News Kerry's 7 Dollar Minimum Wage - What Do You Think?

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The discussion centers around John Kerry's proposal for a $7 minimum wage, with participants expressing skepticism about its effectiveness and potential consequences. Critics argue that raising the minimum wage could lead to inflation, increased unemployment, and small businesses firing less productive workers. Some believe that a free market should dictate wages without government intervention, suggesting that minimum wage laws protect low-income workers from exploitation but may also discourage them from seeking better opportunities. Others point out that many minimum wage jobs are held by teenagers or individuals not supporting families, questioning the necessity of a minimum wage for these demographics. The debate touches on broader economic theories, including the impact of wage regulations on job markets and the potential for wage inflation as employers adjust pay scales in response to minimum wage increases. Overall, opinions are divided on whether a minimum wage is beneficial or harmful to the economy and workers.
  • #51
I think the problem is that too many of you are dealing in theory, and not practical application. People say "well minimum wage is a stepping stone" but If that stepping stone isn't stable (sssssssss) IOW, if you can't provide yourself the basic tools necessary to work AND improve your education or job skills to GET a better job, then it's not a stepping stone, it's a crappy job you're trapped in, for some people. We're talking about the bare minimum, basic living wage necessary to exist in this country. Just because someone has a minimum wage job, doesn't mean that they should have to live subhumanly, which is what some are advocating. I'm not a bleeding heart, but I still think a bottom line is necessary. I worked a minimum wage job when it was 4.25. I was still living at home. But even then if you'd told me I had to exist on that living on my own, I'd have laughed and left. And no matter what people's motivation, if they can't exist on a certain wage, they won't work for it. There's a minimum standard of living beyond which it becomes better to live at a soup kitchen for free than to work a job and not have enough food or money to get to and from work.

And to clarify the immigration comment, I'm talking about all the illegal immigrants that companies get away with paying minimum wage or WORSE because they CAN. If you eliminated all of those illegal immigrants, there would be a huge shortage of lower wage workers, and it would force companies to increase wages to remain competitive. Perhaps this is more true in California than anywhere else, but it's still a valid point.

If you claim that only high school students work these jobs, then there's a simple way to solve that- increase the minimum wage for full time workers only. Let the part timers earn less because of the inference they are students, and let the "breadwinners" or working adults earn enough to eek out an existence.Not to mention- the military has a "COLA" or cost of living allowance which is adjusted to acount for inflation. SO if the Military reconizes it for it's troops, why doesn't it apply to americans as a whole? questions that need answering.
 
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  • #52
I can only see two consistent long-term stands on this issue :

1) Eliminate a federal/state mandated minimum wage, and let the free market do it's job
2) Raise the minimum wage periodically to roughly track inflation rates

Leaving the minimum wage at $5 doesn't make sense. For how long must it be at $5 ?
 
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  • #53
Zantra said:
I think the problem is that too many of you are dealing in theory, and not practical application.
And I think the problem is that too many of you are dealing in what sounds good in your head, and not practical application. :biggrin:

Gokul - you forgot the 3rd choice (the democratic position): raise the minimum wage much faster than inflation to make it a "living wage" (because it isn't now).
 
  • #54
Gokul43201 said:
I can only see two consistent long-term stands on this issue :

1) Eliminate a federal/state mandated minimum wage, and let the free market do it's job
2) Raise the minimum wage periodically to roughly track inflation rates

Leaving the minimum wage at $5 doesn't make sense. For how long must it be at $5 ?

According to the republicans, it's apparently until no one will do minimum wage jobs anymore because you have to work 4 hours to pay for a gallon of milk. Then they can just hire illegal immigrants to work for free in return for legalization or a driver license.

The main republican stance here, is that "I don't make minimum wage so it's not my problem if people that do these jobs aren't happy with it".

And when that same person mugs you, or gets your kid hooked on the rock because he can't feed himself on that job, would you care then?
 
  • #55
Zantra said:
According to the republicans, it's apparently until no one will do minimum wage jobs anymore because you have to work 4 hours to pay for a gallon of milk. Then they can just hire illegal immigrants to work for free in return for legalization or a driver license.

The main republican stance here, is that "I don't make minimum wage so it's not my problem if people that do these jobs aren't happy with it".

And when that same person mugs you, or gets your kid hooked on the rock because he can't feed himself on that job, would you care then?


I'm so glad to see generalizations are still running rampant in this forum.
 
  • #56
phatmonky said:
I'm so glad to see generalizations are still running rampant in this forum.
Well, it is much easier and more fun than posting an actual argument...
 
  • #57
clinton on minimum wage increases when he was running for his first term, "[it's] the wrong way to raise the incomes of low-wage earners." and yes, he was absolutely correct.
 
  • #58
russ, phat, kat, etc..

I'd really like to know if you disagree with my previous post...in the context of long term treatment of the minimum wage. It's clear what the left wants - they mostly want #2 in the long run. But from those on the right, I hear choice #1 mentioned, but in the context of leaving the minimum wage where it is. That seems inconsistent to me.

So, again, what would be the point of leaving it the way it is ? Eventually that'll turn the minimum wage into a vestigial organ or it will cause widespread outcry demanding a rather sudden increase that may well be undoable (because that would be disastrous).

russ, your comment on the 3rd option is noted, but that would only be a short term effect (until the minimum wage matches a "livable wage").
 
  • #59
Gokul, reading through your above post made me realize something that I've been forgetting/overlooking throughout this entire discussion. There are also state-mandated minimum wages when states deem the Federal minimum wage is too low. It makes more sense to me for states to determine minimum wages, because cost of living differs quite dramatically from state to state. That Federal minimum wage isn't even going to come close to a living wage in New York City, but would be quite a bit closer in some rural part of the midwest. One nation-wide minimum wage can never be a living wage. The thing is, with the current minimum wage, a single person with no children can survive on it. It would need to be a no-frills lifestyle in a cheap part of middle America, but it can be done. If someone expects to raise children on a minimum wage job, then yes, there is a problem, but then they are the ones who should be seeking a job better than minimum wage if they expect to raise a family. So, as I've been thinking about this more, I think we should kick the minimum wage over to the states to determine, and it would be reasonable to set it such that it is a wage on which a single person with no children can obtain basic needs (a cheap apt, food meeting basic nutritional requirements, transportation to and from work, whether via bike or walking or mass transit or a cheap car depending on distance the cheap apts are from jobs), but they can do without the TV, cable, stereo, CDs, DVDs, brand name clothing, etc. If they want to have children, they need to aspire to something better than minimum wage, otherwise minimum wage is just welfare in disguise. This would have the added benefit that in states with low cost of living, small businesses would have a chance to grow without trying to match a "living" wage for a family of four in New York City.
 
  • #60
phatmonky said:
I'm so glad to see generalizations are still running rampant in this forum.


When in Rome...

It's a 2 way street. I've presented an arugment if you flip back a bit.. I'm getting writers cramp.. click on the back button :-p

The main opposing stance is that "if people don't like minimum wage they should get better jobs"... That's the same as saying "if you don't like paying such high taxes you shouldn't like in america"

Again, not dealing with issue, just pushing it under the carpet.
 
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  • #61
Gokul43201 said:
russ, phat, kat, etc..

I'd really like to know if you disagree with my previous post...in the context of long term treatment of the minimum wage. It's clear what the left wants - they mostly want #2 in the long run. But from those on the right, I hear choice #1 mentioned, but in the context of leaving the minimum wage where it is. That seems inconsistent to me.

russ, your comment on the 3rd option is noted, but that would only be a short term effect (until the minimum wage matches a "livable wage").
My point was that I don't think either 1 or 2 accurately reflects the position of either side. For #1, I've never heard of anyone who wants this. #2 better reflects the Republican position than the Democratic one. My #3 is the Democratic position. And it wouldn't be a "short term effect," (sure, it would require passing only one law, but that's missing the point): it would be permanent, and its consequences to the economy would be permanent.
 
  • #62
Gokul43201 said:
russ, phat, kat, etc..

I'd really like to know if you disagree with my previous post...in the context of long term treatment of the minimum wage. It's clear what the left wants - they mostly want #2 in the long run. But from those on the right, I hear choice #1 mentioned, but in the context of leaving the minimum wage where it is. That seems inconsistent to me.

So, again, what would be the point of leaving it the way it is ? Eventually that'll turn the minimum wage into a vestigial organ or it will cause widespread outcry demanding a rather sudden increase that may well be undoable (because that would be disastrous).

russ, your comment on the 3rd option is noted, but that would only be a short term effect (until the minimum wage matches a "livable wage").

Bring it back to a states rights issue, including the ability for each state to choose NOT to have a minimum wage if they wish not to.
 
  • #63
phatmonky said:
Bring it back to a states rights issue, including the ability for each state to choose NOT to have a minimum wage if they wish not to.
While I don't share this opinion, there is a good logic to it: the cost of living and cost of employing is different everywhere and a national minimum wage doesn't reflect that.
 
  • #64
Aquamarine said:
You are ignoring those other studies mentioned by Stigler. See also his lists of references.

More:
http://www.cato.org/tech/competitionandantitrust.html


What other studies? He mentions a few facts, such as taxi drivers and the problem with anti-trust, but these are not studies. What list of references? He has further reading at the bottom, but he doesn't reference hardly anything, and certainly doesn't have a citations. Some of those are followups (such as the Kessel paper, maybe?) but since they aren't correctly cited it takes reading to be sure.

If this was supposed to convince me that our economy is a pure market system without govt intervention, it is not working. Judging by the front page of the Oct 18 Wall Street Journal, I'm not the only one having serious doubts. I still object to the constant references to "letting free market" do the price setting in this thread, because I don't necessarily believe it will run efficiently (and I am certain they are implying that). How is discussing anti-trust legislation (which does not apply to oligopolies) going to affect my opinion there?

Sorry its taking so long to reply, hopefully my typing be back to normal soon.
 
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  • #65
gravenewworld said:
I don't believe there should be a minimum wage at all. The free market should decide "minimum wage." The minimum wage is $5.15/hr, but honestly who really gets paid this much? Hardly anyone. Even teenagers who work at McDonald's get paid higher than that because the labor markets have decided a wage that is higher than 5.15/hr. Raising minimum wages wouldn't cause inflation, however, unemployment may increase.

I am sure all the illegal mexicans will eat that up! Then the americans unemployment rate will be like 20%
 
  • #66
Lawrence Albano said:
I am sure all the illegal mexicans will eat that up! Then the americans unemployment rate will be like 20%
Maybe since the economy has severe atherosclerosis due to reduced capitalism, for example regulations like minimum wage and benefits like social security.

It sure didn't happen during the more capitalistic nineteenth century when an enormous amount of poor people emigrated to the US.
 
  • #67
Locrian said:
What other studies? He mentions a few facts, such as taxi drivers and the problem with anti-trust, but these are not studies. What list of references? He has further reading at the bottom, but he doesn't reference hardly anything, and certainly doesn't have a citations. Some of those are followups (such as the Kessel paper, maybe?) but since they aren't correctly cited it takes reading to be sure.

If this was supposed to convince me that our economy is a pure market system without govt intervention, it is not working. Judging by the front page of the Oct 18 Wall Street Journal, I'm not the only one having serious doubts. I still object to the constant references to "letting free market" do the price setting in this thread, because I don't necessarily believe it will run efficiently (and I am certain they are implying that). How is discussing anti-trust legislation (which does not apply to oligopolies) going to affect my opinion there?

Sorry its taking so long to reply, hopefully my typing be back to normal soon.
It was you who introduced oligopolies and monopolies as examples of market failure in this thread about the minimum wage. This had nothing to do with the minimum wage except for guilt by association.

From the article, which since its primary audience is the public has an easy language and less than perfect reference list (But still usable):
Several kinds of evidence suggest that monopolies and small-number oligopolies have limited power to earn much more than competitive rates of return on capital. A large number of studies have compared the rate of return on investment with the degree to which industries are concentrated (measured by share of the industry sales made by, say, the four largest firms). The relationship between profitability and concentration is almost invariably loose: less than 25 percent of the variation in profit rates across industries can be attributed to concentration.

For somewhat more scholarly articles:
http://www.cato.org/pubs/pas/pa021.html
http://www.cato.org/pubs/pas/pa405.pdf
http://www.mises.org/journals/rae/pdf/R3_4.pdf
http://www.cato.org/pubs/journal/cj20n3/cj20n3-3.pdf
http://www.cato.org/pubs/journal/cj6n3/cj6n3-5.pdf

For a more easy read, the history of the Sherman Act:
http://www.mises.org/journals/scholar/DiLorenzo.PDF
http://www.cato.org/pubs/journal/cj9n3/cj9n3-13.pdf

More:
http://www.cato.org/tech/competitionandantitrust.html
http://www.mises.org/fullstory.aspx?control=328&fs=mises.org+on+microsoft+
 
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