Should the minimum wage be raised?

[JDeuce]

http://www.miami.com/mld/miamiherald/business/national/11045670.htm

The article is a few days old, but it looks like Teddy Kennedy is at it again. I think he's had a minimum wage jihad going for decades now...

Frankly, I think minimum wage should be abolished altogether...but I'm curious to hear opinions from the peanut gallery here.

Oh, and btw...if you think registering at every single site sucks like I do, then try this one before going to the Herald site:

http://www.bugmenot.com/view.php?url=registration.miami.com

 

[RobFunk]

well its pretty good in mass like everything else here :>Grin>

but it should be 7 bucks across the board. people have to actually live off this deuce.

whats the republican way? shaft the no job skills people who you already shafted by cutting education and job training shaft them some more with 3 bucks an hour and have them pay a higher tax rate than the rich. is that what the loopy chic with the southern accent deserves for voting bush?!

abolish it. . .boy you got it all figured out huh

 

[one9]

I say make it an even $10..you would have cleared out all of the suckers by then.

 

[JDeuce]

Rob,

The problem with raising MW is that you'll employ less people. You can force employers to pay their low skilled workers more money, but you can not force them to employ more workers. Raising the MW helps those who are still employed, but it cuts the number of available jobs because companies will invariably hire less workers. It is a simple demand curve; as the price of labor goes up, employers hire less labor.

Secondly, I remember reading a stat that only 2.8% of workers over the age of 30 are receiving the MW...meaning this is mostly high school kids working after school we're talking about. Christ, I wouldn't even know where to find a job that pays MW. Just look in the classifieds, and even if you only have a high school diploma...you should be able to find something that pays you more.

If you want me to explain why getting rid of MW altogether is a good idea, I will. But the real message behind minimum wage is to develop skills that are in demand...not to pay the unskilled more money.

Oh, and Notorious...Mr. Valentine has set the price.

 

[Dawoofdaddy]

Why not make the minimum wage $50, $60, $100,.........what the hell, make it 200 dollars per hour? The end result will be the same.

Most people who advocate a higher miniumum wage are the first to complain when they pay higher prices.

The idea of a required minimum wage epitomizes of government gobbledegook.

Whether it is Democrats like Kennedy or Republicans like Bush, politicians meddling with the laws of economics are why this nation has massive debts.

arty:

 

[RobFunk]

everything you said makes sense but it wont fly becuase of the job training and education cuts under the bush administration

you dont want to train these kids? ok fine give them 8 bucks to be the fry boy.

 

[WildBill]

The interesting thing about it are those that are so anti-illegal immigration are those that are against minimum wage. A wage level set too low encourages illegals since the minimum often only attracts them. If you cut back the supply of unskilled jobs, you cut out the ease which an illegal can find a job. Further you encourage getting skills and finishing school by cutting back on the supply of jobs at the very bottom. In return employers feel compelled to properly hire instead of just hiring a lot of people at a low wage and letting it settle itself out. If the business owner has to pay a little more, they take more care at hiring and have more incentive to give the person a value-added job. Think about the takeaway here of eliminating it. Some employers could cry out they can't find workers at the $3/hour they claim they can afford. The few legal workers at that rate would not earn enough to stay off of public assistance. But you would have Mexicans whose minimum is about $4/day still willing to come take those jobs. Its the worst of all worlds really.

You can make the argument both ways really and there are surprising economic incentives that come off that actually are thought to be more liberal or conservative viewpoints supporting both sides. I personally think though cutting down on the number of low wage jobs is a good economic goal for the country so raising the rate would encourage a better workforce, one that can meet the competitive demands we have.

 

[JDeuce]

Bill,

The point is that even without a minimum wage in place, businesses could not simply pay employees whatever they want. They must pay them enough to attract decent workers. If there were no minimum wage as of tomorrow, someone who offered his workers 50 cents an hour wouldn't find anyone to work for him. Pretty soon, the workload in the warehouse would pile up...and he'd find himself out of business.

Just like DWD said...if we're going to repeal the laws of supply and demand, why should we settle for $7/hr? Why not just raise the minimum wage to $20/hr? If some is a good thing...why isn't tripling even better?

Businesses must pay what others in similar situations are paying, or else they cannot attract workers. If they want better workers than their competitors, they'll have to pay a premium...

Remember reading about Henry Ford's $5 work day? It had some pretty interesting effects in the labor and auto markets...

 

[WildBill]

That is an oversimplification of the argument, one that misses the point about the effect on a society in general. You are certainly right employers need to be able to pay the wages, but the simple argument is maybe we have too much low wage work and losing some of it might be beneficial because it changes the incentives for people within and outside our society. The proper amount isn't $20 or probably even $10. At $8 a number of low-end jobs that do society little good would be eliminated. To just employ someone for the sake of saying they have a job isn't always the best idea or one that does society as a whole a good deed. That is my argument. I am not expecting the same number of jobs to be held. I am expecting some reduction in the number of jobs, but with it incentives to work and better yet to study and get trained. If you know you have to finish high school or possibly face a lifetime of not so steady work, might that not incentivize you to do better?

The only other solution that would work is to make the minimum staggered by state. You could have some states that have lower costs and a lower cost labor supply sort of dedicated to lower-end labor. Some states would get many of the low value-add manufacturing type jobs, while others would basically move up the food chain by not offering a wage low enough to attract that. It could seriously deflect the momentum of offshoring, but of course those states would not exactly be havens for most people to live in. Its not very practical, but if we lived in a perfect economic world we could create proper incentives that move society up the value-add chain further.

 

[JDeuce]

Bill,

You're arguing that minimum wage should be lowered so that a few of the jobs at current minimum wage level will be eliminated? Wow...

Make no mistake about it...businesses are businesses because they make money. When a business is no longer profitable, it goes OUT OF BUSINESS. People don't own and operate businesses out of the goodness of their hearts.

With that in mind, I don't think many (if any) businesses employ people just for the sake of having employees. The employees are there because they're performing some kind of valuable service to the company. If an employee could be cut off the payroll right now, and whatever work he was doing can be allocated to the current employees without slowing everyone else down too much...you can bet your ass thats whats going to happen. Department managers constantly analyze employee performance in order to see if any fat can be trimmed.

Under your scenario of raising MW to $8/hr, a few jobs probably would be eliminated at first...but the new increased workloads would slow everyone else down (meaning company performance would eventually suffer).


If you know you have to finish high school or possibly face a lifetime of not so steady work, might that not incentivize you to do better?

Stands to reason, doesn't it? So what effect do you think a complete elimination of minumum wage would have? Although with minimum wage at what...$5.15/hr now, that should serve as a pretty huge motivator already. Wtf is $5.15...it won't even get you a combo meal at Wendy's.

I chose to go the college route so I wouldn't have to struggle mightily to make ends meet. And I need to continue to learn new software, go to seminars, etc...to keep myself competitive in the work force. Like I said, education is one of the major factors in determining your fate. Education complacency nowadays = death.

Anyways, minimum wage jobs are entry level jobs not meant to support a "lifestyle"...unless that lifestyle is drinking Sam's Club Cola and eating Kraft Mac & Cheese 7 days a week, with no cable TV, and barely enough underwear to last a week.

 

[Dawoofdaddy]

I say make it an even $10..you would have cleared out all of the suckers by then.

POLITICIANS WOULD NEVER AGREE TO SUCH AN 'EVEN' NUMBER. THEY WOULD RATHER WASTE BILLIONS OF DOLLARS TO PERFORM 'STUDIES' TO CONCLUDE THAT THE MINIMUM WAGE SHOULD BE....DEMOCRATS $27.1429 AND REPUBLICANS $0.76476!

THE WHOLE IDEA OF A GOVERNMENT MANDATED MINIMUM WAGE IS RIDICULOUS. WHATS MORE, IS THAT MILLIONS OF AMERICANS BELIEVE IT HELPS US WORKING PEOPLE.

:digit:

 

[Redneckman]

Dawoofdaddy is right on. Plus the minimum wage was never meant to be a wage to support a family in the first place. Let economics dictate what the "minimum acceptable wage" should be.

 

[Dawoofdaddy]

To go even further, how about completely getting government out of the equation. I doubt any of them have a clue what is like to be a 'working' person.

VOTE THIRD PARTY!

Any other vote is the real way to 'waste' your vote! As I've said before, please read, The Creature From Jekyll Island written by G. Edward Griffin. It discusses various cons the government does to the people. The book is widely available.

 

[WildBill]

THE WHOLE IDEA OF A GOVERNMENT MANDATED MINIMUM WAGE IS RIDICULOUS. WHATS MORE, IS THAT MILLIONS OF AMERICANS BELIEVE IT HELPS US WORKING PEOPLE.

:digit:

That is the union and liberal line, but it isn't really believed. My point of view is purely from an economist view. I know a lot of them argue to get rid of it as well, but I think we need to look more at the incentive side of what can be accomplished with a higher minimum wage. I don't hold anything back, it will cut jobs out of the economy for a transition period. But the problem in this country in the near future won't be unemployment, it will be a stagnant skill level of the society. Cutting out the lowest end jobs, done by what are in general the most unproductive people in our society, creates more direct incentives to do better in training and consequently will move the society up in terms of skill. In a true capitalist system the US would try to rid itself of all the low-end jobs, but since so many things have to be done here its impossible to do. So I say lets at least work on it. Lets bring it up so that even the people working at McDonalds have to be more productive and add value to the franchise. People working at McDonalds today could end up being CEOs, the one who recently died started out low in Australia and worked his way up. Not all people working at the bottom of the barrel are incapable of contributing more, but if they are expected and surrounded by people with no talent or desire, they lose the incentive to do more.

This is an argument that goes far beyond that I have seen on the issue. In fact I have never seen anyone make my exact argument, but intuitively to me it makes sense. I am a strong believer that we are in jeopardy of losing standard of living not because of trade, but because of mediocrity. Keeping wages low to insure full employment will just drive home the acceptance of that mediocrity. Lets do something about it is my point.