Kerry on Minimum wage

[merphie]

Does anyone have Fed Incoem tax stats? Without any Social Security Tax, Medicate tax add on. Its not like the working average stiff is benefiting froom SS or Medicare, so you cant hold that against them. Might as well toss in your retirement and medical plan deductions as "taxes".

Its seems that when we talk about the "rich paying more than their share" the numbers are really inflated.

I believe Medicare and SS is a fixed percent of 3.25% of your gross. The federal tax depends on the deductions and pay scale.

 

[BPSCG]

Sometimes, the answer is that the best possible law is too complicated to actually work. My opinion is that the need for the principle of a minimum wage is very clear,

Not to me it isn't. For starts, a minimum wage is no guarantee of being able to afford basic food, clothing, and shelter, at least not where I live. And while northern Virginia is fairly high-rent, it's by no means unusual. So if the minimum wage doesn't enable you to buy food, clothing, and shelter, what's the point?

and it is up to legislators to work it out. (God help us all.)

Amen that.

Exactly. The example is simplified. I know some people who make a whole lot more than minimum wage whose true value to the company is somewhat less than zero.

If it's less than zero, they should be fired. But what if it's more than zero, but less than $5.15? If the employer's willling to pay $3.00, and the employee is willing to take it, why is it anyone else's business? I hope to retire in a couple of years. If I find an employer who's willing to pay me $3.00 an hour to put stamps on envelopes and that's as hard as I want to work after retirement, why should you care? Why should there be a law that says it makes no difference what the employer and I agree on?

And of course, the services of one, single, employee are rarely worth anything. It's the total work performed by the whole team of employees.

No, almost everyone's work is worth something; don't forget, a million times zero is still zero.

What should an employee be paid if his services are worth less than the minimum wage?

He should be fired. If his lack of value is due to his problem, for example he is too lazy to work, get rid of him and find someone not so lazy. If his labor is inherently of so little value that you cannot afford to pay him a decent salary, as defined previously, then you should not be allowed to profit from his labor.

Go back to my envelope-stamping job. If a prospective employer tells me he has an envelope stamping machine that costs him $4.00 an hour to run, why should I be prohibited from doing that job for him for $3.00?

What if the employer says he can send the envelopes to Carjackistan, have them stamped, and have them sent back to him for $4.00? Given the choice of doing that or paying me $5.15, what do you think he's going to do?

Now, you would not demand that a business pay a minimum price for its phone service;

No, but I would demand the phone company pay its employees minimum wage, which they would then pass on to the business that uses its service. Indirectly, then, I am demanding that the business pay a minimum price for its phone service.

But why should labor be treated differently from any other cost of doing business? Why is it okay for government to fix the price of labor, but not for rent?

Kerry proposes a 37% increase in the minimum wage. Why doesn't he instead propose that all businesses cut their prices by 37%? What would be wrong with that?

So why should it pay $5.15 to an employee who's only worth $1.25?

I believe that every person not suffering from a handicap is capable of doing labor that is enough to keep him alive at a decent level. In other words, I believe that every non-handicapped person is capable of producing something that is worth a fair minimum wage. If you, as an employer, cannot figure out a way to harness that person's talent sufficiently for him to make enough to feed himself, then you aren't a very good businessman, and you should go get a job, and release that person into the employment pool where someone else can harness them more effectively.

And what if the employee isn't mentally handicapped, but just a stoner who can't be relied on to do anything worth more than $3.00 an hour? Forcing an employer to pay him $5.15 an hour means the employer isn't getting value for his money, in which case the employer will eventually fire the guy. Allowing the stoner to work for $3.00 an hour satisfies the stoner and the employer. What's wrong with that?

For handicapped people, we provide a subsidy to employers so that we, as a society, shoulder the burden instead of sticking it to the employer who is trying to do what he can for a handicapped person.

Handicapped people working in sheltered workshops are a completely different kettle of fish, not really relevant to the discussion.

 

[BPSCG]

I believe Medicare and SS is a fixed percent of 3.25% of your gross.

Have a look at your pay stub and see if you still believe that. Divide FICA into your gross pay, and you'll see it comes out to 7%, unless you make over the ceiling.

And your employer matches that amount; if you pay $10 from your paycheck for FICA, so does your employer, for a total of $20.00.

 

[Cleon]

1. it would raise the over-head of businesses.
2. In return the businesses would raise their fees to compensate.
3. The cost of living would increase
4. Minimum wage would have no effect.

It's difficult for me to take these sorts of things seriously.

Every time someone talks about raising the minimum wage, conservatives rant and rave that the sky is falling. Oh, it'll force businesses to raise their prices, oh, it'll hurt the economy, oh, it'll have the opposite effect, blah blah blah.

In the end, the minimum wage is raised, some folks get a small raise, and the economy absorbs it perfectly well. Turns out raising the minimum wage is a good thing.

 

[Tmy]

http://www.aflcio.org/yourjobeconomy/minimumwage/staterates.cfm

Heres a list of the states min wage amounts.

The states wh the hire MW tend to be states that have higher costs of living.

Why is it that all the jobs arent moving to the "cheaper" states?

 

[Tmy]

Heres a list of state umemployments. Its rather odd. At first glace the top ofthe list has states wh high min wage. But theres also low min wage states right with them. (For example Cali and South Carolina have the same unemployment rate but difft ends of the min wage spectrum.)

The bottom of the list has the same screwyness.

Then again, many factors go into unemployment.

oops, heres the link.http://www.dol.state.nm.us/dol_surr.html

 

[merphie]

Re: Re: Kerry on Minimum wage

It's difficult for me to take these sorts of things seriously.

Every time someone talks about raising the minimum wage, conservatives rant and rave that the sky is falling. Oh, it'll force businesses to raise their prices, oh, it'll hurt the economy, oh, it'll have the opposite effect, blah blah blah.

In the end, the minimum wage is raised, some folks get a small raise, and the economy absorbs it perfectly well. Turns out raising the minimum wage is a good thing.

I just wanted to see what other people thought.

 

[merphie]

Have a look at your pay stub and see if you still believe that. Divide FICA into your gross pay, and you'll see it comes out to 7%, unless you make over the ceiling.

And your employer matches that amount; if you pay $10 from your paycheck for FICA, so does your employer, for a total of $20.00.

I used to do pay roll for a corporation I ran. I couldn't remember the extact percent. However it is a set percent. It may increase if you make over a certain amount, but I didn't have to worry about that.

 

[Suddenly]

I used to do pay roll for a corporation I ran. I couldn't remember the extact percent. However it is a set percent. It may increase if you make over a certain amount, but I didn't have to worry about that.

Actually it stops at a certain amount, not sure what is is exactly, meaning that you pay zero percent on income above a certain amount.


As far as the minimum wage goes, has anyone actually gone past the theory and looked at the real world effect? I don't want to look up the stuff again, but there is some evidence that it stimulates the economy, not because the menial workers have more to spend, rather because the higher labor costs create a market for automation, which creates higher tech jobs....

 

[merphie]

Actually it stops at a certain amount, not sure what is is exactly, meaning that you pay zero percent on income above a certain amount.


As far as the minimum wage goes, has anyone actually gone past the theory and looked at the real world effect? I don't want to look up the stuff again, but there is some evidence that it stimulates the economy, not because the menial workers have more to spend, rather because the higher labor costs create a market for automation, which creates higher tech jobs....

I wouldn't know I never dealt with payrolls that big.

The answer to your question depends on who you believe. Every economist has a different version. I couldn't find any similarities between the theories when I searched.

 

[Meadmaker]

Well, we don't have to worry about Kerry increasing the minimum wage, do we. At least not unless the Democrats do amazingly well in mid-term elections in 2006.

So if the minimum wage doesn't enable you to buy food, clothing, and shelter, what's the point?

Then it needs to be higher

If I find an employer who's willing to pay me $3.00 an hour to put stamps on envelopes and that's as hard as I want to work after retirement, why should you care?

Most minimum wage laws have lots of exceptions in them to accomodate cases like this. For example, part time workers are frequently exempt. Very young people are exempt. Independent contractors are exempt. That's probably where you would fall. You would probably not agree to $3.00 per hour. You would agree to $3.00 per 100 envelopes, or something, where an average worker could stuff 200 envelopes per hour. At your leisurely, semi-retired pace, you would get $3.00 an hour, but the law would not be broken.

The minimum wage laws are designed to protect people who are trying to earn their living, and plenty of loopholes exist for people who are doing other things, besides trying to make a living.


Why should there be a law that says it makes no difference what the employer and I agree on?

Agree. That's an odd word. Would anyone ever freely make an agreement, the result of which is a guaranteed life of poverty? If the minimum wage is set fairly, then that is what will happen if someone agrees to a wage that is less than minimum wage.

The fact that so many people around the world do in fact accept such agreements is proof that true freedom is not found in the mere absence of legal restrictions.





Go back to my envelope-stamping job. If a prospective employer tells me he has an envelope stamping machine that costs him $4.00 an hour to run, why should I be prohibited from doing that job for him for $3.00?

As I said before, I believe that every able-bodied, non mentally handicapped person is capable of doing work that would allow him to survive at a decent level. Do you disagree?

If that is the case, then, you won't accept such a position if that is your only means of support. You have to make a living, and that job won't do it. Therefore, the only possibile way this situation arises is if an artificial shortage of opportunities has been created. One way to guarantee an end to that shortage is to not allow people to profit from paying you sub-living wages. Make him pay $4.00 an hour to run his machine, and someone will find a way to harness your abilities at the minimum wage.



What if the employer says he can send the envelopes to Carjackistan, have them stamped, and have them sent back to him for $4.00?

Carjackistan is, presumably, a place where there is no minimum wage. Wouldn't it be nice if we could all live freely, negotiating whatever compensation was fair for our labor, just like they do in Carjackistan?

But why should labor be treated differently from any other cost of doing business? Why is it okay for government to fix the price of labor, but not for rent?

Because the building doesn't have to eat.

Kerry proposes a 37% increase in the minimum wage. Why doesn't he instead propose that all businesses cut their prices by 37%? What would be wrong with that?

It wouldn't accomplish anything. A 37% price cut would be more or less identical to demanding a 37% pay raise for all employees. A 37% increase in the minimum wage only affects the lowest paid employees.



Allowing the stoner to work for $3.00 an hour satisfies the stoner and the employer. What's wrong with that?


Does it "satisfy" the stoner? If $3.00 an hour can't create a decent living condition, he might accept it, but he can't live on it. Therefore, either the government will provide extra money to him, or he will steal it. Or, option 3, his health will fail.

If you are allowed to pay him $3.00 an hour, his worth is probably worth $3.10 an hour. You will hire 100 stoners, and make $10.00 an hour, and society will have to accept the consequences of having 100 underfed stoners on the streets.

 

[Meadmaker]

Originally posted by Suddenly

Actually it stops at a certain amount, not sure what is is exactly, meaning that you pay zero percent on income above a certain amount.

Approximately $80,000 per year.


As far as the minimum wage goes, has anyone actually gone past the theory and looked at the real world effect?

Lots. However, the ones that have found evidence to support whatever their pet theories are inevitably look at very little data. If they looked at all of it, the support for their theories would vanish.

Try to find a correlation between minimum wage and any of the macroeconomic variables we talk about so much, like inflation rates, interest rates, or unemployment. You won't find it.

I have reached a conclusion that most economics is pseudoscience, and especially most economic modelling. Instead of all that nonsense, just try to follow basic morality, and I think you will reach more accurate conclusions. Is it moral to allow a rich man to grow wealthy off the labor of people paid so little or with so little opportunity that they are slaves in all but name? No.

If you agree, then you support a minimum wage, and the only tricky part is finding exactly how to set it.

And if you don't agree, find me any place on Earth that does not have a minimum wage law, and ask yourself if you would like to live the life of an average person in that place.

 

[BPSCG]

Well, we don't have to worry about Kerry increasing the minimum wage, do we. At least not unless the Democrats do amazingly well in mid-term elections in 2006.

So did you finally end up voting for Badnarik?

As I said before, I believe that every able-bodied, non mentally handicapped person is capable of doing work that would allow him to survive at a decent level. Do you disagree?

Yes. If he has no skills that society values, he's not capable of doing work that would allow him to survive at a decent level (I'll let your use of the vague term "decent" slide).

If that is the case, then, you won't accept such a position if that is your only means of support. You have to make a living, and that job won't do it.

Exactly. And if the prospective employer can't find anyone to do the work for the wages he offers, he'll be forced by the market to increase the wages he pays.

Therefore, the only possibile way this situation arises is if an artificial shortage of opportunities has been created.

You're using the passive voice, which is always a tipoff to me that the author is being intellectually dishonest ("Mistakes were made.") Who is creating "an artificial shortage of opportunities"? How is he doing this? To what end?

But why should labor be treated differently from any other cost of doing business? Why is it okay for government to fix the price of labor, but not for rent?

Because the building doesn't have to eat.

So what? The employer has no obligation to feed his employee. He only has an obligation to pay the employee the salary agreed to and earned for the work done. And the employee has no obligation to the employer other than to do the work demanded for the salary agreed to and received.

Allowing the stoner to work for $3.00 an hour satisfies the stoner and the employer. What's wrong with that?

Does it "satisfy" the stoner?

If it doesn't, why is he working there?

If $3.00 an hour can't create a decent living condition, he might accept it, but he can't live on it. Therefore, either the government will provide extra money to him, or he will steal it. Or, option 3, his health will fail.

Or option 4, he will find a better-paying job. And the employer that tries to succeed by hiring $3.00 an hour employees will find that he can't do it because the guy next door is paying $4.00 and the guy across the street is paying $4.10.

 

[Meadmaker]

BPSCG
So did you finally end up voting for Badnarik?

No. I wimped out, I admit. The night before the election, I read an Iraqi blog that I occaisionally read, (Riverbend, if you are familiar with it) and decided I couldn't do it. She convinced me that I had to vote for Kerry. (Iraq is very complicated, and the truth is I don't blame Bush for everything about it, but that's for another thread.)

For the first time in my life, though, I voted for almost all Republicans other than Kerry. On the state level, I care about school choice and Tort reform, and the Republicans are definitely much closer to me on those issues.

And when Kerry lost, I couldn't feel too unhappy about it. He really did run a slimy campaign.


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Therefore, the only possibile way this situation arises is if an artificial shortage of opportunities has been created.
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You're using the passive voice, which is always a tipoff to me that the author is being intellectually dishonest ("Mistakes were made.") Who is creating "an artificial shortage of opportunities"? How is he doing this? To what end?

All around the world, you can find examples of places where millions live in utter poverty, and a minority live middle-class lives, and a few people have great wealth.

Those millions of people all have the same skills that our own people have. However, they lack capital. They can't create jobs themselves.

Meanwhile, the people at the top, who could create better jobs, have no incentive to do so. They are already rich. The system is working for them. So, there is plenty that people are willing and able to do, and lots of people would benefit if they did it, but no one who would benefit has the money they need to make it happen. I call this an artificial shortage, because everyone wants something to happen, but noone has the resources to make it occur.

A situation is created, by no one in particular, but rather by an inevitable result of a system of economics. It isn't created by the rich, or by the poor, or the middle class. It exists. It is stable. And so it persists. To eliminate it, something has to be done to knock the system out of equilibrium. Something like, say, a minimum wage law.

One flaw in most conservative, as the term is used today, economic theory is the premise that, given freedom, people will seek to maximize their own economic benefits. I don't think that's true. I think the major motivation of people is not maximizing their own economic situation, but rather maximizing their position within society. They don't want to be richer. They want to be richer than their neighbors. If they are already the richest, there is no need to get richer. And there is certainly no need to help someone else get better off.

A minimum wage law stresses the system. If the rich person, who employs the impoverished millions, is forced to pay them enough to lift them out of poverty, then he has to change. He won't be able to skim profit any more with what he is doing, because there won't be any. The work they are doing isn't adequate to create the value that would lift them out of poverty, so if the rich man pays them a wage that would lift them out of poverty, he will lose money. If the rich man doesn't change, his fortune will dwindle.

So, he has to make better use of his employees. He has to find a way to increase their productivity so that he can pay a "decent" wage, and yet still have profits to skim. The result is increased productivity, which means more production, which means more prosperity.

Look around the world. Name any place where there is no minimum wage, but there is prosperity anyway.

So what? The employer has no obligation to feed his employee.

And that is where we fundamentally disagree. If he can't feed his employee, where "feed" means provide that employee a "decent" wage so that the employee can buy food, then he should not have a right to take profit from the employee's labor.

Of course, over in Carjackistan, your statement would be true. Would you want to live there?