Niki Kelly has an article for the Fort Wayne Journal Gazette entitled, “State Minimum Wage Hike Gaining Steam.” State efforts seem spurred on by federal efforts, public sentiment, and the mere fact that it hasn’t changed in 10 years.
I always have mixed feelings about the minimum wage. It needs to be there. But I couldn’t say how to put it at a level that makes sense. I’m not sure you want it high enough to result in supporting a family if someone works 40 hours. Not all jobs are full-time or significant enough to warrant a living wage. If you want to hire someone for an odd job that isn’t very significant, you should be able to pay what the work is worth rather than some inflated price designed for a different type of situation. On the other hand, you want someone who works hard and plays by the rules to be able to support a family and prosper. You don’t want the huddled masses spending every waking hour struggling to make enough to shelter and feed themselves at a subsistence level.
Everybody seems to do better when the majority of Americans have a little walking around money. I figure the economy does better when the money is in the pockets of folks who are going to spend it on things like washers and dryers tan it does when the money is in the pockets of folks who are going to buy yachts or expensive works of art.
[tags]minimum wage, labor[/tags]
I agree that the best place to add money is where you say, to those that buy the washers and dryers.
I really think rasing the minimum wage screws the average worker though. Using fake numbers, if the minimum wage is $5 now and we raise it to $7, who will pay for it? We all know the business OWNERS won’t lower their wage to pay for it, so the cost of goods goes up. A $2 value meal will be $2.25. Milk, potatoes, movies, popcorn all go up a little bit to make up for the increase.
Now what about the person making $9 per hour? They are the people who need the help most. They are the ones that make enough over minimum wage to scrape out a living. Now, their wage that does NOT increase is worth LESS! At the same time, the high school kid that is working a few hours a week has more buying power than before.
I do not understand why it is so hard for people to see how that hurts people who need help the most! I know a federal hike is in the first 100 hours as well, and I think it is just as much of a scam to the Democratic base as the federal marrage amendment is to the Republican base. Both things are pulling the emotional strings saying they are going to help, and all they do is get in the way of real progress.
P.S.
Just thought of this…how about instead of a minimum wage, we make a maximum wage? Restrict the highest a corp can pay anyone to a percentage of their average company salary. If the CEO wants a pay raise, he’ll have to pay the workers more to bump that average wage higher. This would go for GOVERNMENT AS WELL.
I don’t think it is any less “American” to do that than it is minimum wage, and it would put the money in the right hands. Total compisation would need to be the measure as well. Benefits, bonus health, stocks, etc…
If the Democrats started down that path, I’d have a lot more respect for them.
I used to think that a hike in the minimum wage automatically meant an increase in prices, but upon further reflection, that’s not necessarily the case. In a competitive market place, theoretically competition will hold prices down.
A company that had a bunch of fat in its upper management, and, rather than raising prices, cut the fat up top and kept prices the same would stand to gain market share and, ultimately, make more money for its shareholders.
I understand that a completely free market is, often enough, merely a hypothetical construct used by University of Chicago economists, ignoring the realities of interlocking board directorships and good old boy networks and whatnot, but it does have some basis in truth.
So, anyway, there is at least a theoretical possibility that market forces combined with minimum wage laws would conspire to shift wealth from the wealthy to the working class without necessarily raising prices.
You mean cutting the middle managers. There is no cutting the fat up top. We don’t do that here in the USA. The middle managers aren’t buying yachts, but they’re the ones building houses, buying new cars, etc. It is good to keep them spending as well.
I can see that, good point.
What about directly attacking it with the max wage? Any thoughts around here if that would work? Let’s ignore the fact that the rich wouldn’t let that happen for a sec and assume that there are enough honest lawmakers to pass a law like that.
I don’t know about a “maximum” wage, but I’m certainly comfortable with a relatively high tax bracket on unusually high levels of income. Just pulling it out of my rectum here, but say something like 60% on income over $1 million in a year? I also favor estate taxes on large estates, particularly if they can be used to limit taxes on income (after all, even if an heir may have a moral claim to the proceeds of an estate, it’s nothing compared to the moral claim of a worker on the proceeds of his labor at the end of the week.)
At the end of the day, my goal would be to have tax policy that inhibits the sorts of large concentrations of wealth that tend to warp market and democratic processes but which doesn’t inhibit hard work, risk taking, and ingenuity. I don’t know — would you work hard for $100 million, but just not bother for $20 million?
I think a big part of the problem with a minimum wage is that you automatically exclude people whose labor does not provide that much value to the employer.
Bear in mind that when this calculation is made, the cost of an employee to an employer is much more than wages – you have to add in taxes, overhead, etc.
I heard a self-reported conservative republican say that ‘they can’t raise the minimum wage high enough to suit me – but then, I make automated manufacturing equipment…’.
Doug- Why are you so comfortable with such high levels of taxes on high wage earners?
Put philosophically, I know you are uncomfortable with others setting moral standards in areas of personal relationship conduct, so why are you comfrotable setting moral standards in the area of personal economic conduct?
Because I think huge concentrations of wealth distort markets and democracies. And, generally, I don’t mind the generator of that wealth enjoying it to its fullest (see, e.g. Bill Gates). The harm seems to outweigh the benefit when that great wealth is passed on to heirs. Here we are, 150 years after John D. started shaping the oil industry, and his spawn still has an impact on our democracy far out of proportion to their individual merits and achievement.
Doug said: “I used to think that a hike in the minimum wage automatically meant an increase in prices, but upon further reflection, that’s not necessarily the case. In a competitive market place, theoretically competition will hold prices down.”
I agree completely Doug. There seems to be no empirical data for a raise in minimum wages resulting in increased prices of goods (many states are well above the federal rate).
Costco already pays over the minimum wage, it sells milk for the same price as Walmart. If Walmart has to raise wages to meet the federal hike, they can sell milk for more – but they would be hurt be the competition of Costco.
Doug- That you can specify the Rockefellers by name suggests to me how rare such a case is. I’ll raise the stakes on myself and through out the name Paris Hilton- everybody’s popular bad example of the idle unearned rich.
However, whether Rockefeller or Hilton, the money was earned by someone who chose to pass it on to their successors. What you are saying then is that you are satisfied with making value judgments for people; that you are quite happy judging people’s relative merits.
Think hard on this. I’ll bet you react negatively when someone describes a poor person as “worthless”… which is also a judgment on the person’s relative merit. Just the other side of the coin.
I’m not judging the person’s worth. If they can make their own fortunes, more power to them. I don’t think it’s a value judgment on the heir to say that an heir’s moral claim to a decedent’s estate is less than a laborer’s claim to the proceeds of his labor. An heir and a laborer can be one in the same person.
As a society, we benefit when individuals have incentive to work hard, be creative, and take risks. That’s why it’s important to have a society where people can get rich by exhibiting those traits. Ridiculously rich in some cases. However, I think there is a case of diminishing returns; and I don’t think the United States generally is getting the most bang for the buck.
To get back to the last paragraph of the post – what do you have against America’s yacht builders and artists?