America needs bold increases in the Minimum Wage

JUST-THE-FACTS ABOUT AMERICA'S MINIMUM-WAGE

It is decisions made at the levels of the national Executive and Legislature that affect most the way we live. And for those living below the Poverty Threshold (all 45 million of them) the Minimum Wage in America is laughable. (Except when it diminishes your standard of living.)

From the Pew Research Center: 5 facts about the minimum wage - excerpt:

1. Adjusted for inflation, the federal minimum wage peaked in 1968 at $8.68 (in 2016 dollars). Since it was last raised in 2009, to the current $7.25 per hour, the federal minimum has lost about 9.6% of its purchasing power to inflation. Back in 2015, The Economist estimated that, given how rich the U.S. is and the pattern among other advanced economies in the Organization for Economic Cooperation and Development, “one would expect America … to pay a minimum wage around $12 an hour.”

2. Less than half (45%) of the 2.6 million hourly workers who were at or below the federal minimum in 2015 were ages 16 to 24. An additional 23.3% are ages 25 to 34, according to the Bureau of Labor Statistics; both shares have stayed more or less constant over the past decade. That 2.6 million represents less than 2% of all wage and salary workers. (See more about the demographics of minimum-wage workers.)

3.Twenty-nine states, plus the District of Columbia and nearly two dozen cities and counties, have set their own higher minimums. State hourly minimums range from $7.50 in New Mexico to $11.50 in D.C., according to the U.S. Department of Labor’s Wage and Hour Division. Together, these states include about 61% of the nation’s working-age (16 and over) population, according to our analysis of U.S. Census Bureau data. Among the cities that have enacted even higher local minimums are San Francisco ($15 by 2018), Seattle ($15 by 2021), Chicago ($13 by 2019) and San Diego ($11.50 by 2017), according to the National Employment Law Project. And in 12 states, the minimum wage rises automatically each year based on a cost-of-living formula.

4. About 20.6 million people (or 30% of all hourly, non-self-employed workers 18 and older) are “near-minimum-wage” workers. We analyzed public-use microdata from the Current Population Survey (the same monthly survey that underpins the BLS’s wage and employment reports), and came up with that estimate of the total number of “near-minimum” U.S. workers – those who make more than the minimum wage in their state but less than $10.10 an hour, and therefore also would benefit if the federal minimum is raised to that amount. The near-minimum-wage workers are young (just under half are 30 or younger), mostly white (76%), and more likely to be female (54%) than male (46%). A majority (56%) have no more than a high-school education.

5. The restaurant/food service industry is the single biggest employer of near-minimum-wage workers. Our analysis also found that 3.75 million people making near-minimum wages (about 18% of the total) worked in that industry. Among near-minimum workers aged 30 and younger, about 2.5 million (or nearly a quarter of all near-minimum workers in that age bracket) work in restaurants or other food-service industries. But because many of those workers presumably are tipped, their actual gross pay may be above $10.10 an hour. (Federal law, as well as wage laws in many states, allows tipped employees to be paid less as long as “tip credits” bring their pay up to at least the applicable minimum.)

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MY POINT

The Poverty-Threshold-Wage is $25K annually, which becomes $12/hour (based upon a 52 week year and a 40-hour work-week). See herebellow the states where the MW equals or is greater than the P-T-W: States with minimum wages higher than the $7.25/hr federal standard. I count none and only 7 above the MW of $10/hour!

Agreed. The country would be better if the minimum wage was increased.

That's right, take money away from the poor and give it to the lazy. That's what raising the MW beyond what the market demands does. When you raise the MW, businesses raise prices to compensate. Raising prices effects those on fixed incomes the most. Raising the MW impacts the lowest performing employees the most, since with a high MW, they have little incentive to perform, since they are getting decent money already. So you keep giving that 28 year old McDonald's burger flipper $15/hr., your grandma doesn't really need that heart medication all that badly.

/flush

camlok said:

WHAT!!??? And take money from the 1%. You are obviously socialists???, commies??, huh, I always get confused on those terms but those are the memes I am instructed to hurl from my right wing handlers.

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Enjoy your $20 Big Mac at McDonald's.

If you are an adult, working for minimum wage, you made some pretty ****ty decisions in life.

MTAtech said:

Agreed. The country would be better if the minimum wage was increased.

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10 Reasons intelligent people oppose minimum wage:

1) makes it illegal to employ people not worth minimum wage
2) raise prices for poor people who often shop where minimum wage folks work
3) speeds up automation and replacement of minimum wage jobs
4) teaches workers that you get ahead with govt violence rather than being worth more
5) raises prices, reduces demand, and thus reduces employment
6) makes American workers even less competitive with foreign workers
7) makes a huge % of work force (42%) minimum age workers with no incentive to improve their skills.
8) speeds up transition from high density brick and mortar employment to low density on line employment
9) encourages govt to enact more libsocialist policies to get more votes from the supposed beneficiaries

While I'd welcome people obtaining higher wages, I'm not keen on provisions that restrict free trade because they all result in deadweight losses and inefficient allocations of resources. Price floors are but one type of trade restriction, and the minimum wage is nothing other than a price floor.




I know folks don't often or don't like to acknowledge it, but when in the market for labor, workers are the suppliers and employers are the consumers. So, if one's principles/sensibilities align with the notion that paying less is better than paying more, it's quite difficult to justify governmentally defined price floors.

• If the government forced the price of, say, shoes to $100, what would you think?
  • People willing to pay $100 for shoes wouldn't care, but people willing to play less than $100 would be upset.

So, that leaves us in a position of needing one of two things happening:

• People need to earn more than whatever is the current minimum wage.
• Prices need to come down.

Which of those two things can be made to happen? Frankly both, but not without "pain," so to speak. How? Well, think about what one does when one wants to buy something at a lower price than the seller is asking? What tactic can one use that works nearly every time the price one offers to pay was profitable enough for the seller (provided one is dealing with the proprietor or his/her pricing-decision-authorized agent)? The "walk" tactic.

Quite simply, every seller has an ideal profit margin/sum that s/he wants to earn and one that s/he is willing to accept because though not ideal, is profitable enough. While a seller wants to get as close as possible to their ideal profit margin/sum, s/he will yet prefer to accept an "acceptable" profit over taking no profit. Anyone who's ever taken a job that paid a bit less than they desired has done exactly what I just described. I don't care what be the reason(s) one did so, the fact remains that one found acceptable the price the buyer was willing to pay for one's labor. If one had a choice among multiple offers and accepted one that paid less, there again, one did so because, at of the day, the offer was acceptable enough. So it is with all sellers.


The sad reality is that buyers of labor can fairly well rely on sellers of labor to act in economically irrational ways. On the other hand, sellers of products and services, the very same folks who are buyers of labor, can again rely on individual buyers of those products, the very same folks who are sellers of labor, and services to behave economically irrationally. In a market where any given individual behaves irrationally as both a buyer of other folks' goods/services and as a seller of their own product, their labor, that irrationally behaving individual gets "screwed." When millions of individuals do the same thing, it's millions of unrelated individual detrimental exchanges happening, but it looks like they're related because so many folks are behaving in precisely the same irrational way(s).

When individuals en masse commence to behave in economically rational ways, one of two things will happen: the price of labor will increase or the price of things producers offer will come down. It'd be a huge market correction, and there're no two ways about it; it'll hurt to go through it, but it's really the only way to force the market to new equilibrium values and do so in a way that affects everybody. On the upside, the hurt will be across the entire spectrum of incomes. Wealthy folks will watch the value of their holdings plummet and they'll be forced to liquidate all sorts of assets to cover the drop in value.

Is such a correction the kind of thing workers can force? Yes, it is....Indeed, if suppliers of labor band together to force such a correction, they'll almost certainly be offered a minimum wage of $15 or $20 in exchange for ending their efforts. The real test will then come. Will workers press on for a full correction or will they cave? I don't know....

A DECENT MINIMUM WAGE

Xelor said:

While I'd welcome people obtaining higher wages, I'm not keen on provisions that restrict free trade because they all result in deadweight losses and inefficient allocations of resources. Price floors are but one type of trade restriction, and the minimum wage is nothing other than a price floor.

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Very wrong.

You are applying the nature of a price of a service/product (cost plus profit) to human labor (only cost and no profit), which is unacceptable. You are not comparing "likes", that is, the same entities.

In fact, the price of human labor should indeed be a matter of Supply and Demand as are all inputs to the process of producing goods/services. But, it also should have "special consideration". A service or a good is impersonal. A human being is highly personal, and therefore should be considered on an entirely different plain.

At the same time that human workers are inputs to the Supply Cycle, they are also the essence of Demand. They have a price-cost that is called Wages, and the question here is this: Is the price/cost of human labor definable at a minimum (wage) or should it be like any other input to Supply without any minimum.

I say the nature of inputs places human labor far above that of steel to make a car or a doctor to cure illnesses or an engineer to design a car. We humans are the very reasons that a Market-economy exists. Yes, we participate in that economy by means of production as well as expenditure upon goods-and-services. But there is also a basic concern that is immutable. People must live and there is a minimum standard of life.

Here I introduce the notion of the Hierarchy of Needs as apply to our human existence. These were first (and best) described by the psychologist Abraham Maslow and are characterized as follows:


Furthermore, I insist on the fact that those bottom two rungs on the ladder (physiological and safety) are fundamental to life, and therefore well within the responsibility of the state/government to assure they are available as minima to all citizens of a nation.

Which brings me to the argument of the Minimum Wage, which should be available to all in a manner such that they can survive decently if minimally. And that wage is not the present common wage of $7.25 an hour. It is better defined by a wage that is equal or superior to the Poverty Threshold wage, which at $12/hour allows people to be paid at the very least $25K a year.

Will this have an impact on cost-prices? Of course it will, but only for about 14% of Americans today who currently find themselves below the Poverty-Level wage and who will most certainly spend the money. It will allow them to live much better. (Which, btw, amounts today to about 37 million men, women and children.)

Note also that that number of Americans below the Poverty Threshold is equal to the combined population of the states California and Maryland. Is that enough for us to be concerned?

Yes, it is ...

Lafayette said:

JUST-THE-FACTS ABOUT AMERICA'S MINIMUM-WAGE

It is decisions made at the levels of the national Executive and Legislature that affect most the way we live. And for those living below the Poverty Threshold (all 45 million of them) the Minimum Wage in America is laughable. (Except when it diminishes your standard of living.)

From the Pew Research Center: 5 facts about the minimum wage - excerpt:


MY POINT

The Poverty-Threshold-Wage is $25K annually, which becomes $12/hour (based upon a 52 week year and a 40-hour work-week). See herebellow the states where the MW equals or is greater than the P-T-W: States with minimum wages higher than the $7.25/hr federal standard. I count none and only 7 above the MW of $10/hour!

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We already have an answer to the minimum wage: illegal aliens, low skill immigrants, and welfare for displaced citizens.

faithful_servant said:

That's right, take money away from the poor and give it to the lazy. That's what raising the MW beyond what the market demands does. When you raise the MW, businesses raise prices to compensate. Raising prices effects those on fixed incomes the most. Raising the MW impacts the lowest performing employees the most, since with a high MW, they have little incentive to perform, since they are getting decent money already. So you keep giving that 28 year old McDonald's burger flipper $15/hr., your grandma doesn't really need that heart medication all that badly.

/flush

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hehe...I dunno man, it's tough to call working people lazy when they are working, isn't it? There's all kinds of ways people end up in minimum wage jobs...and not everyone is equipped to do more than that. Not sure the lazy thing is fair, bud...

OlNate said:

hehe...I dunno man, it's tough to call working people lazy when they are working, isn't it? There's all kinds of ways people end up in minimum wage jobs...and not everyone is equipped to do more than that. Not sure the lazy thing is fair, bud...

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I'd say that is was fair, since people who aren't lazy work to advance themselves. A high MW puts the guy who does a half-assed job on the same financial level as the girl who busts her ass every day. But because the employer has pay Mr. Half-ass a wage that is well beyond his worth, she can't afford to pay Miss Bustsherass the wage she deserves. So you have an employer who can only afford to pay a total of $30/hr for his all of his employees and now because she HAS to pay Mr. Half-ass $15/hr., Miss Bustsherass only gets $15/hr. We just set up a system where we reward laziness and fail to reward hard work.

faithful_servant said:

I'd say that is was fair, since people who aren't lazy work to advance themselves. A high MW puts the guy who does a half-assed job on the same financial level as the girl who busts her ass every day. But because the employer has pay Mr. Half-ass a wage that is well beyond his worth, she can't afford to pay Miss Bustsherass the wage she deserves. So you have an employer who can only afford to pay a total of $30/hr for his all of his employees and now because she HAS to pay Mr. Half-ass $15/hr., Miss Bustsherass only gets $15/hr. We just set up a system where we reward laziness and fail to reward hard work.

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What about if Miss Bustsherass works at a MW job at $7.50 now, and her employer chooses not to reward her ass busting with a higher wage? What about if no employer does, because despite busting her ass, she does a job that isn't valued above minimum wage? Shouldn't a minimum wage job provide for the minimum requirements of life, if Miss Bustsherass is performing at her best? We weren't all born to be CEO's, I know I wasn't...

Most MW jobs suck, and people have to work hard to keep them, because there's always someone else to do the work. I know, I know, you can remember that guy that one time at the burger place that pissed you off because he took to long to bring out your fries. But I am sure I remember conservatives explaining the American dream as being such that someone who is willing to work hard can have a contented life.

As well paying, low skilled jobs are replaced with automation and robotics, this is a conversation you're going to have, as people who used to be able to work at a factory job and provide a great life for their family are now more and more forced into MW or low wage jobs just to survive. These aren't lazy people, FS, these are people for who the bottom run has been stolen, and they have no way to climb the ladder, no matter how hard they work.

I hear your concerns, there's a lot more to fixing things than just raising the minimum wage, but I am not sure your characterization is accurate, and as time goes by it's going to get tougher to throw that "lazy" word around.

OlNate said:

What about if Miss Bustsherass works at a MW job at $7.50 now, and her employer chooses not to reward her ass busting with a higher wage? What about if no employer does, because despite busting her ass, she does a job that isn't valued above minimum wage? Shouldn't a minimum wage job provide for the minimum requirements of life, if Miss Bustsherass is performing at her best? We weren't all born to be CEO's, I know I wasn't...

Most MW jobs suck, and people have to work hard to keep them, because there's always someone else to do the work. I know, I know, you can remember that guy that one time at the burger place that pissed you off because he took to long to bring out your fries. But I am sure I remember conservatives explaining the American dream as being such that someone who is willing to work hard can have a contented life.

As well paying, low skilled jobs are replaced with automation and robotics, this is a conversation you're going to have, as people who used to be able to work at a factory job and provide a great life for their family are now more and more forced into MW or low wage jobs just to survive. These aren't lazy people, FS, these are people for who the bottom run has been stolen, and they have no way to climb the ladder, no matter how hard they work.

I hear your concerns, there's a lot more to fixing things than just raising the minimum wage, but I am not sure your characterization is accurate, and as time goes by it's going to get tougher to throw that "lazy" word around.

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in most places, you either move up, or you move out

you dont stay at the bottom

i dont want you...why would any employer want an employee who doesnt grow?

and just the basics gets you the first bumps....be on time, show up, and learn

second and subsequent bumps are related to your ability to learn more and more

the more valuable you become, the more you earn

skills pay the bills....always has, always will

OlNate said:

What about if Miss Bustsherass works at a MW job at $7.50 now, and her employer chooses not to reward her ass busting with a higher wage? What about if no employer does, because despite busting her ass, she does a job that isn't valued above minimum wage? Shouldn't a minimum wage job provide for the minimum requirements of life, if Miss Bustsherass is performing at her best? We weren't all born to be CEO's, I know I wasn't...

Most MW jobs suck, and people have to work hard to keep them, because there's always someone else to do the work. I know, I know, you can remember that guy that one time at the burger place that pissed you off because he took to long to bring out your fries. But I am sure I remember conservatives explaining the American dream as being such that someone who is willing to work hard can have a contented life.

As well paying, low skilled jobs are replaced with automation and robotics, this is a conversation you're going to have, as people who used to be able to work at a factory job and provide a great life for their family are now more and more forced into MW or low wage jobs just to survive. These aren't lazy people, FS, these are people for who the bottom run has been stolen, and they have no way to climb the ladder, no matter how hard they work.

I hear your concerns, there's a lot more to fixing things than just raising the minimum wage, but I am not sure your characterization is accurate, and as time goes by it's going to get tougher to throw that "lazy" word around.

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Then Miss Bustsherass needs to up her skillset. It's what I did. Had I not upped my skillset, I'd be getting about $15/hr right now. But I saw that the demand for my skillset wasn't valued beyond that, so I made the effort to learn new skills.

faithful_servant said:

Then Miss Bustsherass needs to up her skillset. It's what I did. Had I not upped my skillset, I'd be getting about $15/hr right now. But I saw that the demand for my skillset wasn't valued beyond that, so I made the effort to learn new skills.

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What if Miss Bustsherass is doing the very best she can?

gdgyva said:

in most places, you either move up, or you move out

you dont stay at the bottom

i dont want you...why would any employer want an employee who doesnt grow?

and just the basics gets you the first bumps....be on time, show up, and learn

second and subsequent bumps are related to your ability to learn more and more

the more valuable you become, the more you earn

skills pay the bills....always has, always will

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So, let the low skill folks starve? People's skill sets are different...what if your skill sets aren't valued?

OlNate said:

So, let the low skill folks starve? People's skill sets are different...what if your skill sets aren't valued?

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why arent their skills valued?

are they mentally unable to learn?

did they blow off school doing drugs? not even graduate?

do they have physical impairments which make getting a job tougher?

what is their excuse? rationale? please explain their dilemma

and the 1/1000 that is truly needy and we as a society need to help...i will be first in line giving them a nice check

the rest....not so much

Xelor said:

While I'd welcome people obtaining higher wages, I'm not keen on provisions that restrict free trade because they all result in deadweight losses and inefficient allocations of resources. Price floors are but one type of trade restriction, and the minimum wage is nothing other than a price floor.

Lafayette said:

Very wrong.

You are applying the nature of a price of a service/product (cost plus profit) to human labor (only cost and no profit), which is unacceptable. You are not comparing "likes", that is, the same entities.

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Let me get one thing clear. I appreciate that you took the time to put some thought into my remarks. It shows that you put some measure of effort into it, and that you did is what I acknowledge and appreciate.


I was tempted to respond to your remarks, but then I realized that no matter what approach I took to do so, my remarks would necessarily be didactic because I'd have to respond to you having tacitly rejected the facts that (1) wages are the price of labor (2) that labor and service are economically synonymous, (3) that laborers earn no profit from providing their labor, and (4) that the minimum wage is not a floor defined with regard to the price of labor.

Your rejection of those notions informed me instantly that you are operating on some theory of economics that is all your own...It's not Keynesian, not Marshallian, not Austrian, Marxist, behaviorist, not classical, not market modernist, not neoclassical or anything else that professional economists recognize. It's just all your own, for there is no economist anywhere who will, as you have, flat out reject the four things you did at square-one in your post. I can only ask that you point me to the document wherein your theory has been published because I'm not going to discuss anything economics with you until I have had time to examine the empiricism that supports your theory.

And, yes, I read some of your normative assertions. Rothbard is who came to mind when I read them.





References/Note:
These aren't the texts I learned from or from which I taught, but they'll do.

• Principles of Economics
• Intermediate Microeconomics
• Intermediate Macroeconomics

gdgyva said:

why arent their skills valued?

are they mentally unable to learn?

did they blow off school doing drugs? not even graduate?

do they have physical impairments which make getting a job tougher?

what is their excuse? rationale? please explain their dilemma

and the 1/1000 that is truly needy and we as a society need to help...i will be first in line giving them a nice check

the rest....not so much

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hehe...well, I'd love to see that statistical analysis that leads you to 1:1000 ration of people who are deserving vs. lazy...but that's probably for another day.

I mean, I hear what you're saying, but let's not forget that during the time period that Trump considers "Great", Americans were able to work at the same factory for 30 years, screwing in the same four screws into a metal plate, and buy a home, a car or two, allow their wives to not work and look after their children, who they put through school, and then retired with a pension and die with no debt and a nice inheritance to leave their kids. So, perhaps we shouldn't get too pissy with folks who flip burgers instead because those manufacturing jobs are gone...it's the same thing, just a different hand movement...and a lot less value on their "skill set", vs. the guy who, yup, screwed in the same four screws into a metal plate before tossing it into a parts bin or sending it down the line.

American wealth and success was built on well rewarded, unskilled labor as much as, if not more than, anything else.

OlNate said:

What if Miss Bustsherass is doing the very best she can?

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according to laws of evolution ultimately she must be discouraged from reproducing to insure survival of species. Liberals are anti science so don't accept this and thus we have the least fit reproducing the most in effect reversing evolution.

a fifteen dollar an hour minimum wage!

OlNate said:

hehe...well, I'd love to see that statistical analysis that leads you to 1:1000 ration of people who are deserving vs. lazy...but that's probably for another day.

I mean, I hear what you're saying, but let's not forget that during the time period that Trump considers "Great", Americans were able to work at the same factory for 30 years, screwing in the same four screws into a metal plate, and buy a home, a car or two, allow their wives to not work and look after their children, who they put through school, and then retired with a pension and die with no debt and a nice inheritance to leave their kids. So, perhaps we shouldn't get too pissy with folks who flip burgers instead because those manufacturing jobs are gone...it's the same thing, just a different hand movement...and a lot less value on their "skill set", vs. the guy who, yup, screwed in the same four screws into a metal plate before tossing it into a parts bin or sending it down the line.

American wealth and success was built on well rewarded, unskilled labor as much as, if not more than, anything else.

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and those manufacturing jobs are gone

they arent coming back....and people have been preaching that for YEARS now

just a basic high school diploma is not a path to success....you need a trade school, or a skill base

college isnt for everyone...my daughter is a nanny...but she speaks five languages and is in demand

we live in a service economy....if you cant find or learn a skill, you will be forced to live in near poverty

Because somewhere near $ 12 bucks an hour is where your top range is for most of the country for unskilled labor

As an employer, is isnt worth anything more to me....

Not when i am paying $ 14.50 for base accts payable/recv clerks

gdgyva said:

and those manufacturing jobs are gone

they arent coming back....and people have been preaching that for YEARS now

just a basic high school diploma is not a path to success....you need a trade school, or a skill base

college isnt for everyone...my daughter is a nanny...but she speaks five languages and is in demand

we live in a service economy....if you cant find or learn a skill, you will be forced to live in near poverty

Because somewhere near $ 12 bucks an hour is where your top range is for most of the country for unskilled labor

As an employer, is isnt worth anything more to me....

Not when i am paying $ 14.50 for base accts payable/recv clerks

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Social services cost around fourteen dollars an hour, by comparison. Some on the left believe we should not be subsidizing Capitalists, if the right wing is going to whine about the cost of social spending, that helps make that happen.

gdgyva said:

and those manufacturing jobs are gone

they arent coming back....and people have been preaching that for YEARS now

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reverse the liberal policies that sent our jobs off shore ie liberal unions taxes and regulations and most of those jobs will come back and certainly far fewer will leave.