2 ms·

Trust me: I believe that people deserve an honest living. I believe people have the right to housing, warmth, good food, healthcare, and the ability to have ple

by scarmig 14y ago

Trust me: I believe that people deserve an honest living. I believe people have the right to housing, warmth, good food, healthcare, and the ability to have plenty of autonomy and free time to do what they love and achieve self-fulfillment. I am not averse to governments passing laws to achieve this. But all organizations have a choice: I can either pay a worker $X or replace labor with capital for $Y, within the budgetary constraint $Z. If $Y < $X, they'll do that, or be outcompeted by organizations which do choose to do that. (If $Y and $X are both >$Z, well, that's when the organization closes up shop.) That's a real choice, and it's not easily legislated into oblivion.

krapp 14y ago
That's a real choice, and it's not easily legislated into oblivion. I understand that, and I don't mean to demonize business by any means. A minimum wage might well stifle competition somewhat, but I think the lack of one would do more harm than good. Given the choice between harm to business and harm to people, I'll choose to harm business.
- jlgreco 14y ago
  Do the people actually benefit in that situation? When a business closes up shop, do other businesses naturally expand their labor force in a linear manner to provide new jobs for the ones that were lost? Ideally the competing businesses will easily expand of course, since they have less competition after their competitor dropped out, but is that expansion linear? I suppose for some types of jobs it may be. If a coffee shop closes, and it's competitor opens another branch to soak up the extra demand, the additional coffee shop will probably use approximately the same number of employees as the old one fired. But can the same be said of, say, factories? What if the second factory, while filling the same demand as the first, was more successful because it used more effective automation?
  - krapp 14y ago
    That is a fair point. But what's the benefit in lower wages across the board, to the workers making them and to the economy? Perhaps the answer (at least in the US) would be to reduce the cost of reeducation to facilitate transition, and socialize healthcare? Lower wages might not be so bad where healthcare and education don't represent potential lifetime burdens for people. But then the tax burden for that would fall disproportionately on the poor wouldn't it? And also, there might just not be jobs at all to replace the ones lost. I don't know.
    - jlgreco 14y ago
      Free education and healthcare definitely seem like good first steps to improving the situation to me. Letting the prospective workers be as smart and as healthy as they care to make themselves seems to have no obvious downsides to me. With any luck that would create an expanded middle class that could be taxed to pay for it. The trend of people squandering their education and ending up in low paying jobs anyway disturbs me, but I think that could be solved by offering only majors that are in demand for free. Free STEM and medical sciences would be my initial suggestion, but I would want to see any decision like that backed up with some solid data (perhaps the data would reveal my concern is unfounded).
- markshead 14y ago
  Lets say you run a small movie theater. You hire a 5 people for $5 per hour to sell tickets. Many of these are teenagers and other people who have schedules that can't work a normal job. The government comes in and says minimum wage needs to be $10 per hour. After doing the math, you decide that financially you can't afford to keep all those people on at $5 per hour. So you keep one to help run the front of the theater and put in a machine where people can swipe their credit cards to buy tickets. Who was harmed? The business or the people? The $5 per hour may not seem like much, but to the teenager it is $5 per hour, plus a chance to learn to manage their own money, a chance to learn people skills, a chance to learn work ethic, a chance to have a good reference from you for later jobs, etc.
  - krapp 14y ago
    I understand your point, and I admit it's complex. But what happens when the government says I can pay whatever I want and I tell those people they're now making $2 an hour because nobody's buying the six dollar popcorn anymore? A minimum wage may have its downside but at least with it, people have an expectation of how little they can expect to make and plan accordingly. It provides a measure of stability at least.
    - markshead 14y ago
      To me the ability to find a job is a more important measurement of stability than the government saying that no job worth less than X and hour can be had. But back to your question about what happens when employers lower their wages to $2 per hour, they would probably lose all of their employees and have to raise wages if they want workers. Believe it or not, wages do correspond in some way to the amount of benefit an employee brings to a company. Lets say you want to hire someone to clean your house. How much would you have to pay in order to attract someone with enough skill to do the job? You couldn't just say you'll pay $0.50 per hour and magically get people to clean your house at that rate. There might be some people you'd attract for $5 per hour. As the price goes up, so does the pool of people you could pull from. However, above a certain price, it isn't worth it for you to pay someone else to do it. You might do it yourself or just live with it being dirty. If having your house cleaned is worth only $5 per hour to you and someone is willing to do house cleaning for $5 per hour should you be allowed to hire them? They probably aren't going to be willing to work for $5 per hour if they can make $10 per hour somewhere else. Does it make sense for the government to say, "You can't hire this person unless the value they provide is greater than $7.25 per hour"? I don't feel that benefits you or the person who you want to pay. I don't feel it benefits society as a whole because I think we benefit by having money flowing through more hands not fewer. Minimum wage says that transactions below a certain hourly rate are not allowed, so it prevents money from flowing through some of the hands that might get it otherwise.
dllthomas 14y ago
It's easily legislated into oblivion for any particular instance - just ban the automated looms (or whatever else is replacing workers), or require that the companies still employ people to watch the capital do its thing (some unions have gone this route, at various points). It's not, however, easily solved well - both the above are things I'd object to; particularly the latter, where I feel like we're removing not adding dignity.
Someone 14y ago
"That's a real choice, and it's not easily legislated into oblivion." It might kill the economy or grow a black market, but it is easily legislated into oblivion. The thing is: legislation can decrease $X and/or increase $Y. Put a $1000 a barrel tax on oil, and proportionally on other sources of energy, and abolish income taxes and you will find that people are willing to pay close to $Z for manual labour. Yes, that is exaggeration, but any increase of the cost of capital relative to that of manual labour will have some effect. It will either put companies out of business or it will create manual labour jobs. Problem is that this requires international cooperation or unilateral restrictions on trade (import bans or high import tariffs)

by scarmig 14y ago

krapp 14y ago

That's a real choice, and it's not easily legislated into oblivion. I understand that, and I don't mean to demonize business by any means. A minimum wage might well stifle competition somewhat, but I think the lack of one would do more harm than good. Given the choice between harm to business and harm to people, I'll choose to harm business.

jlgreco 14y ago
Do the people actually benefit in that situation? When a business closes up shop, do other businesses naturally expand their labor force in a linear manner to provide new jobs for the ones that were lost? Ideally the competing businesses will easily expand of course, since they have less competition after their competitor dropped out, but is that expansion linear? I suppose for some types of jobs it may be. If a coffee shop closes, and it's competitor opens another branch to soak up the extra demand, the additional coffee shop will probably use approximately the same number of employees as the old one fired. But can the same be said of, say, factories? What if the second factory, while filling the same demand as the first, was more successful because it used more effective automation?
- krapp 14y ago
  That is a fair point. But what's the benefit in lower wages across the board, to the workers making them and to the economy? Perhaps the answer (at least in the US) would be to reduce the cost of reeducation to facilitate transition, and socialize healthcare? Lower wages might not be so bad where healthcare and education don't represent potential lifetime burdens for people. But then the tax burden for that would fall disproportionately on the poor wouldn't it? And also, there might just not be jobs at all to replace the ones lost. I don't know.
  - jlgreco 14y ago
    Free education and healthcare definitely seem like good first steps to improving the situation to me. Letting the prospective workers be as smart and as healthy as they care to make themselves seems to have no obvious downsides to me. With any luck that would create an expanded middle class that could be taxed to pay for it. The trend of people squandering their education and ending up in low paying jobs anyway disturbs me, but I think that could be solved by offering only majors that are in demand for free. Free STEM and medical sciences would be my initial suggestion, but I would want to see any decision like that backed up with some solid data (perhaps the data would reveal my concern is unfounded).
markshead 14y ago
Lets say you run a small movie theater. You hire a 5 people for $5 per hour to sell tickets. Many of these are teenagers and other people who have schedules that can't work a normal job. The government comes in and says minimum wage needs to be $10 per hour. After doing the math, you decide that financially you can't afford to keep all those people on at $5 per hour. So you keep one to help run the front of the theater and put in a machine where people can swipe their credit cards to buy tickets. Who was harmed? The business or the people? The $5 per hour may not seem like much, but to the teenager it is $5 per hour, plus a chance to learn to manage their own money, a chance to learn people skills, a chance to learn work ethic, a chance to have a good reference from you for later jobs, etc.
- krapp 14y ago
  I understand your point, and I admit it's complex. But what happens when the government says I can pay whatever I want and I tell those people they're now making $2 an hour because nobody's buying the six dollar popcorn anymore? A minimum wage may have its downside but at least with it, people have an expectation of how little they can expect to make and plan accordingly. It provides a measure of stability at least.
  - markshead 14y ago
    To me the ability to find a job is a more important measurement of stability than the government saying that no job worth less than X and hour can be had. But back to your question about what happens when employers lower their wages to $2 per hour, they would probably lose all of their employees and have to raise wages if they want workers. Believe it or not, wages do correspond in some way to the amount of benefit an employee brings to a company. Lets say you want to hire someone to clean your house. How much would you have to pay in order to attract someone with enough skill to do the job? You couldn't just say you'll pay $0.50 per hour and magically get people to clean your house at that rate. There might be some people you'd attract for $5 per hour. As the price goes up, so does the pool of people you could pull from. However, above a certain price, it isn't worth it for you to pay someone else to do it. You might do it yourself or just live with it being dirty. If having your house cleaned is worth only $5 per hour to you and someone is willing to do house cleaning for $5 per hour should you be allowed to hire them? They probably aren't going to be willing to work for $5 per hour if they can make $10 per hour somewhere else. Does it make sense for the government to say, "You can't hire this person unless the value they provide is greater than $7.25 per hour"? I don't feel that benefits you or the person who you want to pay. I don't feel it benefits society as a whole because I think we benefit by having money flowing through more hands not fewer. Minimum wage says that transactions below a certain hourly rate are not allowed, so it prevents money from flowing through some of the hands that might get it otherwise.

dllthomas 14y ago

It's easily legislated into oblivion for any particular instance - just ban the automated looms (or whatever else is replacing workers), or require that the companies still employ people to watch the capital do its thing (some unions have gone this route, at various points). It's not, however, easily solved well - both the above are things I'd object to; particularly the latter, where I feel like we're removing not adding dignity.

Someone 14y ago

"That's a real choice, and it's not easily legislated into oblivion." It might kill the economy or grow a black market, but it is easily legislated into oblivion. The thing is: legislation can decrease $X and/or increase $Y. Put a $1000 a barrel tax on oil, and proportionally on other sources of energy, and abolish income taxes and you will find that people are willing to pay close to $Z for manual labour. Yes, that is exaggeration, but any increase of the cost of capital relative to that of manual labour will have some effect. It will either put companies out of business or it will create manual labour jobs. Problem is that this requires international cooperation or unilateral restrictions on trade (import bans or high import tariffs)