The Minimum Wage: What's the Big Deal?

#1
volprof

volprof

Destroyer of Nihilists
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#1
This forum is not what any rational person or even I (as an unrational person) would describe as exactly pro-poor, uneducated people (although we have a lot of uneducated people posting on here), but something that has always caused me to pause is the absolute disdain some Americans have for the minimum wage.

I want to get VolNation's assessment of the minimum wage. I want to understand why it may or may not be a good idea.

Generally speaking, I'm pro-minimum wage, but I understand that many of you aren't. What's the deal? Help a dumb guy out.

I will go ahead and say that, if your rationale is some sort of trippy Ron Paul "free market is God" goofy stuff, I don't buy that at all. The nineteenth century was a veritable experiment in free market free-for-all economics, and, well, let's just say that it made Adam Smith look cute. No, the free market does not automatically determine living (or even decent wages), and the free market gives us a major financial crisis at least once or twice every decade, per the nineteenth-century. Hey, don't hate on me; hate on the nineteenth-century.

Anyhow, that bit of free market utopian nonsense (the equivalent of Karl Marx, just on the opposite side of the economic spectrum) being out of the way, why do you still despise the minimum wage? Conversely, why do you support the minimum wage?
 
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#8
#8
Just using 1963 since these are the oldest numbers for all three categories.

1963 minimum wage - $1.25
1963 average annual income - $4,396
1963 average house price - $19,300

2010 minimum wage - $7.25
2010 average annual income - $41,673
2010 average house price - $272,900

Just what has a $6 raise in the minimum wage over 47 years accomplished?
 
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#9
#9
hog88 said:
Just using 1963 since these are the oldest numbers for all three categories.

1963 minimum wage - $1.25
1963 average annual income - $4,396
1963 average house price - $19,300

2010 minimum wage - $7.25
2010 average annual income - $41,673
2010 average house price - $272,900

Just what has a $6 raise in the minimum wage over 47 years accomplished?
Click to expand...

The decline in fast food quality?
 
#10
#10
If minimums were good, wouldn't a minimum of $50 be great, or a minimum of $100 be outstanding?
 
#11
#11
hog88 said:
Just using 1963 since these are the oldest numbers for all three categories.

1963 minimum wage - $1.25
1963 average annual income - $4,396
1963 average house price - $19,300

2010 minimum wage - $7.25
2010 average annual income - $41,673
2010 average house price - $272,900

Just what has a $6 raise in the minimum wage over 47 years accomplished?
Click to expand...

just trying to understand your point, what do you think those numbers show? that 6 dollars didn't help the ratio between the three? because it seems like each of those are independent numbers.
 
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#12
#12
Staunch monetarists like Friedman were against the minimum wage but ultimately I think it is a pretty good thing. While most employers would pay at or over the minimum wage rate without legislation there are probably some businesses that would take advantage of a lack of statutory protection against excessively low wages. Especially seeing as there is a large amount of underutilized labour in most Western countries, the supply and demand for workers needs to be equal to survive without a minimum wage IMO.
 
#13
#13
minwage-real.jpg
 
#14
#14
LouderVol said:
just trying to understand your point, what do you think those numbers show? that 6 dollars didn't help the ration between the three? because it seems like each of those are independent numbers.
Click to expand...

Raising the minimum wage isn't going to help those who earn it. Most all union contracts have automatic escalators tied to the minimum wage, so almost everything we buy goes up right along with it.
 
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#15
#15
hog88 said:
Raising the minimum wage isn't going to help those who earn it. Most all union contracts have automatic escalators tied to the minimum wage, so almost everything we buy goes up right along with it.
Click to expand...

That's called inflation.
 
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#16
#16
hog88 said:
Raising the minimum wage isn't going to help those who earn it. Most all union contracts have automatic escalators tied to the minimum wage, so almost everything we buy goes up right along with it.
Click to expand...

Exactly. We can pay every one 100 bucks an hour, but the price of bread goes up too.

The additional costs are passed along.
 
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#18
#18
hog88 said:
Raising the minimum wage isn't going to help those who earn it. Most all union contracts have automatic escalators tied to the minimum wage, so almost everything we buy goes up right along with it.
Click to expand...

unions are a entirely different argument than wages. seems like this would be the strategy of any business. we have to pay our workers more so we are going to charge more. that is the whole argument with no $15 an hour because McDonalds becomes a expensive joint to eat at.
 
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#19
#19
loudervol said:
unions are a entirely different argument than wages. Seems like this would be the strategy of any business. We have to pay our workers more so we are going to charge more. That is the whole argument with no $15 an hour because mcdonalds becomes a expensive joint to eat at.
Click to expand...

wtf?
 
#21
#21
This is a competitive society or at least used to be for the most part.

Getting started = minimum wage. Have aspirations? Learn/work to earn more. Make yourself more valuable on the job and in the market. Minimum wage should be a step not a destination.
 
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#23
#23
hog88 said:
And how's that helping the minimum wage earner?
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Inflation is going to happen whether you have a minimum wage or not. We live in a globalized world. The minimum wage law is a protection against absurd rates of pay because of the excess supply of workers. You see the results of no wage protection in these third world countries that pay people like 50 cents a week for hard labor.
 
#24
#24
LouderVol said:
because the inverse is not true. drop the minimum wage and you would not see prices drop to match.
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Not now, you are correct. However raising it will not be a benefit either.

There should have never been a FMW established, if a state wanted to enact one, fine.
 
#25
#25
hog88 said:
Not now, you are correct. However raising it will not be a benefit either.

There should have never been a FMW established, if a state wanted to enact one, fine.
Click to expand...

It should really be raised at the rate of inflation.
 
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