patrick.net

The problem is not lack of regulation. Federal regulation of wages is a very innefficient way to allocate resources. Tariffs don't make us more efficient either.

we have a corrupted government in bed with big business spoon feeding us about the "global" economy and what not........how is that working for you? better have a job in government, utilities or the health field. it gets pretty slim after that anymore.

mikem says

with so many good jobs sent overseas I see no other option but to raise it substantially to $10 hr. If that job at $10 hr. could have been outsourced it already would have.

So you want the jobs paying $7.50~$9.99 banned here, and have to be out-sourced too.

Do people still believe bleeding the patient is the best cure?

BTW, the manufacturing jobs outsourced in the past two decades may well be in-sourced to robots soon. Should the robots be banned too? Sounds like Ludditism to me.

Our problem is not with outsourcing or global trade, but government regulations and high taxes that prevent new businesses from being formed to hire the laid off workers. The raising of minimum wages along with mandatory healthcare further discourage new businesses from forming and existing businesses from expanding into new fields and hiring more workers.

Reality says

Because Safeway's cost has also gone up too due to minimum wage law requirement. Another possiblity is that one of them stops carrying the chips altogether because the sales volume split between the two stores could only afford a $7.50/hr stocker at each store. The remaining store then can raise the chip prices quite a bit higher, $11.

What if Safeway already pays its employees more than the MW due to being unionized?

Do you have any evidence that this has occurred before? Have prices ever increased due to a minimum wage increase?

What about demand?

We have employer based healthcare and retirement plans thanks to Roosevelt. But don't go thanking him directly, it wasn't his idea.
He passed disastrous wage laws, that required all workers be paid the same, for the same job, regardless, skill or experience, or productivity.
So the only way companies could get qualified workers was to offer them medical(100% for family as well) and Profit sharing. The Roosevelt law was eventually repealed but the Employer based Slave entrapment stayed as a relic, as testament on how fucked shit gets when the Government intervenes and meddles with wages.

CaptainShuddup says

He passed disastrous wage laws, that required all workers be paid the same, for
the same job, regardless, skill or experience, or productivity

Isn't that the Leadbetter law passed by Obama?

CL says

What if Safeway already pays its employees more than the MW due to being unionized?

Big companies often can afford to and have to pay workers more due to economy of scale and the dehumanizing big-corporation environment that need to pay people more to keep people (and prevent them from stealing from the company). Just like Henry Ford had to pay people more in order to keep workers on his production line (contrary to his pseudo economics claiming a company can get rich by giving away products to its own workers).

Unionizing a retailer OTOH is usually a quick way to bankruptcy, as retailing is a competitive industry, so far.

Do you have any evidence that this has occurred before?
Have prices ever increased due to a minimum wage increase?

What do you think happens to price when smaller competition is driven out of business? Why do you think big companies like Walmart have been advocating raising minimum wage for many years?

What about demand?

What about demand? Don't you need to eat? In a local convenience store market, competition has a much greater effect on price than the theoretical possibility of all nearby residents refusing to eat.

CL says

What if Safeway already pays its employees more than the MW due to being unionized?

Do you have any evidence that this has occurred before? Have prices ever increased due to a minimum wage increase?

What about demand?

I could be wrong, but I think most grocery stores pay at least a few employees minimum wage.

Even if they don't, what about suppliers, you know Safeway does stock non-Safeway brands, and I bet at least of few of those companies pay minimum wage employees.

If they don't raise prices or lay off workers, where does the extra money come from for higher salaries? No more health benefits(whoops, can't do that anymore). No PTO(I think there's a law against that too).

Ask any business owner on here, you have to account for every expense, there is no magic rug where wage hikes get swept under.

lostand confused says

Isn't that the Leadbetter law passed by Obama?

No! This was more diabolical. Let's say you're a 20 year vetran in an industry, and the going wage set by Roosevelt said that job only paid 25 cents an hour, I could not lure you to work for me, by offering you a dollar an hour.

1. No increases in wage rates, granted as a result of voluntary agreement, collective bargaining, conciliation, arbitration, or otherwise, and no decreases in wage rates, shall be authorized unless notice of such increases or decreases shall have been filed with the National War Labor Board, and unless the National War Labor Board has approved such increases or decreases.

2. The National War Labor Board shall not approve any increase in the wage rates prevailing on September 15, 1942, unless such increase is necessary to correct maladjustments or inequalities, to eliminate substandards of living, to correct gross inequities, or to aid in the effective prosecution of the war.

http://www.ibiblio.org/pha/policy/1942/421003a.html

Does this seem familiar?

During World War II, price controls were used in an attempt to control wartime inflation. The Franklin Roosevelt Administration instituted the OPA (Office of Price Administration). That agency was rather unpopular with business interests and was phased out as quickly as possible after peace had been restored. However, the Korean War brought a return to the same inflationary pressures, and price controls were again established, this time under the OPS (Office of Price Stabilization).

It became an independent agency under the Emergency Price Control Act, January 30, 1942. The OPA had the power to place ceilings on all prices except agricultural commodities, and to ration scarce supplies of other items, including tires, automobiles, shoes, nylon, sugar, gasoline, fuel oil, coffee, meats and processed foods. At the peak, almost 90% of retail food prices were frozen. It could also authorize subsidies for production of some of those commodities.

Excellent find, Captain. We were allegedly fighting fascism and communism, right?

Roosevelt did a ton of good shit. He over reached on somethings.
When you read the new deal it seemed like a hell of a deal and it was.
The New deal started out with 14 acts that were passed but grew in scope to over 27 acts, many of which were abolished or repealed by WWII.
But you'll see that though out his presidency new things kept being added to it. Like now "Pass something, anything even if nobody read the damn thing" style politics took over and Socialist agendas degraded much of what Roosevelt original intended.

It is why people are still gun shy of Big Government today.

NuttBoxer says

If they don't raise prices or lay off workers, where does the extra money come from for higher salaries?

I suppose it could come from a general increase in the price of ALL goods, (not just the goods that lower income people consume) as well as taking a slice of profits. But since the minimum wage worker is also a consumer, then their ability to pay and therefore consume would also increase. So, it would be offset.

The inverse would be that the payroll tax lowers their ability to consume. Don't you believe that the 2% hike to pre-stimulus levels cuts their ability to consume, and therefore cuts into profits and sales in retail?

CashWillCrash says

$9 per hour is $19,000 per year if you never take a day vacation. I agree with

Moderate Infidel, if your business cannot even pay that kind of slave wage then you got a shitty business. Just give it up.

no one works at min wage for long term. they gain some experience and a work ethic and move up the job/pay scale .. its only the first step into a much better job/career path.

the liberals move to raise min wage is no more than their desire to lock in people into dead end jobs. After all... it was Clinton and Obama who kept saying.. "those jobs aint coming back".. time to fire their asses if they are so incompetent in job creation and continue to be anti US business.

I worked at minimum wage jobs in high school, college, and even after college until I got on with my career. Minimum wage is a joke. My first job paid a whopping $4.25 an hour. That worked out to be royal sum of $170 a week. Even back then it was ridiculous.

If any of you have ever worked at a job like this- such as a restaurant, retail store, or whatever then you'll know that the work is usually hard. The jobs I had were pretty challenging. And you do it all for a pittance.

What's missing from this debate is the positive outcome of paying people more for what they do. I remember that the last job non-office job I had, which was working at a family owned lumber yard was a real eye opener. We were paid fairly decently and given good benefits. They even matched our 401k.s We got Sundays off. They had parties for us. As a result most of those I worked with had been there for 20,30, and sometimes even 40+ years. We were probably the best lumber yard in the area because our employees knew their stuff, and thus customers were VERY loyal to us even though we were a bit more pricey than the big box stores.

When you pay your employees a fair wage, then you'll have more loyal employees. More loyal employees means less turnover, less time and money spent finding new hires, training new employees, or potentially losing customers if the inexperienced staff gives unsatisfactory service. In reality, while paying employees more might seem more costly, I think there too needs to be an assessment of what an employee's value is to the company. How much does it cost to have constant turnover, new training, and customers who don't put their trust in the service they get?

thomaswong.1986 says

the liberals move to raise min wage is no more than their desire to lock in people into dead end jobs

Yes. Its the... the LIBERALS! Whatever. That statement made zero sense.

Minimum wage pays more than money.
It puts Character in your moral bank account that you can withdraw later, when you need the experience.

You're not supposed to stay at a minimum wage job for ever.
One must be as willing to walk out of a door, as they were willing to walk through the door in the first place. When one door closes another one opens.

High minimum wage, will close more doors, than they will open.

CaptainShuddup says

High minimum wage, will close more doors, than they will open.

I disagree. Let me give you another comparison: The US auto manufacturing industry versus the German auto manufacturing industry.

The German auto industry not only produced almost 50% more cars in Germany than US autoworkers produce cars in the US, but they also pay their employees around 50% more than workers in the US doing the same amount of work. And at the same time BMW, Mercedes, and VW AG all are having stellar sales and profits these days. Higher wages does not automatically= lost profits.

CL says

I suppose it could come from a general increase in the price of ALL goods, (not just the goods that lower income people consume) as well as taking a slice of profits. But since the minimum wage worker is also a consumer, then their ability to pay and therefore consume would also increase. So, it would be offset.

The inverse would be that the payroll tax lowers their ability to consume. Don't you believe that the 2% hike to pre-stimulus levels cuts their ability to consume, and therefore cuts into profits and sales in retail?

Offset, exactly! Translation, you make more, but everything costs more, so money is now worth less(inflation).

I believe money in my pocket is better for the economy than money in any governments pocket, so yes, any tax hurts the economy.

I guess it's just cuz I'm a way better budgeter cuz my debt is more than a tad under several trillion dollars...

edvard2 says

When you pay your employees a fair wage, then you'll have more loyal employees.

No kidding! That's why employers usually pay more than minimum wages. What makes the government officials think they have the right to reduce the previously 120%-mw job at $9/hr to minimum wage purchasing power? The answer lies in the big corporations like Walmart encouraging the politicians to raise minimum wage in order to drive out competition, so they can raise prices.

edvard2 says

When you pay your employees a fair wage, then you'll have more loyal employees. More loyal employees means less turnover, less time and money spent finding new hires, training new employees, or potentially losing customers if the inexperienced staff gives unsatisfactory service. In reality, while paying employees more might seem more costly, I think there too needs to be an assessment of what an employee's value is to the company. How much does it cost to have constant turnover, new training, and customers who don't put their trust in the service they get?

I agree with what you're saying. But the issue here isn't better wages, it's forced minimum wages.

We all agree you shouldn't pay someone who's cleaning toilets the same as someone who's programming medical devices, but what if the minimum wage for toilet scrubbers is raised to what the developer used to make for his software? Obviously the developer now has to get a raise as well.

Extreme example but you get the point. It's not how much you make, it's how much purchasing power you have, and inflationary fiat currencies insure you are always running uphill.

It's the assholes throwing bigger piles of worthless paper on us as we run, and telling us "You're almost there" who benefit as they ride to the top without taking a step.

I don't know about you, but I'm tired of running...

edvard2 says

I worked at minimum wage jobs in high school, college, and even after college until I got on with my career.

'nuff said.

NuttBoxer says

Offset, exactly! Translation, you make more, but everything costs more, so money is now worth less(inflation).

That's also not a necessarily automatic outcome either. To put this into perspective, the rate of pay for the average American, inflation added, was higher during the post WW2 years in the 50's. The amount of purchasing power the average American had was greater. Its also key to see that wages for lower and middle income workers also increased regularly right up until the late 70's-early 80's. Throughout the majority of that time period inflation was moderate at best right up until the mid to late 70's.

At this point real wages have stayed static for close to 35 years. In the meantime inflation has in fact gone up in the form of more expensive housing, education, healthcare, fuel, food, and transportation related items ( cars, plane trips and so on). So basically the most key expenditures for the average American has gone up dramatically while the average salary and income has remained flat.

Suggesting that we should never raise wages on low income workers over fear of possible inflation is sort of like saying we should try and prevent something that has and is still happening anyway.

CaptainShuddup says

'nuff said.

I take that as a compliment. Working at these jobs I feel is perhaps one of the biggest reasons I was able to succeed in my career and also become very good at saving money. Back when I was making $5 an hour I really learned how to scrape by. It also gave me a real appreciation for those who work in these types of jobs. Even now whenever I go to a store, a restaurant, or some sort of place that uses low wage workers as their staff, I always leave good tips, don't make messes, say thank you and let them know I appreciate their assistance.

Even though I make a very good income now, I still appreciate every day that I can come in, do the job I want to do, get a good income for doing it, and I also know the value of a dollar. To this day I am still careful and frugal with my money. Had I not had the experience of working in those sorts of jobs making that small amount of money, perhaps I would not have learned as much about being conservative with my money.

edvard2 says

I take that as a compliment. Working at these jobs I feel is perhaps one of the biggest reasons I was able to succeed in my career and also become very good at saving money.

It was, and it is.

edvard2 says

To put this into perspective, the rate of pay for the average American, inflation added, was higher during the post WW2 years in the 50's. The amount of purchasing power the average American had was greater.

That's not correct. The 1950's average income, as high as it was compared to the rest of the world, was lower than the 1960's and today's, inflation adjusted of course.

Its also key to see that wages for lower and middle income workers also increased regularly right up until the late 70's-early 80's. Throughout the majority of that time period inflation was moderate at best right up until the mid to late 70's.

The change took place in the late 1960's to early 1970's. The term "stagflation" was coined around 1973. Nixon administration introduced price control, obviously because food price was becoming too high for the average workers.

edvard2 says

Suggesting that we should never raise wages on low income workers over fear of possible inflation is sort of like saying we should try and prevent something that has and is still happening anyway.

Raising the threshold for legal jobs hits the low income family in two ways:

1. The family may well lose that 2nd or 3rd worker's income in the family because the job is outlawed by the higher minimum wage.

2. As small businesses are driven out of business by the minimum wage law, big retailers can raise price. The low income family spends a higher percentage of their income on retail goods. That means they are disproportionately hit by the retail price increases.

NuttBoxer says

I agree with what you're saying. But the issue here isn't better wages, it's forced minimum wages.

We all agree you shouldn't pay someone who's cleaning toilets the same as someone who's programming medical devices, but what if the minimum wage for toilet scrubbers is raised to what the developer used to make for his software? Obviously the developer now has to get a raise as well.

But what makes the low wage the employee receives "fair"? Is it fair just because the corporation says it is?

Since the recovery, almost all of the gains have gone to the very top. Meanwhile, the lowest rung has lost purchasing power. What if it is this imbalance that is causing the malaise?

http://www.newrepublic.com/article/112397/one-percent-gobbles-economic-recovery#

"Another way to put it is that the one percent didn’t just gobble up all of the recovery during 2010 and 2011; it put the 99 percent back into recession.

It’s worth noting that 2011 wasn't an especially great year even for the mighty one percent. The one percent's pre-tax income stagnated that year. But the 99 percent's pre-tax income stagnated more."

I think another way to look at it is that those low wages go to the top already, in the form of stocks and profits. Is it fair for the wealthy to get wealthier at the bottom's expense?

If the "market" were to decide, the minimum wage worker could get paid a dollar, and the 1%'s share would be even larger.

Don't those fry cooks and stock boys help create those profits?

So in a free market, with no wage control, there are still small companies right? And there are still good companies to work for like the lumber yard mentioned above right?

In that case where will prospective employees go, the giant corporation jobs that pay squat and don't respect their workers, or the businesses that value their employees, and show it through good pay and benefits?

Good business, regardless of size, is based on principals like service, quality, and respect. None of those qualities require a minimum wage.

What makes us who were are, government rules, or personal morals?

In a free market competition will drive out the bad businesses, and everyone will profit from better goods, services, and opportunities.

AND employees will get paid what they are worth, not what the government mandates.

NuttBoxer says

In a free market competition will drive out the bad businesses, and everyone will profit from better goods, services, and opportunities.

Why wouldn't that simply lead to monopolies? And monopolies aren't good for anyone.

Capitalism requires a level playing field and a healthy group of consumers. Unregulated capitalism results in wealth and income inequality, robber barons, poor working conditions and a destitute working class.

CL says

NuttBoxer says

In a free market competition will drive out the bad businesses, and everyone will profit from better goods, services, and opportunities.

Why wouldn't that simply lead to monopolies? And monopolies aren't good for anyone.

Capitalism requires a level playing field and a healthy group of consumers. Unregulated capitalism results in wealth and income inequality, robber barons, poor working conditions and a destitute working class.

You mean monopolies like GE, Dupont, AT&T, Sempra Engergy, Tyson Chicken, etc, etc, etc...

You mean Robber Barons like Bernanke, Gates, Ted Turner, Soros, etc, etc, etc...

You mean income inequality like how CEO's currently make +300% more than the average worker?

You mean poor working conditions like Walmart forcing employees to work unpaid overtime, not take breaks, etc, etc, etc...

You mean a destitute working class like current citizens who have lost serious purchasing power due to inflation, record numbers on food stamps, over 25% real unemployment?

Research conditions in this country the last time we had any vestige of a free market(pre-1913), and see how things were.

The definition of "level" where everyone has equal opportunity is a free market, research your terms. I think what you're advocating is really state-socialism(what we have now)

BTW, I don't support capitalism, there is a difference.

NuttBoxer says

Research conditions in this country the last time we had any vestige of a free market(pre-1913), and see how things were.

Robber barons and frequent panics?

Farther back, and a broader look, try 1785-1861(before fiat currency dominated the economy). Since the ability for any institution to hyperinflate it's currency doesn't represent a true free market(too much manipulation).

Might want to also research JP Morgan's role in the 1907 bank panic that led to the 1913 charter for our current central bank.

CL says

NuttBoxer says

If they don't raise prices or lay off workers, where does the extra money come from for higher salaries?

I suppose it could come from a general increase in the price of ALL goods, (not just the goods that lower income people consume) as well as taking a slice of profits. But since the minimum wage worker is also a consumer, then their ability to pay and therefore consume would also increase. So, it would be offset.

The inverse would be that the payroll tax lowers their ability to consume. Don't you believe that the 2% hike to pre-stimulus levels cuts their ability to consume, and therefore cuts into profits and sales in retail?

Briliant! A reverse psychology edition of the wealth effect

Make everything people buy more expensive, and then they'll think they're rich,,,,,bizzarro world

errc says

Briliant! A reverse psychology edition of the wealth effect

Make everything people buy more expensive, and then they'll think they're rich,,,,,bizzarro world

Does the wealth of Executives cause prices to increase? Why don't we want to lower the top wages then?

Why has productivity increased, but pay for the lowest rung decreased?

edvard2 says

thomaswong.1986 says

the liberals move to raise min wage is no more than their desire to lock in people into dead end jobs

Yes. Its the... the LIBERALS! Whatever. That statement made zero sense.

That is the talking points of Conservatives vs Liberals.

Conservatives say.. Min wage jobs are just a starting job... 6months to establish yourself and you move up into another role or job. Its a good starter point with a job history. 3 references from managers are far more golden than any wage increase.

for Liberals.. your locked in... they dont talk about progressing into better jobs, they talk about your dead end job and how to keep you there.

CL says

Capitalism requires a level playing field and a healthy group of consumers. Unregulated capitalism results in wealth and income inequality, robber barons, poor working conditions and a destitute working class.

because of the great depression, congress created the SEC with the SEC act of 33/34.
which required companies to publish their financial statements. Nearly 65 years of evolution of the regulations and fine tuning.. it did nothing to stop the irrational pubic buying/paying bubble prices on stock during the late 90s later to crash 90% or like today prices of facebook or linkedin with a PE 1000x earnings. How stupid is that.

Yet.. yes.. this is creating income inequalities... so why has regulations failed.

The housing bubble is another example of failed regulations not to mention common sense. How do you regulate common sense... Tulips anyone ?

Lets add Enviromental Regulations of the late 80s and 90s... results.. killed off American manufacturing.
Try to build a Semiconductor plant in over regulated California.. good luck!

thomaswong.1986 says

Nearly 65 years of evolution of the regulations and fine tuning.

Wouldn't it matter that the GOP tends to put Fake Regulators there?

One of the benefits of minimum wage increase is to automate all mean jobs, jobs that people don't wanna do but are forced to.

Critics say that automating eliminates jobs. My question is: so what? Just change the frigging "work to pay mortagage/rent" paradigm. Let people pursue whatever shit they want, instead of sending through assembly lines (of modern education, jobs, etc).