The Michele Bachmann Watch

@High Seas,

Sure High Seas, enjoy your lettuce at $9 lb.

I'm employer, I pay a living wage for my area and I can do it because I don't feel the need to make more than 275* times what my employees make.

(According to the Economic Policy Institute report, in 1965, U.S. CEOs in major companies earned 24 times more than a typical worker; by 2007, they made 275 times more. U.S. CEOs also make far more than CEOs in other advanced countries, the report said. )

2 Replies

@High Seas,

High Seas wrote:

True - but except for you nobody else brought it up. At least you know the difference between "national" and "domestic" (as in GNP and GDP) so you don't need to be told we have 20 million lawful residents in desperate straits - or about 20 million illegal aliens working at or about $2/hr.

What reality do you live in that 20 million people in the US earn $2 an hour? The majority of illegal aliens make at least minimum wage to my knowledge. Do you have evidence to support your claim of 20 million making $2 an hr?

Quote:

Businesses from Walmart to your corner Bodega would lose out if they had to pay $3/hr plus observe whatever other restrictions are imposed by applicable laws - but how many states (currently unable to help the unemployed / underemployed) would benefit? Try 48 our of 50!

I'm unclear how someone underemployed working 20 hours a week, making $6 an hour, will suddenly be better off financially if they work 40 hours for $3 an hour. Can you explain your math to us?

1 Reply

@parados,

HS sems disconnected from anything but macro economics. Thats the problem with most of the conservatives.
I herad Rush Limbo giving a lecture about holding minimim wage down so that the "job creators" will create even moe jobs. That logic, coming from a guy who is paid 50 million a year, is so loaded with ass kissing to mammon that he was similarly out of touch. The job creators have created all the jobs off shore with a "so what, **** em all" attitude. Even Henry Ford wasnt as valueless. Even he saw the need to pay people enough so they could afford the cars we make.

Course his rubber plantation state was a big loser

1 Reply

@farmerman,

It's a fundamental law in economics (macro and micro) that in any market you can fix the price, or you can fix the quantity, but you can't do both at once.

1 Reply

@High Seas,

so demand is a given?

1 Reply

@farmerman,

Are we still talking about unskilled labor? If so - and no matter what Parados claims about illegals getting paid at least minimum wage - yes, demand is given. The posters who mentioned up to $9 for a head of lettuce, or nobody to pick up the blueberries in the fields, know that the market-clearing price for that labor is below minimum wage - if it were at or above minimum wage (and in compliance with other applicable labor-related laws) it would find legal residents as takers. So, elasticity of demand in the very short run equals zero at the given (below minimum wage) hourly price per hour of labor:

http://demonstrations.wolfram.com/ThePriceElasticityOfDemand/HTMLImages/index.en/1.gif

http://demonstrations.wolfram.com/ThePriceElasticityOfDemand/
Legal residents might want to take up some of these jobs on offer if that offer were available to them - but it isn't. In that sense minimum wage laws interfere with demand for labor, and abolishing them increases demand for labor. Note that unskilled labor in this case is segmented by law - i.e. you get 2 different demand curves even in the short run. In the longer run of course demand curves shift (eg think of machinery introduced to pick up new varieties of crops not requiring hand-picking, which takes time), as do wages. If matching supply and demand for labor across all types, skilled and unskilled - and assuming for simplicity only legal residents are being considered - we can have persistent mismatches between labor supply and labor demand, incl. non-overlapping skill sets, distance, local unionization rates, additional government regulations, etc. We're in one such terrible mismatch right now - have been for 3 years.

2 Replies

@High Seas,

Quote:

Legal residents might want to take up some of these jobs on offer if that offer were available to them - but it isn't.

You need to speak to farmers. Reality is that pickers mostly get paid by the pound/bushel for what they pick. Faster pickers make more money, but no one is making big bucks. Farmers will tell you Americans will not take these dirty, hard jobs. I live in a farming community and people would rather make less money working fast food or malls than picking crops. Farmers (especially orchard growers) advertise for anyone during picking season, they rarely can get enough people because locals know how hard and dangerous the work is. Most apple orchards around here lose a percentage of their crop just to the fact they can't get it all picked. They can't pay more because they are in competition with apple growers in China who basically run on slave wages. Americans want cheap, perfect food and that is why farmers resort to migrant (not illegal around here) labor.

1 Reply

@Green Witch,

Did you work through the explanation just posted? Farmerman knows elasticity calculations, the explanation was for others here. If you do, you'll see the inconsistencies in your post. Again: we have 20 million unemployed/underemployed persons - these being legal residents, the others aren't counted in official statistics - in this country. If in your area people can find work at minimum wage in malls etc, that's not them. Not sure how to make that clearer.

1 Reply

@Green Witch,

there should not only be a minimum wage, there should be a maximum wage as well

1 Reply

@High Seas,

We got off a little off topic with migrant labor and farm wages, but let's get back to the issue...

Do you think a laid off accountant, sales executive or office manager should take a job picking crops to solve their unemployment problem? Do you think paying them minimum wage will solve America's economic problems?

1 Reply

@djjd62,

Most of what is quoted as "excessive wages" is due to taxpayer largesse in both public and private sectors. The too-big-to-fail public institutions like Fannie Mae are the worst - all the bad loans the banks made went on their books. Next come private banks / insurers bailed out instead of going belly up. Read this:

Quote:

Understanding Derivatives -- A Primer

Heidi is the proprietor of a bar in Detroit.

She realizes that virtually all of her customers are unemployed alcoholics
and, as such, can no longer afford to patronize her bar.

To solve this problem, she comes up with a new marketing plan that allows
her customers to drink now, but pay later.

Heidi keeps track of the drinks consumed on a ledger (thereby granting the
customers' loans).

Word gets around about Heidi's "drink now, pay later" marketing strategy and
as a result, increasing numbers of customers flood into Heidi's bar. Soon
she has the largest sales volume for any bar in Detroit.

By providing her customers freedom from immediate payment demands, Heidi
gets no resistance when, at regular intervals, she substantially increases
her prices for wine and beer, the most consumed beverages.

Consequently, Heidi's gross sales volume increases massively.

A young and dynamic vice-president at the local bank recognizes that these
customer debts constitute valuable future assets and increases Heidi's
borrowing limit.

He sees no reason for any undue concern, since he has the debts of the
unemployed alcoholics as collateral!!!

At the bank's corporate headquarters, expert traders figure a way to make
huge commissions, and transform these customer loans into DRINK BONDS.

These "securities" then are bundled and traded on international securities
markets.

Naive investors don't really understand that the securities being sold to
them as "AAA Secured Bonds" really are debts of unemployed alcoholics.
Nevertheless, the bond prices continuously climb!!!, and the securities soon
become the hottest-selling items for some of the nation's leading brokerage
houses.

One day, even though the bond prices still are climbing, a risk manager at
the original local bank decides that the time has come to demand payment on
the debts incurred by the drinkers at Heidi's bar. He so informs Heidi.

Heidi then demands payment from her alcoholic patrons, but being unemployed
alcoholics they cannot pay back their drinking debts.

Since Heidi cannot fulfill her loan obligations she is forced into
bankruptcy. The bar closes and Heidi's 11 employees lose their jobs.

Overnight, DRINK BOND prices drop by 90%.

The collapsed bond asset value destroys the bank's liquidity and prevents it
from issuing new loans, thus freezing credit and economic activity in the
community.

The suppliers of Heidi's bar had granted her generous payment extensions and
had invested their firms' pension funds in the BOND securities.

They find they are now faced with having to write off her bad debt and with
losing over 90% of the presumed value of the bonds.

Her wine supplier also claims bankruptcy, closing the doors on a family
business that had endured for three generations, her beer supplier is taken
over by a competitor, who immediately closes the local plant and lays off
150 workers.

Fortunately though, the bank, the brokerage houses and their respective
executives are saved and bailed out by a multibillion dollar no-strings
attached cash infusion from the government.

The funds required for this bailout are obtained by new taxes levied on
employed, middle-class, nondrinkers who have never been in Heidi's bar.

credit internet link unknown to me - got this by e-mail; as good a non-technical explanation of abysmal lending practices as any.

1 Reply

@Green Witch,

Green Witch wrote:

Do you think a laid off accountant, sales executive or office manager should take a job picking crops to solve their unemployment problem?

What they should do is up to them!

Fortunately we don't live in a socialist country with 20-year plans dictating where anyone should go and what kind of work he should accept at what wage rate. I find it astounding that the question would even occur to you. I've already proved eliminating min. wage increases demand for labor - the original Q.

2 Replies

@High Seas,

You proved nothing. The only one telling these people what to do it people like you who think creating more crappy paying jobs will solve economic problems. Low wage jobs just create more poverty and then people like you have to step over more homeless bodies in the street while complaining about the "lazy bums" who won't work.

1 Reply

@High Seas,

You need to watch the documentary "Inside Job" to understand Capitalism in it's purist form created these problems. A government afraid to interfere allowed for this mess from the start and now it has to interfere to prevent economic disaster.

0 Replies

@Green Witch,

Green Witch wrote:

You proved nothing.

You can't read, or you don't know the meaning of "proof", and/or you persist in obsessive rants - sorry can't start on your psychoanalysis, not my field. Bye.

2 Replies

@High Seas,

Quote:

- if it were at or above minimum wage (and in compliance with other applicable labor-related laws) it would find legal residents as takers

You speak from complete ignorance it seems High Seas.
Farming is not exempt from wage laws nor are they exempt from checking the status of workers they hire. Admittedly, they don't care how bad the forgery is, but most do check to provide the necessary CYA.
Would you rather work at McDonald's for $9 an hour or in the hot sun for 10-12 hours a day for $7.25 an hour with no overtime?

From the Dept of Labor

Quote:

The Fair Labor Standards Act (FLSA) exempts agricultural workers from overtime premium pay, but requires the payment of the minimum wage to workers employed on larger farms (farms employing more than approximately seven full-time workers.

No reasonable farmer would risk paying $2 an hour with the fines that would cost more than any savings he would make vs paying the minimum wage.

0 Replies

@High Seas,

And you don't appear to understand reality vs theory.

This from a fact sheet on migrant workers
source

Quote:

12% of all farmworkers earn less than the minimum wage.

1 Reply

@High Seas,

HS buys full-on, the belief that "trickle down" is the way our economy works best and that regulation is a job killer.Actually, regulation is a job creator. Regulation has created entire new industries like architecture, LEEDS manufacture, Consulting engineering, environmental services, etc.

Sending jobs out of country destroys the mid and uppwr level jobs as well as trades. AND, it destroys the "spin off" industries that had prospered when the industries were located here. Mexico has been a major recipient of industries whove moved to "Avoid regulation" and so companies like Black and Decker have tried to weather a down market for their own crap . MEanwhile, the quality of the goods that they used to produce in their plants in maryland, has sunk to terrible levels due to underpowered cheap motors, poor metallurgy (A specialty from China) , and marketing that cant convince any tradesman that B&D stuff is any good. B&D had to, under recent quality problems, beef up their little advertised division DEWALT and hype these tools as the "High quality professional tools made in AMerica". All that was because they tried to dance as a MAquiladoros entrepreneur and sent theyre own business into a dive.
YOU get what you pay for. (Demand always trumps anything else)

1 Reply

@High Seas,

High Seas wrote:

I've already proved eliminating min. wage increases demand for labor - the original Q.

You proved absolutely nothing with your 'analyis'.

There is already a decently-sized subset of Americans that will not work for minimum wage. How do you propose to get them to work for less?

0 Replies

@parados,

parados wrote:

And you don't appear to understand reality vs theory.

this actually is a brilliant summary of the Bachmann Watch

0 Replies

The Michele Bachmann Watch

Related Topics

Quick Links

My Account

able2know