Low Minimum Wages Kill Jobs and Crush Living Standards for Everyone

[wlsc 0]

...Contrary to right-wing propaganda, decent pay for workers helps the economy and boosts job creation.

Senator Tom Harkin, Democrat of Iowa, has introduced a bill to raise the federal minimum wage to $9.80 from its present level of $7.25. Polls are showing many voters in favor, though they are confused about what it would mean for the job market. The truth is that a move would be good for a slow economy and have a positive impact on the jobs crisis. ..

[DrewEckhardt 0]

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...Contrary to right-wing propaganda, decent pay for workers helps the economy and boosts job creation.

Absolutely!

There are more jobs for those of us designing and building machines when increasing labor costs make automation relatively affordable.

For instance the high pay for grocery cashiers and baggers from unionization meant that machines to replace them became relatively affordable. When I go down to my corner grocery store they no longer employ either; just a set of machines with one person clearing stoppages and checking IDs for alcohol purchases.

There are more jobs for people in developing countries when increased first world labor costs mean their labor comes at a steeper discount.

As of 2009 GM UAW workers were averaging $28/hour and the Chinese were getting only $150 a month. More new jobs went to China although it didn't go so well for US workers with plants like NUMMI closing.

The more I think about it, the better an American minimum wage increase seems. "Middle class" means having 1/3 of your income left after taking care of basic needs like housing and food. With a starting point of just $3000/year in developing countries each American minimum wage job that goes away because the cost of the labor exceeds the value of the product will free up the money needed to elevate FIVE foreign families from poverty to middle class!

[wlsc 0]

Good work - you hit all the right-wing propaganda talking points in one reply!

It seems the only way forward is to get rid of those dastardly unions and then pay workers chinese pay rates. No other solution is available.

[lawrocket 3]

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Good work - you hit all the right-wing propaganda talking points in one reply!

It seems the only way forward is to get rid of those dastardly unions and then pay workers chinese pay rates. No other solution is available.

Nicely done. You hit all the left wing propoganda points - offer no proof for your opinions or assertions and point to factual scenarios as nothing more that right1ing propoganda talikng points.

Got anything to counter the points made? Or does the outsourcing of labor-intensive manufacturing jobs to low-wag areas not count? Is there a way other than that? Seems so. You offer no solution.

My wife is hotter than your wife.

[wlsc 0]

The buying power of the minimum wage needs to be restored to a sensible level. At the moment it is set too low.

[DrewEckhardt 0]

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Good work - you hit all the right-wing propaganda talking points in one reply!

The so-called American Right sometimes uses correct ideas to market itself.

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It seems the only way forward is to get rid of those dastardly unions and then pay workers chinese pay rates. No other solution is available.

A middle class lifestyle results from the difference between net income and basic expenses - shelter, clothing, food and arguably both medical care and education.

Our problem isn't on the supply side. The bottom 10% of our gross income distribution is still in the top 30% of the world's and poverty now comes with a color TV (as opposed to without windows or running water in places like Mexico). The government lets us keep more of our money than they do in the rest of the world with the most progressive income tax system (defined as the top earning decile's share of tax to share of income) out of the OECD 24 including Australia, Austria, Belgium, Canada, The Czech Republic, Denmark, Finland, France, Germany, Iceland, Ireland, Italy, Japan, Korea, Luxembourg, The Netherlands, New Zealand, Norway, Poland, The Slovak Republic, Sweden, Switzerland, and The United Kingdom.

Our problem is on the expense side. Our corporatist government colludes with powerful organizations to enrich their electors at the peoples' expense. Housing prices are propped up by Government Sponsored Enterprises buying and guaranteeing home loans larger than the free market would (the Realtors(TM) used to have the biggest PAC in the country). Health insurers get special tax treatment that gets people into more expensive plans and exclusion from anti-trust legislation so they have more latitude in jacking up prices. The government pays as much to private for profit health care companies to take care of the old and unprofitable as other countries do to take care of their entire populations. Special treatment of student loan debt (like exclusion from brankruptcy protection) has facilitated education costs going up at 4X the rate of inflation. Where other governments spend tax revenues on not-for-profit services for citizens ours direct their spending towards powerful lobbies, like the California Correctional Peace Officers Association which has quadrupled our prison count and incarceration rate to fill them or military industrial complex with total spending matching the rest of the world put together in bad years (although we were never in any danger of the rest of the world all ganging up on us).

This is an inherent side effect of the American electoral system. Jobs that cost $1.5M/year to get but pay only $170,000 get employees open to a little quid pro quo with the people covering the net loss. Two very similar groups of such systemically corrupt people that act about the same once in office are the inevitable result of our first past the post voting system.

The politics and shrinking of America's middle class caused by it aren't going to change until citizens in states which give them legislative abilities via ballot inititatives get proportional representation which they use to elect governments acting on their behalf instead of the corporatist interests.

[wlsc 0]

The buying power of the minimum wage needs to be restored to a sensible level. At the moment it is set too low.

[DrewEckhardt 0]

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The buying power of the minimum wage needs to be restored to a sensible level. At the moment it is set too low.

Here are some monthly costs:

Room in a house or larger apartment close enough to employment for cycling/walking/public transit : $400
Share of utilities including pre-paid phone minutes, heat, basic cable: $75
Food $250
Basic medical insurance $100
Bus pass $70

total: $895/month

$10,740/year

7.25/hour minimum wage * 2000 hours = 14,500 annually

The standard deduction and personal exemption total $9650 leaving $4850 of taxable income and a $485 federal tax liability in the 10% bracket.

Social Security is 4.2% with the Obama rate cut and Medicare 1.45% or $819/year.

That leaves net income of $13,195.

Looks manageable but not luxurious unless some one can't get affordable medical insurance due to pre-existing conditions; although we'd be better off fixing that problem by getting the profit-making insurance company middle men out of the way instead of changing the rules so they make even more money.

In a historical context from 2000 - 2010 minimum wage workers got over a 10% increase in real dollars which is better than the rest of us did - except for the geographic increase I got with my move to the west coast I'm making the same inflation adjusted wage I did in 2001. Come to think of it I haven't even had a take-home pay increase in nominal dollars since 2008, let alone the 10% we gave minimum wage earners over that period.

[loumeinhart 0]

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Standards for Everyone by wlsc
Post: The buying power of the minimum wage needs to be restored to a sensible level. At the moment it is set too low.

lol

"Sir the buying power is level 3 and needs immediately raised to level 5!"


Dreaming also lets you dust yourself off after going in.

[wlsc 0]

Your figures are wrong. In a historical context the value of the minimum wage is very, very low. Raising the minimum wage will help rebalance the economy.

[mnealtx 0]

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Your figures are wrong. In a historical context the value of the minimum wage is very, very low. Raising the minimum wage will help rebalance the economy.

Show your numbers to rebut, then.

Mike
I love you, Shannon and Jim.
POPS 9708 , SCR 14706

[wlsc 0]

In a historical context the value of the minimum wage is very, very low. Raising the minimum wage will help rebalance the economy.

[DrewEckhardt 0]

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Your figures are wrong. In a historical context the value of the minimum wage is very, very low. Raising the minimum wage will help rebalance the economy.

Nope. Apart from 2009-2011 after the minimum wage reset but before inflation took a bite it's as high as it's been in real (CPI) dollars since 1985.

In 1989 I worked for minimum wage as a lifeguard netting $3.35 an hour which is $6.20 in 2012 CPI adjusted dollars.

Federal minimum wage is currently $7.25 which is 17% more generous.

The minimum wage was first introduced in 1955 with a rate of $0.75 in nominal dollars. Adusted for inflation that's $6.42 with the current minimum 13% better.

In between Eisenhower and Reagan there were years with a higher minimum wage; although with emerging economy residents able to work as engineers instead of in garment factories, American women wherever they want instead of the home (or as school teachers, secretaries, operators, and other stereotypical low wage professions unless blessed with some combination of opportunity and luck), and communication/shipping anywhere about as fast as you want things are rather different now.

I'd like a return to historic income tax rates, specifically like they were in 1913. The 1913 income tax law allowed a $3000 exemption for single people ($65,331 in 2010 dollars) and $4000 for married couples ($87,108). The next $20,000 ($435,544) was taxed at 1%. Robber barons raking in $500,000 a year ($10,888,595) paid the top tax rate of 7%.

I'll happily support a lobbying effort for a package deal bringing back that piece of history and the inflation adjusted minimum wage from the cherry picked year of your choice.

[wlsc 0]

...A federal minimum wage was first set in 1938. The graph shows nominal (blue diamonds) and real (red squares) minimum wage values. Nominal values range from $0.25/hr in 1938 to the current $7.25/hr. The graph adjusts these wages to 2010 dollars (red squares) to show the real value of the minimum wage. Calculated in real 2010 dollars, the 1968 minimum wage was the highest at $10.04...

[headoverheels 291]

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Your figures are wrong. In a historical context the value of the minimum wage is very, very low. Raising the minimum wage will help rebalance the economy.

Show your numbers to rebut, then.

When I was making about $2/hr at minimum wage (less earlier), the starting salary for a new grad electrical engineer was about $10k. Minimum wage has only gone up ~4x, and that new grad income has gone up 8-10x.

[linebckr83 3]

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When I was making about $2/hr at minimum wage (less earlier), the starting salary for a new grad electrical engineer was about $10k. Minimum wage has only gone up ~4x, and that new grad income has gone up 8-10x.

In all fairness, I'd say new grad EE salary has increased closer to 5-6x. I don't know of any new grad engineer making that much, and I'm an AE making 60k which is on the higher side for engineering.

"Are you coming to the party?
Oh I'm coming, but I won't be there!"
Flying Hellfish #828
Dudist #52

[lawrocket 3]

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The buying power of the minimum wage needs to be restored to a sensible level. At the moment it is set too low.

Increasing the minimum wage does not increase buying power. Tell me how the minimum wage has helped anything? Seems there are stuill poor, still poverty, etc. There will always be a bottom ten percent.

The best way to increase purchasing power is to lower the price of goods and services. What was the beginning of the middle class? If you answered "industrial revolution" then you are correct. The industrial revolution did several things. First - it got unskilled people employed. Yes, the uneducated and the lowly skilled could make money. And they could buy things because they were cheap.

Clothes were less expensive when weavers were put out of business by cheap textiles. Automobiles were less expensive when they were industrialized. We didn't pick up everyone's wages so everyone would buy a custom built car. We made cars accessible to all by lowering the prices.

Now the poor can afford cell phones. Remember the eoghties? Cell phones were the province of the rich? Not anymore. Because the phones are so inexpensive that America's poor can afford them.

Purchasing power of the poor? Look at what our "poor" have. We increase their purchasing power by lowering prices.

The evidence of how this really works stares you in the face. Increasing wages doesn'tseem to do much except make people feel good about increasing the minimum wage and then figuring out that it didn't do much so raise it again.

Edited to add: I also note that you've switched your argument to "spending power" from "job creator."Nd again with nothing other than assertion.

Here's an idea - open a business and pay your employees the wages that you think will be what they need to buy what they want. You may even last two or three months doing it before you realize that you aren't getting paid. Or is it something that others should do? You know, you won't pay people that, which is why other people should be forced to do it

My wife is hotter than your wife.

[skypuppy 1]

Automobiles were less expensive when they were industrialized. We didn't pick up everyone's wages so everyone would buy a custom built car. We made cars accessible to all by lowering the prices.
__________________________________________________

Some of what you say is correct. Henry Ford raised a lot of ire among other industrial leaders when he decided to pay his factory workers a higher rate, partly because he wanted to increase the market for his automobiles - also partly because of the high turnover in his factories due to the nature of work on the 'new' production line.

If some old guy can do it then obviously it can't be very extreme. Otherwise he'd already be dead.
Bruce McConkey 'I thought we were gonna die, and I couldn't think of anyone

[mcrocker 0]

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The buying power of the minimum wage needs to be restored to a sensible level. At the moment it is set too low.

The buying power is based on cost of living, not wages. Inflation has taken away the buying power not low wages.

[billvon 2,400]

>Contrary to right-wing propaganda, decent pay for workers helps the
>economy and boosts job creation.

Job creation in other countries, yes.

The more expensive you make american labor the more companies will look overseas to get that labor.

>The truth is that a move would be good for a slow economy and have a
>positive impact on the jobs crisis.

I don't see how laying more people off will help the jobs crisis.

[wlsc 0]

Walmart are going to get their labour from overseas - I think not.

Using your model with wages in China every American job would have already gone to that country. And look - wages are going up in China. They're getting richer and people won't work for peanuts.

[jclalor 12]

Not only is the MW too high as it is, these dead beats need to start paying their fare share in incom tax.

[kelpdiver 2]

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Walmart are going to get their labour from overseas - I think not.

Using your model with wages in China every American job would have already gone to that country. And look - wages are going up in China. They're getting richer and people won't work for peanuts.

Which is where Vietnam and newly good Burma come in.

Still laughing at your version of macroeconomics, DD. It's as consistent as Chutes n Ladders.

[wlsc 0]

Walmart are going to get their labour from overseas - I think not.

[brenthutch 383]

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In a historical context the value of the minimum wage is very, very low. Raising the minimum wage will help rebalance the economy.

Why don't we raise the mininum wage to $100,000 per year and then there will be no more poor people. Problem solved!