Except you missed the part about the possibility that labor regulations may have in fact contributed to this underclass.
Because our economy is larger, and there are more opportunities.
No, it shows the exact opposite. The number of people in poverty has risen precisely as the number of regulations have lessened. It shows that reducing government interference increases opportunities. Obviously, reducing one regulation will not instantly transform a country of a billion people into a free market paradise. Many countries have a long way to go. Including the US, BTW.
No, and agian, no. The great feature of capitalist markets is that it allows people to create and keep their own labor. Winning and losing has little to nothing to do with it. If I said that the great feature of socialist economies was that it makes losers and more losers, would you not chastise me?
Again, you have to insert the “often at somebody else’s expense”. This is simply not true. Why is that person participating in the transaction it is simply enriches the other participant at his expense?
That’s because this is anerroneous characterization of capitalism.
Not to mention that there is no such thing as a resource which is plentiful for everyone’s desire. I’m not sure what the point of this part is.
Yes, but there are other reasons for its existence as well. Lets not simply brush aside the political advantages of being in favor of minimum wage laws.
No, it is far prefferable to attack the problem of poverty by increasing the number of opportunities and the benifits for taking advantage of them.
You know, we don’t even have to bring India in to this. About a hundred years ago, America had child labor, slave-like company store and sharecropper schemes, sixteen hour workdays, unpaid overtime, absurdly dangerous job sites and great teeming slums and sweatshops.
What happened? Was it a huge increase in productivity? Did we start relying more on the forces of the free market?
No, it was the LABOR MOVEMENT. We now enjoy such a high standard of labor (and labor is a good chunk of living) thanks to a popular movement that led to government regulation of labor. And guess what? It didn’t detroy America’s economy. We are still one of the most prosperous and productive places on Earth. America and Europe have some of the most regulated labor markets, and yet they enjoy unprecedented prosperity and an increadable standard of living. Part of it is because we are blessed with abundant resources and political clout. But with these blessing we have worked to make sure that even our poorest citizens do not have to live and work in the worst conditions.
Yes. It was a huge increase in productivity. That and lots of other things.
Given your propensity to think that labor regulation is the reason for good living standards, this make sense. However it is not true. Take a look at the Index of Economic Freedom. It demonstrates a link between economic freedom and growth. You might also note that America and Europe are not “the most regulated labor markets”. They are amongst the most free of markets.
Allow me to be clear for a second. I am not saying that the labor movement was irrelevant or that it was a drag on the economy overall. For the most part, early on at least) the labor movement was about the labor suppliers cooperating to increase the value of their labor. To the extent that they did this voluntarily, they did a great many good things.
Also, I should say that the economic history of America let alone the free world is far too complex to boil down to increased labor laws good, or even decreased regulation good.
Simply not true. I guess if you raise it high enough it guarantees people will be laid off, but not at as likely at smaller levels. Assuming the economy continues to grow, people at the low end may have to look longer, but will get a better job. There’s a whole raft of economists who agree that incremental changes in min wage are not proven to increase unemployment.
That is the most absurd map. I didn’t get a chance to look into the report, but what is the meaning of saying Europe is economically “less free”? I mean, they have higher economic mobility than the US (see Danzinger “Understanding Poverty”, Harvard Press). Are the idea that Haiti is economically more free than Cuba is bizarre. Maybe on the books, but certainly not in practice (free enterprise in Haiti exists, but many are targetted by paramilitary), nor in living standards. :smack:
I read the book a few years ago. My conclusion was that Ehrenreich predetermined her desired out come, then struggled and bemoaned all the way to that inevitable end.
Her aim was not to earn a living, but to show she couldn’t earn a living. On at least one occasion, she turned down a slightly more lucrative job opportunity at Home Depot or Lowes for reasons that didn’t seem wholly rational.
As I recall, she made dreadfully expensive housing choices. Someone working low wage jobs can’t afford the luxury of a private residence—they’ll have to share accommodations. Usually this will entail living in “group homes” and possibly even sharing a bedroom. Immigrant families often sleep multiple adults in a single room. Ehrenreich wanted to live alone and paid the price—an unsustainable life style for that income.
My first full time job on my own, back in 1987 or 1988, that paid a hair above minimum wage, $4.75, or something like that. I rented a room in a house for $250 + 1/3 utilities per month. Not glamorous living, but I made ends meet.
Any individual who doesn’t abuse drugs or alcohol, uses contraceptives wisely or family planning options as necessary, shouldn’t have too much trouble with maintaining a minimal life style on minimum wage. Living within income is the key, although spendthrifts of any wage capability can run afoul.
Having a national minimum wage isn’t automatically a bad thing, though having it set locally or on the state level may be an option. The Living Wage is bogus, as I see it, as people can and do live off the minimum wage.
Your comment on Nickle and Dimed is interesting as a critic of her methods. However, your argument on the living wage being bogus as some people earn it and aren’t dead yet is, well, boooogus. The living wage argument assumes people aren’t single and childless (makes difficult of the targetting issue as singles get the same money). Also, living is different from being non-poor. Poor is ultimately subjective, but there are many outcomes from living at a low income that we just cann’t ignore. I don’t think you’ll find many people able to live as an individual on the minimum wage (without over 40 hours a week) in most large cities. Most of them will have income support from the government or other sources.
I assume you are refering to the studies done by David Card and Alan Krueger? If so, I think you are overstating their results. They showed that older models of the rise in unemployment were flawed. They also showed that the rise in real wages “outweigh”, or are large relative to the rise in umemployment. One summary I found put it this way “Do U.S. economists believe that an increase in the minimum wage has no effect reducing employment? No, they do not. Ask economists to predict what the impact of doubling the minimum wage would be, or of even larger increases that would take the minimum wage up to the average wage, and they will reply that at such high levels the loss of jobs for currently low-wage workers from the government’s mandating higher wages would be substantial. But ask U.S. economists today about the effects of a small marginal increase in the minimum wage, and the answer you will get is that a 10% boost to the minimum wage will reduce employment among affected workers by 0.5% to 1.0%–a loss of employment opportunities that is small relative to the boost in earnings received by those low-wage workers who remain employed.”
As in everything economic, the reality is complex. Are those put out of work and those whose income are increased really better off as a group? I suppose if the number put out is small enough, and the wage increase is large enough, you could say so. But this strikes me as a zero sum analysis of the situation. If those workers whose wages would increase really are worth that increase, wouldn’t it be better to give them the tools to seek it? If government programs are necessary, wouldn’t an incentive be better than an absolute floor? What I’m asking, is why is it necessary to create a wage law in the first place? I understand the desire to help people at the bottom of the economic scale. I do not understand the fixation on broad based and restrictive government regulations.
Right, the Labor Movement was a part of the free market. The workers, who own their labor and can decide whom to sell it to and what to sell it for, collectively decided that it was in their self interest not to accept low wages, long hours and poor conditions. To restrict workers from legitimate negotiation over compensation is as counter to the free market ideal as price fixing.
I would argue not that America is prosperous because of the movement, but that the movement wouldn’t have gone far without America’s relative prosperity and high productivity.
Think of the economy as a rope, and productivity as slack in the rope. With high productivity there is a lot of slack, so the economy can easily absorb and accommodate more expensive working conditions which take up some of the slack. Workers have every right, and indeed, every obligation to demand better conditions.
But suppose the workers in a subsistence farming economy (where the output barely meets the needs of the population) demand the same conditions. There just isn’t the slack in the rope to allow anything of the sort. What subsistence farmer can afford to work an 8 hour day when a 16 hour day is what he needs to grow enough food? What subsistence farmer can afford NOT to have his children work those same hours?
Taking it further, suppose the farmer increases his productivity. Maybe he gets a horse and plow so he doesn’t have to do everything by hand. Now he is able to either (a) produce more in the same amount of time or (b) take less time to produce the same amount. He now has slack in his rope. He can now afford to let his children work less. Productivity makes this possible
So, yeah, it was high economic productivity that gave the workers more clout and led them to demand better conditions.
Your quote in italics makes my case well. My further argument is that if the economy continues to grow people laid off will find work and it will be better paying work. I don’t have researchers names for this, but I might later in the day as I finish this paper on the min wage and ethics.
Regarding with not regulate something other than wages: I’m all for more jobs programs, but if they are low paying jobs we haven’t gotten far in reducing poverty. If you’re for stimulating higher paying jobs, I’m all for that, but that doesn’t mean they aren’t still people getting only (sub) min wage jobs (now that you’ve done away with it). Finally, the min wage may be poorly targetted, but it’s easier to administer than a large program. Besides, if it helps many and doesn’t appear to be hurting many, why not use it? All in all, we could have other ways, but we don’t have perfect administrative capacity nor do we have political support for large welfare programs but there is some support for min wage laws. People like the moral statement: “If you work, you should be able to earn a living.” Otherwise, why work?
Oh, there are also arguments about social stability for supporting the min wage. You don’t hear these often nowadays, but the argument used to run “freedom from hunger for the poor and freedome from unrest for society.” Minimum wages keep bread riots down was the idea. (Earlier 20th century debates.)
See this author for some interesting history (although he’s not a great writer there’s some good stuff in his papers that are freely available on the web):
Levin-Waldman, Oren. 1996. Exploring the Politics of the Minimum Wage. The Levey Economics Institute of Bard College.
Levin-Waldman, Oren. 1997. Minimum Wage and Justice? The Levey Economics Institute of Bard College.
Levin-Waldman, Oren and George W. McCarthy. 1998. Small Business and the Minimum Wage. The Levey Economics Institute of Bard College.
Well, of course. Someone else said that changes in the minimum wage which merely reflect the “reality on the ground” will not result in job loses. That fits right in with the old model. The problem, of course, is that minimum wages are not tied to any economic indicators. We do not raise them only in good times and lower them in bad times, or anything of the sort. We raise them and leave them alone. Sometimes we raise them inappropriately, and sometimes we do not raise them when we should. My point is that systems with feedback built into them are far more adaptable.
No, you are still thinking of government programs. What I was trying to suggest is that there may be ways to help poor wage earners without involving the government at all. Except, perhaps, as a central information gathering place.
Of course. But isn’t sub minimum wage better than no wage? Do you really think it is better for a person to earn no money and live entirely off of charity or welfare than to earn some money and live only partially off of charity?
So I guess you would have no problems if several of the grocery stores got together, and decided that consumers really should pay $6 a gallon for milk? And they then threatened violence against any grocery stores in the area who didn’t participate? And then they got the government to take their side and force you to bargain with them instead of simply changing grocery stores?
Free market my *ss. I see absolutely no difference between this grocery store scenario and what unions do now.
That is because you are concentrating on the negative side of the labor movement. Some, perhaps many, unions do just as you described. Others simply were ways in which employees agreed not to work for low wages. Others were simply collective bargaining tools. Even today unions still fulfill these roles. I’m not sure where I come down on the goodness or badness of unions. But it is unfair to characterize the entire labor movement of the last century as only using the tactics you described.
Given the quote you had in italics a couple postings back, this Hobson’s choice is not a fair debating point. It appears that some increase, don’t know to where, doesn’t hurt through firings of other low income people. Besides, maybe helping some people with min wage (that would earn less without) is better than having “everybody” working but many for truly crappy wages. If people have to start working for even crappier salaries, you’re also going to have a really unproductive workforce and possilby more social unrest. So, I’d rather have a min wage, some (as you noted minor job loss) and then support for those who loss their jobs (which would be the weakest members of the labor force and thus likely to have a variety of needs anyway) through retraining, etc.
Regarding your idea for non government programs, what are they? How will they be sufficient to meet need if not coerced through government?
No, you are overstating it again. The quote, and the research shows that small increases in the minimum wage do not increase unemployment as much as we used to think. They do not show that unemployment is not increased. I think they all agree that some jobs get elliminated. It’s just a very small number of them.
However, I was refering to your statement ““If you work, you should be able to earn a living.” Otherwise, why work?” You seem to be saying that working for a lower wage is less desireable than not working at all. Allow me to turn the debate around on you and say that this may be true for ridiculously low wages, but for small decrements from the minimum wage this is clearly not true.
Quite true. Maybe. And keeping in mind that we are talking about helping some at the expense of others. As long as we say those things, I have no problem with debating how many will be helped vs how many will be hurt, and by how much.
Here you have gone too far. Especially in the “unproductive workforce” area. I’m sorry, but government programs are totally inadequate for maintaining a productive workforce. They simply cannot ever adjust fast enough to changing realities. They cannot be tailored to individual cases.
I’m talking about making it more desireable to share the wealth of increased productivity. I’m not presenting fully implementable policies. For instance what if an employer wanted to institute a program whereby employee saleries were tied directly to productivity. They could contractually develop a measure of productivity which would effect total take home pay. If this required lowering the base pay below the minimum wage, would it be legal?
If it’s a small number of them then you are overstating my “overstatment”. I agree some jobs might be lost, but I also think there are arguments for how they get pick up again. Lets not split hairs.
I’m assuming that some social programs exist. If work doesn’t pay better than welfare, why work? Especially since there are costs involved in working, including very high ones like day care.
yep.
Two words for you: student loans. There is also some reason to belive, evidence is mixed, that minimum wages cause employers to invest more in their workers, producing a public good.
I dunno. Obviously there are many jobs that have commissions, I’m not sure if the base pay can be below minimum. In anycase, how is this a way to reduce poverty?
OK, I’ll agree not to split hairs if you agree that talking about the jobs lost due to minimum wage is not an unfair debating tactic.
Ok, but now you are assuming some floor below which any work at all is counterproductive. I certainly agree that working at a job which does not bring in more money than it costs is not profitable. But I am saying that this calculation cannot be done once from Washington and apply to the whole country. It has to be done millions of times every day by individuals weighing their options.
Yes. I did not mean that government programs are only evil. I meant that goals of maintaining a productive workforce are far better handled in the private sector. Perhaps it was my turn to overstate.
By allowing people to earn more when their productivity is increased. And by tying such a pay increase directly to productivity instead of to political whim.
