Discussion About Raising Minimum Wage to $15/hr

[hybrid]

Hence the term minimum wage.

Don't quite follow you logic there.  Why raise the minimum if it doesn't actually have any measurable effect?  Or indeed, if the effect is to induce a chain reaction increase in all other wages & prices such that (almost*) everyone winds up right back where they started, getting more dollars that are worth less?

*Almost, because people why retired early and thought they wre going to live off their fixed-income investments will get screwed :-)

What I mean by that is minimum wage is the somewhat agreed upon level of compensation that people can scrape by on, not get ahead on.  Yes, I know it can be done, but the simple reality is most folks don't.

I don't think $15 an hour will gain much traction, but I do think a significant rise in the current level will.  Society is becoming increasingly aware of the ever-widening gap between the extremely well-heeled and the folks in the lowest quintile of the work force.  That translates into votes.  Or, at the very least, little sympathy for the laws and policies that helped widen the gulf. 

[Jamesqf]

I don't think $15 an hour will gain much traction, but I do think a significant rise in the current level will.  Society is becoming increasingly aware of the ever-widening gap between the extremely well-heeled and the folks in the lowest quintile of the work force.

The point, though, is that it does nothing to narrow that gap, or improve conditions for the lowest quintile.  What happens if the MW is raised from sat $7.50 to $15 is that it soon takes $15 to support the same lifestyle that $7.50 used to.

[hybrid]

I don't think $15 an hour will gain much traction, but I do think a significant rise in the current level will.  Society is becoming increasingly aware of the ever-widening gap between the extremely well-heeled and the folks in the lowest quintile of the work force.

The point, though, is that it does nothing to narrow that gap, or improve conditions for the lowest quintile.  What happens if the MW is raised from sat $7.50 to $15 is that it soon takes $15 to support the same lifestyle that $7.50 used to.

No, sorry, the core rate of inflation is not directly linked to the minimum wage.  Take a look at the most recent MW rate hikes compared to the inflation rate for a quick example.  A substantial bump in the MW will dramatically improve the buying power of the lot making that wage.

[daverobev]

I don't think $15 an hour will gain much traction, but I do think a significant rise in the current level will.  Society is becoming increasingly aware of the ever-widening gap between the extremely well-heeled and the folks in the lowest quintile of the work force.

The point, though, is that it does nothing to narrow that gap, or improve conditions for the lowest quintile.  What happens if the MW is raised from sat $7.50 to $15 is that it soon takes $15 to support the same lifestyle that $7.50 used to.

No, sorry, the core rate of inflation is not directly linked to the minimum wage.  Take a look at the most recent MW rate hikes compared to the inflation rate for a quick example.  A substantial bump in the MW will dramatically improve the buying power of the lot making that wage.

There is a lag, for sure, but increasing wages certainly increases the cost of things. Rents go up, taxi prices go up.

Short term, yes, buying power goes up. Long term, less so.

[Jamesqf]

No, sorry, the core rate of inflation is not directly linked to the minimum wage.  Take a look at the most recent MW rate hikes compared to the inflation rate for a quick example.  A substantial bump in the MW will dramatically improve the buying power of the lot making that wage.

Then why hasn't it done so, historically?

[hybrid]

No, sorry, the core rate of inflation is not directly linked to the minimum wage.  Take a look at the most recent MW rate hikes compared to the inflation rate for a quick example.  A substantial bump in the MW will dramatically improve the buying power of the lot making that wage.

Then why hasn't it done so, historically?

Are you asking me why the poor stay poor?  That's a different topic.  Suffice to say that the definition of poor has changed over the years.  In years past poor meant not enough calories per day, in 2013 it is more likely to mean not enough nutritious calories per day.  Today's poor tend to have more things because things have become cheaper, but less access to expensive services (like affordable health care and child care) that have become more costly over time.

[Luck better Skill]

No, sorry, the core rate of inflation is not directly linked to the minimum wage.  Take a look at the most recent MW rate hikes compared to the inflation rate for a quick example.  A substantial bump in the MW will dramatically improve the buying power of the lot making that wage.

Then why hasn't it done so, historically?

  Inflation is driven by the middle class not minimum wage earners.  My first apartment was $200 a month, now that number is $600 to $800 in my town.  During that time minimum wage went from $3.50 to 7.50.  Minimum wage doubled and inflation more than tripled. 
  The middle class or rich have the discretionary income to push up prices.  The poor do not.  Your target demographic must be able to pay if you want to sell or rent.  You can buy a $20 or $200 pair of jeans.  With out the large middle class jeans would be 20 with some 2000 ones for the wealthy. 
  I think $15 is to high of a bump for minimum wage, 10 or 11 would be better.

[StarswirlTheMustached]

No, sorry, the core rate of inflation is not directly linked to the minimum wage.  Take a look at the most recent MW rate hikes compared to the inflation rate for a quick example.  A substantial bump in the MW will dramatically improve the buying power of the lot making that wage.

Then why hasn't it done so, historically?

Are you asking me why the poor stay poor?  That's a different topic.  Suffice to say that the definition of poor has changed over the years.  In years past poor meant not enough calories per day, in 2013 it is more likely to mean not enough nutritious calories per day.  Today's poor tend to have more things because things have become cheaper, but less access to expensive services (like affordable health care and child care) that have become more costly over time.

Here, at least, increases in minimum wage (at least of late) seem to lag inflation, rather than lead it. Though a sufficiently long lag time for the inflationary effect could possibly make it appear that way. I honestly don't know how to tell the difference. Do you?

To me, the only logical way to set up a minimum wage would be to define the desired lifestyle, and and put into law an algorithm that will define the minimum wage in each city/county based on the parcel of goods thus defined. (How austere you want to define that is a whole other kettle of fish, and is probably related to how prevalent you perceive minimum wage jobs to be.) Though that would give you a minimum salary, and I suppose you'd have to use the local average of hours folk on minimum wage make (certainly not 40, at least around here). To address your concern about youth unemployment, you could also make it tied to age, as we do here in Ontario-- students (IIRC, that's considered to be anyone under 18) aren't required to be paid as much as adults. You could tie that into the local stats for youth enemployment, and... you know what? I'm starting to think that this starting to get too complicated, fast. 
You know what?
Let's just go back to that minimum income thread, cut everybody a check, and let the market work it out after that. 

Which really does beg the question: What do all these people do?

The "End of Work" problem-- I think I had that book. It does not paint a pretty picture to me.
I think it's the key question that this debate misses. It seems like Jamessqf is assuming that there ARE enough non-minimum-wage jobs for the lazy fucks to go get, if they were just willing to. It's the same thing that's driving the boom in education: people with good jobs have college educations-- that means if you get a college education, you'll get a good job, right? Well, if there are 50 million openings for college-educated workers, and a hundred million graduates... ah, no. Much disappointment. At what point the market was supposed to magic up a demand for all these eggheads is beyond me.
If there aren't enough jobs to go around, at any wage, the debate starts to get a bit different.

[mpbaker22]

If McDonalds workers start making $15/hr, I better the hell start making $50.  Otherwise, going to college and getting a real degree for 3.5 years was pretty much a waste.  I mean, I make something like $23/hr, and I'm pretty sure I'm worth 3x someone who can only flip burgers for a living.  On the other hand, I know people who make close to minimum wage doing real jobs, and they deserve to make more.

[BlueMR2]

If McDonalds workers start making $15/hr, I better the hell start making $50.  Otherwise, going to college and getting a real degree for 3.5 years was pretty much a waste.  I mean, I make something like $23/hr, and I'm pretty sure I'm worth 3x someone who can only flip burgers for a living.  On the other hand, I know people who make close to minimum wage doing real jobs, and they deserve to make more.

No kidding.  Most of my friends have done the full 4 year (and some even extra schooling) thing, and I can only think of a couple of them that are making $15/hr or more.  College is already a risky gamble with there being far fewer professional jobs than people coming out of college fighting for them.

[gimp]

I spend a lot of time automating things. I work in silicon, and I can (and do) automate some fairly interesting stuff. A lot more is done by a lot of different people.

Here's a cool example - placement. People used to place transistors by hand (on paper schematics, no less). Now we run RTL through various flows, and then fix the hot spots and critical paths. People do a better job than machines in specific areas, but it'd take too many people to place billion+ transistor projects.

Now, the engineers didn't lose their jobs. Folks who are well educated and have a broad base can move laterally or vertically. Some people who did placement now write placement automation tools. Some people hand-massage critical paths. Some do analog stuff that isn't as easy to automate. Some have moved into different areas - architecture, validation, DFT, etc etc. Some got promoted. Some left to other jobs or startups.

But most people can't really do that. All of those white-collar desk jobs, writing reports... someone spends a week on a script, sticks it into a cron job, writes documentation and meets with stakeholders, and in two weeks someone else is out of a job. Hopefully they find a new one.

The low-skill stuff is even worse, because it's harder to switch careers.

My point with this is that we do more and more automation, and it's awesome for progress, but it leaves the issue of unemployment. Now, here's the real question:

Will the jobs pop up elsewhere, or are they gone?

We used to have 98% of our population farm, but now we don't. Clearly those jobs were replaced. But can we always replace jobs? Factory folk, where did they go? Where will fast food workers go once a machine spits our a perfect pizza, and fries, and burgers? It's not difficult to automate, just low ROI.

If eventually we have a permanent situation where there are significantly more workers than jobs, we're going to need to restructure our society. I think if a country can feed, clothe, and provide shelter and goods and even luxuries to all of its people, and there are still more people than jobs, we're going to have to figure out how to get people doing work they enjoy - not necessarily profitable work; maybe art, or music, or writing, or even basement-science or garage-tinkering - and make sure they're content.

If instead we end up with a large percent of the population entirely disfranchised, and with nothing to lose, things will get ugly.

[dragoncar]

I spend a lot of time automating things. I work in silicon, and I can (and do) automate some fairly interesting stuff. A lot more is done by a lot of different people.

Here's a cool example - placement. People used to place transistors by hand (on paper schematics, no less). Now we run RTL through various flows, and then fix the hot spots and critical paths. People do a better job than machines in specific areas, but it'd take too many people to place billion+ transistor projects.

Now, the engineers didn't lose their jobs. Folks who are well educated and have a broad base can move laterally or vertically. Some people who did placement now write placement automation tools. Some people hand-massage critical paths. Some do analog stuff that isn't as easy to automate. Some have moved into different areas - architecture, validation, DFT, etc etc. Some got promoted. Some left to other jobs or startups.

But most people can't really do that. All of those white-collar desk jobs, writing reports... someone spends a week on a script, sticks it into a cron job, writes documentation and meets with stakeholders, and in two weeks someone else is out of a job. Hopefully they find a new one.

The low-skill stuff is even worse, because it's harder to switch careers.

My point with this is that we do more and more automation, and it's awesome for progress, but it leaves the issue of unemployment. Now, here's the real question:

Will the jobs pop up elsewhere, or are they gone?

We used to have 98% of our population farm, but now we don't. Clearly those jobs were replaced. But can we always replace jobs? Factory folk, where did they go? Where will fast food workers go once a machine spits our a perfect pizza, and fries, and burgers? It's not difficult to automate, just low ROI.

If eventually we have a permanent situation where there are significantly more workers than jobs, we're going to need to restructure our society. I think if a country can feed, clothe, and provide shelter and goods and even luxuries to all of its people, and there are still more people than jobs, we're going to have to figure out how to get people doing work they enjoy - not necessarily profitable work; maybe art, or music, or writing, or even basement-science or garage-tinkering - and make sure they're content.

If instead we end up with a large percent of the population entirely disfranchised, and with nothing to lose, things will get ugly.

Ha!  I used to do full-custom circuit design and here's the thing.... it was BORING.  I was drawing rectangles all day long.  The smart, educated people definitely have other options.

[hybrid]

My 2c, as less and less people are required to make things more and more people move into service industries.  Take for example the plethora of massage therapists today.  I seriously doubt there were many of those in 1950.

There were 153,000+ in the US in 2010.     http://www.bls.gov/ooh/healthcare/massage-therapists.htm 

The downside to either being an assembler of goods or in a service industry is that if your skills are specialized and your market evaporates you may have to develop entirely new skills very quickly.  A good plumber will always be able to find work.

[gimp]

Ha!  I used to do full-custom circuit design and here's the thing.... it was BORING.  I was drawing rectangles all day long.  The smart, educated people definitely have other options.

Where at, out of curiosity? I'm looking for fulltime jobs in a couple months. There are a lot of awesome companies I haven't even heard of, which is why I'm asking. Though there's a good chance they don't exist anymore...

[hybrid]

If McDonalds workers start making $15/hr, I better the hell start making $50.  Otherwise, going to college and getting a real degree for 3.5 years was pretty much a waste.  I mean, I make something like $23/hr, and I'm pretty sure I'm worth 3x someone who can only flip burgers for a living.  On the other hand, I know people who make close to minimum wage doing real jobs, and they deserve to make more.

No kidding.  Most of my friends have done the full 4 year (and some even extra schooling) thing, and I can only think of a couple of them that are making $15/hr or more.  College is already a risky gamble with there being far fewer professional jobs than people coming out of college fighting for them.

This raises an interesting discussion.  mpbaker states that he is worth 3X what a guy flipping burgers is worth.  And that people doing "real jobs" at the same level of compensation deserve to make more.

To that I would ask why is flipping burgers not as "real" a job as other $8 an hour jobs, and why is a hard working, but perhaps less able, person worth only a mere third of someone making a middle of the road salary?  I don't have any easy answers here, but I will say I am uncomfortable with the prevalent notion in this country that hard work in menial jobs is the equivalent of menial work.  I think work is work, and I am damned thankful I don't flip burgers for a living, and these folks work a lot harder during the day than I do at my comfy desk job.  These folks deserve more respect than they get from the educated class. 

I fully get that capitalism sets wages based on scarcity of the qualified labor pool (and I have certainly benefited from that, as many people cannot do my job so my salary reflects that), I also think that capitalism in its rawest form (no minimum wage) denegrates the social value of work itself.  The job becomes the only thing of value, not the poor schmuck actually doing that job.  Surely in the richest country on earth we are better than that low bar.  That is why I support a decent bump in the minimum wage (to somewhere between 9 and 10 an hour).  Those that sing the tired old song about how it will kill jobs will have to reconcile that opinion with the fact that bumps in the minimum wage historically have had little to no effect on jobs overall in the longer term.

The simple truth is we can afford to pay some of our hardest workers more than they make now, and almost every dime they get paid will flow right back into the local economy (unlike tax cuts for the wealthiest Americans, which are far less stimulative). 

[ender]

hybrid the way I've thought of "what salary is fair?" is in terms of what value jobs add to society and the economy.

Someone who is working at fast food is in my opinion not adding anywhere near as much value to either as someone who is designing new processes to improve automation within manufacturing, like what gimp said.

One job simply maintains the status quo while the other actively contributes new knowledge and benefits to both society and economic growth. One is also considerably easily doable while the other requires specific and specialized skill sets which are possessed by a much smaller percentage of people.

We used to have 98% of our population farm, but now we don't. Clearly those jobs were replaced. But can we always replace jobs? Factory folk, where did they go? Where will fast food workers go once a machine spits our a perfect pizza, and fries, and burgers? It's not difficult to automate, just low ROI.

If eventually we have a permanent situation where there are significantly more workers than jobs, we're going to need to restructure our society. I think if a country can feed, clothe, and provide shelter and goods and even luxuries to all of its people, and there are still more people than jobs, we're going to have to figure out how to get people doing work they enjoy - not necessarily profitable work; maybe art, or music, or writing, or even basement-science or garage-tinkering - and make sure they're content.

This is so true and is one of my main "concerns" with the benefits of automation.

My current project work is basically automating a considerable portion of busy-work for office workers. In the longer term, I see it effectively eliminating multiple jobs and potentially even an entire department. I am well aware the net effect of people who can write any sort of automation/software is effective elimination of a very large band of what were previously considered "middle class" jobs.

This problem is going to only get worse over time as the jobs employers can offer become even more polarized in terms of income/earning potential.

[davisgang90]

If raising the minimum wage leads to a decrease in available jobs (which logic dictates it will) then the true effective minimum wage is $0.00/hr.

[mpbaker22]

If raising the minimum wage leads to a decrease in available jobs (which logic dictates it will) then the true effective minimum wage is $0.00/hr.

By lowering minimum wage to 0, you would employee anyone who is not employable at $7.25/hr, but is willing to work for less.  I guess what I'm getting at is I don't know the point of your post ... what you said is basic economics.  It's also basic economics that raising minimum wage creates a deadweight loss.

[davisgang90]

If raising the minimum wage leads to a decrease in available jobs (which logic dictates it will) then the true effective minimum wage is $0.00/hr.

By lowering minimum wage to 0, you would employee anyone who is not employable at $7.25/hr, but is willing to work for less.  I guess what I'm getting at is I don't know the point of your post ... what you said is basic economics.  It's also basic economics that raising minimum wage creates a deadweight loss.

It was somewhat tongue in cheek.  If you raise the minimum wage and cause there to be fewer jobs, those who are now unemployed have seen their per hour wage decrease to zero.  $15/hr works out to aroun $30,000 a year before taxes (assuming 40/wk).  I can't see how that will do anything but decrease the number of jobs available and increase the pace of automation to replace the workers.

[dragoncar]

If McDonalds workers start making $15/hr, I better the hell start making $50.  Otherwise, going to college and getting a real degree for 3.5 years was pretty much a waste.  I mean, I make something like $23/hr, and I'm pretty sure I'm worth 3x someone who can only flip burgers for a living.  On the other hand, I know people who make close to minimum wage doing real jobs, and they deserve to make more.

This is what happens when you raise minimum wage.  If the minimum wage cashier gets $15/hr, then the nursing assistant that is currently getting $15/hr should then get $30/hr, and then the registered nurse that is getting $30/hr should get $60/hr, and on and on.  Otherwise, why would the nursing assistant bother with all the extra education and responsibilities for $15/hr when s/he can simply stand at a cash register and ring up orders for the same exact wage?  And if they raise the wage for the nursing assistant, then why would someone want to become an RN for the same wage as a nursing assistant?

The domino effect will work its way throughout our society to the point that healthcare costs double, rents double, food prices double, etc.  So what happens to the minimum wage workers making $15/hr?  They'll be out there trying double their minimum wage to $30/hr.

Why would the nurse get $30/hr?  Why not $16 or just $15?  When there are high-paying jobs that require no education, the competition for them will be fierce.  If you are 1 of 1000 applicants for a $15/hr burger flipping job, you might still go to nursing school so that you can be 1 of 2 applicants for a $15/hr nursing job.

[dragoncar]

If McDonalds workers start making $15/hr, I better the hell start making $50.  Otherwise, going to college and getting a real degree for 3.5 years was pretty much a waste.  I mean, I make something like $23/hr, and I'm pretty sure I'm worth 3x someone who can only flip burgers for a living.  On the other hand, I know people who make close to minimum wage doing real jobs, and they deserve to make more.

This is what happens when you raise minimum wage.  If the minimum wage cashier gets $15/hr, then the nursing assistant that is currently getting $15/hr should then get $30/hr, and then the registered nurse that is getting $30/hr should get $60/hr, and on and on.  Otherwise, why would the nursing assistant bother with all the extra education and responsibilities for $15/hr when s/he can simply stand at a cash register and ring up orders for the same exact wage?  And if they raise the wage for the nursing assistant, then why would someone want to become an RN for the same wage as a nursing assistant?

The domino effect will work its way throughout our society to the point that healthcare costs double, rents double, food prices double, etc.  So what happens to the minimum wage workers making $15/hr?  They'll be out there trying double their minimum wage to $30/hr.

Why would the nurse get $30/hr?  Why not $16 or just $15?  When there are high-paying jobs that require no education, the competition for them will be fierce.  If you are 1 of 1000 applicants for a $15/hr burger flipping job, you might still go to nursing school so that you can be 1 of 2 applicants for a $15/hr nursing job.

Regardless of competition, you are still taking away the main motivation (money) for people to spend massive amounts of time and money to build their skill sets.

Let's figure out where your breaking point is:

Would you get a two-year degree with the expectation that you will make the same hourly wage as a 16 year old dropout with no work experience?

Would you get a four-year degree with the expectation that you will make the same hourly wage as a 16 year old dropout with no work experience?

Would you get a graduate degree with the expectation that you will make the same hourly wage as a 16 year old dropout with no work experience?

Would you get a PhD with the expectation that you will make the same hourly wage as a 16 year old dropout with no work experience?

How much in student loans are you willing to take on to get a minimum wage job?  $10,000?  $50,000?  $100,000?  $200,000 (doctor)?

Or how about truly hard work.  Would you be willing to bust your ass pouring concrete or endanger your life on a crabbing ship for minimum wage knowing that some teenager standing in a climate controlled building taking orders at a cash register is making the same wage as you?

What happens when we decide everyone is equal because hey, work is work and they're trying their hardest, so we should pay everyone the same?  You are going to take away people's motivation to better themselves.

Plenty of people do all of the above simply to avoid getting a job

[greaper007]

The problem with these discussions is that they generally employ the "fundamental attribution error" early on.   We blame the situation on the individual instead of the larger system that funnels the individual towards certain choices.    This isn't an opinion, it's a proven psychological theory.   

Let's not blame the individual, or the faulty school system, institutional racism, poor family structure or the myriad other social problems that exist in our society.    Lets look at history.    50 years ago a white, male, high school grad could get a job on an assembly line that would pay him what most middle managers earn today.   Much like fast food work, it was shitty soul crushing work.   But he could earn enough to send his kids to college (which was the equivalent of about $5000 a year) who would then be able to break into a higher social class than the one they were born into.   

That used to be called the American dream, it doesn't exist today.    Now the US sits towards the bottom of the list of social mobility for developed countries.   Raising the minimum wage above something that would earn food stamps isn't about individuals, it's about all of us.    When I was first hired as an AIRLINE PILOT I made $17,000 a year, often slept less than 6 hours a night and was probably flying your children around.   All while corporate jerk offs drove airlines into the ground and took massive golden parachutes.    If we really want to take our country back, we have to establish a minimum living wage, and I say that as a current VP of a corporation (even if it's in name only). END RANT

[quilter]

My cheap-o recipes are at http://ourqueenskitchen.wordpress.com/ if anyone is interested.  Buzzmarketing!

Great recipes. Your ingredient prices are lower than what I can find on foot or by bike, but very down to earth

[Luck better Skill]

$15 is too high of a jump, 9 or 10 is more realistic.  Minimum wage is one of places the theory of capitalism breaks down with reality.  People cannot go to a remote place, live of the land and wait for wages to go up.  For those caught in the cycle of living hand to mouth it is hard to break free and move up the economic ladder.

[mpbaker22]

The problem with these discussions is that they generally employ the "fundamental attribution error" early on.   We blame the situation on the individual instead of the larger system that funnels the individual towards certain choices.    This isn't an opinion, it's a proven psychological theory.   

Let's not blame the individual, or the faulty school system, institutional racism, poor family structure or the myriad other social problems that exist in our society.    Lets look at history.    50 years ago a white, male, high school grad could get a job on an assembly line that would pay him what most middle managers earn today.   Much like fast food work, it was shitty soul crushing work.   But he could earn enough to send his kids to college (which was the equivalent of about $5000 a year) who would then be able to break into a higher social class than the one they were born into.   

That used to be called the American dream, it doesn't exist today.    Now the US sits towards the bottom of the list of social mobility for developed countries.   Raising the minimum wage above something that would earn food stamps isn't about individuals, it's about all of us.    When I was first hired as an AIRLINE PILOT I made $17,000 a year, often slept less than 6 hours a night and was probably flying your children around.   All while corporate jerk offs drove airlines into the ground and took massive golden parachutes.    If we really want to take our country back, we have to establish a minimum living wage, and I say that as a current VP of a corporation (even if it's in name only). END RANT

Except this ignores the very basics of economics theory.  The issue isn't that the government should mandate a minimum wage and prevent the presidents from having golden parachutes.  The issue is that stockholders are primarily wealthier individuals who vote their shares to allow the presidents to have golden parachutes.  If the middle class wasn't so obsessed with buying shit, they'd be the majority shareholders in corporations, and all the other bullshit wouldn't exist.  Hell, I'm sitting here at 24 years old, and I own more corporate stock than the average 40 year old, yet I actually make less than the US median! 

[galliver]

First, in the mid-late 1800's, there were factories. It didn't take much skill to work in a factory. Factory workers were treated like shit. Paid pennies, worked 20 hr/day, zero healthcare--if the machine ripped off your arm, you were SOL. They could afford rice and beans and lived 8 people to a 10'x10' room. Kids who were lucky enough to go to school instead of working at the family sweatshop had to drop out by the end of elementary school and get a job. This happened, but it's not what we want our lowest national standard of living to look like.

It's not what they wanted, either. They organized. They unionized. They rebelled. They demanded higher wages and more respect. By the 1950's, a factory job was middle class. You could support a family on that, roof over their heads (buy a house!), food on the table, clothes on their back, if you saved you could send the kids to college. If you didn't,  they could save up and go anyway (you could pay tuition even at a private university with earnings from a summer job!).

But then we automated factories, because all those workers are expensive. We automated other things...we no longer need secretaries to type up memos, for example. The nature of the job market changed. But there always have been and always will be "unskilled" workers. They had to go somewhere; they went to the service  and retail industries, because they're still there. I don't believe those will ever completely go away. People do like dealing with people (at least yelling at them when things go wrong). Right now, we don't respect people with retail jobs. Kind of like those industrial-era factory jobs. They are paid (relative) pennies, might be juggling two jobs to net 40-60 hr/week, paid pennies (maybe enough to live on). Many fall below the poverty line and are eligible for government benefits, which come out of tax dollars. If you think about it, you are subsidizing corporations that don't pay enough to keep the (e.g.) single mother of two above the poverty line.


My perception of history aside, I believe we should value all workers willing and able to work full-time enough to keep them above poverty. That's my fundamental disagreement with most of this thread. If someone is willing to show up and lift boxes or flip burgers or get yelled at because the lady in the SUV asked for *no* ketchup, and keep this up 40hr/week, 50 wk/year, YES, they should be able to not only afford food (including veggies, chicken, and a roast for holidays), housing (2 BR for family of 4), medical care (incl. dental checkups). But also a decent (5-6 yr max) computer to go with their internet connection, an older car bought used (1-car family),  and a little to put away.  The poverty line can be lower than this, at the true "bare necessities". The wage we expect corporations to pay people for labor should not be.

For anyone arguing that increasing min wage would raise prices on everything to the point where it would be useless, no, it wouldn't. The price increase would be very small: http://newscenter.berkeley.edu/2012/10/24/food-day-report-on-how-minimum-wage-hike-would-impact-consumers-workers/

For anyone arguing that doubling min wage *requires* doubling all other wages...no, it doesn't. Yes, there needs to be a shift for it to be equitable, but I think the nurse who was making $15/hr would be pretty happy with $20/hr. The engineer making (what works out to) $30/hr would  probably be ok with $40. The idea is to shrink the income gap, not to scale it. You just have to accept that valuing the labor of your cashier at $30k/year promotes a better standard of living and healthier society all around, and you're still doing better than him/her so why are you griping?

For anyone arguing that kids are "a choice" or "a luxury"...I won't even start.

Hybrid, if you have read this far, you are awesome. You redeemed my faith in humanity/this thread. Thank you.

[mpbaker22]

But then we automated factories, because all those workers are expensive. We automated other things...we no longer need secretaries to type up memos, for example. The nature of the job market changed. But there always have been and always will be "unskilled" workers. They had to go somewhere; they went to the service  and retail industries, because they're still there. I don't believe those will ever completely go away. People do like dealing with people (at least yelling at them when things go wrong). Right now, we don't respect people with retail jobs. Kind of like those industrial-era factory jobs. They are paid (relative) pennies, might be juggling two jobs to net 40-60 hr/week, paid pennies (maybe enough to live on). Many fall below the poverty line and are eligible for government benefits, which come out of tax dollars. If you think about it, you are subsidizing corporations that don't pay enough to keep the (e.g.) single mother of two above the poverty line.


My perception of history aside, I believe we should value all workers willing and able to work full-time enough to keep them above poverty. That's my fundamental disagreement with most of this thread. If someone is willing to show up and lift boxes or flip burgers or get yelled at because the lady in the SUV asked for *no* ketchup, and keep this up 40hr/week, 50 wk/year, YES, they should be able to not only afford food (including veggies, chicken, and a roast for holidays), housing (2 BR for family of 4), medical care (incl. dental checkups). But also a decent (5-6 yr max) computer to go with their internet connection, an older car bought used (1-car family),  and a little to put away.  The poverty line can be lower than this, at the true "bare necessities". The wage we expect corporations to pay people for labor should not be.

For anyone arguing that increasing min wage would raise prices on everything to the point where it would be useless, no, it wouldn't. The price increase would be very small: http://newscenter.berkeley.edu/2012/10/24/food-day-report-on-how-minimum-wage-hike-would-impact-consumers-workers/

For anyone arguing that doubling min wage *requires* doubling all other wages...no, it doesn't. Yes, there needs to be a shift for it to be equitable, but I think the nurse who was making $15/hr would be pretty happy with $20/hr. The engineer making (what works out to) $30/hr would  probably be ok with $40. The idea is to shrink the income gap, not to scale it. You just have to accept that valuing the labor of your cashier at $30k/year promotes a better standard of living and healthier society all around, and you're still doing better than him/her so why are you griping?

For anyone arguing that kids are "a choice" or "a luxury"...I won't even start.

Hybrid, if you have read this far, you are awesome. You redeemed my faith in humanity/this thread. Thank you.

Now, I would be completely in favor of a law that raises the minimum wage to $x + $y per dependent, or something to that effect.  Of course, we'd have to somehow remove the incentive employers would have to only hire workers without dependents.  A blind doubling of the minimum wage?  That I can't support, it'd be disastrous.  As far as I can tell, the link to Berkeley's study provides no real evidence of their conclusion.  Anyone could have written that article with any ridiculous amounts.  Can you link to their data sets?  In fact, as far as I can tell, they typically link to their full reports.  But for this specific report, there isn't a direct link from the UC Berkeley article to the data set.

[mpbaker22]

I did just find their data, and in fact, I disagree with their analysis.  On page 6 (may be referred to as page 8), they have a series of tables showing percentage of payroll at each pay rate.  If you bump the pay at each rate up to 9.8, but leave anything above 9.8 alone, the result is an 6.57% increase for grocery stores.  their calculation results in a 4.3% increase.  Furthermore, they actually assume a direct + indirect increase LESS Than the 4.3% without explaining where that 4.3% comes from. 
I did the same calculation on the total column and came up with an 8% direct increase.  yet their calculations come up with 3.8% increases.

I don't even know what to say other than I would immediately stop linking to such a study.  The calculation errors are both blatant and numerous.

http://laborcenter.berkeley.edu/foodlabor/price_food12.pdf

[BlueMR2]

By lowering minimum wage to 0, you would employee anyone who is not employable at $7.25/hr, but is willing to work for less.  I guess what I'm getting at is I don't know the point of your post ... what you said is basic economics.  It's also basic economics that raising minimum wage creates a deadweight loss.

Ask my wife right now and she'll say that minimum wage is too high.  She's been out of work for about 9 months now.  There are no paying jobs to be had.  However, volunteer positions are plentiful.  If the minimum wage wasn't so high, they'd be able to pay more people instead of only paying some and completely hosing the rest by only allowing them to volunteer (she's going so stir crazy at home that she's willing volunteer/work for free now)...

[galliver]

I did just find their data, and in fact, I disagree with their analysis.  On page 6 (may be referred to as page 8), they have a series of tables showing percentage of payroll at each pay rate.  If you bump the pay at each rate up to 9.8, but leave anything above 9.8 alone, the result is an 6.57% increase for grocery stores.  their calculation results in a 4.3% increase.  Furthermore, they actually assume a direct + indirect increase LESS Than the 4.3% without explaining where that 4.3% comes from. 
I did the same calculation on the total column and came up with an 8% direct increase.  yet their calculations come up with 3.8% increases.

I don't even know what to say other than I would immediately stop linking to such a study.  The calculation errors are both blatant and numerous.

http://laborcenter.berkeley.edu/foodlabor/price_food12.pdf

Admittedly, I was doing something else at the time and was looking for a reputable source to back up something I've seen and heard multiple times before. Didn't realize a comment on a forum had to be documented and analyzed at the level of a doctoral dissertation. But, my pride aside, thanks for finding the original study and checking their analysis for us. Though if your numbers don't match, maybe there is a step they're doing that you missed. Just saying. I have no actual idea.

However, even with your calculus, the prices increase by let's round to 10% whereas the wages go up (according to that study, 7.25 to 9.80) by 35%. Let's assume everyone else's wages go up by 10% to match the price increases, and so ALL goods and services increase by 10%. Minimum wage group still has more purchasing power than before. Unless my grasp of economics is  completely off (and I'll admit it's not my strongest suit), it still does not return us to the status quo.

Now, to your proposal of $x+$y/dependent. Sounds an awful lot like "from everyone according to his abilities; to everyone according to his needs." I know of a country that tried that as an ideology and I vaguely remember it falling down around my ears when I was three.  Also the word "Communism" is a bit unpopular in this country, so you might have trouble getting that one to catch on. Alternately, your formula sounds like welfare payments. Personally, I don't think wages should be determined based on an individual's needs, but rather on their ability to work. I just think that the ability to work needs to be valued high enough as to allow an individual to support themselves and a dependent on a corporate paycheck, without being eligible for government benefits (except the usual, free schooling and so forth). This is something we should expect of people hiring workers.

[mpbaker22]

I did just find their data, and in fact, I disagree with their analysis.  On page 6 (may be referred to as page 8), they have a series of tables showing percentage of payroll at each pay rate.  If you bump the pay at each rate up to 9.8, but leave anything above 9.8 alone, the result is an 6.57% increase for grocery stores.  their calculation results in a 4.3% increase.  Furthermore, they actually assume a direct + indirect increase LESS Than the 4.3% without explaining where that 4.3% comes from. 
I did the same calculation on the total column and came up with an 8% direct increase.  yet their calculations come up with 3.8% increases.

I don't even know what to say other than I would immediately stop linking to such a study.  The calculation errors are both blatant and numerous.

http://laborcenter.berkeley.edu/foodlabor/price_food12.pdf

Admittedly, I was doing something else at the time and was looking for a reputable source to back up something I've seen and heard multiple times before. Didn't realize a comment on a forum had to be documented and analyzed at the level of a doctoral dissertation. But, my pride aside, thanks for finding the original study and checking their analysis for us. Though if your numbers don't match, maybe there is a step they're doing that you missed. Just saying. I have no actual idea.

However, even with your calculus, the prices increase by let's round to 10% whereas the wages go up (according to that study, 7.25 to 9.80) by 35%. Let's assume everyone else's wages go up by 10% to match the price increases, and so ALL goods and services increase by 10%. Minimum wage group still has more purchasing power than before. Unless my grasp of economics is  completely off (and I'll admit it's not my strongest suit), it still does not return us to the status quo.

Bolded part is incorrect.  I got to the wage assumptions and realized their analysis was completely off.  I didn't complete my own analysis.  Their direct labor increase was off by more a factor of 2.  The 8% increase I mentioned is only the actual increase due to direct labor ... I.E. it can be thought of (in some ways) as an average of the percentage increase at each price level. 

In theory, the actual increase in prices could be less than the 8% increase I mentioned, or it could be more.  Regardless, I would think an 8% increase is decidedly high!  I certainly don't want 8% inflation on top of inflation!

[galliver]

Then what is your proposal?

[grantmeaname]

Plenty of people do all of the above simply to avoid getting a job

[hybrid]

Hybrid, if you have read this far, you are awesome. You redeemed my faith in humanity/this thread. Thank you.

Wow, that was very nice.  Thank you.  I almost hate to say I don't agree with everything you say above!

I think if you are a single mother of two working minimum wage you are always going to be in relative poverty at any reasonable minimum wage.  Households with two kids need more than one income (whether that be spouse, significant other, relative, roommate, whatever).  I have two kids, and I simply cannot imagine raising them on a job paying $21,000 a year, assuming a minimum wage of $10 per hour and full time employment.

But fundamentally we agree on many concepts.  Workers at the lowest end deserve more foir their efforts in a country where so much wealth is generated but spread about so unequally, and the argument that jobs will dry up is demonstrably false when looked at through the lens of all other minimum wage hikes.

[mpbaker22]

Then what is your proposal?

Proposal with regards to what?  I vote we keep minimum wage where it is or increase it maybe 10% then tie it to CPI.  As far as I can tell, most people want the minimum wage to be set such that a full time worker is guaranteed wage above the official poverty line. 
As a mustachian, the official poverty line is a bunch of bullshit.  My 2013 expenditures came in just over that line and they included a ton of gifts to friends, alcohol, and wasteful traveling.  If you take those three items out, I was at about 75% of the poverty line, so I don't feel bad for anyone who makes an income at the poverty line. 
For people with kids, see above.  I think I could even support the government subsidizing the difference between the 2 minimum wages, but I'd have to think about secondary results before fully supporting it.

[minimalist]

Then what is your proposal?

Proposal with regards to what?  I vote we keep minimum wage where it is or increase it maybe 10% then tie it to CPI.  As far as I can tell, most people want the minimum wage to be set such that a full time worker is guaranteed wage above the official poverty line. 
As a mustachian, the official poverty line is a bunch of bullshit.  My 2013 expenditures came in just over that line and they included a ton of gifts to friends, alcohol, and wasteful traveling.  If you take those three items out, I was at about 75% of the poverty line, so I don't feel bad for anyone who makes an income at the poverty line. 
For people with kids, see above.  I think I could even support the government subsidizing the difference between the 2 minimum wages, but I'd have to think about secondary results before fully supporting it.

Your low expenses are impressive.  Have you ever posted a breakout of those expenses?

[smalllife]

My 2013 expenditures came in just over that line and they included a ton of gifts to friends, alcohol, and wasteful traveling.  If you take those three items out, I was at about 75% of the poverty line, so I don't feel bad for anyone who makes an income at the poverty line. 

75% pre or post tax?  Income at the poverty line still has social security and medicare taken out - and at that level it certainly makes a difference.

[lordrtype1]

I would point out something that was brought to my attention not long ago with regards this minimum wage debate.

We may think there have been raises to minimum wage over the years, but here is some food for thought:  Martin Luther King's famous 'I have a Dream' speech was the highlight of a march for 'freedom  and living wages' (something like that, I'm recalling that off the top of my head). and they were asking for about 2.65/hr then. Adjusted for inflation, that is about 15/hr.  This is how much it has changed since.  So I think the number could seem high, but really, it's incredibly low.  Sweden, median income is about 50k, and there's a LOT less people there.  Japan is about 48k.  Median US wages are EIGHTTH in the world!!  before we assume this is a lot for the ecomony to handle, others seem to be doing just find.

One more example: in I believe Denmark or Sweden (whichever was the happiest in 2012), NPR interviewed a trash man and asked him about his job and wages.  He was paid 80k a year, and lived between a doctor and a lawyer.  He was fine with that, and actually enjoyed his work.  If money were taken from the equation, there would be a lot more working at their job and happy to do it, and they would already be halfway to their financial independance.  After all, if you love what you do, you'll never 'work' a day in your life.