Straight Dope Message Board

[bump]

I don't know... I still think most people would fall into the second or third category. I don't know many people who would give up their lifestyle to become an artist and live on the dole at $15k a year (or whatever). But I know plenty who might downgrade to a job that pays say... 20k less in order to get less work hours, closer to home, etc... for any number of reasons- more time with kids, ability to spend extra time on avocations, whatever.

I think we'd see that second category a lot among graduating students- UBI would be a good buffer between having to get a job to live and having the time to get a job they're satisfied with.

[bump]

A bit of follow up thinking...

I suppose category 1 is really more "People who choose not to work for whatever reason, not necessarily low income") That way, we cover the people who choose not to work because of family caregiver committments, stay-at-home moms, lazy stoners, etc... without getting into a category for each specific situation.

My intuition tells me that the final category would be the biggest surprise for people- I'm not seeing how we'd pay for a UBI for every person without having to tax the bejeezus out of everyone with a well paying job. I mean, at a UBI of 15k, a family of four would receive 60k in UBI. That's right at the median household income. So right there, you'd have to come up with more cash to pay that UBI than half of all families MAKE, much less pay out in taxes. Even assuming that median income 4 person family pays roughly 25% of their income in taxes that they would essentially receive back, it would still mean that the government would have to produce 45k for that family. For a family making 100k, who let's say pays 35% in taxes, we're still looking at having to cough up 25k for that family in UBI. I don't know where that break-even is, but it seems to be very high.

The other thing I haven't figured out yet is what it would mean in terms of the remaining social safety net. Proponents often claim that it would take the place of a lot of things, but we'd still need all the stuff we currently have and then some- a low 15k UBI wouldn't obviate the need for health insurance or universal health care. We'd still need a lot of social service type stuff for flat out dumb people who spend their UBI unwisely, or get into a lot of debt, or whatever. I can completely see situations where people basically sign their UBI payments over to monthly payments and are still stuck without enough cash to feed their kids, etc... and would need public assistance. Assuming that we don't suddenly take a callous tack and throw them to the wolves, because, hey UBI!, then we'd still need programs to help the unfortunate and the stupid.

It sounds great in theory, but it also sounds like something we can't pay for. I'd be more in favor of a negative income tax scheme whereby people get boosted to the poverty line (or whatever arbitrary threshold), but where say... a family of four making that median 61k doesn't get any assistance, nor would the family making 100k.

[Elendil's Heir]

CNN has a concise overview of the Green New Deal: https://www.cnn.com/2019/02/14/polit...own/index.html

For SEO: Greennewdeal

[Irishman]

Originally Posted by Evil Economist

Sam Stone, could you clarify for me? It seems as though you're pretty badly misrepresenting what was in the bill. Was this because: 1) the bit you claimed was in the bill actually is in the bill, but in a different area (and if so, could you quote it); 2) you honestly thought the bit you claimed was in the bill was in the bill, you just didn't understand it; or 3) you deliberately misrepresented what was in the bill?

Is there another alternative explanation I'm missing?

He probably read it in the summary FAQ:

We set a goal to get to net-zero, rather than zero emissions, in 10 years because we aren’t sure that we’ll be able to fully get rid of farting cows and airplanes that fast,

o Totally overhaul transportation by massively expanding electric vehicle manufacturing, build charging stations everywhere, build out highspeed rail at a scale where air travel stops becoming necessary, create affordable public transit available to all, with goal to replace every combustion-engine vehicle

Or here:

The Green New Deal sets a goal to get to net-zero, rather than zero emissions, at the end of this 10-year plan because we aren’t sure that we will be able to fully get rid of, for example, emissions from cows or air travel before then.

These are AOC released documents, though they have been pulled. But it's not a total ass-pull by Sam Stone.

Originally Posted by Ambivalid

I think that UBI is a lazy ineffective approach because I dont see it being proposed as part of a comprehensive plan to combat poverty but as more of a stand-alone idea. I cam see it being a positive tool when used as as one facet of a larger vision for ending poverty. But I never really hear much of substance about that larger vision.

Originally Posted by Ambivalid

Well, just to very briefly mention a few aspects i would imagine going into this larger vision is working to change the long-entrenched (both as individuals and culturally) health and lifestyle behaviors and habits that in part work to keep a person in stasis, to keep them in poverty. [snip]


So we need to understand better these already mentioned issues hindering many people in poor communities when trying to improve the quality of their lives. This should allow, through cooperation with and input from the local communities and people in them, plans and policy to be crafted that would help foster an environment where the people in these poor communities have access to the education, information, training, and/or medical treatment whose previous lack thereof had been a direct influence on perpetuating the poor decision making that strengthen the vicious cycle that keeps them in a failure to launch scenario.

The Green New Deal tries to address this:

Whereas climate change, pollution, and environmental destruction have exacerbated systemic racial, regional, social, environmental, and economic injustices (referred to in this preamble as “systemic injustices”) by disproportionately affecting indigenous peoples, communities of color, migrant communities, deindustrialized communities, depopulated rural communities, the poor, low-income workers, women, the elderly, the unhoused, people with disabilities, and youth (referred to in this preamble as “frontline and vulnerable communities”);

(1) it is the duty of the Federal Government to create a Green New Deal— [snip]

(E) to promote justice and equity by stopping current, preventing future, and repairing historic oppression of indigenous peoples, communities of color, migrant communities, deindustrialized communities, depopulated rural communities, the poor, low-income workers, women, the elderly, the unhoused, people with disabilities, and youth (referred to in this resolution as “frontline and vulnerable communities”);

(3) a Green New Deal must be developed through transparent and inclusive consultation, collaboration, and partnership with frontline and vulnerable communities, labor unions, worker cooperatives, civil society groups, academia, and businesses; and [snip]

(C) providing resources, training, and high-quality education, including higher education, to all people of the United States, with a focus on frontline and vulnerable communities, so that all people of the United States may be full and equal participants in the Green New Deal mobilization; [snip]

(E) directing investments to spur economic development, deepen and diversify industry and business in local and regional economies, and build wealth and community ownership, while prioritizing high-quality job creation and economic, social, and environmental benefits in frontline and vulnerable communities, and deindustrialized communities, that may otherwise struggle with the transition away from greenhouse gas intensive industries;

(F) ensuring the use of democratic and participatory processes that are inclusive of and led by frontline and vulnerable communities and workers to plan, implement, and administer the Green New Deal mobilization at the local level;

Originally Posted by Shodan

Good thing almost nobody in the US works multiple MW jobs just to make ends meet, then.

Many people either work long hours on one low wage job, or work multiple low wage jobs that add up to long hours. Others work only one low wage job for limited hours and struggle even worse to get by, requiring government subsidies even though they work.

Originally Posted by Quartz

I'm not sure how you get that, because those to be on UBI were selected. I didn't see that new people were given UBI. The aim was to get them back to work. And it didn't work.

The experiment was to see what would happen. True, they did not have higher employment rates than the control group, but they did not have lower employment rates, which is what many conservatives claim would happen.

[bump]

I still think that she'd have got a lot more traction had she limited the scope to strictly environmental remedies. Throwing all that social justice stuff in there probably managed to alienate a lot of people who might have been on board for climate change/environmental reasons, but who weren't ready to commit to UBI and all the other stuff.

Maybe split it off and give the environmental stuff one name, and the social justice/economic stuff something to do with the New Deal.

[Grim Render]

Parts of this are what we already have in Scandinavia, but dialed up to 11. Everyone has a right to education and the necessities of life -food, healthcare, a place to live. If they are unable to provide it for themselves.

This just sounds like it would like to take that further. I am doubtful about that. We do the things we do for good economic reasons. Maybe there is another island of stability beyond us again but we haven't seen the outlines of it yet.

[BwanaBob]

I'm hoping that some genius out there is perfecting AI such that it can replace a manager. It too is a skill that can be replaced.

[slash2k]

Originally Posted by bump

I mean, at a UBI of 15k, a family of four would receive 60k in UBI. That's right at the median household income. So right there, you'd have to come up with more cash to pay that UBI than half of all families MAKE, much less pay out in taxes.

As I understand it, UBI is intended primarily for ADULT citizens, people who would theoretically be in the labor force, rather than all family members. A four-person family wouldn't get $60K unless all four are over 18 (or 16 or 21 or whatever age is set). For example, the Ontario pilot scheme used 18-64 as the age range; the Finnish study used 25 to 58. That would change your calculations significantly.

[eschereal]

Apart from that, there is nothing that says that UBI would be uniform per capita. Your check would have to be anchored to your residence: if there are multiple accounts based at one residence, there would probably be a reduction in each, since it is well-established that sharing accommodations will be a little or a lot less expensive than one-person-one-dwelling. But the check would almost certainly not be halved, because it would be idiotic in terms of a green new deal to discourage people from sharing digs.

[asahi]

Originally Posted by Velocity

The Green New Deal proposed by Ocasio-Cortez contains an interesting part: "Economic security for those unwilling to work."


There needs to be a strong social net for those who are unable to work or temporarily out of work, no doubt. But for those who are unwilling to work, this opens up a huge can of worms. Many workers in America - perhaps even the majority - do not enjoy their jobs and work their jobs only because they have to make financial ends meet. If we provide enough financial assistance that Americans who don't want to work, don't have to work another day in their lives, then many millions of people (especially, those who work in minimum-wage industries, such as janitors, fast food, cashiers etc) would retire on the spot. That would be catastrophic for the economy.

Perhaps one could argue that this is just another word for Universal Basic Income. But UBI would also be problematic if it is so generous that many people simply quit working altogether and leave a gaping hole in the workforce. (Unless Ocasio-Cortez is proposing massive automation that would let tens of millions of workers not have to work, but I don't think she is suggesting that at all.)

Question: where in her resolution does it say that it's going to cast a social safety net for those who are unwilling to work?

[MrDibble]

Originally Posted by Sam Stone

When farming was mechanized, tens of millions of people were displaced. [...] But they all wound up in other jobs.

Did they? Or did this mechanisation process maybe contribute a leeetle bit to the high unemployment levels during the Great Depression?

[Broomstick]

Farm mechanization started back in the late 19th Century and the displacement of people took place over decades. It accelerated with better internal combustion engines which supplanted the earlier steam-driven farm equipment, but, again, that mostly occurred in the 'teens- '20's.

Not saying there was no effect, but it certainly wasn't a major one for the Great Depression.

[MrDibble]

Originally Posted by Broomstick

Farm mechanization started back in the late 19th Century and the displacement of people took place over decades. It accelerated with better internal combustion engines which supplanted the earlier steam-driven farm equipment, but, again, that mostly occurred in the 'teens- '20's.

Overall, yes, but there was a definite upswing related to farm mechanisation as part of the overall productivity shock trend between 1925 and 1930. Probably it was because some regions mechanised later than others, and contributed to the overall urban joblessness in the Depression. I'm thinking particularly of the Mississippi Delta and migration to Chicago, Cleveland etc.

[Broomstick]

True, but that migration was also stimulated in no small part by increasing job opportunities in factories up north. In Detroit, for example, the growing auto industry attracted people from all over to the new jobs there.

There were a lot of factors at work.

[msmith537]

Originally Posted by MrDibble

Did they? Or did this mechanisation process maybe contribute a leeetle bit to the high unemployment levels during the Great Depression?

Maybe indirectly if the mechanization led to over farming (combined with drought) that led to the dust bowl in the 30s.

[Lemur866]

Originally Posted by octopus

Wrong. If anything minimum wage workers are overpaid.

Concerning the OP, that green platforms thing was a bit nutty. I thought the cow fart detail was humorous.

If minimum wage workers are overpaid, then why the fuck does McDonalds pay them? As a charity?

As right-wingers are fond of pointing out, we could raise the minimum wage to $100 an hour. We wouldn't see McDonalds suddenly paying their burger-flippers $100 an hour, what would happen is that all the burger flippers would lose their jobs.

So what would happen if the minimum wage were $2 an hour, and we raised the rate to the socialistic sum of $7.25? You think the burger flippers who used to make $2 an hour would suddenly get a raise? No, they'd be fired, because a business model that depended on $2/hr wages couldn't survive at $7.25/hr.

If a business chooses to pay some guy $7.25 an hour, then who the fuck are you to say that the magic of the marketplace is wrong, and that guy is only worth $5/hr? If he were only worth $5/hr, then McDonalds would have fired his ass.

[Sam Stone]

Originally Posted by Lemur866

If minimum wage workers are overpaid, then why the fuck does McDonalds pay them? As a charity?

As right-wingers are fond of pointing out, we could raise the minimum wage to $100 an hour. We wouldn't see McDonalds suddenly paying their burger-flippers $100 an hour, what would happen is that all the burger flippers would lose their jobs.

So what would happen if the minimum wage were $2 an hour, and we raised the rate to the socialistic sum of $7.25? You think the burger flippers who used to make $2 an hour would suddenly get a raise? No, they'd be fired, because a business model that depended on $2/hr wages couldn't survive at $7.25/hr.

If a business chooses to pay some guy $7.25 an hour, then who the fuck are you to say that the magic of the marketplace is wrong, and that guy is only worth 50c/hr? If he were only worth $5/hr, then McDonalds would have fired his ass.

What actually happens is that jobs that are worth >0 but less than $7.25 simply don't get done. Or, the workers that make minimum wage above their productivity level have their benefits cut, or are forced to multi-task or work harder, whatever.

The real minimum wage is $0. The natural minimum wage is the wage that anyone is willing to work for at all. In a rich country, no one works for 50 cents per hour. If the minimum wage were set at that, no one would do it and the real minimum would still be much higher.

To the extent that minimum wage increases actually affect real-world wages, the evidence is that some people who were working under the old minimum get raises, at the expense of others who are laid off. The other effect of high minimum wages is to shrink certain industries (restaurants, fast food, etc), reduce service (bigger lines at grocery stores) and accelerate investment into labor reducing automation. McDonald's, for example, has responded to the increasing costs of their labor force by accelerating the rollout of automated ordering kiosks.

Another bad thing about minimum wages, which applies to any attempt to fix prices, is that it destroys information. If the minimum wage is $15/hr, you lose all the information about the demand for jobs that could pay $10/hr. Without a market-set, fluctuating wage system, you induce inefficiency by masking the value available in jobs that would pay somewhat less.

It would be much better to eliminate minimum wages entirely. You still won't see people working for 50c/hr, because I don't think anyone WILL work for 50c/hr.

Question: What's the prevailing wage for migrant workers? Illegal labor is not subject to minimum wages, or any other regulations for that matter. So do the migrants who get picked up at Wal-Mart for day labor work for 50c/hr? If they are paid more, that should tell you that other forces than minimum wage laws are at play in setting salaries.

[Heffalump and Roo]

Originally Posted by Sam Stone

To the extent that minimum wage increases actually affect real-world wages, the evidence is that some people who were working under the old minimum get raises, at the expense of others who are laid off. The other effect of high minimum wages is to shrink certain industries (restaurants, fast food, etc), reduce service (bigger lines at grocery stores) and accelerate investment into labor reducing automation. McDonald's, for example, has responded to the increasing costs of their labor force by accelerating the rollout of automated ordering kiosks.

Could I get a cite for this?

This is not what happened when Seattle went to $15/hr minimum wage. In Seattle, increasing the minimum wage increased employment, increased the number of hours worked and had "near zero" impact on restaurant employment. One reason given for the increases, which might be non-intuitive, is that people used their increased wages to put back into those industries.

When Seattle started down the road to the $15 minimum wage, the city hired a University of Washington team of economists to analyze the wage’s effects on the city. In the years since, the Seattle Minimum Wage Study Team’s findings have been largely positive. In 2016, they found that wages in Seattle are up, low-wage employment increased in the city, and the number of hours worked increased. They reported earlier this year that the wage increase had “near zero” impact on restaurant employment. And this week, in their final study for the city, the Seattle Minimum Wage Study Team released a report proving prices at restaurants and grocery stores haven’t increased because of the minimum wage.

International Policy Digest

To be fair, studies in other places showed different things, and studies in Seattle have contradicted this one. But people questioned some of the assumptions in that study that contradicted this one. I think the studies need to be closely looked at for their assumptions, duration and methodology.

Originally Posted by Sam Stone

Another bad thing about minimum wages, which applies to any attempt to fix prices, is that it destroys information. If the minimum wage is $15/hr, you lose all the information about the demand for jobs that could pay $10/hr. Without a market-set, fluctuating wage system, you induce inefficiency by masking the value available in jobs that would pay somewhat less.

What's the benefit in maintaining this information that tells you how many workers could be paid less?

At some level, the workers who are paid less will be relying on government assistance to get by because there are not enough hours in the day to string together enough $5/hr jobs to survive. Knowing how many of these people exist doesn't give much useful information that I can see.

[k9bfriender]

Originally Posted by bump

A bit of follow up thinking...

I suppose category 1 is really more "People who choose not to work for whatever reason, not necessarily low income") That way, we cover the people who choose not to work because of family caregiver committments, stay-at-home moms, lazy stoners, etc... without getting into a category for each specific situation.

As long as we are not means testing, nor "worthiness" testing, then sure, everyone should get the same, so that's not an issue. Categorizing them is only for our own purposes of identifying the different types of groups that would be collecting UBI, not for parceling it out, so the "grouping" is arbitrary.

My intuition tells me that the final category would be the biggest surprise for people- I'm not seeing how we'd pay for a UBI for every person without having to tax the bejeezus out of everyone with a well paying job. I mean, at a UBI of 15k, a family of four would receive 60k in UBI. That's right at the median household income. So right there, you'd have to come up with more cash to pay that UBI than half of all families MAKE, much less pay out in taxes. Even assuming that median income 4 person family pays roughly 25% of their income in taxes that they would essentially receive back, it would still mean that the government would have to produce 45k for that family. For a family making 100k, who let's say pays 35% in taxes, we're still looking at having to cough up 25k for that family in UBI. I don't know where that break-even is, but it seems to be very high.

The other thing I haven't figured out yet is what it would mean in terms of the remaining social safety net. Proponents often claim that it would take the place of a lot of things, but we'd still need all the stuff we currently have and then some- a low 15k UBI wouldn't obviate the need for health insurance or universal health care. We'd still need a lot of social service type stuff for flat out dumb people who spend their UBI unwisely, or get into a lot of debt, or whatever. I can completely see situations where people basically sign their UBI payments over to monthly payments and are still stuck without enough cash to feed their kids, etc... and would need public assistance. Assuming that we don't suddenly take a callous tack and throw them to the wolves, because, hey UBI!, then we'd still need programs to help the unfortunate and the stupid.

It sounds great in theory, but it also sounds like something we can't pay for. I'd be more in favor of a negative income tax scheme whereby people get boosted to the poverty line (or whatever arbitrary threshold), but where say... a family of four making that median 61k doesn't get any assistance, nor would the family making 100k.

We can't pay for it under the assumptions that you have made, and under the economic model that we currently operate under for delivery of necessities.

However, with some adjustments to your assumptions, and a change in the economic model that is used to deliver necessities, we may be able to.

Personally, rather than a monthly or weekly check, I see a UBI as acting more as a voucher system, with maybe a bit of cash tossed in for flexibility in spending, but the bulk of it would come in the form of direct services.

I don't think that someone on UBI needs much. They need food, clothing and shelter, access to healthcare, and I do believe, for the usefulness and the low, low cost of it, they also need access to communication and entertainment (the internet). That's really about it, that's about all that I would be willing to provide with my taxpayer dollar to someone who is not willing to work, but I also see that as the floor, the minimum that I find acceptable to provide for those who are not able to work. Since willing and able are sometimes hard to differentiate, I see that position as a fairly convenient compromise. With some economies of scale, I can see the actual cost of a UBI being significantly less than your projected 15k.

Useful thing about vouchers rather than cash, is that everyone will get them, but not everyone will use them. They would be good for the basic goods and services deemed essential to existing in this world, so if you had the means to get better, then you would likely not bother.

Whether it is actually building government owned and operated apartment complexes, or contracting that out to the private market and paying them, it should not cost that much to hook everyone up with a studio apartment who wants one. Doesn't have to be big, just enough to stretch and put your stuff. Food doesn't need to be great, it just needs to be palatable and nutritious. I am personally a big fan of cricket flour based foods, as they would have very low cost and environmental impact, as well as being healthier than traditional foods.

I'd also like to see better educational materials out there. Right now, YouTube is a plethora of instructional videos. I've learned to fix my AC in my house, my radiator in my car, as well as any number of little fixes and things. Downside, is that I have also seen some "instructional" videos that left me scratching my head, and wondering if I missed something, or if the video was just wrong. Having a higher standard to be met for videos to be considered educational, and providing them for free to the masses, should allow people to spend time acquiring skills on their own.

As far as entertainment, hooking them all up to the internet, while enforcing IP rights a bit better than is currently done, means that they will have access to all the educational and entertaining media that is out there for free, as well as an incentive to earn a bit in order to see the new release of that special movie that is coming out. Older movies and shows in syndication would be available, but for new releases and current shows, you'd have to pay something.

As far as entertainment goes, I think that a useful job of those "on the dole" would be to watch TV and movies, and then rate and recommend them. How long do you spend looking for something to entertain you? I know that there are times, when presented with the incredible amount of stuff that I could consume, I spend more time trying to find what is worth my time, than I spend actually watching it. Having millions of people curating stuff and helping the best to rise to the top, with "the best" also taking into account *your* preferences, makes you more productive, as you are not frustratedly "flipping through channels" looking for something to provide you with entertainment. It would be like the netflix recommendations, except instead of a computer algorithm, it is using people, so may be less stupid. Sitting around and watching TV could act as a useful production booster.

Games are also more important than I think that anyone has really touched on. More and more of our life is becoming virtual. I know people who pretty much live in another world. Some of these people even make money from playing the games. I do see a virtual economy of virtual goods and services growing and becoming in many ways, as important or even more important than the real world economy, if they aren't just linked with a straight exchange rate.

People talk about the guy that just wants to sit around and play games all day, well, what if sitting around and playing games all day makes you a millionaire? (or at least pays the bills)

Speaking of "games", there are games with real world uses. Right now there are a few things like folding @ home, and the mini game in Eve Online that plots the positions of stars in the milky way, that people can devote their free time to to advance our knowledge. Adding these thing as mini games to more games, as well as advancing the uses and utility of them would start working towards creating a distributed problem solving network, made up of both computers and humans, that could be diverted towards finding solutions to many problems. For instance, directing traffic patterns, weeding fields or hydroponics, or any logistical task that requires human input.

But yeah, UBI should be the basics, not even really comfortable, and certainly not luxurious, delivered at the lowest cost that we can manage, and, while not means tested, still "self means tested" as people with greater means would not necessarily want to use the vouchers, as they can purchase better than they offer. But, it should provide the elements necessary for survival, as well as the tools to improve yourself so that you can, should you so choose, enter into the workforce as a productive member.

As far as kids go, that's a whole different thing, but I am also a believer that school should be open 24/7, along with sleeping arrangements. Parents who cannot afford to take care of their children can still be a large part of their lives, but they would no longer be considered to be the primary care giver. Kids can visit their parents, they can hang out with their parents, but they have a place to go that is safe and with people whose job and skills is actually to raise children.

Originally Posted by Sam Stone

What actually happens is that jobs that are worth >0 but less than $7.25 simply don't get done. Or, the workers that make minimum wage above their productivity level have their benefits cut, or are forced to multi-task or work harder, whatever.

Not really. People do not make produce the same value every moment of the day. I have employees who, at one moment, are producing a hundred dollars an hour in value, and at the next, are sweeping up the floor. The pay that they get is based on an average of those values.

You have equity items, and what it is worth to pay for them. I like to have a clean store, so I spend quite a bit of labor in keeping it clean. I used to do it all myself, but now that I have employees, I pay them to do so. There is a value to having it that way, and that value is what justifies those wages.

The real minimum wage is $0. The natural minimum wage is the wage that anyone is willing to work for at all. In a rich country, no one works for 50 cents per hour. If the minimum wage were set at that, no one would do it and the real minimum would still be much higher.

No, the real minimum wage is negative. There are plenty of examples in history of land owners or companies charging workers more to live than they pay, putting the worker more and more into debt.

One of the ways to become a rich country is to pay everyone a living wage. A good way to stop being a rich country is to allow workers to compete to see who will take the lowest wage.

[Evil Economist]

Originally Posted by Irishman

He probably read it in the summary FAQ:



Or here:


These are AOC released documents, though they have been pulled. But it's not a total ass-pull by Sam Stone.

I appreciate you looking into Sam Stone's statement for him, since apparently he couldn't be bothered. But those bullet points are all under the heading "National Infrastructure," implying this applies only to domestic flights. Sam Stone actually said "My favorite is the plan to replace all air travel with high speed rail." Notice that there's no "Domestic" or "National" disclaimer in his sentence, which means Sam Stone intended us to believe that under the Green New Deal rail travel was expected to replace international flights. Which would deserve a failing grade if it were true.

Since Sam Stone is giving out grades, I wonder what grade he would give someone who didn't understand the difference between domestic and international infrastructure? Or perhaps the question should be: What grade would he give someone who did understand the difference but deliberately misrepresented the facts in order to score a political point?

[Evil Economist]

Originally Posted by Sam Stone

To the extent that minimum wage increases actually affect real-world wages, the evidence is that some people who were working under the old minimum get raises, at the expense of others who are laid off. The other effect of high minimum wages is to shrink certain industries (restaurants, fast food, etc), reduce service (bigger lines at grocery stores) and accelerate investment into labor reducing automation. McDonald's, for example, has responded to the increasing costs of their labor force by accelerating the rollout of automated ordering kiosks.

Originally Posted by Heffalump and Roo

Could I get a cite for this?

This is not what happened when Seattle went to $15/hr minimum wage. In Seattle, increasing the minimum wage increased employment, increased the number of hours worked and had "near zero" impact on restaurant employment. One reason given for the increases, which might be non-intuitive, is that people used their increased wages to put back into those industries.

Yeah, there's a enormous quantity of literature showing that minimum wage increases haven't increased unemployment by any measurable amount. You'd have to do some pretty selective reading to miss it.

Here's Brad DeLong's summary, of which the most relevant bit is: "The majority of economists believe that raising the minimum wage from its current level would significantly boost the incomes of the working poor and have little adverse effect on employment. A large minority of economists believe that raising the minimum wage would actually increase employment...There's no debate on whether minimum wages at their current level are discouraging employment. They don't."

As a general rule of thumb, anyone who makes claims about the negative effects of minimum wages on employment, without even mentioning the fact that the majority of economists disagree with that claim, probably isn't worth listening to. They're selling a political fantasy, not a scientific belief.

[octopus]

Originally Posted by Evil Economist

Yeah, there's a enormous quantity of literature showing that minimum wage increases haven't increased unemployment by any measurable amount. You'd have to do some pretty selective reading to miss it.

Here's Brad DeLong's summary, of which the most relevant bit is: "The majority of economists believe that raising the minimum wage from its current level would significantly boost the incomes of the working poor and have little adverse effect on employment. A large minority of economists believe that raising the minimum wage would actually increase employment...There's no debate on whether minimum wages at their current level are discouraging employment. They don't."

As a general rule of thumb, anyone who makes claims about the negative effects of minimum wages on employment, without even mentioning the fact that the majority of economists disagree with that claim, probably isn't worth listening to. They're selling a political fantasy, not a scientific belief.

Some random dude’s blog isn’t strong evidence. What is strong evidence is the shift in location of manufacturing. You think the rust belt is a good thing? You honestly think a person filling a cup with coffee for $15 is not inflationary for the municipality. What is the purchasing power change?

Furthermore, the only place minimum wage boosts tend to have small effects is when, due to supply and demand in the labor market the lowest wage is already high. Make that $15/hr or $20/hr wage nationally and watch China ascend even faster.

[Evil Economist]

Originally Posted by octopus

Some random dude’s blog isn’t strong evidence. What is strong evidence is the shift in location of manufacturing. You think the rust belt is a good thing? You honestly think a person filling a cup with coffee for $15 is not inflationary for the municipality. What is the purchasing power change?

Furthermore, the only place minimum wage boosts tend to have small effects is when, due to supply and demand in the labor market the lowest wage is already high. Make that $15/hr or $20/hr wage nationally and watch China ascend even faster.

Brad DeLong isn't "some random dude."

Also, we're probably not going to travel to China to buy our morning coffee.

And if you're worried about the impact on our economy if American workers start making more than Chinese workers, I think you'll be shocked to learn that you've woken up in 2019, and things have changed.

[Evil Economist]

Originally Posted by octopus

Furthermore, the only place minimum wage boosts tend to have small effects is when, due to supply and demand in the labor market the lowest wage is already high.

Here's a paper studying the impact of increasing the minimum wage by more than 50% (from 8.25 to 13). Conclusion: "After the minimum wage hikes, incomes were boosted most for more than 330,000 total workers in low-paying occupations and industries...Overall, the higher minimum wage has been associated with an increase in worker incomes but little to no impact on employment or the number of private business establishments. "

[Evil Economist]

Originally Posted by Evil Economist

Here's a paper studying the impact of increasing the minimum wage by more than 50% (from 8.25 to 13). Conclusion: "After the minimum wage hikes, incomes were boosted most for more than 330,000 total workers in low-paying occupations and industries...Overall, the higher minimum wage has been associated with an increase in worker incomes but little to no impact on employment or the number of private business establishments. "

Missed the edit window.

The higher minimum wage may have boosted the morale of low-wage employees, improving productivity. Because the higher pay increased the relative cost to workers if they lose their jobs, the higher minimum wage may have induced greater work effort from employees. On the employer side, managers may have responded to a higher minimum wage by raising performance standards such as requiring better attendance records or requiring employees to take on additional job tasks. The higher wage floor may also have made it easier for employers to recruit and retain employees, allowing employers to be more diligent in their hiring practices. Reduced costs for recruiting and retaining “absorb about 15 percent of the increased payroll costs”

So the increased minimum wage results in more productive employees and lower hiring costs and reduced turnover costs. Almost as though the businesses are benefiting from the wage increases. Weird. Right-wing economics 101 failed to predict this.

[Budget Player Cadet]

Originally Posted by Evil Economist

Yeah, there's a enormous quantity of literature showing that minimum wage increases haven't increased unemployment by any measurable amount. You'd have to do some pretty selective reading to miss it.

Here's Brad DeLong's summary, of which the most relevant bit is: "The majority of economists believe that raising the minimum wage from its current level would significantly boost the incomes of the working poor and have little adverse effect on employment. A large minority of economists believe that raising the minimum wage would actually increase employment...There's no debate on whether minimum wages at their current level are discouraging employment. They don't."

As a general rule of thumb, anyone who makes claims about the negative effects of minimum wages on employment, without even mentioning the fact that the majority of economists disagree with that claim, probably isn't worth listening to. They're selling a political fantasy, not a scientific belief.

In other words: libertarians. The same folks who'll argue that public schooling is a bad thing.

[octopus]

Originally Posted by Budget Player Cadet

In other words: libertarians. The same folks who'll argue that public schooling is a bad thing.

A study in a decent market which is growing and exempts teens from even the state minimum wage sees no or very little ill effect from a very modest minimum wage increase is not the same thing as a national minimum wage increase. Yeah, giving San Francisco workers an extra $0.25/hr will probably not be counterproductive.

A nationwide $15/hr? I’d like to see what happens.

[Evil Economist]

Originally Posted by octopus

A study in a decent market which is growing and exempts teens from even the state minimum wage..

If you're talking about the Chicago study, it only allowed paying teens $0.50 below the minimum wage. That's not an "exemption". And I don't know what the word "even" is doing in that sentence.

[Heffalump and Roo]

Originally Posted by Evil Economist

Brad DeLong isn't "some random dude."

In case anyone else, like me, didn't know who Brad DeLong is, here's some snippets from his wiki.

James Bradford "Brad" DeLong (born June 24, 1960) is an economic historian who is professor of Economics at the University of California, Berkeley. DeLong served as Deputy Assistant Secretary of the U.S. Department of the Treasury in the Clinton Administration under Lawrence Summers.
. . .
He graduated summa cum laude from Harvard University in 1982, followed by an M.A. and PhD in economics in 1985 and 1987, respectively, also from Harvard.[3]

After earning his PhD, he taught economics at universities in the Boston area, including MIT, Boston University, and Harvard University,
. . .
DeLong considers himself a free trade liberal. He has cited Adam Smith, John Maynard Keynes, Andrei Shleifer, Milton Friedman, and Lawrence Summers (with whom he has co-authored numerous papers) as the economists who have had the greatest influence on his views.

J. Bradford DeLong

[Pithily Effusive]

Originally Posted by Velocity

There needs to be a strong social net for those who are unable to work or temporarily out of work, no doubt. But for those who are unwilling to work, this opens up a huge can of worms. Many workers in America - perhaps even the majority - do not enjoy their jobs and work their jobs only because they have to make financial ends meet.

People like to work. The percentage of people who "don't like to work" averages about 8%. It's the same percent the police keep seeing over and over who do 80% of the crime. Where your comment disturbs me deeply, and don't feel like the Lone Ranger 'cause you aren't in this, is conflating work with job. Jobs are accessways to this current organization of economics - capitalism. People generally don't like their jobs. Anyone who has a job they like is considered to be lucky. These jobs are what capitalists create when they invest their capital. This process has literally consumed any alternatives and locked economics into a vice. Land being held by multi-nationals, agri-business driving the family farm out of existence has forced people to go to capitalists for these jobs as there is no other way to obtain the means of exchange - the money.

People speak of these jobs as though they are as natural as the noonday sun. People expect others to hold these jobs and wish to work these jobs, or they're judged as bad citizens. People who raise this as an issue are automatically labeled communist because the capitalists have so effectively taken over the language of economics. NO school of economics is about investigating alternatives to capitalism. They're all engaged in learning how to milk it for what it can.

For people to conflate jobs with work is to succumb to the propaganda. People wish to see something come of their lives, and gladly put effort into things that can make that come about. People hate their jobs. It makes perfect sense, and it should be a red flag of alarm going up. Instead, it's a criticism - Do your job whether you like it or not, or you're a bad citizen.

The most embarrassing thing I've heard about my country in my lifetime is, "Immigrants will do the jobs Americans refuse to do." Being surrounded by people who can't understand why is beyond annoying.

[msmith537]

Originally Posted by Pithily Effusive

For people to conflate jobs with work is to succumb to the propaganda. People wish to see something come of their lives, and gladly put effort into things that can make that come about. People hate their jobs. It makes perfect sense, and it should be a red flag of alarm going up. Instead, it's a criticism - Do your job whether you like it or not, or you're a bad citizen.

I don't think I ever "hated" my job. At least, not the actual work. I may have preferred to do other things, but the actual work tasks never bothered me.

What I always hated was the one-way street of the employer/employee arrangement. That by being a mere "employee" you have to eat all manner of shit, subject to the whims of your company, manager, or customers. Indeed, what I have seen in my 20+ years of working is that the attitude of companies is that their employees are a costly nuisance and this attitude has worsened over time. Sure, many highly profitable companies dress this up with stupid perks like free snacks and lip service about "positive corporate culture". But in practice, these same companies are very quick to reject anyone who doesn't drink their cool aid.

I recall early on in my career, companies were willing to hiring smart, hard-working people and give them the training to do their jobs. Before that, companies even had pension funds for long-time employees. These days, those same companies are looking to outsource, automate or contract out as many jobs as possible. I don't think a society can operate like that long term - a relatively small population employed in highly profitable multi-billion businesses with the vast majority working in either low-level service jobs or constantly competing for "contracts" with no stability, benefits or health care. At some point, the government is going to have to step in to provide some basic level of infrastructure and social safety nets.

[bump]

Originally Posted by msmith537

I don't think I ever "hated" my job. At least, not the actual work. I may have preferred to do other things, but the actual work tasks never bothered me.

What I always hated was the one-way street of the employer/employee arrangement. That by being a mere "employee" you have to eat all manner of shit, subject to the whims of your company, manager, or customers. Indeed, what I have seen in my 20+ years of working is that the attitude of companies is that their employees are a costly nuisance and this attitude has worsened over time. Sure, many highly profitable companies dress this up with stupid perks like free snacks and lip service about "positive corporate culture". But in practice, these same companies are very quick to reject anyone who doesn't drink their cool aid.

I recall early on in my career, companies were willing to hiring smart, hard-working people and give them the training to do their jobs. Before that, companies even had pension funds for long-time employees. These days, those same companies are looking to outsource, automate or contract out as many jobs as possible. I don't think a society can operate like that long term - a relatively small population employed in highly profitable multi-billion businesses with the vast majority working in either low-level service jobs or constantly competing for "contracts" with no stability, benefits or health care. At some point, the government is going to have to step in to provide some basic level of infrastructure and social safety nets.

Amen brother.

I think the corporate kool-aid thing is a very distressing thing. It's a perversion of the worker/company relationship of yesteryear where the company demanded loyalty and sacrifice, but generally provided stability, security and a chance for advancement. Now it's that the company demands at least as much loyalty and security as before, but now they're just giving you a paycheck, without the stability, security or chance for advancement. And if you recognize this, and don't play along, they view you as disruptive, or not sufficiently committed or whatever.

Like you say, free snacks or other trivial perks don't make up for that particular imbalance. I kept thinking about it at previous jobs when having to work over my Xmas time off, or being up at 1 am working on things, etc... and realizing that I wasn't getting anything EXTRA for it; they were just expecting without any additional consideration for my sacrifice, and I wouldn't be any more protected from a layoff or bumped up in line for a promotion or a raise either.

[k9bfriender]

Originally Posted by bump

Amen brother.

I think the corporate kool-aid thing is a very distressing thing. It's a perversion of the worker/company relationship of yesteryear where the company demanded loyalty and sacrifice, but generally provided stability, security and a chance for advancement. Now it's that the company demands at least as much loyalty and security as before, but now they're just giving you a paycheck, without the stability, security or chance for advancement. And if you recognize this, and don't play along, they view you as disruptive, or not sufficiently committed or whatever.

At the same time, it is harder and harder to find employees who will be loyal and dependable, no matter the loyalty and security given. Not sure which got eaten first, the chicken or the egg.

Like you say, free snacks or other trivial perks don't make up for that particular imbalance. I kept thinking about it at previous jobs when having to work over my Xmas time off, or being up at 1 am working on things, etc... and realizing that I wasn't getting anything EXTRA for it; they were just expecting without any additional consideration for my sacrifice, and I wouldn't be any more protected from a layoff or bumped up in line for a promotion or a raise either.

The bottom line is sacrosanct. If you have investors or stockholders, then they will demand that you wring every drop of productivity out of your employees as possible, at the lowest compensation for their time and effort as possible.

[bump]

Originally Posted by k9bfriender

At the same time, it is harder and harder to find employees who will be loyal and dependable, no matter the loyalty and security given. Not sure which got eaten first, the chicken or the egg.

Pretty sure the employers broke that one back in the 1970s and 80s with all the layoffs they did back then- it really was a shock to a lot of people who had never heard of that kind of thing. And I think repeated layoffs just reinforced that there's no gain to being loyal for employees these days.

I mean, no company is going to come out and say "We won't lay you off, no matter what." or "We guarantee you at least a cost-of-living raise each year." Absent that, where's the benefit in being loyal to the company? Like you say below, you'll be sacrificed on that profitability altar as soon as it makes financial sense.

Originally Posted by k9bfriender

The bottom line is sacrosanct. If you have investors or stockholders, then they will demand that you wring every drop of productivity out of your employees as possible, at the lowest compensation for their time and effort as possible.

IMO, that's a problem with management selection and training. You get accountants and finance people promoted into c-suite management jobs, and while they can crunch the numbers like nobody's business, they don't quite get the people factors stuff. That's not to say that layoffs aren't occasionally required, but they shouldn't look at them as an everyday management procedure either. Layoffs ought to be the corporate equivalent of bomber crews throwing their guns out to stay aloft, not something to do in order to save fuel on the trip home.

[BrianDime]

Originally Posted by Shodan

In states where the MW is different from the federal MW, they are making more than the federal MW. In states where they are the same, they are making the same as the federal MW. Cite. Is that what you mean? I feel like I am not understanding you.

Regards,
Shodan

Just as a data point, NC's minimum wage is 7.25. Since that's the same as the Fed MW, it doesn't show up in what you are talking about?

[JcWoman]

Originally Posted by bump

IMO, that's a problem with management selection and training. You get accountants and finance people promoted into c-suite management jobs, and while they can crunch the numbers like nobody's business, they don't quite get the people factors stuff. That's not to say that layoffs aren't occasionally required, but they shouldn't look at them as an everyday management procedure either. Layoffs ought to be the corporate equivalent of bomber crews throwing their guns out to stay aloft, not something to do in order to save fuel on the trip home.

I think that mentality comes from the market pressures after a company goes public. Small, privately owned companies can prioritize their people (not saying they all do, just that they can). Once you go public, you're a slave to quarterly earnings reports.

I agree with you about the layoff issue. I think it's because companies have moved to "just in time" staffing. If you're familiar with "just in time" inventory, where instead of maintaining a warehouse of inventory, you set up an active supply chain to move products from the manufacturer to the customer as orders come in. They seem to be staffing this way now, too. Starting a project? Staff up for it. Project coming to an end? Shed those people. New project ramping up? Hire new people for it. This is also what's behind the increase in using 1099 contractors or sub-contract staff who are W2 to staffing agencies and keeping a very small in-house staff of W2 workers.

[octopus]

Originally Posted by Evil Economist

If you're talking about the Chicago study, it only allowed paying teens $0.50 below the minimum wage. That's not an "exemption". And I don't know what the word "even" is doing in that sentence.

Below the state minimum wage. Not the Chicago minimum wage. What that means is for some work you can replace adults with teens. Look, minimum wage bumps in high cost of living cities isn’t good case studies for the effects of national wage policy.

For that we can look at the dislocation of manufacturing and a permanent non-employable class.

[Evil Economist]

Originally Posted by octopus

Below the state minimum wage. Not the Chicago minimum wage. What that means is for some work you can replace adults with teens.

True, and the solution is to raise the minimum wage for teens.

Look, minimum wage bumps in high cost of living cities isn’t good case studies for the effects of national wage policy.

For that we can look at the dislocation of manufacturing and a permanent non-employable class.

Do you have a cite that this occurs?

[bump]

Originally Posted by JcWoman

I think that mentality comes from the market pressures after a company goes public. Small, privately owned companies can prioritize their people (not saying they all do, just that they can). Once you go public, you're a slave to quarterly earnings reports.

I agree with you about the layoff issue. I think it's because companies have moved to "just in time" staffing. If you're familiar with "just in time" inventory, where instead of maintaining a warehouse of inventory, you set up an active supply chain to move products from the manufacturer to the customer as orders come in. They seem to be staffing this way now, too. Starting a project? Staff up for it. Project coming to an end? Shed those people. New project ramping up? Hire new people for it. This is also what's behind the increase in using 1099 contractors or sub-contract staff who are W2 to staffing agencies and keeping a very small in-house staff of W2 workers.

You're probably right about the public/private company difference.

And what you say about the JIT staffing is true too... my favorite is the whole "let's hire contractors to do X function- that way, it's not payroll, it's support or operational expense", and then they keep the contractors around for YEARS, and then act all surprised and frantic when the contractors get reassigned by their management in favor of a cheaper person, taking all the tribal knowledge and company lore with them. Had they hired a full-timer, that person wouldn't have been *as* likely to bail, provided you treat them right.

It's definitely a different model- it's a just-in-time and very modular way of doing staffing. And it sounds very much like an accountant-driven model. It's NOT ideal for getting the best performance out of say... an IT department. It's NOT something workers enjoy.

And probably most importantly in the long run, it's not one that's sustainable. Since it is predicated on the wide availability of competent, available mid-career professionals, it doesn't have any real room for entry-level and early career professionals. Under this model, companies are not going to want to hire a kid right from college or with maybe a year of experience, because they don't slot into a modular, just-in-time slot in most companies. They're looking for someone who can get hired when they're staffing up, step right in and start working, not someone who will have to have a lot of the basics explained to them.

The last place I worked was much like what you and I describe, and the youngest people there were in their early 30s, outside of the 2-3 college interns who were there the last 3-4 months I was there, and some of the very low level PC support/helpdesk folks. That whole strata of 22-29 year old professionals was almost entirely absent in an IT department of around 150 people. And I know why- they were perpetually looking for people to just get hired and start working, and not looking to train or groom people in any way. Which not coincidentally, was why they were suffering fairly high turnover in the full timers who had been there a while, like me. None of us were getting opportunities for advancement or management roles because they were just doing this JIT business and hiring a manager or senior person with experience, rather than groom and promote from within.