Is a minimum wage necessary?

Gus, and I'll bet those heartless bastards acted out of feelings of righteous indignation, an expression of their belief that they are of the respectable side of society.

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And I would bet that you would be correct, JL.

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I once argued about my childhood poverty with a local columnist. He made it plain he did not care if my family perished; he was gratified the state refused us any aid after our first year in Texas. We were denied, despite the fact we were twelve persons, in 1957, living on a sixteen year old boy's salary of $1 per hour.

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Low wages are hard to make it with in the US. Never mind apartments with microwaves and airconditioning. I haven't had airconditioning my whole life until a couple of months ago, and now I have a "swamp cooler".

A lot of people double and quadruple up. Insurance, should one go for it, is incredibly expensive if you live as an independent contractor or as a part timer - people often do a few part time jobs.

I moved from Chicago to LA when I was thirteen. That was just as my family security was going to hell in a handbasket, but I'd had a few years as a middle/upper middle class kid. Well, say, 1.5 years. So, slums were what I could see from our Buick.

When we got to LA, I knew there were tough parts of town. I married a guy who'd lived at the heart of south LA until he met me and he'd lived two blocks from Florence and Normandie his whole life, a neighborhood with some tough stuff going on. But me, at fourteen, when I saw what they considered a tough neighborhood in LA, I thought, eh! because it didn't look like I'd seen, for minutes mind you, back in Chicago. I got to know better over time.

There is a dredge on one's life, when transportation is mostly unavailable, night and day are dangerous, and you have a lot of trouble showing up at a job even when you desire it badly.

People can get welfare.. but between welfare and living ok is quite a bit of a chasm for a lot of people.
I don't actually give two figs what minimum wage does for or against the Economy.

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Well, my post looks damn odd next to Edgar's and well it should. I always listen to Edgar.

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Looks fine to me.

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I don't think a "National" minimum wage makes any sense, since the purchasing power varies wildly from State to State. Here in Wisconsin it is set at $6.50, which is a bit lower than the law of supply and demand demands I pay, even a dishwasher. I use it as a starting point to determine a new employee's worth during training but only kids and the truly incompetent will actually work for it. There were 62 people on my payroll this week, and only 2 at the minimum wage that aren't tipped on top of it.

In Lake Geneva, Wisconsin, even fast food places were advertising starting pay of $8.50, 12 years ago. For the most part, I think the market should be allowed to set it's own price, but would agree that there does have to be a minimum wage of some kind. I'd have to study further before answering definitively; but I don't think I'd be opposed to Kennedy's (Snood's) attaching it to inflation either even retrospectively providing they spaced it out to give business an opportunity to adjust. It might hurt a little initially, but I think in the long run you simply empower more qualified buyers anyway.

On the other hand; I would vehemently oppose any suggestion to raise the minimum to the actual cost of living, as this would inevitably make vast numbers of people virtually unemployable. There's a limit to what anyone would pay for incompetence. As Thomas correctly pointed out, a great many people could and would be replaced by technology if this were the case. The net result would be devastating to the poorest of the poor.

I've also read that large local minimum wage increases (didn't Dys reference one?) have terrible side-effects on the poorest of the poor, as more qualified applicants stream in from surrounding communities making it almost impossible for the least competent to find any work at all.

In broad strokes, I think I also like Thomas's idea of financing some of the disparity through increasing the Earned Income Tax Credit... perhaps even more than attaching minimum wage to inflation. (It's a bit off topic; but I think I'd also like to see that money come from a healthy Death Tax. Should I prove successful; I know I'd rather pay a higher portion of my tax burden upon my death, which in turn would free up more of my dough to create jobs during my lifetime... and encourage me to do so.)

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Bill, the more I read your stuff, the more I am convinced that you have a black heart.

I still like you, but I am beginning to wonder why.

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The issue of a national minimum wage is complex, because as somebody already mentioned, the cost of living ain't the same across the US - or even from community to community in the same county.

It's a tough call even for states, because of what I said in the first paragraph.

I think the issue is a matter of extremes; too high a minimum wage will hurt the poor for reasons OBill explained. If it's too low, survival would be the issue - even when working full-time - with some carrying two jobs.

It's a tough call, but today's minimum is too low. The idea of regular increments to minimum wage is a good one - for businesses to cope with them.

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ossobuco wrote:

Low wages are hard to make it with in the US. Never mind apartments with microwaves and airconditioning. I haven't had airconditioning my whole life until a couple of months ago, and now I have a "swamp cooler".

A lot of people double and quadruple up. Insurance, should one go for it, is incredibly expensive if you live as an independent contractor or as a part timer - people often do a few part time jobs.

I moved from Chicago to LA when I was thirteen. That was just as my family security was going to hell in a handbasket, but I'd had a few years as a middle/upper middle class kid. Well, say, 1.5 years. So, slums were what I could see from our Buick.

When we got to LA, I knew there were tough parts of town. I married a guy who'd lived at the heart of south LA until he met me and he'd lived two blocks from Florence and Normandie his whole life, a neighborhood with some tough stuff going on. But me, at fourteen, when I saw what they considered a tough neighborhood in LA, I thought, eh! because it didn't look like I'd seen, for minutes mind you, back in Chicago. I got to know better over time.

There is a dredge on one's life, when transportation is mostly unavailable, night and day are dangerous, and you have a lot of trouble showing up at a job even when you desire it badly.

People can get welfare.. but between welfare and living ok is quite a bit of a chasm for a lot of people.
I don't actually give two figs what minimum wage does for or against the Economy.

I can remember, as you probably can when cars didn't have air conditioning. I'd get into my little chevy with it's plastic seat covers and on a hot day (90F), I'd sweat like a hog in heat. When it was time to exit the car, I'd have to peel my butt off the seat, a very hurtful event, when wearing shorts.

We got by without AC and even today, I rarely use it in the house.

Mimimum wage? Welfare? Poor folks get by. It was many years before we had a TV. No big deal. We went to the neigbors or down the street where there was a TV in the window of a store for all the passerbys to look at.

Minimum wage? Welfare? Poor checks? Low wages? We all saved in the Savings and Loan Bank, where we got prizes for opening our little Christmas club accounts.

Interesting how, the poor if given direction can become very wealthy just by saving and "making do". When the soles on our shoes developed holes, did we go to the shoe repair shop and pay big bucks for a repair job? No way! We just bought a little repair kit from WoolWorths to fix up the soles. More savings.

One other way, the poor have compensated for low wages and welfare checks is by pooling their resources. With a 2 bedroom apartment, gues how many beds you can set up and guess how much money you can save by such an arrangement.

I don't miss my poor days, but I have too say that they were among the happiest of my whole life!

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Quote:

here is a dredge on one's life, when transportation is mostly unavailable, night and day are dangerous, and you have a lot of trouble showing up at a job even when you desire it badly.

Very true, but then we had the buses and the subway. Sure it was cold in the Winter and hot in the Summer, and remember for a long time no AC on either subway or bus, but nevertheless we got by. We were tough, determined and disciplined. And think of the dough we saved. If nothing else was available, we walked, walked and walked and brother how strong our legs got! Surprised

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Earned Income Tax Credit...

Do you think the rest of us know what the hell you are talking about?

Sort of like stuff being deductible... you have to earn x to have stuff be deductible..

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Miller wrote:

Quote:
here is a dredge on one's life, when transportation is mostly unavailable, night and day are dangerous, and you have a lot of trouble showing up at a job even when you desire it badly.

Very true, but then we had the buses and the subway. Sure it was cold in the Winter and hot in the Summer, and remember for a long time no AC on either subway or bus, but nevertheless we got by. We were tough, determined and disciplined. And think of the dough we saved. If nothing else was available, we walked, walked and walked and brother how strong our legs got!

You're talking a knowable walkable city like New York.

And the difference is why I am so interested in urban planning and transportation in my adult life.

Los Angeles covers a giant area and hasn't the transportation links that NY has, by a long shot. People really are stranded.
Especially in south LA. Trust me on that. I've sort of an eagle eye on transportation.

But past those folks stranded there, the rest of LA is ill served re busses too. Just not quite as badly.

I happened to live at the other end, as my parents bought a house in the five minutes they had enough money, and then never ever again had the money to make payments, or barely. Yes, I helped make those, from the day I turned sixteen. But the house was in an ok area. So ok that the bus came every 90 minutes. I bought my first car when I was 27, that is, when I had a decent lab income.

So, since I lived in a good neighborhood in a sorta bare and troubled house, I am quick to dismiss people waving at neighborhoods as full of stupid thoughtless folk. People in middle class or even upper class neighborhoods may be clasping at straws to keep it together, and people in simple places may be consistent rent payers. Bias isn't useful.

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Backing up to Miller's point, I wouldn't at all mind if LA were more like New York in many ways.

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The "Earned Income Tax Credit" on it's own is a type of national "minimum wage".

http://www.irs.gov/individuals/article/0,,id=96406,00.html

The Earned Income Tax Credit (EITC) sometimes called the Earned Income Credit (EIC), is a refundable federal income tax credit for low-income working individuals and families. Congress originally approved the tax credit legislation in 1975 in part to offset the burden of social security taxes and to provide an incentive to work. When the EITC exceeds the amount of taxes owed, it results in a tax refund to those who claim and qualify for the credit.

To qualify, taxpayers must meet certain requirements and file a tax return, even if they did not earn enough money to be obligated to file a tax return.
----

In the early 90's, the first year that we were able to claim our daughter on our taxes, we roughly broke even. We might have had a small refund...200.00 or so, but I don't remember. Another couple we knew, had a child the exact same age, but the wife worked about six months at a bank, the husband worked for cash mowing yards...so no actual taxed income on him. They received around 3,500.00....for basically not working enough.

Mrs X made 15,000 last year, but our calculations show that she should have made 20,000...so here's a check for the difference.

This goes on every year, but the amounts have grown. There are several families that I know of....as I've risen in the tax bracket, I pay in more than they make during the year....and they draw these huge checks every April....in the 5k range, which is roughly what they pay in over the fiscal year. They get all their money back and usually a surplus to boot, so they are not paying in their SS money, or anything else for that matter.

They tend to blow the money right away...good for the economy I suppose...but regardless it's still horse ****.

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Thanks, 2packs.

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Anyone who is familiar with the most basic elements of economics can see that minimum wage is economically not viable.

Raising the minimum wage causes unemployment because it forces employers to dismiss low productivity workers and effectively put them out of the market. Minimum wages thus act as barriers to entry and people wonder how unemployment occurs.

The premise underlying the minimum wage movement is that supposedly if you raise it to $8, or better yet, $12, supposedly millions would be lifted out of poverty. What it really means is that anything beyond what the government fiat dictates, which means, many voluntary and free wage contracts are now criminal. If the minimum wage does not cause unemployment and is such a great thing to help the poor, then why is the government so cheap? Why settle at $8 an hour? Why not $50? $100? $1,000?

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gustavratzenhofer wrote:

Bill, the more I read your stuff, the more I am convinced that you have a black heart.

I still like you, but I am beginning to wonder why.

This is another of those occasions when I don't know if you're being funny or serious. I've had a lousy night, with lots of wondering if I'm in the right in being properly protective or overly protective of my girls, and if you're serious... please don't tell me till tomorrow or I may just cry tonight.

ossobuco wrote:

Earned Income Tax Credit...

Do you think the rest of us know what the hell you are talking about?

Sort of like stuff being deductible... you have to earn x to have stuff be deductible..

My bad, darlin. A tax deduction is something you can deduct from the amount you owe tax on. A credit is real money against what you actually owe and can result in positive money.
Example:
A person who owes $2,000 in taxes who receives a tax credit of $10,000 gets a check from Uncle Sam for $8,000. Not the norm, but it could be in certain cases without disrupting the normal flow of business. This is just another example of Thomas's brilliance.

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edgarblythe wrote:

I happen to feel the USA can do much better by its poor than it has, and that is my central theme.

I agree. That is not the point I argued against. I argued against JLNobody, who had implied a connection between working on a minimum wage and starvation. There is a lot of room between "working people may be starving" (which is basically bogus) and "the USA can do much better" (which is basically true). Rhetoric that ignores this room sounds impressive, but casts more heat than light on the issue.

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People who make minimum wage are forced to choose what to buy among necessities. Many if not most are malnourished. This is a fact that I have witnessed my entire life.

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Is a minimum wage necessary?

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