First Minimum Wage Increase Since 1997 Voted Down

[Dingfod]

$77.93 an hour (based on 2080 hours a year) Senators vote down $1.10 an hour increase to the stagnant minimum wage, which has been at $5.15 an hour since 1997. Senators didn't seem to have problem with voting themselves a $1.92 an hour increase last year, only a $4000 a year increase.

What is wrong with them? Even the Walmart CEO is calling for an increase in the minimum wage. Not for his employees sake, of course, but because their customer base is strapped for cash and a 21% increase in their wage as proposed would mean lots more money flowing in the doors of Walmarts everywhere.

[TomJoe]

Friggin stupid. I see absolutely no reason as to why the Republicans (all except 4 of them) would vote against a minimum wage increase. Was something "more objectionable" tagged onto this bill to create such a partisan voting outcome?

[alphamale]

As anyone who passed Econ 101 with a C or better knows, the minimum wage is a job killer, especially targeting the lowest wage earners, the ones who can least afford it. Liberals know that and like it, because it creates welfare cases, one of their voting constituencies.

[Ensign Steve]

He's so predictable, it's cute!

No fair trolling the troll, Warren.

[Dingfod]

Minimum wage! *snap* Hiyah! -- TMBG

[Wizard]

I make minimum wage working in a grocery store, It would have been better making 6.15 an hour than 5.15.

[Dingfod]

They could only pay you $4.25 an hour because you're under 18. They're just being nice to you.

[Waluigi]

How many people really make minimum wage anymore? Not counting teenagers, part-time workers, and such. How many full-time jobs, even crappy ones, still pay the federal minimum wage?

Even McDonalds hires at almost $7/hour around here, because they lose good help to mall stores and restaurants, which pay more than minimum wage, too.

Now, I'm not going to debate whether $7/hour is sufficient to live on, because I don't think it is. However, I would suggest that market demand for labor does a much better job at raising wages than the federal minimum wage does. Of course, when the labor demand is soft, wages plummet, so there's a downside to it as well.

But honestly, even $6.25 isn't enough to live on, and most working poor probably make more than that, anyway. So why raise the federal standard?

My guess is that the Republicans are intentionally avoiding the minimum wage issue, hoping to prove that the market can set the labor rates better than the government can. It remains to be seen whether that's true in practice, or just in theory.

[Darren]

Originally Posted by alphamale

As anyone who passed Econ 101 with a C or better knows, the minimum wage is a job killer, especially targeting the lowest wage earners, the ones who can least afford it. Liberals know that and like it, because it creates welfare cases, one of their voting constituencies.

So that's what's in Room 101!

[Wizard]

Darren, and that's why those Mexicans took our jobs. lol Do you know where I got that saying from?

[Alonzo Fyfe]

Actually, raising the minimum wage does more harm than good at those who are at the bottom end of the economic ladder. The damage comes from multiple directions.

(1) Some marginal businesses -- those just barely making enough to stay in business -- close their doors, putting their workers out of work.

(2) Those who do not close their doors could try to reduce their wage burden by cutting back on hours, cutting back on benefits, or cutting back on employees. Increasing prices could reduce demand enough to make it possible to reduce the size of the labor pool.

(3) Automation becomes more cost-effective. Raise the minimum wage, and watch Wal-Mart increase the number of self-service checkout counters at its stores. Indeed, Wal-Mart may very well be seeking an increase in the minimum wage precisely because it can avoid those costs through greater automation that its competitors cannot afford.

(4) Others who might have otherwise stayed out of the labor pool -- particularly high-school and college-aged kids and spouses who would otherwise have stayed home or pursued other interests -- now have a stronger incentive to enter the labor market and compete for the same jobs. The losers in this competition are the inner-city youth who get replaced by these more middle-class employees.

Alonzo Fyfe
Atheist Ethicist Blog

[Trojan]

Originally Posted by Alonzo Fyfe

Actually, raising the minimum wage does more harm than good at those who are at the bottom end of the economic ladder. The damage comes from multiple directions.

(1) Some marginal businesses -- those just barely making enough to stay in business -- close their doors, putting their workers out of work.

(2) Those who do not close their doors could try to reduce their wage burden by cutting back on hours, cutting back on benefits, or cutting back on employees. Increasing prices could reduce demand enough to make it possible to reduce the size of the labor pool.

(3) Automation becomes more cost-effective. Raise the minimum wage, and watch Wal-Mart increase the number of self-service checkout counters at its stores. Indeed, Wal-Mart may very well be seeking an increase in the minimum wage precisely because it can avoid those costs through greater automation that its competitors cannot afford.

(4) Others who might have otherwise stayed out of the labor pool -- particularly high-school and college-aged kids and spouses who would otherwise have stayed home or pursued other interests -- now have a stronger incentive to enter the labor market and compete for the same jobs. The losers in this competition are the inner-city youth who get replaced by these more middle-class employees.

Alonzo Fyfe
Atheist Ethicist Blog

Then why not just LOWER the minimum wage! Yeah, in the early 20th century there weren't any annoying leftists around! Capitalism thrived on the backs of the working poor, living in cumpney shanties. Ahh the good old days when you had legal slavery, no troublesome unions or anything else to get in the way of cumpney profit! HuAhh! CAPITALISM!!!!

[Darren]

Between 1979 and 1997, the GDP of the U.S. increased by 38%. During that same period the median salary increased by only 9 %. At the start of that same period (1979), the income of the richest 1% of American famillies was ten times that of the median. In 1997, that ratio had increased to 23 times the median.*

So the money is there, it's just not being distributed fairly. Those on the bottom of the economic ladder are already suffering, even if they work, there being no guarantee that any work they do will be fairly remunerated. Those on the top are becoming richer and richer and the gap between rich and poor is dramatically widened.
It is clear that some areas are worse off than others, it is these areas which need to be prioritized through economic assistance. There is little incentive in a free market economy to develop poor zones. In fact, the opposite is the case, since such zones provide an abundant supply of cheap labour.
A minimum wage, coupled with other planned measures of income distribution, could remove the precarious situation many famillies face in the U.S. - the down side Waluigi referred to being daily reality for about 40 million people in the U.S. It seems pretty clear that the free market works for some and leaves others behind (as one might expect), and that it is disastrous for much of humanity.



*Figures ultimately from (PNUD) Global Report on Human Development - Paris, Economica - 2002

[TomJoe]

Originally Posted by Alonzo Fyfe

(1) Some marginal businesses -- those just barely making enough to stay in business -- close their doors, putting their workers out of work.

We hear about all these tax breaks for big business. Exactly what is being done for small business? I love how Exxon reported it's largest profit gain ever last week, yet we were all suffering with $3/gallon gasoline prices.

(3) Automation becomes more cost-effective. Raise the minimum wage, and watch Wal-Mart increase the number of self-service checkout counters at its stores. Indeed, Wal-Mart may very well be seeking an increase in the minimum wage precisely because it can avoid those costs through greater automation that its competitors cannot afford.

Good point. I had not considered this. I have noticed more of these self-service checkout counters at its stores, and do admit to using them because they're faster and IMO easier. I guess one should be suspect when Wal-Mart, which is all about the bottom line, is lobbying for something eh?

Good points, all of them.

[Darren]

Originally Posted by Alonzo Fyfe

Actually, raising the minimum wage does more harm than good at those who are at the bottom end of the economic ladder. The damage comes from multiple directions.

Are you actually advocating the reduction (read stripping) of protection for workers, Alonzo?
By failing to raise the minimum wage, that is effectively what results when increases in the cost of living are taken into account.
The absence of such protection can only increase the precarity of the poorer social strata, not reduce it. Unskilled labour would be the hardest hit, since it would be an employers' market and they (the unskilled) and their families would be open to the worst exploitation.
It is certainly not in the interest of those at the bottom of the economic ladder to be offered short term work which will not cover, or might just barely cover, their living expenses for an uncertain time.

While some of the points you make certainly hold true when the option of a raised minimum wage is considered in complete isolation from other aspects of the economy (like progressive taxation for individuals and businesses, social security, public sector subsidies etc.), it still does not make sense to paint less protection for labour as more protection .

[Alonzo Fyfe]

Originally Posted by Darren

Are you actually advocating the reduction (read stripping) of protection for workers, Alonzo?

No.

I would advocate a program whereby people whose income is below a certain "minimum wage" with subsidized medical care, food, and housing so long as they remain entrolled and are showing reasonable progress in an educational/vocational training program. Allow them to train their way into jobs that pay a higher wage (at least, those with an interest in actually entering into and succeeding in such a program).

Meanwhile, leave the minimum wage alone (or, actually, I would have no opposition to eliminating it altogether). The effect of this is that it would leave these low-paying jobs open, allowing individuals to acquire work experience along with their education.

One of the effects of this program is that it will train a large body of workers out of these low-pay jobs, which will reduce the supply of laborers for this job, which will force wages up as employers compete for fewer employees in this particular skill area.

How would I pay for this? Answer: By taxes on the wealthy.

Raising the minimum wage does more harm than good, particularly on people on the lowest rung of the economic ladder. They are simply thrown out of the job market and opportunities that they would otherwise have had are taken from them.

Alonzo Fyfe
Atheist Ethicist Blog

[beyelzu]

Originally Posted by Darren

So the money is there, it's just not being distributed fairly. Those on the bottom of the economic ladder are already suffering, even if they work, there being no guarantee that any work they do will be fairly remunerated. Those on the top are becoming richer and richer and the gap between rich and poor is dramatically widened.

and yet if you work 48 weeks out of the year, you are almost certain to move up the economic ladder. also in america, how suffering is there by the poor. most of them own cars, fridges, color tvs, and a signigicant percentage have cable. being poor in america is not being poor romania or albania or susaharan africa. on that note, my friend cat is from romania came here when he was about 7 or 8, his mom couldnt understand that there were poor people here that were fat, because such an animal did not exist in romania.

It is clear that some areas are worse off than others, it is these areas which need to be prioritized through economic assistance. There is little incentive in a free market economy to develop poor zones. In fact, the opposite is the case, since such zones provide an abundant supply of cheap labour.
A minimum wage, coupled with other planned measures of income distribution, could remove the precarious situation many famillies face in the U.S. - the down side Waluigi referred to being daily reality for about 40 million people in the U.S. It seems pretty clear that the free market works for some and leaves others behind (as one might expect), and that it is disastrous for much of humanity.

and yet i cant remember the last time i heard about someone starving to death in america. btw, i would love to see a comprehensive study on raising the minimum raise to see if after a brief downturn it actually helps the economy, poor people dont save money as a rule and thus spend the raise, the rich invest and save, the spending does much more to help the economy.

[beyelzu]

Originally Posted by TomJoe

We hear about all these tax breaks for big business. Exactly what is being done for small business? I love how Exxon reported it's largest profit gain ever last week, yet we were all suffering with $3/gallon gasoline prices.

on the gas thing, suffering?? kind of strong in the language considering most of the world pays like 6 dollars us for a gallon of gas and have for years. i would actually like to see such a tax passed here in america exempting commercial trucks.

Good point. I had not considered this. I have noticed more of these self-service checkout counters at its stores, and do admit to using them because they're faster and IMO easier. I guess one should be suspect when Wal-Mart, which is all about the bottom line, is lobbying for something eh?

Good points, all of them.

the automation thing was a great point.

[erimir]

Originally Posted by Alonzo Fyfe

so long as they remain entrolled and are showing reasonable progress in an educational/vocational training program. Allow them to train their way into jobs that pay a higher wage (at least, those with an interest in actually entering into and succeeding in such a program).

So, you would say that education is the way out of poverty?

Originally Posted by beyelzu

on that note, my friend cat is from romania came here when he was about 7 or 8, his mom couldnt understand that there were poor people here that were fat, because such an animal did not exist in romania.

I hate when people bring this up (I used to do it myself). Obesity is a health problem among the poor, it is not proof that they're not really that bad off. It's caused by poor diet, because in America many of the cheapest foods are greasy and sugary, and periods of hunger that cause your body to store more fat in anticipation of more hunger.

It doesn't show how good the poor have it, because, believe it or not, being obese is not healthy.

[Waluigi]

I think it's easy to say that the poorest of the poor in the U.S. still aren't nearly as poor as the poor people in other countries. However, the quality of their "relative poorness" doesn't mean it's okay for them to suffer.

Education can be a way out of poverty, but not by itself. Education, combined with opportunity and desire, are what lift people out of a lower social class. Unfortunately, that combination is often hard to come by.

A poor education hinders somebody before they're even old enough to work. Some working poor have to work 2-3 jobs to support themselves, and have no opportunity to further their education because they're working 16 hours a day.

However, I would submit that, more often than it's desirable to admit, a lack of ambition to move up the social ladder is what causes people to stay where they are.

A friend of mine runs a little convenience store. He said the same people come in once a month to cash their welfare checks and drop half of it on cigarettes and lottery tickets. These people are never going to be off social assistance, because they have no desire to be, and probably don't have the aptitude to boot.

There is nothing that government can do to help some people, because they simply don't want to be helped.

The question becomes: what should government do (if anything) to help those that actually want to be helped? Working poor jobs (those paying, let's say, less than $10/hr.) usually don't provide tuition assistance, or an opportunity for advancement. But people need to work. They can't all work for the government. So what can be done by the government?

[erimir]

The thing about education was a joke - reference to another thread.

[TomJoe]

Originally Posted by beyelzu

on the gas thing, suffering?? kind of strong in the language considering most of the world pays like 6 dollars us for a gallon of gas and have for years. i would actually like to see such a tax passed here in america exempting commercial trucks.

Well, ok, not suffering really. Fortunately, my new job affords me a nice cushion since I'm still sticking to my poor graduate school days budget. So while I paid more, I wasn't terribly affected. Of course, given the fact that home heating costs are predicted to be increased by upwards of 30% this winter, there is still plenty of time for my bank account to suffer this year.

However, my experiences are different than others. The gas price hikes hurt not just at the pump but at the grocery store too. Was I the only one to notice an increase in most vegetables and dairy? These increases in gas and food, for people who are already living paycheck to paycheck, certainly caused people to suffer. That Exxon reported record profits is bullshit.

Also, as to the cost of gas elsewhere in the world. In Europe, from what I've been told, they have extensive public transportation. So the increase in gasoline, for private use, can be see as an incentive to use public transportation. If here, in the US, they had good public transportation, both city and intercity ... I'd use it.

[Waluigi]

Originally Posted by erimir

The thing about education was a joke - reference to another thread.

I figured that, given your wink smiley, but you still raised a good point, so I ran with it.

[beyelzu]

Originally Posted by erimir

It doesn't show how good the poor have it, because, believe it or not, being obese is not healthy.

believe it or not it takes a certain amount of caloric intake to be fat, nobody starves to death in america my friend

[Adora]

(1) Some marginal businesses -- those just barely making enough to stay in business -- close their doors, putting their workers out of work.

The question is then: Who the fuck was letting these businesses run like that in the first place? If they're that inefficent, making money only because they pay people pittance, I question their right to stay open.

(2) Those who do not close their doors could try to reduce their wage burden by cutting back on hours, cutting back on benefits, or cutting back on employees.

Actually, the most common way businesses handle such situations is to increase casual work and cut back on fulltime/permanent employees. This isn't as bad as cutting back employees, but does create a dangerous, extremely unstable culture of employment, which does not benefit the majority of people who do work minimum wage (lower socio-economic females) who need economic independance and work safety to improve their lives.

(3) Automation becomes more cost-effective.

Actually, it doesn't. You still need a large number of people to monitor those machines, who need to be trained, and the initial output for them and their system is quite expensive. Also, there's maintainence and the cost of fixing something when it breaks down, which a lot of businesses don't factor into their equations, but which ends up costing a shitload in the long run.

(4) Others who might have otherwise stayed out of the labor pool -- particularly high-school and college-aged kids and spouses who would otherwise have stayed home or pursued other interests -- now have a stronger incentive to enter the labor market and compete for the same jobs. The losers in this competition are the inner-city youth who get replaced by these more middle-class employees.

This is crap. Minimum-wage workers are hired because they won't complain, don't know their rights and won't demand more money.You'll still get lower-class kids working at McDonalds who are uneducated and therefore won't try and assert their worker rights, which you run the risk of having if you hire those from better-educated classes. If the minimum wage goes up you bet your rationalist cock the inflation will serevely rise, keeping the relative socio-economic status intact. It's been doing this around the world for the last 30 years, which greatly decreases the real worth of the minimum wage sometimes to half or 40% over 10 years of what it was when it was increased. So to make up for that, you need to increase the minimum wage at least 40%, otherwise you're just running a slave system, and an economy that doesn't deserve to exist in the first place.