"Nearly half of Americans can’t afford the basics of life anymore"

[StarBright]

Minimum wage has been increased way too high here in my state .... up to $15 in the coming years and then indexed to inflation.  It's crazy.  We're talking about jobs that aren't really worth even half that amount.  All it does is cause employers to move work somewhere else, lay off workers, and increase prices for the rest of us.  I just don't support charity wages dictated by government.  A reasonable minimum wage around $7/hr I'm not totally against since we are at least somewhere in the realm of what the pay should be at that rate.

Wow - $7 dollars an hour sounds so low! I made $6.75 an hour at my after school job over 20 years ago (this was in the midwest and I worked with plenty of adults who had that for the "real" job).

[Kris]

If employers don’t pay a living wage to their employees, I have to make up the rest as a taxpayer through welfare.

Screw that. I shouldn’t have to subsidize the employer.

[Bloop Bloop]

If employers don’t pay a living wage to their employees, I have to make up the rest as a taxpayer through welfare.

Screw that. I shouldn’t have to subsidize the employer.

I don't think your argument works out. Right now there are a lot of people whose wages, going by the market, are not up to scratch. They don't get full-time hours because their labour is fungible and cheap. I'm thinking Uber drivers, waiters and the like. Some in these jobs are very good at them and they make easily over a living wage (great). Some are not very good, get inconsistent shifts, and struggle.

Now, if every employer (say every restaurant that employs waiters, or every agency that employs cleaners) had to give even the least capable and shitty employees a "living wage", two things would happen. Either the average wage for bottom-end jobs would increase significantly, thus leading to inflation. Or employers would fire all the people who they think aren't worth the new 'living wage', thus leading to a higher welfare bill.

You're better off allowing the labor market to price itself. It leads to not very great outcomes for those at the bottom of the distribution, but it rarely leads to starvation. And it also keeps prices low.

[Kris]

If employers don’t pay a living wage to their employees, I have to make up the rest as a taxpayer through welfare.

Screw that. I shouldn’t have to subsidize the employer.

I don't think your argument works out. Right now there are a lot of people whose wages, going by the market, are not up to scratch. They don't get full-time hours because their labour is fungible and cheap. I'm thinking Uber drivers, waiters and the like. Some in these jobs are very good at them and they make easily over a living wage (great). Some are not very good, get inconsistent shifts, and struggle.

Now, if every employer (say every restaurant that employs waiters, or every agency that employs cleaners) had to give even the least capable and shitty employees a "living wage", two things would happen. Either the average wage for bottom-end jobs would increase significantly, thus leading to inflation. Or employers would fire all the people who they think aren't worth the new 'living wage', thus leading to a higher welfare bill.

You're better off allowing the labor market to price itself. It leads to not very great outcomes for those at the bottom of the distribution, but it rarely leads to starvation. And it also keeps prices low.

They can be fired. Employers are under no obligation to keep shitty employees. Especially when the unemployment rate is so low.

My position stands. If we had always allowed "the market" to make the choices, people would be working seven days a week, twelve hours a day. Children would be working those hours, too. There would be no such thing as overtime. Employers will do whatever they can to make a profit at the expense of their employees. If they can't pay a decent wage for their employees, we as taxpayers should not have to subsidize their bad business model.

[GuitarStv]

You're better off allowing the labor market to price itself. It leads to not very great outcomes for those at the bottom of the distribution, but it rarely leads to starvation. And it also keeps prices low.

I think that you're forgetting 'it rarely leads to starvation' only when the tax payers subsidize the labor market by preventing starvation from happening through social programs.  Which of course, prevents the market from pricing itself.

[Bloop Bloop]

If employers don’t pay a living wage to their employees, I have to make up the rest as a taxpayer through welfare.

Screw that. I shouldn’t have to subsidize the employer.

I don't think your argument works out. Right now there are a lot of people whose wages, going by the market, are not up to scratch. They don't get full-time hours because their labour is fungible and cheap. I'm thinking Uber drivers, waiters and the like. Some in these jobs are very good at them and they make easily over a living wage (great). Some are not very good, get inconsistent shifts, and struggle.

Now, if every employer (say every restaurant that employs waiters, or every agency that employs cleaners) had to give even the least capable and shitty employees a "living wage", two things would happen. Either the average wage for bottom-end jobs would increase significantly, thus leading to inflation. Or employers would fire all the people who they think aren't worth the new 'living wage', thus leading to a higher welfare bill.

You're better off allowing the labor market to price itself. It leads to not very great outcomes for those at the bottom of the distribution, but it rarely leads to starvation. And it also keeps prices low.

They can be fired. Employers are under no obligation to keep shitty employees. Especially when the unemployment rate is so low.

My position stands. If we had always allowed "the market" to make the choices, people would be working seven days a week, twelve hours a day. Children would be working those hours, too. There would be no such thing as overtime. Employers will do whatever they can to make a profit at the expense of their employees. If they can't pay a decent wage for their employees, we as taxpayers should not have to subsidize their bad business model.

The unemployment rate is low because the cost of labour is low. If we followed your proposal and raised the minimum wage to a living wage, and then just paid welfare to all the people fired as a result, we would:
- Be paying a lot more welfare to a lot more unemployed people (Group A)
- Simultaneously, have a lot of people suddenly earning more than they did before, meaning a rise in the cost of low-end goods and services (Group B)

Sure, if you move enough Group B people off welfare to counterbalance Group A people moved onto welfare, your total "welfare" budget might not increase. But you're still a lot worse off, because suddenly inflation hits every single person by diminishing consuming power.

I'd rather fix problems with welfare than inflation. Because at the end of the day welfare is unpalatable and encourages people to take on unpleasant jobs so that they can still have some semblance of a wage. If we just gave all jobs such a wage, people would no longer take on unpleasant jobs, and the cost of said jobs would go up, and we'd all have to pay more money as a result.

[BTDretire]

Minimum wage has been increased way too high here in my state .... up to $15 in the coming years and then indexed to inflation.  It's crazy.  We're talking about jobs that aren't really worth even half that amount.  All it does is cause employers to move work somewhere else, lay off workers, and increase prices for the rest of us.  I just don't support charity wages dictated by government.  A reasonable minimum wage around $7/hr I'm not totally against since we are at least somewhere in the realm of what the pay should be at that rate.

Wow - $7 dollars an hour sounds so low! I made $6.75 an hour at my after school job over 20 years ago (this was in the midwest and I worked with plenty of adults who had that for the "real" job).

I started at $0.60 an hour in 1969, that was below minimum wage, I was 14 yrs old and doing a job that I probably shouldn't have been doing. The place was called Kiddieland with kid sized rides, like boats in a small concrete pond, planes that flew around a central pole, a small ferris wheel, cars that went round and round, horses and a train that went around the park.
 Looking back I don't think a 14 yr old should have been in charge of any of those rides.
  I can say I rode my bike to work back then :-)
I did work my way up to $1.00 an hr.
 The job did get me experience and I saw those that could show up on time and do their job,
and saw their were people that could do that.

[Wrenchturner]

Not to generalize about the commentary in the thread, but if someone collects little income at a job, it may be because they add little value as an employee.  Not necessarily because their employer is a monster.  It's critical to maintain a distinction, essentially to maintain the value of currency (pricing).

There seems to be an undercurrent in these conversations regarding responsibility.  If someone's cash flow is negative, I'd argue it's their problem first, and society's problem second.

Customers don't necessarily sympathize with employees that can't produce, regardless of the reason.  Maybe it's the employer that's caught in the middle.

[GuitarStv]

Not to generalize about the commentary in the thread, but if someone collects little income at a job, it may be because they add little value as an employee.  Not necessarily because their employer is a monster.  It's critical to maintain a distinction, essentially to maintain the value of currency (pricing).

There seems to be an undercurrent in these conversations regarding responsibility.  If someone's cash flow is negative, I'd argue it's their problem first, and society's problem second.

Customers don't necessarily sympathize with employees that can't produce, regardless of the reason.  Maybe it's the employer that's caught in the middle.

It's possible that you're correct in some cases.  But stats would argue that worker productivity is higher than ever, and not typically reflected in wages.

[Wrenchturner]

Not to generalize about the commentary in the thread, but if someone collects little income at a job, it may be because they add little value as an employee.  Not necessarily because their employer is a monster.  It's critical to maintain a distinction, essentially to maintain the value of currency (pricing).

There seems to be an undercurrent in these conversations regarding responsibility.  If someone's cash flow is negative, I'd argue it's their problem first, and society's problem second.

Customers don't necessarily sympathize with employees that can't produce, regardless of the reason.  Maybe it's the employer that's caught in the middle.

It's possible that you're correct in some cases.  But stats would argue that worker productivity is higher than ever, and not typically reflected in wages.

Interesting chart.  Might have to do with the decoupling from gold, or tech as well.  Or double income families.  Not sure how to correct the issue you've pointed out.

I suppose as a worker I have to ruthlessly force my employer to compete. 

[GuitarStv]

How many low salary employees do you believe are capable of forcing their employers to do anything?

I suspect that technology has radically improved the productivity of workers.

[pecunia]

- SNIP -

My position stands. If we had always allowed "the market" to make the choices, people would be working seven days a week, twelve hours a day. Children would be working those hours, too. There would be no such thing as overtime. Employers will do whatever they can to make a profit at the expense of their employees. If they can't pay a decent wage for their employees, we as taxpayers should not have to subsidize their bad business model.

I think you are absolutely correct.  History teaches us that these are the conditions that used to prevail until people revolted against such conditions.  Society adjusted and more people thrived.  Society can afford to give people a living minimum wage and adjust.  Why didn't the employers of years ago provide more humane conditions and more affordable wages?  It's simple.  They didn't have to.  It was the accepted condition of the time.  They were successful and the issues of low wages and child labor were other people's problems.  Would they do it again?  Sure.  Human nature hasn't changed.

Why aren't conditions improving in third world countries where employers flock?  It is the status quo in those countries and the leaders in those countries choose not to help their people.  Why don't employers pay those people in those countries more?  The products that are exported give the employer great profit.  They have the money.  They don't have to.  Simple minded people would give the aphorism that this is what the people are worth without giving a small amount of additional thought and consider, "Wait a minute?  Worth is all relative. "  Thoughts of human decency and kindness are apparently secondary considerations to such people.

Back to the US.  We subsidize companies like Wal-Mart in that we pay for their employees medical treatment and food stamps.  There is a difference between a free market and a fair market.

[js82]

Interesting chart.  Might have to do with the decoupling from gold, or tech as well.  Or double income families.  Not sure how to correct the issue you've pointed out.

I suppose as a worker I have to ruthlessly force my employer to compete.

The only one of those that's a remotely logical explanation is technological advances - technology can improve productivity while devaluing/limiting the value of labor in many professions.  Decoupling from gold isn't going to do that.  Nor is an increase in dual-income households.

Another part of it is growing overvaluation of management.  The ratio of CEO pay to average employee pay has gone up by nearly an order of magnitude since the 70's.  It's not because CEO's have gotten an order of magnitude better at their jobs while the rest of us sit on our thumbs.  Management doesn't grow productivity - engineers/scientists do.  But management is disproportionately allocating to itself the benefits of the productivity increases that others created.

There's also the shift from a broad-based "stakeholder" model of capitalism, to the shareholders-first-at-all-costs model that pervades American capitalism today.

[Bloop Bloop]

Another reason is that companies can now outsource labour in a way they couldn't physically do previously. Thus local labour has a harder time competing.

I don't see anything wrong with that as long as people aren't starving. It's a competitive world. There are winners and losers.

[Wrenchturner]

How many low salary employees do you believe are capable of forcing their employers to do anything?

I suspect that technology has radically improved the productivity of workers.

That chart reflects on the whole workforce, not only low salary employees.  But to answer you, very few of them, because they probably are easily replaced as employees.  I can force my employer to pay me more because I'm hard to replace.

[Wrenchturner]

Interesting chart.  Might have to do with the decoupling from gold, or tech as well.  Or double income families.  Not sure how to correct the issue you've pointed out.

I suppose as a worker I have to ruthlessly force my employer to compete.

The only one of those that's a remotely logical explanation is technological advances - technology can improve productivity while devaluing/limiting the value of labor in many professions.  Decoupling from gold isn't going to do that.  Nor is an increase in dual-income households.

Another part of it is growing overvaluation of management.  The ratio of CEO pay to average employee pay has gone up by nearly an order of magnitude since the 70's.  It's not because CEO's have gotten an order of magnitude better at their jobs while the rest of us sit on our thumbs.  Management doesn't grow productivity - engineers/scientists do.  But management is disproportionately allocating to itself the benefits of the productivity increases that others created.

There's also the shift from a broad-based "stakeholder" model of capitalism, to the shareholders-first-at-all-costs model that pervades American capitalism today.

I definitely agree on the overvaluation of management.  Again, not sure how to resolve that one.  Managers do compete, and they are overcompensating themselves, much like how elected bureaucrats like to vote themselves raises.  You can definitely see this in post sec. education as well.

[Padonak]

You really think people on low wages don't put in effort?

Yes. After having worked a couple low-income jobs in high school, I can say that without a doubt. The amount of people calling in sick, showing up late, showing no interest in advancement, and putting in little to no effort was astounding.

Seriously have you ever set foot in any Megacorp at all?

I work for one. No, the 6-figure incomes don't call in sick a lot because their bonus payment depends on it. Instead they call in to say they work from home today or close the door to their office the entire day so nobody knows what they're really doing.

The blue collar workers that we employ, when we are not satisfied with their work we fire them. The white collar workers just get promoted to a different department or are at worst suspended with full pay for 6 months so they can find another job.

Yes, our blue collar workers sometimes don't show up in time or are rude, but on the other hand we time their bathroom breaks and make them work in the heat during summer and in the freezing cold during winter, we let the bosses yell at them. Often blue collar workers are treated with such contempt that it's no wonder they retaliate by breaking the rules. I'm not talking specifically about my current employer but my general experience from my own minimum wage jobs and how I now hear leadership talk about workers. No one has yelled at me anymore since I got my degree.

Do you have any vacancies at your megacorp? White collar jobs, that is.

[Bloop Bloop]

Yeah, I'd like one of those cushy white collar jobs. I'm stuck here working regularly past 2am to prepare for trials. Plus, if anything happens to me after, say, 4pm the evening before a trial, it's too late to organise a replacement trial counsel so I simply have to attend. And once a trial starts, I have to attend each subsequent day. The notion of a sick day is foreign to me. If I'm breathing, I'm there.

[Imma]

I'm based in Europe but we employ tens of thousands of employees in the US, so we're probably in a location close to you too :) I hear similar stories about friends in other big companies. Once you are over a certain income threshold and have made a few friends, it's almost impossible to get fired unless you actively commit fraud or something like that.

I have a law degree too @Bloop Bloop but there's a good reason I chose not to become a trial lawyer. I am not admitted to the bar, in my country that's not necessary to give legal advice. To be admitted, you work 60-80 hours a week as an apprentice at a law firm for 3 years and pass some exams too and I knew I wouldn't survive that.  For me this is the ideal legal job: variety, research, but no clients, no courts and no insane working hours. I specialized in tax specifically because of this.

[John Galt incarnate!]

I have a law degree too @Bloop Bloop but there's a good reason I chose not to become a trial lawyer. I am not admitted to the bar, in my country that's not necessary to give legal advice. To be admitted, you work 60-80 hours a week as an apprentice at a law firm for 3 years and pass some exams too and I knew I wouldn't survive that.  For me this is the ideal legal job: variety, research, but no clients, no courts and no insane working hours. I specialized in tax specifically because of this.

Before I graduated from law school I knew I didn't want to practice law.

What I liked best was acquiring knowledge of the Constitution.

I too never took the bar exam.

You've got your ideal legal position.

Kudos!

I'm VERY happy for you.


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