Perhaps those part timers are not too ambitious, don't have anything but a GED, aren't that smart. Too bad. Everyone should not be punished for being successful to pay for the slacks.

Sure, there is money in America. You want some? OK, then take the RISK, come up with an idea and have at it. If you become successful you can pay yourself whatever you want. I'm sure that if you have 10 million bucks in net profit after that 4th year, you won't be paying yourself $25K a year but probably $500K as a reward to yourself for doing so well.

[OldManMac]

Originally Posted by BadKosh 

Walmart and McDonalds have lots of ENTRY LEVEL JOBS. They are for part time workers with a few full time managers. Perhaps those part timers are not too ambitious, don't have anything but a GED, aren't that smart. Too bad. Everyone should not be punished for being successful to pay for the slacks.

Sure, there is money in America. You want some? OK, then take the RISK, come up with an idea and have at it. If you become successful you can pay yourself whatever you want. I'm sure that if you have 10 million bucks in net profit after that 4th year, you won't be paying yourself $25K a year but probably $500K as a reward to yourself for doing so well.

IOW, those who don't further "educate" themselves, and "progress" deserve to be treated like shit! Great business philosophy, but very contrarian to the teachings of a guy whom the vast majority tout as their supposed role model.

[ebuddy]

Originally Posted by BadKosh 

Walmart and McDonalds have lots of ENTRY LEVEL JOBS. They are for part time workers with a few full time managers. Perhaps those part timers are not too ambitious, don't have anything but a GED, aren't that smart. Too bad. Everyone should not be punished for being successful to pay for the slacks.

Sure, there is money in America. You want some? OK, then take the RISK, come up with an idea and have at it. If you become successful you can pay yourself whatever you want. I'm sure that if you have 10 million bucks in net profit after that 4th year, you won't be paying yourself $25K a year but probably $500K as a reward to yourself for doing so well.

You know I love you man, but the above does NOT demonstrate an effective ambassador of conservatism.

It's not that you and I are necessarily smarter or more destined for prosperity than others by virtue of our education or other singular factor as this attitude is more akin to the paternalism and intellectual folly of liberalism. It's about government policies and how they manifest in the ethos of the collective. It is simply the difference between giving a man a fish or teaching him to fish. One is far more compassionate and effective than the other, but requires tough-love, time, and patience. The sort of "Red Hen" lessons we teach our children from a very young age with an innate common sense that must be unlearned through government "intentions" and paper-ideology, fostered through a childish, McDonald's, gotta-have-it-now mentality.

The minimum wage increase is nothing more than Fed folly attempting to mitigate the symptoms of the Fed folly that preceded it.

[ghporter]

I'm sorry to say that BadKosh's post does come across the way OldManMac paints it. It's hard to characterize "slackers" though. Some are well educated and lack motivation, others have little education and little drive to get more. And some are simply unable to find something that interests them enough to motivate them.

But the problem isn't whether or not there are "slackers" out there who make up part of the work force. It's the "underemployed" that are filling minimum wage jobs because that's all they could get. They are the ones with the problem, and it's a tough one.

It used to be that entry level, minimum wage jobs were filled by people who were going to school or just out of school and thus were flexible enough to deal with odd shifts, inconsistent hours and relatively menial tasks, all for a pittance of a wage. They lived with their families, maybe worked more than one such job, and used this for a springboard to further education or better employment.

Then we had the Great Recession, and people who had been pulling down high 5-figure (and higher) salaries suddenly needed to find something to help put bread on the table. These people are not 19 years old and living with Mom and Dad. They are often well into their 20s or 30s, frequently have families and mortgages, and are stuck between a very nasty rock (eviction, bankruptcy, hunger) and an equally nasty hard place (a "job" that brings with it connotations of "slacker" work).

I do not know how to accurately learn what percentage of the economy is made up of those earning minimum wage, nor how to find out those workers' demographics. But my observations are that those "do you want fries with that?" jobs are much more frequently filled by people who are NOT the traditional late-teens/early twenties student types. And the point about that is that a "living wage" is now an issue for those minimum wage, formerly entry-level jobs.

And finally, where do those motivated, "in school" folks who used to get their start in those jobs going to find their own work? With most of the local entry-level jobs filled by people who are way overqualified or who needed to move downward in the job ladder, where will Joe or Jane Collegebound get their jobs, and maybe the gap-filling savings needed to get to college?

[Hawkeye_a]

Friedman on Minimum Wage

Unintended consequences; Judging policies by intentions rather than the results they produce.

[subego]

Originally Posted by turtle777 

Bottom line: there's little evidence that minimum wage destroys existing jobs, but it slows down economic growth in the future.

Is there some reason labor isn't going to follow the basic theories you learn in Econ 101?

If the cost of a resource increases, that comes out of somewhere. Either you pay more, they make less, the quality decreases, etc.

I honestly don't understand why this is the least bit contentious.


Likewise, does not any intelligent person illegally pay lower than minimum wage with the intent of successfully undercutting their competition? Also known as growth.

Edit: that last paragraph is phrased poorly. I'm not saying paying below minimum wage is the intelligent thing to do, I'm saying of the people who pay below minimum wage, the most intelligent of them do so with the intent of undercutting their competition.

[Snow-i]

Originally Posted by subego 

Is there some reason labor isn't going to follow the basic theories you learn in Econ 101?

If the cost of a resource increases, that comes out of somewhere. Either you pay more, they make less, the quality decreases, etc.

I honestly don't understand why this is the least bit contentious.

I had the same puzzlement in the other thread with OAW. I'm not sure how much of that everyone followed but it was very refreshing to see several other members saying the same thing I was in a very similar context. It's nice to see I'm not the only one who didn't sleep through econ 101.

[subego]

I likewise find the "doesn't kill jobs it kills growth" is just kicking the can. Growth is where jobs come from.

[turtle777]

Originally Posted by subego 

I likewise find the "doesn't kill jobs it kills growth" to be something of a canard. Growth is where jobs come from.

You need to read the paper.

The point it makes is employers are NOT going to immideately fire people over higher min. wage, but in the long run, higher less people, and automate more.

-t

[mattyb]

Originally Posted by subego 

Is there some reason labor isn't going to follow the basic theories you learn in Econ 101?

Have you heard the story of the miners that were given a pay rise and actually ended up doing less hours?

[subego]

Originally Posted by turtle777 

You need to read the paper.

The point it makes is employers are NOT going to immideately fire people over higher min. wage, but in the long run, higher less people, and automate more.

-t

I edited it.

[subego]

Originally Posted by mattyb 

Have you heard the story of the miners that were given a pay rise and actually ended up doing less hours?

Go on...

[mattyb]

Originally Posted by subego 

Go on...

Well, it shows that people in certain jobs will actually work less when they get pay rises. So in fact the mine owner lost out, since the miners were taking home the same, but producing even less. One would have guessed that they would at least have done the same hours but that wasn't the case. So for certain jobs, our Econ 101 theories do not apply.

[Snow-i]

Originally Posted by mattyb 

Well, it shows that people in certain jobs will actually work less when they get pay rises. So in fact the mine owner lost out, since the miners were taking home the same, but producing even less. One would have guessed that they would at least have done the same hours but that wasn't the case. So for certain jobs, our Econ 101 theories do not apply.

How does this not fall exactly in line with basic econ principles? One would guess that hours would go down all else the same. The money's gotta come from one of the variables.

[turtle777]

Originally Posted by subego 

Is there some reason labor isn't going to follow the basic theories you learn in Econ 101?

If the cost of a resource increases, that comes out of somewhere. Either you pay more, they make less, the quality decreases, etc.

I honestly don't understand why this is the least bit contentious.

The paper does not dispute this. I also believe this is true. The question is: over what period of TIME does this happen noticeably, and in a statistically relevant way.

Our economy is so interconnected that any change takes time to work through the system and show the results. There are also other things that influence employment, and those factors can never be completely ruled out or held constant.

-t

[subego]

I'd say this is pretty dead simple too.

When the cost of production increases (and what resource is costing more is irrelevant, it can be labor, goods, or something else) the first instinct of employers isn't to just start firing people willy-nilly to rebalance the books.

Firing people, assuming those people are doing actual work, is going to cut your production. Any financial balance you can get out of that you lose in production. Firing someone in this situation just gets you deeper into the hole.

The only way to balance out that loss is growth, which is going to happen slower because you're out of balance in the first place. Likewise, once you're in balance again, further growth will go slower because you can only hire four employees for every five you were hiring before.

If you were going to hire five, but now hire only four, that's less jobs in my book.

[subego]

Originally Posted by mattyb 

Well, it shows that people in certain jobs will actually work less when they get pay rises. So in fact the mine owner lost out, since the miners were taking home the same, but producing even less. One would have guessed that they would at least have done the same hours but that wasn't the case. So for certain jobs, our Econ 101 theories do not apply.

I'm not 100% sure I understand you here, but there is no basic economic principle linking how much people get paid and how much work they actually do.

Likewise, the theories are based on how many business behave in the aggregate. There are always going to be exceptions and outliers.

[OldManMac]

Even if everyone worked hard and went to college someone would still need to make our pizzas, stock our shelves, and drive our cabs. Quit looking down on them, and assume they deserve to live in poverty. (I would guess that some guy who many of you supposedly worship would feel that way, but it's only convenient to spout it on Sundays)

[subego]

Who are you talking to?

[mattyb]

Originally Posted by Snow-i 

How does this not fall exactly in line with basic econ principles? One would guess that hours would go down all else the same. The money's gotta come from one of the variables.

Originally Posted by subego 

I'm not 100% sure I understand you here, but there is no basic economic principle linking how much people get paid and how much work they actually do.

Likewise, the theories are based on how many business behave in the aggregate. There are always going to be exceptions and outliers.

Well, my understanding was that this behaviour did not follow basic economic theories. And I'd be interested to see where and when in history that an increase of minimum wage has made people work less (overall). I certainly wouldn't have thought that they would work less, but then I haven't had the misfortune of working in a mine.

If we say that many if not most economic principles are based around humans acting in self-interest, I think that most people would assume that people would like to gain more money (at the least) for the same hours worked. These miners prooved that this is not the case.

[subego]

The problem with raising the minimum wage isn't people working less, it's purely a question of what your labor costs are. When you get into costs, that's when economic theory comes into play.

Let's say I'm starting a business which employs MW workers. Let's also say I have $100/hr to distribute to my employees.

If the MW is $5/hr, I can hire 20 people. If it's $10/hr I can hire only 10. All these people are theoretically doing the same amount of work. Let's take it to an extreme. If the MW is $1/hr I can hire 100 employees. I just created 100 new jobs. Where's my "thank you"?

That extreme example shows the incompatible goals you have working here. A lower MW means more jobs. It's a direct cause-and-effect relationship.

On the other hand, you obviously can't live on $40/wk.

[turtle777]

Originally Posted by subego 

I'd say this is pretty dead simple too.

Only if you apply common sense. In today's political environment, that's a rare commodity.

Originally Posted by subego 

If you were going to hire five, but now hire only four, that's less jobs in my book.

I agree, but don't forget, official government statistics will never count that as a loss.
Heck, it's even worse how they report things today. When you run out of unemployment aid, you are not considered unemployed anymore. The statistics are completely fudged and f*cked up.

It's no wonder that people that only look at those statistics at face value come to the wrong conclusion about impact of policies like minimum wage.

-t

[turtle777]

Originally Posted by subego 

That extreme example shows the incompatible goals you have working here. A lower MW means more jobs. It's a direct cause-and-effect relationship.

Very good example.

-t

[ebuddy]

Originally Posted by OldManMac 

Even if everyone worked hard and went to college someone would still need to make our pizzas, stock our shelves, and drive our cabs. Quit looking down on them, and assume they deserve to live in poverty. (I would guess that some guy who many of you supposedly worship would feel that way, but it's only convenient to spout it on Sundays)

I don't often do this, but your post begged it;

I'm guessing Jesus would find your argument laughable seeing as the absolute most destitute poor among us in the US are among the wealthiest people on the planet. Maybe you share a problem with the alleged, low-empathy conservatives in also defining people by their wealth.

The fry-cooks we all need, begin to train other part-time kids who become effective at it, push their trainer into management, build his resume, and send him off elsewhere to excel while building their own resumes. If you ever earned minimum wage, OldMan -- you didn't earn it for very long and there's no reason, other than a distorted marketplace, that anyone else would expect to continue earning it. Believe it or not, you don't need benevolent politicians to legislate kindness because the average everyday Joe business-owner happens to be at least as compassionate as they. Trust me.

[Shaddim]

It would personally bother me, a lot, to pay anyone other than a high school teen minimum wage. My shop intern makes $9.50 /hr. Regulation isn't the answer however, the problem is companies have dehumanized their employees, treating them like a disposable resource. I stopped frequenting a specific national chain when I found out their labor practices. They'd hire someone at minimum wage and within 6 months evaluate whether they were suitable for management, if they weren't or simply didn't want to be a manager, they would drop their hours to virtually nothing until they quit and start the process with more new hires.

[besson3c]

Originally Posted by ebuddy 

I'm guessing Jesus would find your argument laughable seeing as the absolute most destitute poor among us in the US are among the wealthiest people on the planet.

But so what? This is all relative to the cost of living where we live, most of us can't simply move to Ethiopia or something where our American dollars would buy more there than they would here.

The fry-cooks we all need, begin to train other part-time kids who become effective at it, push their trainer into management, build his resume, and send him off elsewhere to excel while building their own resumes. If you ever earned minimum wage, OldMan -- you didn't earn it for very long and there's no reason, other than a distorted marketplace, that anyone else would expect to continue earning it. Believe it or not, you don't need benevolent politicians to legislate kindness because the average everyday Joe business-owner happens to be at least as compassionate as they. Trust me.

Here is how I see the minimum wage...

There are a number of businesses that benefit from cheap labor. They benefit from cheap labor because it is either too expensive to devise some way of automating this work, or else the cheap labor scales to run their business for what they are willing to pay.

In some cases increasing the minimum wage would push employers to automate that work, replacing old jobs with a smaller number of new ones (running the machines that automate stuff).

In some cases increasing the minimum wage would result in having to make a number of adjustments to the economic machine of the company. In some cases it might be impossible to make this work (although in these cases this is probably not the sign of a healthy company). In other cases it might involve having to cut back and offer fewer jobs.

In some cases, and this is where I would expect most people feel compelled to push against the minimum wage, employees are paid that low wage for no other reason other than it is legally permissible, there is no incentive (other than moral) to increase wages, and companies can do so but choose not to.

As people like Bill Gates have said, the minimum wage is a complicated subject and there are so many scenarios to consider, I'm sure there are a number of them other than the ones I've listed.

The question is, are there a number of the "we pay crappy wages for no other than than we can" scenarios? Probably, yes. Are there a significant number of these that increasing the minimum wage would create enough positive effects to offset the negative ones? I honestly don't know.

My point is, let's not pretend that there aren't companies paying crappy wages just because they can in a very exploitive manner, and that they would increase wages if they could. That is just a silly notion, IMO.

[besson3c]

Originally Posted by Shaddim 

It would personally bother me, a lot, to pay anyone other than a high school teen minimum wage. My shop intern makes $9.50 /hr. Regulation isn't the answer however, the problem is companies have dehumanized their employees, treating them like a disposable resource. I stopped frequenting a specific national chain when I found out their labor practices. They'd hire someone at minimum wage and within 6 months evaluate whether they were suitable for management, if they weren't or simply didn't want to be a manager, they would drop their hours to virtually nothing until they quit and start the process with more new hires.

Yeah, this is exactly the sort of thing I meant in my last post...

What is your answer to the question I posed, what is your opinion?

[besson3c]

What makes sense to me is setting the minimum wage relative to the size/wealth of the company.

In large cities there are generally all sorts of options for some sort of crappy work, but in smaller towns it seems to me that it would be the larger chains setting the bar as to what these wages should be. You can attempt to compete against these larger chains my offering better wages, but generally speaking I would expect that more often than not these chains just set those local standards, and where there are few opportunities these larger chains really have the upper hand: it's their shitty job or nothing in Smallville, USA (or anywhere, really) if you don't really have any skills.

[Shaddim]

It's a region/state thing, it can't be done on the federal level because what's considered a living wage in one place, isn't in another. Each state, and even city, needs to find its own answer. In my area a person can live on $300 /wk; rent ($300), food ($250), clothes, etc. and still have a couple $100 in spending money for the month, whereas 200 miles away in Nashville it wouldn't be possible.

[ebuddy]

Originally Posted by besson3c 

But so what? This is all relative to the cost of living where we live, most of us can't simply move to Ethiopia or something where our American dollars would buy more there than they would here.

You're missing the point entirely. From Jesus' perspective, there are hoards of people living in squalor among straw huts, disease, dirty water, and dirt pies, I'm not sure he's as concerned for the wealth of someone in the US with more square footage of living space than the average European, 5 times the daily recommended amount of protein, clean water, heating and cooling, cable television, and two cars. I'd submit perhaps he'd be a little more concerned about spiritual poverty with regard to the US.

Poverty in the US is something quite different than poverty abroad and God's scope is likely a little greater than OldMan's partisan pot-shot among the contentious politics of the continental US.

Here is how I see the minimum wage...

There are a number of businesses that benefit from cheap labor. They benefit from cheap labor because it is either too expensive to devise some way of automating this work, or else the cheap labor scales to run their business for what they are willing to pay.

In some cases increasing the minimum wage would push employers to automate that work, replacing old jobs with a smaller number of new ones (running the machines that automate stuff).

In some cases increasing the minimum wage would result in having to make a number of adjustments to the economic machine of the company. In some cases it might be impossible to make this work (although in these cases this is probably not the sign of a healthy company). In other cases it might involve having to cut back and offer fewer jobs.

In some cases, and this is where I would expect most people feel compelled to push against the minimum wage, employees are paid that low wage for no other reason other than it is legally permissible, there is no incentive (other than moral) to increase wages, and companies can do so but choose not to.

As people like Bill Gates have said, the minimum wage is a complicated subject and there are so many scenarios to consider, I'm sure there are a number of them other than the ones I've listed.

The question is, are there a number of the "we pay crappy wages for no other than than we can" scenarios? Probably, yes. Are there a significant number of these that increasing the minimum wage would create enough positive effects to offset the negative ones? I honestly don't know.

My point is, let's not pretend that there aren't companies paying crappy wages just because they can in a very exploitive manner, and that they would increase wages if they could. That is just a silly notion, IMO.

I'd be more in favor of not defining a community (in this case -- business) by its lowest common denominator and drafting broad, punitive legislation to address the problem. The sillier notion is believing a raise in the minimum wage has ever done a thing for wealth disparity, poverty, or employment. If the norm were exploitation, I'd fully expect more than 5% of the entire employment base to be earning it. In reality, it seems to be a very temporary, entry-level, wage for the overwhelming majority of those working part-time who'd ever earned it.