Minimum wage/BUI (split from Immigration)

[J.C.MacSwell]

2 hours ago, iNow said:

 

We can make all the fiscal and economic arguments we want, but for me this (much like universal healthcare) is a moral issue, not a money one. The plantation owners also didn’t want to start paying their slaves and several couldn’t sustain themselves when slavery ended. Too bad. It was the right thing to do, just like this is. 

First of all it's not slavery. It really should not be compared to it.

Second, if you are making a moral argument for it, you can't use that as evidence that $15/hr across the US will work. In fact I will repeat you can't have evidence that 15/hr will work in any State (I also can't have evidence that it won't work....it simply hasn't been tried. All the links we've posted only have projections, or evidence where much more marginal increases will work.

Third, if you want to make it a moral argument...if it doesn't work...and hurts poor areas the most after you've insisted that no one without the ability to find themselves a $15/hr job is allowed to work....then you've hurt every State where it doesn't work and there ability to support social programs and welfare....where now they would need it more than ever.

There are only about 15 States with minimum wages over $10/hr, and none at $15. Yet almost half the States have Democrat Governors. Maybe evil is not the only reason none of them have moved it to $15 already?

 

[MigL]

3 hours ago, iNow said:

The plantation owners also didn’t want to start paying their slaves and several couldn’t sustain themselves when slavery ended.

IIRC the plantation owners ( and those in favor of the situation ) tried very hard to leave the Union, and keep their way of life.
Modern businesses, on the other hand, operate in a global economy, and have no problem leaving, and taking their business and factories overseas.
Haven't you noticed ?

All you've done is given an example ( equating slaves with employees ) of a very low threshold min wage increase that killed  jobs 150 years ago.
 

Edited January 17, 2021 by MigL

[swansont]

1 hour ago, MigL said:

IIRC the plantation owners ( and those in favor of the situation ) tried very hard to leave the Union, and keep their way of life.
Modern businesses, on the other hand, operate in a global economy, and have no problem leaving, and taking their business and factories overseas.
Haven't you noticed ?

All you've done is given an example ( equating slaves with employees ) of a very low threshold min wage increase that killed  jobs 150 years ago.
 

More than twice as many people were freed by 1865 (~3.9 million, out of a US population of about 31.5 million) than are working for the minimum wage (1.7 million in 2018, out of a population 10x larger than in 1865), so I would expect the economic impact to differ

https://www.bls.gov/opub/reports/minimum-wage/2018/home.htm#cps_mw_whe_hist.f.1

[J.C.MacSwell]

3 minutes ago, swansont said:

More than twice as many people were freed by 1865 (~3.9 million, out of a US population of about 31.5 million) than are working for the minimum wage (1.7 million in 2018, out of a population 10x larger than in 1865), so I would expect the economic impact to differ

https://www.bls.gov/opub/reports/minimum-wage/2018/home.htm#cps_mw_whe_hist.f.1

15/hr minimum will capture everyone making less, not just those currently at minimum wage. (exemptions aside)

Of course it would still differ, for a multitude of reasons.

It's really not a good comparison, morally or economically.

[MigL]

1 hour ago, swansont said:

so I would expect the economic impact to differ

For that reason, and many others.
I have to agree that it isn't a valid comparison.

[swansont]

1 hour ago, J.C.MacSwell said:

15/hr minimum will capture everyone making less, not just those currently at minimum wage. (exemptions aside)

 

But the impact will be less for those making more than the federal minimum. The scale was the point I was making. The population, and economy, is much, much larger today.

[iNow]

4 hours ago, J.C.MacSwell said:

if you are making a moral argument for it, you can't use that as evidence that $15/hr across the US will work.

I can make both moral and fiscal arguments, and my fiscal arguments have not relied on moral stances. I shouldn’t have to point this out given how many times I’ve referred to the data. 
 

4 hours ago, J.C.MacSwell said:

First of all it's not slavery. It really should not be compared to it.

I can see my point got missed by introducing such an emotional example like slavery. I was merely saying businesses suffered then too, but we still did it because it was the right thing to do. 

Some businesses will go under due to this change. Some states will be more heavily impacted. That’s not the metric that matters. It’s too simplistic and naive. Jobs will also be created. People will have more money in their own pockets to spend at other peoples businesses, then those people will have more money to spend and the virtuous cycle continues. More people will complete educations and get degrees. They’ll have new ideas and new networked connections. New businesses will be started as people no longer have to work 3 jobs to make ends meet. Kids health will go up as they’re better fed and have their parents nearby more often. The list continues.

If you focus only on immediate costs to some particular sub populations and ignore the returns... if you forget this is an investment and not just an expenditure, then of course you’ll be against it. This is an issue of creative destruction. I urge you to focus a bit more on the creation than on the destruction, which nearly all analyses say will be smaller anyway.

Adjusted for inflation, minimum wage today should actually be closer to $25/hr. Can we please get our heads out of our asses and stop standing as an obstacle to the still too low baby step of $15/hr?

Edited January 18, 2021 by iNow

[swansont]

9 hours ago, iNow said:

I Adjusted for inflation, minimum wage today should actually be closer to $25/hr.

Which underscores the issue: a large part of the economic adjustment will be because the minimum wage has been suppressed. If it had been indexed, the accommodation would’ve been incremental. 

[John Cuthber]

On 1/16/2021 at 11:54 PM, MigL said:

Even though your income has been raised above that arbitrary number that the Government chooses to call the 'poverty line'.

A competent government would have index linked the line so that doesn't happen.

 

 

I don't have many figures for "affordability" but I live in the UK which has about the fifth richest economy in the world.
I really don't believe that we can't afford to pay people enough to stop kids going to school hungry.

I really don't care greatly how we address that issue.
But a minimum wage above the poverty line or a UBI looks like it's worth trying.
If only on the basis that everything else has been tried, and has failed. (who remembers "trickle down economics"?)

 

There is the "but employers will not be able to afford to pay it" war-cry.

And, as I have pointed out, if that's true then they are not running a valid business and all the free market capitalists should be happy to watch them fold.

[dimreepr]

10 minutes ago, John Cuthber said:

A competent government would have index linked the line so that doesn't happen.

 

 

I don't have many figures for "affordability" but I live in the UK which has about the fifth richest economy in the world.
I really don't believe that we can't afford to pay people enough to stop kids going to school hungry.

I really don't care greatly how we address that issue.
But a minimum wage above the poverty line or a UBI looks like it's worth trying.
If only on the basis that everything else has been tried, and has failed. (who remembers "trickle down economics"?)

 

There is the "but employers will not be able to afford to pay it" war-cry.

And, as I have pointed out, if that's true then they are not running a valid business and all the free market capitalists should be happy to watch them fold.

One day, we will see the true value of affordable; but I fear that day will be one day too late...

[iNow]

14 hours ago, J.C.MacSwell said:

15/hr minimum will capture everyone making less, not just those currently at minimum wage. (exemptions aside)

12 hours ago, swansont said:

But the impact will be less for those making more than the federal minimum. The scale was the point I was making.

Seen through this lens, it makes even more sense. 
 

https://www.shrm.org/hr-today/news/hr-news/pages/federal-minimum-wage-increase-good-for-business-cost-too-much.aspx

Quote

Minimum-Wage Workers Are a Small Subset of the Workforce

• In 2017, just 542,000 hourly workers earned the federal minimum wage, according to the Bureau of Labor Statistics. About half (221,000 workers) were age 25 or older.
• Only 2.3 percent of the country's 80.4 million hourly workers earned $7.25 an hour or less, a drop from 2.7 percent the year before and 15.1 percent in 1980. This total includes those paid subminimum wages, such as tipped workers, some teenagers and workers with severe disabilities.
• The percentage of workers earning the federal minimum wage or less today is well below the 15.1 percent recorded in 1980.

 

[MigL]

2 hours ago, John Cuthber said:

A competent government would have index linked the line so that doesn't happen.

 

2 hours ago, dimreepr said:

One day, we will see the true value of affordable; but I fear that day will be one day too late...

One day we'll have competent Governments ...

[iNow]

https://www.vox.com/2019/7/2/20678821/15-federal-minimum-wage-increase-study

Quote

according to a white paperreleased Tuesday by economists Anna Godoey and Michael Reich at the University of California Berkeley. They found no evidence that such a large wage hike would lead to significant job losses or fewer work opportunities — something big business groups often warn about

<...>

Recent research suggests the worst-feared consequences of minimum wage hikes did not come to pass: Employment did not decrease in places where wages went up, and there was actually a residually positive effect on wages for other lower-income workers.

<...>

In sum, “the US can absorb a $15 minimum wage, without significant job losses, even in low-wage states,” Godoey told journalists on Tuesday in a conference call.

Their conclusion supports the findings of the most reliable research that exists on minimum wage. The most recent “meta-analyses” on minimum wage, which analyze several research findings together, suggest that the increase’s likely impact on employment would be minimal.

For example, a 2016 study by economists at Michigan State University crunched data from 60 research studies on the minimum wage in the United States since 2001. They concluded that a 10 percent increase in the minimum wage would likely reduce overall employment in low-wage industries from 0.5 percent to 1.2 percent. 

Another meta-analysis comes in a highly anticipated study forthcoming in the Quarterly Journal of Economics by economists at the University of Massachusetts, University College London, and the Economic Policy Institute. They studied data from 138 cities and states that raised the minimum pay between 1979 and 2016. The conclusion is that low-wage workers received a 7 percent pay bump after a minimum wage law went into effect, but there was little or no change in employment. The study also showed that it would not cost jobs, even in states with large shares of minimum-wage workers. The latest study by Godoey and Reich, which expands the analysis to the county level, supports those findings.

<...>

based on the latest research, the pay raise won’t lead many workers to the unemployment line.

But there I go again, making a moral argument 🙄

[J.C.MacSwell]

1 hour ago, iNow said:

https://www.vox.com/2019/7/2/20678821/15-federal-minimum-wage-increase-study

But there I go again, making a moral argument 🙄

Let's look at how they come to this conclusion:

 

  Quote

according to a white paperreleased Tuesday by economists Anna Godoey and Michael Reich at the University of California Berkeley. They found no evidence that such a large wage hike would lead to significant job losses or fewer work opportunities — something big business groups often warn about

<...>

Recent research suggests the worst-feared consequences of minimum wage hikes did not come to pass: Employment did not decrease in places where wages went up, and there was actually a residually positive effect on wages for other lower-income workers.

<...>

In sum, “the US can absorb a $15 minimum wage, without significant job losses, even in low-wage states,” Godoey told journalists on Tuesday in a conference call.

Their conclusion supports the findings of the most reliable research that exists on minimum wage. The most recent “meta-analyses” on minimum wage, which analyze several research findings together, suggest that the increase’s likely impact on employment would be minimal.

For example, a 2016 study by economists at Michigan State University crunched data from 60 research studies on the minimum wage in the United States since 2001. They concluded that a 10 percent increase in the minimum wage would likely reduce overall employment in low-wage industries from 0.5 percent to 1.2 percent. 

Another meta-analysis comes in a highly anticipated study forthcoming in the Quarterly Journal of Economics by economists at the University of Massachusetts, University College London, and the Economic Policy Institute. They studied data from 138 cities and states that raised the minimum pay between 1979 and 2016. The conclusion is that low-wage workers received a 7 percent pay bump after a minimum wage law went into effect, but there was little or no change in employment. The study also showed that it would not cost jobs, even in states with large shares of minimum-wage workers. The latest study by Godoey and Reich, which expands the analysis to the county level, supports those findings.

<...>

based on the latest research, the pay raise won’t lead many workers to the unemployment line.

So they cite a 10% increase as only reducing employment in low wage industries by 0.5 to 1.2 percent and a 7% increase as having "little or no change".

And they use this to conclude that an increase of over 100% must be fine.

Where did they study economics?

Have they ever come across supply and demand curves?

[iNow]

Hard to say, but at least I’m putting forth supporting resources for my claims. 

I’ll just note also that you completely ignored the other analyses and meta analyses which further supported the conclusion described. 

[swansont]

48 minutes ago, J.C.MacSwell said:

So they cite a 10% increase as only reducing employment in low wage industries by 0.5 to 1.2 percent and a 7% increase as having "little or no change".

And they use this to conclude that an increase of over 100% must be fine.

If they had raised it 7% per year we’d be there, but they didn’t. The current proposal is to raise it over 3 years, not one.

- - - - 

Back in 2010, most states were at or very near the federal level. A few went over $8, with Washington topping the list at $8.55. Somehow several of the states have been able to increase their minimum wages over the last decade without having unemployment spike. Others let the wage stagnate. 

https://www2.census.gov/library/publications/2010/compendia/statab/130ed/tables/11s0651.pdf

Seems like one of the arguments I’ve seen is since they’ve ignored the issue for 10 years that should prevent fixing the problem now (but not worded that way). I don’t find that compelling. If you built up a sweatshop business based on suppressed wages, well, you’re going to have to figure out a better business model.

 

 

[J.C.MacSwell]

1 hour ago, swansont said:

If they had raised it 7% per year we’d be there, but they didn’t. The current proposal is to raise it over 3 years, not one.

- - - - 

Back in 2010, most states were at or very near the federal level. A few went over $8, with Washington topping the list at $8.55. Somehow several of the states have been able to increase their minimum wages over the last decade without having unemployment spike. Others let the wage stagnate. 

https://www2.census.gov/library/publications/2010/compendia/statab/130ed/tables/11s0651.pdf

Seems like one of the arguments I’ve seen is since they’ve ignored the issue for 10 years that should prevent fixing the problem now (but not worded that way). I don’t find that compelling. If you built up a sweatshop business based on suppressed wages, well, you’re going to have to figure out a better business model.

 

 

If they base it on adding 7% from a minimum wage that is sub optimum, what makes you think they can do that every year, and maintain the "little or no change" in employment claimed? 7% is well above the inflation rate of the last 10 years.

I can understand a reasonable argument can be made for increasing minimum wage a reasonable amount, even if there was some detriment to some industries. I might be making it here to a laissez faire capitalist if they posted here, though I think a mix of UBI and regionally set minimum wage would get better results for workers and small business owners. In fact I think UBI and minimum wage.set properly, work well together with UBI doing more for depressed regions (it doesn't just help individuals).

Ask yourself this:

If you want to buy a bicycle you might be willing to pay a small premium to support your local bike shop. How much more would a $15/hr minimum wage add to the cost of the bike at Amazon,vs how much more added at a bike shop? Maybe the kid working there on his first job making less than $10/hr isn't getting exploited, but might eventually want to open a shop of his own, or take part in some other business after getting some experience despite not feeling cut out for more schooling. Maybe the bike shop heading out of business was not a sweat shop after all. 

...then ask yourself who creates more net jobs, the Amazons or small businesses?

2 hours ago, iNow said:

Hard to say, but at least I’m putting forth supporting resources for my claims. 

I’ll just note also that you completely ignored the other analyses and meta analyses which further supported the conclusion described. 

I read them. Did you? How sure are you that they support your claims?

Edited January 19, 2021 by J.C.MacSwell

[iNow]

Do you also think the UBI should be adjusted and differently applied across regions? If not, why not?

15 minutes ago, J.C.MacSwell said:

How sure are you that they support your claims?

Extremely 

[J.C.MacSwell]

2 minutes ago, iNow said:

Do you also think the UBI should be adjusted and differently applied across regions? If not, why not?

 

No. In economically depressed areas the money would tend to go further for the individual and do more for the region.

Similarly, I think everyone should get the same (or choose welfare which would generally be more, but for that you need means tests etc), Most of us here (just a guess) would ultimately be net payers through the taxes required, but no means test and associated costs, and no stigma for getting it.

It wouldn't eliminate the need for a welfare safety net, but would reduce the need for some of it, and would have no potential for clawback. 

[swansont]

47 minutes ago, J.C.MacSwell said:

If they base it on adding 7% from a minimum wage that is sub optimum, what makes you think they can do that every year, and maintain the "little or no change" in employment claimed? 7% is well above the inflation rate of the last 10 years.

You’ve argued you can’t raise it all at once, and here you’re apparently arguing you can’t raise it incrementally.

So I guess there’s nothing to discuss with you on this aspect.

Quote

Ask yourself this:

If you want to buy a bicycle you might be willing to pay a small premium to support your local bike shop. How much more would a $15/hr minimum wage add to the cost of the bike at Amazon,vs how much more added at a bike shop? Maybe the kid working there on his first job making less than $10/hr isn't getting exploited, but might eventually want to open a shop of his own, or take part in some other business after getting some experience despite not feeling cut out for more schooling. Maybe the bike shop heading out of business was not a sweat shop after all. 

 

If you’re buying a $500 bike, I’m thinking the hourly wage of someone at the store is only a small part of that, so bumping the minimum will have a small effect. But maybe that kid sticks around longer with a better wage, and you don’t have to train someone new every time some kid bolts to another job that pays more. That may be a reason Amazon went to $15 an hour recently. They apparently saw the value in doing so.

It’s funny that in these kinds if examples, an edge case is used (a kid working their first job, making $10 an hour) instead of something more representative. That seems to happen a lot.

[iNow]

13 minutes ago, J.C.MacSwell said:

In economically depressed areas the money would tend to go further for the individual and do more for the region.

Thank you for answering, but is this another WAG, or is there analysis to support the assertion that the region would benefit more from UBI over higher federal wage minimums for the workers living there?

[J.C.MacSwell]

1 hour ago, swansont said:

You’ve argued you can’t raise it all at once, and here you’re apparently arguing you can’t raise it incrementally.

So I guess there’s nothing to discuss with you on this aspect..

 Straw man much? I argued you can't raise it by 7% a year in perpetuity, when the inflation rate is significantly less.

I've nothing against raising it by 7% a year until it is optimal for the region, and continuing to adjust it as necessary.

1 hour ago, swansont said:

If you’re buying a $500 bike, I’m thinking the hourly wage of someone at the store is only a small part of that, so bumping the minimum will have a small effect. But maybe that kid sticks around longer with a better wage, and you don’t have to train someone new every time some kid bolts to another job that pays more. 

That's a free enterprise scenario, when that's the case a minimum wage is not required.

1 hour ago, swansont said:

It’s funny that in these kinds if examples, an edge case is used (a kid working their first job, making $10 an hour) instead of something more representative. That seems to happen a lot.

Funny, but you know what else happens a lot? A kid getting his first job at minimum wage that wouldn't even be considered if it had to be $15/hr...

On 1/16/2021 at 11:40 AM, J.C.MacSwell said:

https://www.fraserinstitute.org/article/minimum-wage-increases-wont-solve-poverty#:~:text=Poverty can increase because minimum,young workers in the family.&text=While the more productive workers,result of fewer employment opportunities.

From that:

"In the end, minimum wage hikes rob young people of the opportunity to gain work experience that helps them develop basic skills and earn higher levels of income. Indeed, research finds that earning the minimum wage is often a stepping stone to higher paid work."

[iNow]

1 minute ago, J.C.MacSwell said:

From that:

"In the end, minimum wage hikes rob young people of the opportunity to gain work experience that helps them develop basic skills and earn higher levels of income. Indeed, research finds that earning the minimum wage is often a stepping stone to higher paid work."

The assumption here seems to be that higher minimum wage means it’s harder for teenagers to get that first job because there will be fewer jobs available. That’s nonsense since job gains outpace job losses in this scenario. 

I’m sure there are very many fine people at the Frazer institute, but given their heavy funding from corporations and special interests it’s unsurprising they’d publish a flawed fluff piece like this. 

[J.C.MacSwell]

1 minute ago, iNow said:

The assumption here seems to be that higher minimum wage means it’s harder for teenagers to get that first job because there will be fewer jobs available. That’s nonsense since job gains outpace job losses in this scenario. 

I’m sure there are very many fine people at the Frazer institute, but given their heavy funding from corporations and special interests it’s unsurprising they’d publish a flawed fluff piece like this. 

Not entirely. You are taking away an inexperienced individual's ability to compete on price. If he can only command $10, because he is, say, 30% less productive due to inexperience, and willing to work for $10, but you insist he not be allowed to do that...then you owe him a job....or maybe he's rightfully pissed and, unrightfully,  steals Swansont's new Amazon bike....which he bought at the lowest price because competition works for him.

26 minutes ago, iNow said:

The assumption here seems to be that higher minimum wage means it’s harder for teenagers to get that first job because there will be fewer jobs available. That’s nonsense since job gains outpace job losses in this scenario. 

I’m sure there are very many fine people at the Frazer institute, but given their heavy funding from corporations and special interests it’s unsurprising they’d publish a flawed fluff piece like this. 

By all means be skeptical (you pointed out a good reason to be)...just don't assume it's flawed.

[iNow]

30 minutes ago, J.C.MacSwell said:

You are taking away an inexperienced individual's ability to compete on price. If he can only command $10, because he is, say, 30% less productive due to inexperience, and willing to work for $10, but you insist he not be allowed to do that...then you owe him a job....or maybe he's rightfully pissed and,

The logic here is rather twisted, to the point of being fallacious and nonsequitur. 

There is no change to whether or not an inexperienced individual is being allowed or not allowed to work. They’re simply going to be paid a wage more aligned with a commonly accepted minimum when they do. 

35 minutes ago, J.C.MacSwell said:

By all means be skeptical (you pointed out a good reason to be)...just don't assume it's flawed.

I’m assuming nothing. I’m relying on the preponderance of evidence which demonstrates their underlying premises and consequent claims to be mistaken to the point of fictional.