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WAL-MART CEO: Things Aren't Getting Better For America's Middle Class

Except those government handouts amount to a subsidy for employers who pay low wages, which in turn encourages people to work for low wages and employers to pay those wages.

that is false. If (for example) the government were to cut food stamps tomorrow, there is no mechanism by which that would force minimum wage employers to increase their salary, nor any mechanism by which such a move would force the low-skill workforce to suddenly have greater value-added, justifying such an increase.

Back when I was an unskilled worker, which was in the '50s and early '60s, wages in comparison to the cost of things was much higher than it is now, but there weren't all the government handouts that we have today. It seems to me that the economy was a lot stronger as a result.

Yeah. Bombing your industrial competition into ash and poverty and grime helps, too.
 
that is false. If (for example) the government were to cut food stamps tomorrow, there is no mechanism by which that would force minimum wage employers to increase their salary, nor any mechanism by which such a move would force the low-skill workforce to suddenly have greater value-added, justifying such an increase.

Sure there is, it's called competition. I'm pretty sure you have heard of it, it's the backbone of the free market capitalistic system.

If low wage workers couldn't receive means tested welfare benefits, then they would be more motivated to seek higher paying employment. thus low wage employers would have to compete harder for workers, and compensation would rise.

Many of those low wage workers are capable of doing something else, or are at least capable of obtaining more skills though education, but as long as they are comfortable earning a low wage, they won't bother to improve their employment situation.

Regardless, another mechanism could be the higher minimum wage.
 
Racist stuff aside, why wouldn't we want to decrease demand for low value labor?

Because that means that low-skill, low-education, low-experience workers become structurally unemployable, and are never able to improve their position, but are rather trapped in lifelong poverty or forced into illegal enterprise.

Also, Keynes solution to unemployment was not to reduce wages and prices but to raise consumption through the spending of money through the government.

Part of Keynesian economic theory is to decrease the real value of wages through inflation, provided by government expenditures. That's how you solve the problem of stickiness. Inflation is supposed to be good for us, remember? :roll:
 
Sure there is, it's called competition. I'm pretty sure you have heard of it, it's the backbone of the free market capitalistic system.

Yeah. Competition is going to have the opposite of the effects you are arguing in favor for with regards to low-skill, low-education labor.

If low wage workers couldn't receive means tested welfare benefits, then they would be more motivated to seek higher paying employment. thus low wage employers would have to compete harder for workers, and compensation would rise.

We currently have a large unemployed populace indicating a glut in low-skill, low-education labor. Simply that "people would want more money" does not mean that they will be able to demand higher pay for the same amount of value-added. SOME would, which is why we should eliminate welfare cliffs. However, the idea that our low-income populace are really just a large section of budding electricians, certified computer programmers, and qualified mechanical engineers lounging about on a burger-flipping salary isn't tenable. By and large minimum wage jobs are held by those whose value of labor meets the minimum threshold. They can improve themselves from there (and should be enabled in doing so), but they have to start there.

Many of those low wage workers are capable of doing something else, or are at least capable of obtaining more skills though education, but as long as they are comfortable earning a low wage, they won't bother to improve their employment situation.

Some are. Your typical minority high school drop out with a drug charge under his belt and no experience to speak of in the legal workforce not so much.

The children of middle and upper middle class will do okay - they will have access to the schooling and the social capital to achieve it. It is the vulnerable in our society who will suffer.

Regardless, another mechanism could be the higher minimum wage.

That is a mechanism that will only succeed in (again) harming the poorest amongst us.
 
...
Part of Keynesian economic theory is to decrease the real value of wages through inflation, provided by government expenditures. That's how you solve the problem of stickiness. Inflation is supposed to be good for us, remember? :roll:

Keynes did suggest to Roosevelt in a letter than he could improve our economy with welfare programs, but he also explained that government jobs which produced something of value would be preferable (ie the Hoover Damm).

However, inflation itself is not part of Keynsian theory. Its the side effect of too little production to meet demand. Wages also tend to follow inflation, when inflation is occuring, generally most everything goes up, s ncluding wages. During the late 70s and early 80s, when inflation was double digit, my parents were getting cost of living increases twice a year.
 
Keynes did suggest to Roosevelt in a letter than he could improve our economy with welfare programs, but he also explained that government jobs which produced something of value would be preferable (ie the Hoover Damm).

Producing Value was of little import to Keynes - he thought you could improve the economy by paying one set of people to bury money and another to dig it up. Insanity.

However, inflation itself is not part of Keynsian theory. Its the side effect of too little production to meet demand.

Or it is always and everywhere a monetary phenomenon, or it is the result of artificially depressed interest rates or it is a handy way to sidestep the problem of sticky wages and depreciate workers incomes in ways they are less likely to oppose, making them more employable at the new real rates. Inflation is supposed to give us fuller employment in precisely that manner. It doesn't, which is part of why Stagflation was such as serious challenge to Keynesian economic theory. But according to the theory it is supposed to.

Wages also tend to follow inflation, when inflation is occuring, generally most everything goes up, including wages.

Unless you are in a period which should see wage depreciation, such as during a recession - which is what Keynes was writing about.
 
Producing Value was of little import to Keynes - he thought you could improve the economy by paying one set of people to bury money and another to dig it up. Insanity.

Not according to a letter he sent to Roosevelt which Keynes suggested work programs creating infrastructure would be a better use of money than welfare.
 
Because that means that low-skill, low-education, low-experience workers become structurally unemployable, and are never able to improve their position, but are rather trapped in lifelong poverty or forced into illegal enterprise.

That's a ridiculous argument.

Part of Keynesian economic theory is to decrease the real value of wages through inflation, provided by government expenditures. That's how you solve the problem of stickiness. Inflation is supposed to be good for us, remember?

There is a specific formula used by economist when a certain amount of inflation is considered fine for the economy. That does not mean Keynes wanted to reduce wages:roll:
 
That's a ridiculous argument.

No it is a factual one, and one that has undergirded minimum wage since its inception.

There is a specific formula used by economist when a certain amount of inflation is considered fine for the economy. That does not mean Keynes wanted to reduce wages:roll:

No - he wanted to reduce real wages. He recognized that wages themselves would tend not to reduce.
 
No it is a factual one, and one that has undergirded minimum wage since its inception.



No - he wanted to reduce real wages. He recognized that wages themselves would tend not to reduce.

It's not factual to claim "Because that means that low-skill, low-education, low-experience workers become structurally unemployable, and are never able to improve their position, but are rather trapped in lifelong poverty or forced into illegal enterprise." That is called opinion based on nothing more than speculation. Raising the minimum wage to index for inflation does not mean that an individual will never be able to improve his/her position, and/or be trapped in a lifetime of poverty be or forced into illegal enterprise. That's an erroneous statement.

Also, he did not want to reduce wages.
 
More BS Rob...

1. Progressives would love nothing more than to see Walmart close its doors. Which would ensure that ALL their employees instantly become welfare recipients.

Looks like you are the one spewing BS. I just love watching you think for progressives as if you had a clue. I'd just like to see them allow unions and quit shafting their employees. Not shudder their doors.
 
It's not factual to claim "Because that means that low-skill, low-education, low-experience workers become structurally unemployable, and are never able to improve their position, but are rather trapped in lifelong poverty or forced into illegal enterprise." That is called opinion based on nothing more than speculation. Raising the minimum wage to index for inflation does not mean that an individual will never be able to improve his/her position, and/or be trapped in a lifetime of poverty be or forced into illegal enterprise. That's an erroneous statement.

Unfortunately it is not

National Bureau of Economics Working Paper 19262: We find that the minimum wage reduces net job growth, with the most pronounced effects on younger and low-wage workers

National Bureau of Economics Working Paper 12663: Studies that focus on low-wage workers provide relatively overwhelming evidence that minimum wage increases result in strong disemployment effects

National Bureau of Economics Working Paper 18681: Utilizing proper control groups leads to stronger disemployment effects; the evidence shows that minimum wage increases still represent a trade-off between higher wages for some and unemployment for others

National Bureau of Economics Working Paper 6127: The Evidence indicates that Minimum Wage Increases mostly redistribute resources among the low wage demographics, with slightly more people falling into poverty due to the lost income of disemployment than rising out of it due to income increases.

Increasing minimum wage does, in fact, kick people out of the workforce. Just as it was intended to do.

Also, he did not want to reduce wages.

You are deliberately avoiding a discussion of real wages, which Inflation was indeed intended to reduce, in order to increase employment.
 
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Looks like you are the one spewing BS. I just love watching you think for progressives as if you had a clue. I'd just like to see them allow unions and quit shafting their employees. Not shudder their doors.

Ah. So he was correct. :)
 

Okay, for argument sake let's agree that there may be a small effect of employment for low skilled workers:

Low-wage Workers

All monopsony models suggest that a modest increase in legal minimum wages should increase employment. In the United States, minimum wages affect only young and unskilled workers. Most studies of the effects of legal minimum wages in the 1970s and early 1980s found small decreases in employment for young unskilled workers, as predicted by the competitive model. However, later studies found almost no effect on employment (see Wellington, 1991) and a few studies found increases in employment as predicted by the monopsony model (see Card and Krueger, 1995). However, these latter studies are controversial (see exchange between Neumark and Wascher, 2000, and Card and Krueger, 2000) and have not convinced the majority of labor economists (see Whaples, 1996). In any case, the rate of exploitation, if positive, is probably small. Monopsony in American Labor Markets

Which model would be best becomes the question:

-A model where the most productive and skilled workers compete and get paid good wages which increases employment for them

-A model where the least skilled worker is hired which pushes wages down in monopsony models and also may lead to exploit this type worker

I say the first model is best, and for those who don't have skills or have low level skills, offer work training programs for them so they can have a positive future instead of one where they continue to be exploited by large corporations. This will benefit everyone.

Also, I'm not avoiding anything. Your claim about Keynes is wrong.
 
that is false. If (for example) the government were to cut food stamps tomorrow, there is no mechanism by which that would force minimum wage employers to increase their salary, nor any mechanism by which such a move would force the low-skill workforce to suddenly have greater value-added, justifying such an increase.



Yeah. Bombing your industrial competition into ash and poverty and grime helps, too.

Except that fewer people would be content to keep stocking shelves for minimum if they couldn't live on the wages paid. Instead of handouts, we need to be giving hand ups in the form of incentives to improve job skills, scholarships for low wage workers.

and you can't bomb your competition into ash without also bombing your trading partners into ash. It's a trade off.
 
Looks like you are the one spewing BS. I just love watching you think for progressives as if you had a clue. I'd just like to see them allow unions and quit shafting their employees. Not shudder their doors.

Allowing Unionization of Walmart would ensure that the doors at some point close. The heart of Walmart's model right now is in providing goods at the 'lowest price'.... Can't do that in a Union Shop.
 
Allowing Unionization of Walmart would ensure that the doors at some point close. The heart of Walmart's model right now is in providing goods at the 'lowest price'.... Can't do that in a Union Shop.

Depends on how much negotiating power that the union had, and what happened with the competition. You can't really say one way or another without enough information. I would think that if Walmart unionized, other retail workers would follow. If Walmarts primary competition all unionized, then seems to me that they wouldn't lose any competitive advantages.

Don't get me wrong, I don't support state laws which give unions more power than they could obtain from just collective bargaining alone, but if the rich and famous can pay third party negotiators to get the best possible deal, shouldn't regular people be given the same option?

I really don't understand why conservatives tend to be all for the wealthy getting richer by utilizing all of the resources that they can muster, but somehow middle class Americans shouldn't be allowed to do the same thing.
 
if the rich and famous can pay third party negotiators to get the best possible deal, shouldn't regular people be given the same option?

Gosh, that sounds like some of that radical "all men are created equal" rhetoric. Where have I heard that one before?
 
Allowing Unionization of Walmart would ensure that the doors at some point close. The heart of Walmart's model right now is in providing goods at the 'lowest price'.... Can't do that in a Union Shop.

Bullcrap speculation at its very best.
 
Okay, for argument sake let's agree that there may be a small effect of employment for low skilled workers:

Given that a negative effect on employment for low-skilled workers is the overwhelming conclusion of the evidence available and the basic application of the laws of supply and demand.

Low-wage Workers

All monopsony models suggest that a modest increase in legal minimum wages should increase employment. In the United States, minimum wages affect only young and unskilled workers. Most studies of the effects of legal minimum wages in the 1970s and early 1980s found small decreases in employment for young unskilled workers, as predicted by the competitive model. However, later studies found almost no effect on employment (see Wellington, 1991) and a few studies found increases in employment as predicted by the monopsony model (see Card and Krueger, 1995). However, these latter studies are controversial (see exchange between Neumark and Wascher, 2000, and Card and Krueger, 2000) and have not convinced the majority of labor economists (see Whaples, 1996). In any case, the rate of exploitation, if positive, is probably small. Monopsony in American Labor Markets

Which model would be best becomes the question:

-A model where the most productive and skilled workers compete and get paid good wages which increases employment for them

-A model where the least skilled worker is hired which pushes wages down in monopsony models and also may lead to exploit this type worker

C: A model that allows low-skilled workers to become higher-skilled workers through experience.

What you miss is that the two models you propose are not mutually exclusive. Our society will pay little for low-value added labor, and highly for high-value-added labor.

I say the first model is best, and for those who don't have skills or have low level skills, offer work training programs for them so they can have a positive future instead of one where they continue to be exploited by large corporations. This will benefit everyone.

Sure. We have one of those. It is called "The Public Education System".

Also, I'm not avoiding anything. Your claim about Keynes is wrong.

:shrug: it simply is not, and that is part of why Keynes' theory had such problems in the 70s.
 
Preach It! Let's bring the same level of success enjoyed by Detroit to WalMart!

Now you blame unions for idiot conservative-based free trade policies. Mental failure of epic proportions.
 
Except that fewer people would be content to keep stocking shelves for minimum if they couldn't live on the wages paid.

:shrug: perhaps. I think you have an exaggerated view of what it means to "live", or the lack of availability of illegal work. Additionally, there simply isn't that much the guy whose job it is to bring in the carts from the parking lot can do to make his labor worth significantly more money.

I have no doubt that the process you are describing will occur for some people. But we have trained entire sections of our populace to a life of dependence and minimum effort.

Instead of handouts, we need to be giving hand ups in the form of incentives to improve job skills, scholarships for low wage workers.

Sure. While we're at it, let's pick everyone who fails out of school, and beat them half to death with whips every day until they start making straight A's. Beatings can continue until morale improves

and you can't bomb your competition into ash without also bombing your trading partners into ash. It's a trade off.

Sure. And then when they are rebuilding, gosh, they'll have to buy from you.....
 
Now you blame unions for idiot conservative-based free trade policies. Mental failure of epic proportions.

:lol:

Nope. The Japanese build here. I blame unions for choking their companies and killing off innovation, ensuring their eventual stultification and death.
 
:shrug: perhaps. I think you have an exaggerated view of what it means to "live", or the lack of availability of illegal work.



Sure. While we're at it, let's pick everyone who fails out of school, and beat them half to death with whips every day until they start making straight A's. That'll incentivize 'em.

Or, perhaps, simply not subsidize them and keep them content to do entry level work.



Sure. And then when they are rebuilding, gosh, they'll have to buy from you.....

Yes, and have help rebuilding their countries, maybe while we are, at the same time building the interstate highway system and paying down the war debt, all the while paying higher wages that we can afford while not spending the cash necessary to do all the building and rebuilding.
 
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