Obama plans to raise the min. wage to $9 an hour.

[magellan01]

@panaccione

Most of the politicians. They’re looking to cut Welfare, Social-Security, Medicare, Medicaid, Education, and more. That’s the point really. You may not share their ideas, but your views have implications. That’s why I take the stance that I do.

What do you mean by cut"? If you mean reduce, that’s one thing; if you mean eliminate that’s quite another. Up till now we’ve been arguing over whether programs like this should exist or not, so if you’re now shifting to “reduce”, you’re moving the goal posts out of the stadium. So, which is it>

And keep in mind, many programs have to be reduced and modified in order to stay solvent. SS for one.

@panaccione

No, this point stands. More engineers = less waiters, dishwashers, burger slingers, and whoever else. With technology, we can automate these simple processes.

Oh, so you want to eliminate the jobs for unskilled workers? And that’s okay because you’re going to eliminate unskilled workers? YEESH! Here’s an idea, let’s make everyone a doctor or engineer! Everyone!! Oh, maybe a couple of rocket scientists, too. Problem solved. You’re naiveté is only exceeded by ability to live in Utopian Fantasy Land. Unbelievable.

[magellan01]

@rogerbox

Yeah protections like minimum wage are SO OFFENSIVE to the poor people, I bet every dollar they make over the $4 their labor is actually worth is like so many more spits in the face.

:rolleyes:

Would you prefer “sweatshop”, does that not offend you?

Rrriiiinnnnnng. Rrriiiinnnnnng. Samuel Gompers is calling. He wants to know why you think he never lived or accomplished anything.

@rogerbox

Here you reveal the typical canard: That no one in poor neighborhoods works ALREADY. MOST POOR PEOPLE WORK. The only thing you are doing by lowering the minimum wage in ghettos is PAYING THEM LESS, making them WORSE.

Nope. Not what I said. But do you deny that unemployment is higher in poor areas than wealthy ones. Because that’s the only way one could say that what I did say was unreasonable. I’ll also direct you to Shodan’s instructive post.

@rogerbox

This is just utterly hilarious and shows how out of touch you are with minimum wage and the poor. You know what someone’s reward is for showing up on time is making moor? No, your reward is making minimum wage and not being fired, if you’re lucky. Bosses are not sitting around looking at minimum wage workers and waiting for them to show their worth and improved skillsets so they can pay them more, that is utterly laughable.

Well, doing the job well enough so that you don’t get fired is a good start. Odd that you find that objectionable. The rest is bullshit. I’ve had minimum wage jobs. In one, there was a crew of about 15 of us. Some got fired. Some got small raises (I got $0.15!). Some were given a bit more responsibility. (I was allowed to drive the truck.) There will always be better workers and worse workers. Each person owes it to himself to figure out what the company values and give more of that than the next guy. I find it exceedingly strange that any adult who has had an entry level job hasn’t learned this.

@rogerbox

Minimum wage isn’t just shitty because you get paid as little as legally possible, you also typically are treated as bad as legally possible (and sometimes illegally).

And what does raising the MW a dollar solve in this regard? Lots of workers, MW or not, get treated shitty. There are shitty bosses. So? As far as being treated illegally, a higher MW won’t solve that either. And if you are being treated illegally, you can quit and/or go to the authorities. As people do all the time.

@rogerbox

There is no golden ladder to the top as long as you show up on time and do your job.

So, now you need not just a way out of a MW job but a golden ladder? And unfortunately for your position, people work themselves out of MW jobs and into management every day.

@rogerbox

You cannot leave your Burger King job and put on your resume “BK: showed up on time with good attitude, learned how to ring up a cash register and eventually learned how to order mayonaise”, no one gives a shit.

If you’re a good employee your employer will be a good reference. Again, as is done every day. Darn, reality rears its tenacious head and proves you wrong yet again.

@rogerbox

There is no rich guy just waiting to see you try hard and are worth investing in at minimum wage, you are a disposable cog in the machine and no more. Typically, in general, et al.

You: You can’t outrun a bear.
Me: I don’t have to, I just have to outrun you.

It’s your job to be more valuable than the next cog. This is true of jobs at MW and every other level. Yep, that reality thing again. Sorry.

[Rawdogvillian]

@Evil_Economist

I’m not familiar with any study showing this; could you give me a link?

So none of the wage increase will be passed on to consumers? There will be no productivity increases from higher wages? You’re making some very strict assumptions here.

Upper income people don’t straddle tax brackets, unless they have no idea how the tax system works.

Regarding #1: Do Minimum Wages Fight Poverty? | NBER - The poor subsidize the other poor, hardly an argument FOR this.

Neumark, an economist who has authored over 100 papers on the minimum wage also wrote this: Minimum Wage Effects in the Longer Run | NBER

Here is another column: http://www.delmarvanow.com/article/20130228/OPINION02/302280039/Walter-E-Williams-Raising-minimum-wage-raises-unemployment-especially-among-unskilled-young-black-workers

Here is a reference to the union contracts which were the SOLE REASON this was proposed, and nobody chose to address: http://online.wsj.com/article/SB10001424127887324048904578318541000422454.html?mod=googlenews_wsj

It is no coincidence that the economic supporter of this program is Alan Kreuger, an economist on the Presidents board of advisors. He authored a 1994 study showing data you claim from NJ fast food restaurants, that an increase in min wage led to an increase in employment.

This study was revisited by Neumark, showing exactly the opposite occurred. Furthermore, the study relied on payroll data with a control group as opposed to simply telephone surveys in Kreugers case. The Effect of New Jersey's Minimum Wage Increase on Fast-Food Employment: A Re-Evaluation Using Payroll Records | NBER

The more you raise the cost of one input, the substitute input becomes more attractive. You raise the cost of labor, an investment in capital becomes more attractive.

By “straddling tax brackets” I mean someone will put their earnings just below the line at which their bracket would increase, or find a way to deduct to reach that point. The penalty for higher earnings and possibly productivity is higher taxes.

Similarly, at lower incomes- there is a gap from one earnings level to the next that is filled with social benefits- welfare, SNAP…housing vouchers etc. This is a disincentive towards higher productivity or earnings, as if those earnings are below a certain level people lose purchasing power in benefits. Thus someone earning say 19K receives say 10K in benefits, unless they can get a job that pays 30K, they have no incentive to work more or improve their lot.

[panaccione]

@magellan01

What do you mean by cut"? If you mean reduce, that’s one thing; if you mean eliminate that’s quite another. Up till now we’ve been arguing over whether programs like this should exist or not, so if you’re now shifting to “reduce”, you’re moving the goal posts out of the stadium. So, which is it>

And keep in mind, many programs have to be reduced and modified in order to stay solvent. SS for one.

Well, at this point I would say republicans are looking to reduce government programs. In some cases, drastically. But I wouldn’t say it’s moving the goal posts very far or even that much of a stretch to say some of them look to cut programs entirely. Just look at your Libertarian poster boy Ron Paul. What were those 5 government agencies he was looking to cut. Or, Rick Perry and the 3 he was looking to cut?

I don’t agree that reducing programs like SS is the first step. Your talking about some of the most vulnerable people we have. They have expected and plan to depend on this program their whole lives. First, we raise taxes. Then, we talk about cuts. Just take a look at how austerity is working out overseas.

@magellan01

Oh, so you want to eliminate the jobs for unskilled workers? And that’s okay because you’re going to eliminate unskilled workers? YEESH! Here’s an idea, let’s make everyone a doctor or engineer! Everyone!! Oh, maybe a couple of rocket scientists, too. Problem solved. You’re naiveté is only exceeded by ability to live in Utopian Fantasy Land. Unbelievable.

I didn’t say eliminate those jobs. I was talking about making education more accessible. If you do this, your going to end up with more engineers and doctors. Many of these jobs at Walmart and McDonalds could be automated already. Who designed that? An engineer.

Look back 100 years and anyone would say it’s naive that we’ll land a probe on Mars. Perhaps, you just lack imagination and ambition.

[Rawdogvillian]

@panaccione

A “republic” is a form of government in which the country is considered a “public matter”, not the private concern or property of the rulers, and where offices of state are subsequently directly or indirectly elected or appointed rather than inherited.

“Democracy” is a form of government in which all eligible citizens have an equal say in the decisions that affect their lives. Democracy allows eligible citizens to participate equally—either directly or through elected representatives—in the proposal, development, and creation of laws

Technically, you’re right. But, you’re just playing semantics buddy. Can I get a cite for all those claims about California?

I imagine that the bulk of Walmarts employees, are NOT, in retirement. Let’s try to focus on the majority here. Also, the MAJOR problem here is income inequality. Walmart, McDonalds, and millions of other companies like these are ALWAYS hiring. They just don’t pay enough to live. Do you think these companies will stop hiring if the minimum wage is raised to $9?

Actually, a lot of these people are NOT on the stepping stone of something bigger. For a lot of people, it IS their livelihood. It might not be minimum wage, but it’s not very much higher. Why do you assume that raising the minimum wage is going to result in all these layoffs? It seems pretty clear that these corporations are doing well and can afford the slight increase in wages.

So what do you propose? I can agree with expanding the EITC. What else?

Lastly, since we have a minimum wage already set, why is it naive to think that raising it with inflation is a good thing? I would think it’s naive to just leave it where its at when it’s quite clear that millions are struggling to survive off of it.

1. the difference between two forms of government is HARDLY SEMANTICS. This is evidenced by the difference in state governments in the US. You have California, which is a direct democracy, and you have other states that are not.

2. Sorry for the journalistic ARTICLE about california’s business climate, California — toxic for business

3. California: 9.8% unemployment. Higher than the national average: http://www.bls.gov/lau/

4. California: highest state and local welfare spending: Compare Spending By State for 2022 - Charts

5. Regarding income inequality- it is a huge problem. Minimum wage law will do nothing to fix it. You are mixing correlation and causation. A better business climate, and many other socioeconomic variables are better addressed to combine in addressing that problem. Minimum wage would be nothing more than a band-aid, and one that leads to infection at that. This is similar to many other government programs- they fail to address the cognitive effort to come up with a real solution, as opposed to some stop gap emotional feel good measure.

6. the stop hiring quip is a non sequitor. They will hire less, unemployment will increase. A few will benefit at the expense of the many. If you do not like corporatism benefiting a few at the expense of the many, why would you support this supposedly altruistic measure that does in effect, the same thing?

7. Raisetheminimumwage.com as a cite? Really?

8. Min wage jobs ARE a stepping stone, for people to gain experience, which leads to higher wages. If you exhibit ANY kind of drive or skill whatsover, you eventually become more worthy to your employer and are paid more. If you are working 40 years at minimum wage, the problem is with YOU. Job 1 not paying you enough? Find another one or work at job 2. Go to community college and learn a skill, learn a trade and get paid while you do so. The blue collar work environment is not what it once was in this country, but there are still jobs that pay a lot better than a masters in social work and do not require a degree, or a 4 year degree.

9. I would agree that the AMERICAN dream is not what it is cracked up to be today and social mobility is not as good as other countries. The minimum wage is not the solution.

10. It is easy to get mad at CEO’s and Corporate profits, as a scape goat. Corporate profits and earnings return to shareholders, individual people like you and I, our 401K’s. Should we reduce those and harm the middle class people who responsibly saved and invested their money for retirement? For their kids 529 so that they can go to a better school or get a better life?

We can look at current economic policies of artificially low interest rates that penalize savers and fixed income people, and encourages malinvestment through these lower rates. This would be another topic…

[Evil_Captor]

@magellan01

Never. It may be not much of a choice, but it is still a choice.

Riiiiight So if I enslave you with a gun to your head, you have no choice. But if you take a $4 an hour job because that’s all you can get, hey … you had a choice. Anything NOT involving a gun to your head is a choice. Every minimum wage worker works at such low wages because they freely chose to … not because had to eat, or have a source of warmth and shelter for living in.

Really, who do you think you are kidding with this stuff?

[Evil_Economist]

@Rawdogvillian

Neumark, an economist who has authored over 100 papers on the minimum wage also wrote this: Minimum Wage Effects in the Longer Run | NBER.

There have been literally thousands of studies of the impact of minimum wages on employment (with Neumark responsible for his share of them). We would expect that, due to the statistical nature of these studies, if the impact of minimum wage increases on jobs was small, a large percentage of the studies would find positive or negative effects. Given this, we could probably find a study written by an eminant economist saying anything we want to hear.

So, we need to turn to meta studies, which summarize the results of all the minimum wage studies conducted to date:

“Hristos Doucouliagos and T. D. Stanley (2009) conducted a meta-study of 64 minimum-wage studies published between 1972 and 2007 measuring the impact of minimum wages on teenage employment in the United States. When they graphed every employment estimate contained in these studies (over 1,000 in total), weighting each estimate by its statistical precision, they found that the most precise estimates were heavily clustered at or near zero employment effects”
…
‘Two scenarios are consistent with this empirical research record. First, minimum wages may simply have no effect on employment… Second, minimum-wage effects might exist, but they may be too difficult to detect and/or are very small.’

About the second meta-study:

“Paul Wolfson and Dale Belman have carried out their own meta-analysis of the minimum wage…The resulting estimates varied, but revealed no statistically significant negative employment effects of the minimum wage”

Your buddy Neumann may have had problems replicating Kreugers study, but other economists have had more luck:

“Dube, Lester and Reich (2010) essentially replicated Card and Krueger’s New Jersey-Pennsylvania experiment thousands of times, by comparing employment differences across contiguous U.S. counties with different levels of the minimum wage…Using this large sample of border counties, and these statistical advantages over earlier research, Dube, Lester, and Reich ‘…find strong earnings effects and no employment effects of minimum wage increases.’”

They’re not the only ones:

“Independently of Dube, Lester, and Reich, economists John Addison, McKinley Blackburn, and Chad Cotti used similar county level data for the restaurant-and-bar sector to arrive at similar conclusions. Addison, Blackburn, and Cotti found no net employment effect of the minimum wage in the restaurant-and-bar sector.”

No real differences for teenagers:

“Allegretto, Dube, and Reich analyzed data on teenagers taken from the Current Population Survey (CPS) for the years 1990 through 2009… once they controlled for different regional trends, the estimated employment effects of the minimum wage disappeared, turning slightly positive, but not statistically significantly different from zero.”

And on the benefit of minimum wages:

"Sara Lemos has conducted a comprehensive review of the 30 or so academic papers on the price effects of the minimum wage. She concludes: “Despite the different methodologies, data periods and data sources, most studies reviewed above found that a 10% US minimum wage increase raises food prices by no more than 4% and overall prices by no more than 0.4%”; and “[t]he main policy recommendation deriving from such findings is that policy makers can use the minimum wage to increase the wages of the poor, without destroying too many jobs or causing too much inflation.”

I personally feel that if you look at the meta studies rather than cherry-picking the studies that agree with your *a priori *beliefs, it’s clear that the minimum wage isn’t causing the problems that your newspaper cites claim.

[Evil_Economist]

@Rawdogvillian

By “straddling tax brackets” I mean someone will put their earnings just below the line at which their bracket would increase, or find a way to deduct to reach that point.

Why?

[Evil_Captor]

Since some of you on the progressive side are new here, I’ll clue you in on the way things work on the Dope: the libertarians and the conservatives will NEVER get what you are proposing, it’s not blindness or willful ignorance, it’s a stratagem. They want you arguing endlessly with them about wealth inequality and minimum wages and what is or is not a choice, because if that happens YOU will not have progressed. They do not want change, they do not want progress, that is what conservatism is about. (Libertarianism is a different animal, it’s almost a religious concept rather than an ideology, so they literally CANNOT see anything that conflicts with their dogma, so I guess it IS blindness of a sort. But the end result is the same for them – they dislike progressives as much as conservatives.)

Don’t get me wrong, the arguments here DO have value, because the libertarians and conservatives here are skilled debaters who can marshall some of the strongest arguments available for their positions. Once you have sparred with them for a while, you will be able to spar with anyone, anywhere and hold your own, or more likely, win.

But once you have learned to argue with them, don’t stick around, move on. The arguments here never really change, and they’ll just keep you mired at the most basic level of progressive ideas, because they oppose them on a fundamental level.

[panaccione]

Evil Captor, I totally get what you are saying. It may seem endless and basically futile. But, there’s one thing that drives me to keep at it - Lurkers.

I lurked on this board for a good 6-7 years before I ever started posting. I learned a lot in that time. I’m sure there are lots of people simply reading slong right now. So, I say keep fighting the good fight.

[Evil_Economist]

@panaccione

Evil Captor, I totally get what you are saying. It may seem endless and basically futile. But, there’s one thing that drives me to keep at it - Lurkers.

I lurked on this board for a good 6-7 years before I ever started posting. I learned a lot in that time. I’m sure there are lots of people simply reading slong right now. So, I say keep fighting the good fight.

Some of us just like arguing

[panaccione]

Yeah, it never hurts to practice either. : )

[emacknight]

@Evil_Captor

Since some of you on the progressive side are new here, I’ll clue you in on the way things work on the Dope: the libertarians and the conservatives will NEVER get what you are proposing, it’s not blindness or willful ignorance, it’s a stratagem.

The problem with US politics in general, and this board in specifics is that you are so used to having only two parties, you assume there are only two answers. Further, you then assume that only one of them can be right, so by default the other must be wrong.

I hate to be the one to tell you this, but more often that not both parties are wrong. The Democrats do not have some moral high ground which makes all their answers are right. And just because the Republicans are evil doesn’t mean all of their answers are wrong.

And not every issue is so simple that it can be divided easily between the two conditions, right or wrong, liberal or conservative.

Minimum wage is one such example of an issue that’s irrelevant to 90% of the discussion in this thread. If your stated goal is to help the poor a MW is a piss poor way to go about doing that. But instead of being able to discuss the issue, everything has to be black or white, right or wrong, liberal or conservative.

You are not morally superior because you argue in favour of a higher minimum wage. The fact that the President wasted even 5min on this should piss you off since that’s 5min he didn’t spend working on an actual solution to the problem.

[R3d_Anonymous]

I was originally quite opposed to this new proposal of Obama because I believed that it would lead to significant price inflation and unemployment, thus crippling the economy. However, now I have mixed feelings about this issue. I’m not completely in favor of the proposal, but I’m certainly much less opposed to it as I was because I can see what he’s trying to do. At the same time, Chimera and some other posters made some good points in that other thread about the minimum wage that I started; this is that living in poverty is very hard. Some are critical and assume that the ones living in poverty are just weak and lazy. While this may sometimes be true, it is not always the case. Some people end up in a bind where they don’t have enough money to go to school and learn some new skills. Paying the rent ends up being a huge difficulty along with paying for food. Sometimes it’s just not possible to get out of that bind unless one gets a raise. Obama is trying to get everyone over the poverty line. As $8.50 per hour is the poverty line, bringing everyone up to $9.00 per hour results in no more poverty (except for the unemployed).

As for the argument that minimum wage jobs aren’t designed so that people can live off of them doesn’t really work. It’s ignoring the issue that in extremely tough cases, people do have to live off of those wages. Therefore, we should do something about it.

Now going back to the problem with this idea in which I haven’t really analyzed in this post, price inflation and unemployment can end up being a problem. Unemployment, as studies have shown, may not be too affected, but price inflation could be a problem. I actually had the wrong idea before. Before I thought that since raising the minimum wage from $7 to $9 an hour is a 28% increase, so you would basically have a spectrum.

No Price Inflation and Lots of Unemployment<------------------------------------------------------------------------------------------------------>28% Price Inflation and No Unemployment

But I was wrong; if wages increase by 28%, that doesn’t mean that the whole price has to be multiplied by 128%. For example, if a burger costs $5.00 and $1.00 of that is being used to pay employees, you only multiply that $1.00 by 128%. So in that case the burger would only cost $5.28, and this is if you strictly rely on inflated prices in order to compensate for the raised wages. You could also use the aid of unemployment and then the price inflation would be even littler.

However, the price inflation problem cannot be dismissed yet. Reason being, employers may not actually need as much money. For example, in the burger case, they may only need to increase the price by a quarter, but since they do have an excuse, it gives them the chance to make more profit. So they may end up going straight from $5.00 to $6.00 given that they do have an excuse in response to people’s complaints. So I’m not really sure why businessmen would be so opposed to this idea. In theory, they could be making more profit because this is an excellent chance for them to raise all their prices.

I think it all boils down to this. Raising the minimum wage from $7.00 to $9.00 will result in less needed government assistance. As all working people will be above the poverty line, we won’t need that many food stamps, etc. However, this results in a more socialist economy than a capitalist one. It requires that others spend more on items, so indirectly we are paying the poor. In a more capitalist economy, such relationships where the rich are forced to pay more in order to help the poor are very limited while socialist economies try to implement these strategies. This makes sense because being the democratic president that he is, you would expect these kind of proposals to be made. Critics of the proposal do not want to pay extra in order to help the poor. Really, if you look at the proposal skeptically, what Obama is trying to do is make it so that the government doesn’t have to spend so much on assisting the poor, but so that the public does by paying more in increased prices. Another potential issue is that the poverty line may be raised as goods will cost more, and eventually $9.00 per hour may end up being below the poverty line. So it’s a little unclear if $9.00 per hour will stay above the poverty line, or if it will gradually sink below it.

So currently, I have mixed feelings on this. I don’t have a clear position on this issue.

[Evil_Economist]

@Anonymous User

Now going back to the problem with this idea in which I haven’t really analyzed in this post, price inflation and unemployment can end up being a problem. Unemployment, as studies have shown, may not be too affected, but price inflation could be a problem. I actually had the wrong idea before. Before I thought that since raising the minimum wage from $7 to $9 an hour is a 28% increase, so you would basically have a spectrum.

No Price Inflation and Lots of Unemployment<------------------------------------------------------------------------------------------------------>28% Price Inflation and No Unemployment

But I was wrong; if wages increase by 28%, that doesn’t mean that the whole price has to be multiplied by 128%. For example, if a burger costs $5.00 and $1.00 of that is being used to pay employees, you only multiply that $1.00 by 128%. So in that case the burger would only cost $5.28, and this is if you strictly rely on inflated prices in order to compensate for the raised wages.

Didn’t I respond to this exact same post in your other thread?

Even your $5.28 assumption overstates inflation because 1) not everyone involved in making a burger is making minimum wage, 2) increasing the minimum wage reduces turnover, lowering the overall employment cost of minimum wage employees, 3) you don’t spend your entire paycheck on burgers, I hope, 4) worker’s productivity increase as their pay increaes, … and on and on and on.

Maybe you should actually read actual published economnics papers about the impact of minimum wages on prices. Here’s economist and minimum wage critic Neumark commenting on the impact of minimum wages on price levels:

Both because of the relatively small share of production costs accounted for by minimum wage labor and because of the limited spillovers from a minimum wage increase to wages of other workers, the effect of a minimum wage increase on the overall price level is likely to be small.

Aaronson, French, and MacDonald “find that a 10 percent increase in the minimum wage increases prices by roughly 0.7 percent.”

If concerns about inflation are keeping you up at night, I think you can relax a little.

Also, go look up the word “socialist.” It doesn’t mean what Fox News tells you it means.

[R3d_Anonymous]

Evil Economist, yes you did reply to it; I decided to add that part into my post. Sorry if anyone is annoyed with the repeat. Well, if inflated prices aren’t too big of an issue, then I don’t see why we wouldn’t want to raise the minimum wage to $9.00 per hour. As long as unemployment doesn’t increase, I think this is proposal actually makes sense now. He’s trying to bring all working people above the poverty line.

[Rucksinator]

This is just MHO, and I haven’t read past page 1. I usually agree with Obama, but not on this one.

I do think that minimum wage should be tied to inflation. I do not think that it should be based on whether or not someone can raise a family on it. Minimum wage is for teenagers and students. Sure, there are a few down-on-their-luck grownups that have to take a MW job temporarily.

I don’t think that companies should be forced to pay teenagers more than they are worth just to help out those dotl adults.

Fix the economy and the MW will only affect teenagers who are just looking for money for the weekend or to buy a car or to score some weed.
ETA: Whoa, 7 pages now. I won’t be offended if people recognize my post as just one person’s opinion and ignore it.

[rogerbox]

“Minimum wage is for teenagers and students.” People keep saying this, but can you explain why? IMO Minimum wage is about what an hour’s worth of labor should be worth, at minimum, in America/your state to keep people from being exploited. So I agree it doesn’t really directly have to do with raising a family.

Anyways, I am no longer a teenager but I don’t understand why it’s okay to exploit teenagers so millionaire burger franchise owners can pocket even more money. Those jobs are HARD.

[panaccione]

Yeah, the major drawback I see to it is the polarized political landscape we live in. Look at what employers threatened to do because of Obamacare. They were looking at .50 cents in raises and even lower, and they threatened to cut jobs and hours because they “couldn’t afford it.” I expect to see major backlash if this proposal goes through.

[rogerbox]

So what if there is? Employees have been taking a haircut in this country for 30 years, who cares about “backlash” at this point?