If I were an employer, I wouldn’t want “free” labor of that nature, because it can consume too many resources just trying to manage it, when you’d have no authority because it could just walk away with no penalty. It’s the same problem that people have with volunteer organizations.
I have a better, and slightly less controversial proposal. Just let the market work, and eliminate the minimum wage. It would do wonders for youth unemployment in the inner city.
Just let the market work, and eliminate the minimum wage. It would do wonders for youth unemployment in the inner city.
But would cause horrible unemployment among the bureaucrat class who no longer had stupid laws to enforce.
Right I will eliminate the minimum wage….let wages drop to pennies per hour, then people will be willing to higher innner city youths. Eliminate mw and obviously welfare and food stamps, and we can have third world shanty towns in no time at all in major cities in the US, surrounded by affluent suburbs, benefiting from the now very cheap source of labor. Think those affore mentioned inner city youth will accept 50cent and our wages? Think you have enough police and army to force them too? Sure that will work, that would get them off their lazy duffs…and burn the cities(& suburbs) down.
Was this supposed to be an intelligent comment?
Did anyone propose “forcing” anyone to work for any particular wage? And we already have shanty towns in cities (I see them in Los Angeles every day). We call them Obamavilles.
What’s “unintelligent” about the comment? If you eliminate mw, (welfare & foodstamps presumably also), then you would be in effect forcing them to accept whatever wage their perspective employer would be willing to pay the inner city youth, however low. Their only alternative would be to starve, and yes we have poor neighborhoods,”shanty towns” of a sort, but not like they have in India or Bangaldesh, or many parts of Africa or Latin America.
The lack of better options is not “force”.
No-one is “forcing” you to eat at McDonalds because Burger King is closed. That’s your choice.
I missed the part about eliminating welfare. That’s a separate issue. People would have a choice of being on the dole, or having an honest job where they could learn work habits and improve themselves, and establish and employment record. It would be invaluable for the teenagers who are unemployable at the current minimum wage.
Hard to see you you could keep welfare/foodstamps and eliminate the minimum wage, alot of people would feed the low paying jobs “force” them to stay on the dole. I would go the opposite route, eliminate welfare and foodstamps for the able-bodied physically & mentally capable of working, and expand the minimum wage to every job. Every adult who wants to eat and expects a check would be required to work for said check. If they can’t find work the gov would either help them find work or failing at that, pay them at least mw and require them to do some kind of work 40 hours a week for their check. I imagine our 100’s of billions of dollars worth of infra-structure repair/maintenance we supposedly need could create easily tens of millions of jobs for instance.
If they can’t find work the gov would either help them find work or failing at that, pay them at least mw and require them to do some kind of work 40 hours a week for their check.
Or quit having the government muck up the economy. Forget everything else, what happens if we eliminate the minimum wage?
Would more jobs be available? Yes.
Would workers have more choices? Yes.
Would everybody be working for pennies? No. Would you?
Employers would compete for the best employees by paying them more. If this benefits the economy (which it would) then they would pay higher wages for some jobs because they would be competing even harder to get the best employers for the new growing economy.
What kind of work would the government help them find? The kind that does not drive the economy up. Only companies trying to profit does that.
BTW, the government already spends time and money trying to find work for people. How’s that working out?
In other words, you are the one advocating the use of force.
Every adult who wants to eat and expects a check would be required to work for said check. If they can’t find work the gov would either help them find work or failing at that, pay them at least mw and require them to do some kind of work 40 hours a week for their check.
Interesting, perhaps this needs some study.
I don’t support compulsion sir. I mean I would not support someone who chooses to be idle, by forcing the tax payers to give him money/food/housing while he/she does nothing. He/she can be as idle as they wish, I just don’t support taxing others forcing them to support his/her idleness against their will. I am only saying that if you wish aid from the government fine, but it should be in the form of pay/benefits for some kind of work in exchange. If they don’t want any aid from the gov, fine I would not once more force anyone to work; just not force others through taxes to involuntarily subsidize their idleness. The fact that I don’t support forcing people to support other’s idleness involuntarily is not the same as forcing them to work in a gulag. After all I work, most of us here probably work, the fact that my employer won’t pay me to sit at home and do nothing isn’t the same as their sending jack-booted thugs to my house to force me to work. They just don’t pay me if I don’t show up (and probably eventually fire me if I didn’t show up), but they wouldn’t try to force me to work.
If you support the minimum wage, you support the compulsion required to enforce it, and prevent people from entering into voluntary agreements.
As opposed to the compulsion of forcing someone to take whatever they can get (wonder how low the bottom would get? $.10/hr, $.05/hr?) or starve. If you got rid of the minimum wage, those “low skill” workers would just organize into Unions (or riot and burn the cities down) to force wages/benefits back up again.
Tim, if you oppose compulsion then stop advocating it.
While you’re wondering, consider, would you work for 5 cents? How many employees would sign up for that. Not many if any. When I was a kid we pulled weeds for that.
So if nobody is willing to work for that, what happens? Employers must offer higher wages to attract workers.
What if an employee is underpaid (as I have been my entire life?) Wouldn’t they look to change to a better job? If they are badly underpaid, doesn’t that lead to a high turn over. Do you realize that high turn over is a large cost to the employer? How does the employer fix that? By paying more.
My son has two jobs. I’ve had more than that at times. My ex-wife works for the state of CA and teaches piano to kids. She has a stable job so rather than take a more challenging one for more pay she’s thinking of taking on five more students.
People can control their own incomes and should by working harder or training themselves to be more valuable. Why is this the governments responsibility especially when the government is so bad at it and doesn’t have the interest of the people that the people have in their own lives?
One more point. The potential for starvation has another name. It’s called incentive. Welfare takes away incentive.
What happens to the wealth of a nation when people have incentive? They train themselves to be worth more, meaning the entire nation is worth more. This is why Americans are paid more than Chinese. It has nothing to do with minimum wage.
Tim, when I was a kid, minimum wage was less than $2/hr. I worked at those places, but never in my life did I earn as little as minimum wage. Why was that?
Really, before we go on, think about it. Why was that?
Hint: It’s two way street. Now think about it a little more.
Because people are suppose to enhance their own worth so that employers can’t get them for less. It works. It benefits everybody but the slackers.
Why would you want to employ people that aren’t worth what they’re paid?
Whose responsibility is it to make yourself worth more?
Even if there were to be a lot of low paying jobs as a result, doesn’t that give more people without work experience a chance to start up the ladder?
Who are you helping by elimination jobs?
Do you have any idea what the unemployment rate is for people without work experience is these days? You think welfare is the solution?
There are places that will only pay the lowest they can and fire anyone who gets uppity. Then again, those places don’t tend to last too long without political influence.
Don’t know, but what life for a middle class white kid was back then in terms of what he would “accept” as far as how low a wage, is probably quite different if one is an inner city youth, whom allot of people simply won’t higher, and not just because of “skill set” or lack thereof.
Or they organize and vote in minimum wage law and/or organize into unions to get higher wages/benefits.
Who gets to decide what I am worth? The least they can get away with paying me and making me accept?
No welfare is not the solution, I proposed above having people work for at least mw instead of wf/foodstamps.
The word is hire Tim, not higher.
The problem with the inner city is it cost more for a business to operate there because of crime and other causes.
Who gets to decide what I am worth?
Excellent question. A superb question. Keep asking questions like that and you are on your way to economic wizardry.
The answer is simple. You do. Even if you work for less at times, that just means you will do what you have to to earn what you’re worth by training yourself or simply looking for a better job. It’s not the employers job to pay you what you want. It’s your job to demand it of yourself.
Imagine the difference in a job interview. You’re not there to beg for a job. You’re giving them a chance to hire you. You could even say no to their offer and let them know they’ll have to do better if they want you. Nothing feels better than considering an employers third offer.
Who decides what anything is worth in a free market? If one person tries to sell something, he’ll only succeed if someone is willing to pay the price. If you offer to sale a used car for $10,000, it’s only worth that much if someone is willing to buy it.
Employers and employees decide what a job is worth. An employer is a buyer of labor and the employee is the seller. An employer will say that a job pays a given wage, say $10 an hour. If the employee accepts the job offer, then the employee has agreed what his labor is worth.
Keep in mind a few simple facts:
1. Employers (at least in the private sector) have to make a profit to stay in business.
2. The money it costs to employ someone is substancially above that person’s salary. There are other factors that add to the cost and many are based on the base salary. For example, the employer has to pay about 7.5% of the salary in Social Security and Medicare taxes, so that $10 a hour wage costs $10.75. But there’s more. Most if not all states also require the employer to pay unemployment insurance and workman’s compensation insurance premiums as well. Those vary by state and by job (more dangerous jobs will likely require higher worker’s comp premiums). In the end, it can easily end up costing $14 an hour or more to hire that $10 an hour employee.
Now, labor is but one part of the employer’s costs, often the biggest one. Consider the example of a simple sandwich shop. The shop owner has to pay rent, utilities, materials, labor, taxes, fees and other expenses. If he can’t make a profit, he’ll go out of business. If employees can’t produce at least a few times as much worth in product as their salary, then the store will not be in business for long.
Imagine the problem of having $1/hr jobs and minimum wage jobs and nothing in between? That’s why you get rid of the minimum wage requirement.
Link seems to 404 for me.
Try this.
I wouldn’t hire somebody that was willing to work for a dollar. There is too much risk coming from both the regulatory side and the employee with virtually nothing to lose.
Alternate proposal. Minimum wage doesn’t apply to anyone on any form of government subsidy.
And the winner of the Baghdad Jim/Admira Gerrib award in Economics goes to . . . Tim!!
Tim, here’s a question for you: if I were an employer, and offered jobs to people at a dollar an hour, how many people do you think would come work for me? But if someone did, and was willing to work for that wage, could you tell me from whence you derive the right to forcibly intrude upon the transaction? I’m always curious how “liberals” determine that they are our gods.
So I can force the business owner into paying mw through the law, or I can “force” the low skill worker into accepting barely above subsistence wages for lack of their having any alternative but starvation. I generally consider myself to be more of a Libertarian, but a practical one. I listened recently to John Stossel who I generally agree with say that sexual harassment laws should be repealed. The grounds are that the person (usually a woman) told by a boss (usually male) demanding sexual favors in exchange for a promotion or even her job, if she submits or not it is her choice…who are we to interfere, she can always just quit? Even if I agreed with that in theory as a practical political matter no politician could hope to be elected getting any significant amount of female’s votes running on something like that. Likewise it is hard to see how any Libertarian politician could hope to get elected running on repeal mw and obviously welfare, food stamps etc to follow. So it’s not really a practical option if I think it has no chance of being passed or that people wouldn’t accept it, so rather whether I think it would “work” in theory is almost irrelevant. Also if you think no one would work for one dollar an hour or much less than mw, then what’s the point of getting rid of mw, if you don’t think wages would fall by that much anyway?
We’re talking about government force here, meaning men with guns showing up if you don’t pay a minimum wage. Not “force” based on life circumstances, which isn’t really force. The alternative is what we have now. Businesses just won’t hire. So, now you are making $0/hr and there is no work being performed for anyone. Even worse, the government pays you for no work being performed.
So, with no minimum wage there is no force involved. I offer a wage of whatever, even $0.10/hr. You take it or leave it. The same is true the other way around. You offer whatever wage, and I take it or leave it. No one points a gun at anyone else.
You’re clearly ignorant not just of economics (that pretty much goes with the Leftist territory, along with a disdain for the syllogism) but what “force” (with our without quotation marks) actually consists of.
And you still haven’t answered my question (probably because it might involve the use of a syllogism) how you would have the right to put the State’s gun to my head and force me to pay someone more than what I am willing to pay them and more than they are willing to work for. I want to know because I’ve long been curious how you get to be one of those gods who have the right to compel others into submission to their desires. Can I fill out the coupon and send in the box top and become one of these deities, too? I would like to force people like you to read Hazlitt’s ECONOMICS IN ONE LESSION, Bastiat’s THE LAW, and Aristotle’s LOGIC.
Aren’t there certain types of jobs that don’t exist anymore because of the minimum wage? I do know that grocery store sackers are nearly extinct. (That was my very first job, in the late 1970s.)
I shop at Krogers…my groceries are usually bagged for me unless I go into the self checkout line.
Tim, who is this mythical low skill worker accepting barely above subsistence wages? Ah, I know. It’s the guy that doesn’t gain any skills. Whose fault is that?
How do they gain skills. By having jobs available which eliminating the minimum wage does.
Don’t you remember what it was like to be 18? I was never out of work unless I wanted to be. The advantage of low pay is it’s easy to quit that job for another. I never worried about being out of work as a kid.
But screw up the economy with bad policy and those 18 yo jobs dry up.
Course those 18-yr old can vote to I wonder how many of them would vote for repealing minimum wage to increase those $1.15/hr jobs? “The potential for starvation has another name. It’s called incentive. Welfare takes away incentive”. Sure it does but I wonder how many people would vote for said incentive? No wonder the dumacrats keep winning elections if this is the opposition’s arguments.
It’s a very old problem Tim. It is said that all democracies will fall as soon as people realize they can vote themselves any form of income.
Losing an argument is not the same as being wrong.
I just learned a useful term from Jeff Goldstein of the “Protein Wisdom” blog: “liberal anti-gun emo.” I think Tim would qualify as a “liberal economics emo.”
I would get rid of minimum wage, Obamacare, welfare, social security, medicare, and income taxes. In the place of all that, I would replace the whole damn tax code with a sales tax on every transaction without exception, and replace the dole with a monthly payment to every citizen, an equal (small) amount to all.
Get rid of the minimum wage and the horridly misnamed “affordable care act” right away.
Transitioning the federal government away from direct taxation on individuals would do a lot to restore the proper balance of power. But it would take a couple years and coordination to avoid a fatal shock to the system. Short of that, a flat rate tax code with minimal deductions would be a good step.
Welfare and medicare should be transitioned to the states with an objective of reducing the hammock / trap back to the safety net originally intended.
Social security is currently wound up so tight that just ending it would release an explosion I’m not sure the nation would survive. But if not unwound it threatens to strangle the nation. There is no way forward that avoids pain.
A tax on every last financial transaction is problematic, and favors large businesses that incorporate their supply chain in house. A single business that mines ore, refines steel, forges components, and assembles a car would have a tax advantage over separate companies that each perform one step in the chain. On top of that, such a tax code would require every individual to catalog their purchases or sales to assess their tax.
“On top of that, such a tax code would require every individual to catalog their purchases or sales to assess their tax.”
Such a tax would be collected at point of sale, exactly the same way state sales tax works now.
A vertically integrated company such as you describe would be rather rare – I can’t think of a single car company that also mines the ore, nor can I imagine that a company that had such divergent foci would be able to do the job cheaper than two companies each focusing upon their specialty. Perhaps that’s a failure of my imagination.
If I hire a neighborhood kid to mow my lawn is that taxed?
You hire me for some work, that transaction is taxed. I could do the work myself. Or hire employees to help me, which is another layer of tax.
The problems with a financial transaction tax include a small tax rate piling up along a supply chain, perverse incentives to shorten the transaction chain, and the tax burden being generally opaque.
I disagree that such a tax would necessarily be opaque – I would think it would be rather visible. You bring up a good point about odd jobs, and a case could be made for a sales threshold below which a business need not collect the tax. So much for “no exceptions”.
Opaque for the same reason a VAT is: You may know exactly what your direct tax is. But the tax paid upstream, passed on as a higher price, is hidden from you. That hidden portion is likely to be several times higher than the visible portion.
The problem with your proposal Ed is that it would work.
Or maybe use a land tax instead of / in addition to a sales tax to fund this. Note how a low basic income like this also discourages mass immigration without having to build fences, employ border guards etc.
I have been wondering how much the untaxed/cash underground economy plays into minimum wage, welfare, and other policy and economic issues. It’s well established that raising the minimum wage lowers employment, and studies to the contrary have been debunked. It seems obvious that as well as pushing people out of taxed employment it will encourage employers and workers to have more off the books jobs, likely while collecting unemployment benefits and/or welfare. I think this is corrosive to society and the rule of law, and I wonder if there is a point where this push to under-the-table work is a worse problem than unemployment.
I was on jury duty once where the victims were illegal immigrants. They said they had no interest in citizenship–they preferred to work the underground economy rather than pay taxes.