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>In that setting you have to do one or more of retrain, move somewhere else, start your own business. Except the presence of a minimum wage makes two of those t

>In that setting you have to do one or more of retrain, move somewhere else, start your own business. Except the presence of a minimum wage makes two of those three more difficult than it would otherwise be. Without savings, how do you pay for retraining? Without savings, how do you pay for relocation? Without savings, how do you start a new venture of your own? Without a minimum wage, how does a person on the very bottom of the social scale accumulate savings? Without a minimum wage, wages for the lowest skill jobs get driven down to starvation wages. At those rates, its very difficult for people to accumulate enough capital to make the necessary improvements to their situation. >But your logic is attractice. We'll just move the minimum wage up to a thousand dollars an hour. We can all be rich together. Right, and while we're at it, we can move the top tax rate right down to 5%. The extra money freed up will generate so much economic activity that government will end up making money in the long run.

yummyfajitas 15y ago
Without savings, how do you pay for retraining? One common method is to work for free for a short time, until you gain the skills necessary to perform a new job. Without a minimum wage, how does a person on the very bottom of the social scale accumulate savings? By reducing consumption. Where I live, the GDP per capita is about 40x lower than the US. The top 5% tends to have a standard of living comparable to the bottom 5% of the US. The savings rate is 20%, compared to +/- 2-3% in the US.
- Klinky 15y ago
  One common method is to work for free for a short time, until you gain the skills necessary to perform a new job. Luckily food, shelter & transport is free too. Where I live, the GDP per capita is about 40x lower than the US. Where exactly do you live & what is the quality of life for those at the bottom?
  - yummyfajitas 15y ago
    I live in India. The quality of life at the bottom here in India is terrible, but that's irrelevant. I'm comparing the US poor to India's top 10% (lets not even discuss India's middle class). The average poor household in the US has 2 rooms per person, a car or two, air conditioning, and all sorts of consumer goods. http://www.census.gov/prod/2008pubs/h150-07.pdf http://www.census.gov/prod/2008pubs/h150-07.pdf I recently visited a family in Bandra (one of the poshest suburbs of Mumbai). They had 0.75 rooms/person, no AC, an inconsistent and undrinkable water supply, no car and a single bathroom about half the size of any in the US (i.e., no separated shower stall). My understanding is that this is fairly typical for their strata. They are in the top 5% (roughly) of India. If Indians can save 20% of their income, so can Americans.
    - Klinky 15y ago
      Your description of "poor" sounds more like "Working Class" or "Lower Middle Class" in the USA. Often these lifestyles are supplied due to easy credit. Sheltered poverty in the USA means studio apartment, no a/c, no car, no laundry facilities on site, dangerous neighborhood, little to no public transport. You also have dirt poor poverty which people commonly refer to as "trailer trash", where you have communities of poor people living in trailers wasting away their lives with poor choices & poverty. Then you have the destitute poor which are those that live on city streets, eat a charity kitchens & often have drug or mental health problems. I will say that the poor in the USA do have it better than the poor in India, but that's mainly due access to government assistance. Often the US poor don't have money to save because they bought an A/C, fixed their car, had to see a doctor or payback a loan they took out the week before to make ends meet. That or they live with subsidized housing & utilities and are given a tiny amount of welfare/food stamps which is lucky to last to the end of the month.
      - yummyfajitas 15y ago
        My definition of poor is the US government standard definition. My description is merely a factual description of people meeting the government's definition, according to the census. 75% of the poor do have a car (25% have two or more), 66% have 2 rooms per person, and just over half have AC. Go read the census article I linked to. If you wish to claim the government's definition of "poor" is overly broad and includes huge numbers of people who are actually middle class, I agree with you. But that simply means there are far fewer poor people in the US than we currently believe. I will say that the poor in the USA do have it better than the poor in India, but that's mainly due access to government assistance. No, it's due to wealth, plain and simple. Take away government assistance and virtually all Americans still have more than $1200/year to live on. a tiny amount of welfare/food stamps which is lucky to last to the end of the month. If that were true, poor Americans would not be fat.
- ceejayoz 15y ago
  > By reducing consumption. If you're making minimum wage, there's not much consumption to be lowered. Rent, transport, and food will eat it all up (and then some).
  - lotharbot 15y ago
    > If you're making minimum wage, there's not much consumption to be lowered. Rent, transport, and food will eat it all up (and then some). Rent, transportation, and food are consumption. If they're eating up everything and then some, find a way to lower them. Move in with your parents if you have to, or share a place with friends. Learn to love rice, beans, and potatoes. Walk or take the bus. There are lots of options. (This isn't abstract theory; I'm presently living on not much more than minimum wage, and I have a wife and kid.)
    - ceejayoz 15y ago
      If you're making minimum wage, chances are you're already riding the bus, eating rice, beans, and potatoes. Chances are also pretty good that your parents and friends are in a similar financial situation. How many minimum wage earners have a MS degree like you?
      - lotharbot 15y ago
        > If you're making minimum wage, chances are you're already riding the bus, eating rice, beans, and potatoes. This is true of very few of the minimum wage and less earners I've been friends with over the years. (I apologize, I don't have broader statistics than "people I know".) It's amazing how little money you can get by on if you're willing to really cut back. I don't think it takes an MS degree to figure out how.

yummyfajitas 15y ago

Without savings, how do you pay for retraining? One common method is to work for free for a short time, until you gain the skills necessary to perform a new job. Without a minimum wage, how does a person on the very bottom of the social scale accumulate savings? By reducing consumption. Where I live, the GDP per capita is about 40x lower than the US. The top 5% tends to have a standard of living comparable to the bottom 5% of the US. The savings rate is 20%, compared to +/- 2-3% in the US.

Klinky 15y ago
One common method is to work for free for a short time, until you gain the skills necessary to perform a new job. Luckily food, shelter & transport is free too. Where I live, the GDP per capita is about 40x lower than the US. Where exactly do you live & what is the quality of life for those at the bottom?
- yummyfajitas 15y ago
  I live in India. The quality of life at the bottom here in India is terrible, but that's irrelevant. I'm comparing the US poor to India's top 10% (lets not even discuss India's middle class). The average poor household in the US has 2 rooms per person, a car or two, air conditioning, and all sorts of consumer goods. http://www.census.gov/prod/2008pubs/h150-07.pdf http://www.census.gov/prod/2008pubs/h150-07.pdf I recently visited a family in Bandra (one of the poshest suburbs of Mumbai). They had 0.75 rooms/person, no AC, an inconsistent and undrinkable water supply, no car and a single bathroom about half the size of any in the US (i.e., no separated shower stall). My understanding is that this is fairly typical for their strata. They are in the top 5% (roughly) of India. If Indians can save 20% of their income, so can Americans.
  - Klinky 15y ago
    Your description of "poor" sounds more like "Working Class" or "Lower Middle Class" in the USA. Often these lifestyles are supplied due to easy credit. Sheltered poverty in the USA means studio apartment, no a/c, no car, no laundry facilities on site, dangerous neighborhood, little to no public transport. You also have dirt poor poverty which people commonly refer to as "trailer trash", where you have communities of poor people living in trailers wasting away their lives with poor choices & poverty. Then you have the destitute poor which are those that live on city streets, eat a charity kitchens & often have drug or mental health problems. I will say that the poor in the USA do have it better than the poor in India, but that's mainly due access to government assistance. Often the US poor don't have money to save because they bought an A/C, fixed their car, had to see a doctor or payback a loan they took out the week before to make ends meet. That or they live with subsidized housing & utilities and are given a tiny amount of welfare/food stamps which is lucky to last to the end of the month.
    - yummyfajitas 15y ago
      My definition of poor is the US government standard definition. My description is merely a factual description of people meeting the government's definition, according to the census. 75% of the poor do have a car (25% have two or more), 66% have 2 rooms per person, and just over half have AC. Go read the census article I linked to. If you wish to claim the government's definition of "poor" is overly broad and includes huge numbers of people who are actually middle class, I agree with you. But that simply means there are far fewer poor people in the US than we currently believe. I will say that the poor in the USA do have it better than the poor in India, but that's mainly due access to government assistance. No, it's due to wealth, plain and simple. Take away government assistance and virtually all Americans still have more than $1200/year to live on. a tiny amount of welfare/food stamps which is lucky to last to the end of the month. If that were true, poor Americans would not be fat.
ceejayoz 15y ago
> By reducing consumption. If you're making minimum wage, there's not much consumption to be lowered. Rent, transport, and food will eat it all up (and then some).
- lotharbot 15y ago
  > If you're making minimum wage, there's not much consumption to be lowered. Rent, transport, and food will eat it all up (and then some). Rent, transportation, and food are consumption. If they're eating up everything and then some, find a way to lower them. Move in with your parents if you have to, or share a place with friends. Learn to love rice, beans, and potatoes. Walk or take the bus. There are lots of options. (This isn't abstract theory; I'm presently living on not much more than minimum wage, and I have a wife and kid.)
  - ceejayoz 15y ago
    If you're making minimum wage, chances are you're already riding the bus, eating rice, beans, and potatoes. Chances are also pretty good that your parents and friends are in a similar financial situation. How many minimum wage earners have a MS degree like you?
    - lotharbot 15y ago
      > If you're making minimum wage, chances are you're already riding the bus, eating rice, beans, and potatoes. This is true of very few of the minimum wage and less earners I've been friends with over the years. (I apologize, I don't have broader statistics than "people I know".) It's amazing how little money you can get by on if you're willing to really cut back. I don't think it takes an MS degree to figure out how.