The REAL minimum wage

[AthenaAwakened]

I wish you anti-MW folks would make up your minds. You say that MW earners are only a very small percentage of the workforce and then turnaround and say the economy will collapse if that miniscule subset of workers get a $2/hr raise.

Nobody's saying the economy will collapse. We are saying that raising it will leave a lot of them without a job at all.

ever?

They will never work again?

 

[Loren Pechtel]

I wish you anti-MW folks would make up your minds. You say that MW earners are only a very small percentage of the workforce and then turnaround and say the economy will collapse if that miniscule subset of workers get a $2/hr raise.

Nobody's saying the economy will collapse. We are saying that raising it will leave a lot of them without a job at all.

ever?

They will never work again?

There will be fewer jobs around. Maybe they'll find a job eventually but there will then be others out of work.

 

[bilby]

There seems to be an underlying assumption that unemployment is always a bad thing. Not only that, but that it is but such a bad thing that it is better to pay people less than they need to meet their basic needs, in order to avoid it.

This assumption is not well founded.

Unemployment is not necessarily and in all circumstances a bad thing. Until the introduction of social safety nets in the early 20th century, unemployment didn't exist. Those safety nets replaced poverty, which was truly awful, with unemployment, which was far less awful. The erosion of those safety nets since the 1970s have created a situation where unemployment persists, but poverty has also returned - a lose-lose situation.

From the point of view of the unemployed person, unemployment is bad if, and only if, it means an inability to meet his basic needs. This is only the case if there is an inadequate social safety net. With an adequate safety net, ideally one that includes the provision of training, unemployment is better than poverty, because the lack of money is compensated by a wealth of time to learn new skills.

From the point of view of the economy, unemployment is bad if, and only if, the people who are unemployed are reducing overall productivity through their unemployment - ie, if there was something useful for them to do that is not getting done; but if there was something useful they could do, that is worth the cost of their basic needs, then they wouldn't be unemployed with a MW set at the level that meets those needs.

From the point of view of employers, unemployment is great - it allows them to keep wages down. A MW is necessary to prevent them from driving it down to the point where their workers cannot meet their basic needs; but above the MW level, wage inflation is kept in check by the existence of unemployed people.

So even if (and this is far from certain), EVEN IF a rise in Minimum Wage was to cause unemployment, this is still not necessarily a reason not to do it.

A civilised society would include the following mutually supporting elements:

1) A minimum wage of around US$15/hour, with 'junior rates' for teenagers, starting at about 50% of the full MW at age 15, increasing with age to the full MW by the age of 21
2) A minimum unemployment benefit of around $300p/w for adults with no other source of income
3) Universal access to healthcare paid for through income taxation, and/or value added tax on non essential goods and services, with minimal or zero direct fees charged to patients for non-elective treatments
4) Universal education to the Bachelors Degree or skilled tradesman level, with education mandatory for all under 16 years old, and all unemployment benefit claimants under 25, also paid for from income taxation, and/or value added tax on non essential goods and services

All of this is readily achievable and affordable - indeed, this is pretty much how things are currently being done in many places, notably North Western Europe; those on the US East Coast may have noted the absence of severe Tsunami damage due to the collapse of that part of the world resulting from these basic humane provisions.

If you stop thinking of the unemployed as lazy slackers, moochers, and n'er do wells, and start behaving humanely towards them, you might be surprised to find that they stop bouncing from poverty compelled crime to minimum wage job and back again like badly abused tennis balls, and start using their periods of unemployment to gain marketable skills that get them into permanent and genuinely productive work. The overall economy booms, unemployment falls, and the remaining unemployed don't need to spend their days mugging old ladies or breaking into people's homes and businesses, just to put food on the table.

Why is this not already being done in the wealthiest nation on Earth? I blame the unfathomable Protestants, and their inscrutable 'work ethic'.

 

[DBT]

Nevertheless, a gap there is. That is not to say our MW rate is satisfactory, it is also set too low. As I said, it should be at least $20ph as a bare minimum.

2) You have a training wage system which provides most of the same benefits as the lower minimum wage.

Training wages, apprenticeships and so on, are for a set period and increase with the experience and qualifications gained from training. As far as I know, many of those on MW in the US, cleaners and other menial workers, remain on their minimum pay rate for life, unless they somehow manage to pull themselves out of the poverty trap.

You're listening to leftist fantasy. The reality is that actual minimum wage workers are in the 1-2% range--that's mostly people starting out.

No, but I have been looking at the reports of pay rates for those who work in the 'menial' labour sector, cleaners, kitchen hands, etc. These are not training positions where they can expect to get pay rises as they progress in skill. Those that are in this position must find it hard to improve their standard of living because such low rates of pay and long working hours do not leave much in the way of spare time or money.

This is not 'leftist' thinking, just the hard reality of a substandard income.


Here's a comparison between the cost of living in Australia and the US.

Info
Consumer Prices in United States are 32.20% lower than in Australia
Consumer Prices Including Rent in United States are 34.39% lower than in Australia
Rent Prices in United States are 38.79% lower than in Australia
Restaurant Prices in United States are 34.02% lower than in Australia
Groceries Prices in United States are 24.77% lower than in Australia
Local Purchasing Power in United States is 25.55% higher than in Australia

So if Australia has a MW that is roughly double that of the US, a MW worker in Australia is still better off.

 

[AthenaAwakened]

I wish you anti-MW folks would make up your minds. You say that MW earners are only a very small percentage of the workforce and then turnaround and say the economy will collapse if that miniscule subset of workers get a $2/hr raise.

Nobody's saying the economy will collapse. We are saying that raising it will leave a lot of them without a job at all.

ever?

They will never work again?

There will be fewer jobs around. Maybe they'll find a job eventually but there will then be others out of work.

forever?

There will permanently be fewer jobs for the rest of time?

So unemployment will never drop no matter what?

 

[Loren Pechtel]

From the point of view of the economy, unemployment is bad if, and only if, the people who are unemployed are reducing overall productivity through their unemployment - ie, if there was something useful for them to do that is not getting done; but if there was something useful they could do, that is worth the cost of their basic needs, then they wouldn't be unemployed with a MW set at the level that meets those needs.

You're making a leap here.

Yes, there is something useful they could do as evidenced by the fact they had a job before. You're ignoring the issue of people who could do something useful but don't have the skills to earn enough to cover what you consider to be their basic needs. (In reality full time work at minimum wage puts someone above the poverty line unless they have too many dependents--it *DOES* meet their basic needs.)

- - - Updated - - -

I wish you anti-MW folks would make up your minds. You say that MW earners are only a very small percentage of the workforce and then turnaround and say the economy will collapse if that miniscule subset of workers get a $2/hr raise.

Nobody's saying the economy will collapse. We are saying that raising it will leave a lot of them without a job at all.

ever?

They will never work again?

There will be fewer jobs around. Maybe they'll find a job eventually but there will then be others out of work.

forever?

There will permanently be fewer jobs for the rest of time?

So unemployment will never drop no matter what?

You're giving the same argument as the climate change deniers.

 

[AthenaAwakened]

I wish you anti-MW folks would make up your minds. You say that MW earners are only a very small percentage of the workforce and then turnaround and say the economy will collapse if that miniscule subset of workers get a $2/hr raise.

Nobody's saying the economy will collapse. We are saying that raising it will leave a lot of them without a job at all.

ever?

They will never work again?

There will be fewer jobs around. Maybe they'll find a job eventually but there will then be others out of work.

even if people are clamoring for salad and breadsticks at the Olive Garden? No one would step in and fill a gap in the market? Demand means nothing? It is all about wages?

 

[AthenaAwakened]

You're making a leap here.

Yes, there is something useful they could do as evidenced by the fact they had a job before. You're ignoring the issue of people who could do something useful but don't have the skills to earn enough to cover what you consider to be their basic needs. (In reality full time work at minimum wage puts someone above the poverty line unless they have too many dependents--it *DOES* meet their basic needs.)

- - - Updated - - -

I wish you anti-MW folks would make up your minds. You say that MW earners are only a very small percentage of the workforce and then turnaround and say the economy will collapse if that miniscule subset of workers get a $2/hr raise.

Nobody's saying the economy will collapse. We are saying that raising it will leave a lot of them without a job at all.

ever?

They will never work again?

There will be fewer jobs around. Maybe they'll find a job eventually but there will then be others out of work.

forever?

There will permanently be fewer jobs for the rest of time?

So unemployment will never drop no matter what?

You're giving the same argument as the climate change deniers.

no, I am asking you questions that if you answer them, your argument weakens. Now avoid them some more like you know you want to. I will just keep asking them.

 

[arkirk]

If the job available to you is defined as no skill it is a matter of opinion that is determining your salary. There are good and bad waitresses, like every other occupation. Even digging holes by hand is a skill and some are better than others at it. Some make it a point of doing what they are doing well as a matter of personal pride. Often in the sweatshop environment American labor faces, there is a management effort to limit skills acknowledged to keep costs down. This makes life very unrewarding for the workers and also lowers the quality of the resultant output.

The problem is that we are not a sharing society and have no model to look at anymore.

 

[Loren Pechtel]

I wish you anti-MW folks would make up your minds. You say that MW earners are only a very small percentage of the workforce and then turnaround and say the economy will collapse if that miniscule subset of workers get a $2/hr raise.

Nobody's saying the economy will collapse. We are saying that raising it will leave a lot of them without a job at all.

ever?

They will never work again?

There will be fewer jobs around. Maybe they'll find a job eventually but there will then be others out of work.

even if people are clamoring for salad and breadsticks at the Olive Garden? No one would step in and fill a gap in the market? Demand means nothing? It is all about wages?

As the price of labor rises companies figure out how to use less of it.

 

[Loren Pechtel]

You're giving the same argument as the climate change deniers.

no, I am asking you questions that if you answer them, your argument weakens. Now avoid them some more like you know you want to. I will just keep asking them.

The point is you used an unreasonable standard. Deniers ignore the trend line, if it's cooler this year then climate change must be false.

You're saying that if unemployment ever goes down it means the effect is false.

- - - Updated - - -

If the job available to you is defined as no skill it is a matter of opinion that is determining your salary. There are good and bad waitresses, like every other occupation. Even digging holes by hand is a skill and some are better than others at it. Some make it a point of doing what they are doing well as a matter of personal pride. Often in the sweatshop environment American labor faces, there is a management effort to limit skills acknowledged to keep costs down. This makes life very unrewarding for the workers and also lowers the quality of the resultant output.

The problem is that we are not a sharing society and have no model to look at anymore.

And a skilled waitress will make well above minimum wage due to tips.

 

[AthenaAwakened]

You're giving the same argument as the climate change deniers.

no, I am asking you questions that if you answer them, your argument weakens. Now avoid them some more like you know you want to. I will just keep asking them.

The point is you used an unreasonable standard. Deniers ignore the trend line, if it's cooler this year then climate change must be false.

You're saying that if unemployment ever goes down it means the effect is false.

No I am not. You keep repeating that jobs will go away and YOU never put a time limit on how long this will be nor do you allow for the economy to adjust to the new wages nor do you consider any other alternative to your dire prediction. So I and other have to keep asking you both broad and specific questions in order to understand if you are speaking about observed reality or simply articles of faith.

- - - Updated - - -

If the job available to you is defined as no skill it is a matter of opinion that is determining your salary. There are good and bad waitresses, like every other occupation. Even digging holes by hand is a skill and some are better than others at it. Some make it a point of doing what they are doing well as a matter of personal pride. Often in the sweatshop environment American labor faces, there is a management effort to limit skills acknowledged to keep costs down. This makes life very unrewarding for the workers and also lowers the quality of the resultant output.

The problem is that we are not a sharing society and have no model to look at anymore.

And a skilled waitress will make well above minimum wage due to tips.

A skilled waitress in a down economy or on a bed night will do shitty.

 

[DBT]

And a skilled waitress will make well above minimum wage due to tips.

Shouldn't the majority of experienced waitresses be skilled at what they do? If so, why should they not be paid for their skill and not have to depend on handouts, tips, from customers who may or may not appreciate their service?

 

[Unbeatable]

My gut reaction is I hate tipping, but that's from the consumer's perspective. I want there to be a predetermined fee dictated by the service provider, not a fee plus an "optional" fee. As it is, I always pay a 20% tip regardless of service, because I don't want to be bothered with evaluating the service and translating that into a dollar amount, and then being judged by others if they don't agree with the amount that I come up with. I hate unspoken rules. So I'd be fine with just turning the "standard tip" into a non-optional "service fee" or something like that.

I'm just not sure what would be better for the service providers. I have a feeling that as employees, their employers are going to try to find some way to screw them no matter what, and I'm no good at strategizing.

 

[Loren Pechtel]

And a skilled waitress will make well above minimum wage due to tips.

Shouldn't the majority of experienced waitresses be skilled at what they do? If so, why should they not be paid for their skill and not have to depend on handouts, tips, from customers who may or may not appreciate their service?

I've seen far too many that seem to be just going through the motions. Then they wonder why they make so little in tips.

It's also possible they work in a place that shares tips--if so there is no incentive to excel.

 

[none]

And a skilled waitress will make well above minimum wage due to tips.

Shouldn't the majority of experienced waitresses be skilled at what they do? If so, why should they not be paid for their skill and not have to depend on handouts, tips, from customers who may or may not appreciate their service?

I've seen far too many that seem to be just going through the motions. Then they wonder why they make so little in tips.

It's also possible they work in a place that shares tips--if so there is no incentive to excel.

Minimum wage is the minimum not the ceiling on what the waitresses income could be.
The employer has the right to pay anyone higher than the minimum wage, they can reward excellence by paying higher than minimum wage.
this principle is already occurring elsewhere.

 

[arkirk]

And a skilled waitress will make well above minimum wage due to tips.

Shouldn't the majority of experienced waitresses be skilled at what they do? If so, why should they not be paid for their skill and not have to depend on handouts, tips, from customers who may or may not appreciate their service?

I've seen far too many that seem to be just going through the motions. Then they wonder why they make so little in tips.

It's also possible they work in a place that shares tips--if so there is no incentive to excel.

I am in favor of tips for exceptional service. It should have absolutely no connection whatever to the base pay of an employee. The jobs are defined by the boss. Bosses can create a work environment that is so sparse in opportunity to excel, they end up running a place with poor service, poor products, and poor customers. McDonalds is a prime example. It is a faux food machine with people merely filling slots with no motivation to excel, no learning opportunity, and no tips.

A "skilled waitress" is a lucky waitress whose boss allows her to become skilled. She works in a high end restaurant and is an exception to the general rule for restaurant workers. The McDonald employee is not heading to a highly skilled position. Your argument and your perception is confined to high end working environments...at least in your arguments here. You never concern yourself with work rules in these giant chains impose on their workers. They define their positions as unskilled and make sure they stay that way. You cannot make a silk purse from a sow's ear.

 

[Celldweller]

McDonalds is a prime example. It is a faux food machine with people merely filling slots with no motivation to excel, no learning opportunity, and no tips.

Kinda, except the beast of Corporate food-chains offers benefits in conjunction with their MW that most businesses would have difficulty competing against. Thus, the draw of minimum wage may not be as daunting for the prospective McDonalds employee when he/she is also offered (taken from McDonalds website) the following:

Medical insurance*
Prescription drug coverage*
24-hour nurse line access
Vision discount*
Available dental*
Additional Benefits
Short-term disability*
Term life insurance*
401(k)*
Paid holidays*
Vacation*
Tuition Assistance*

So for example, the employee may not have the desire to excel from the fry station to the burger station, but with a tuition assistance program might have the incentive to go back to school.

 

[bilby]

Kinda, except the beast of Corporate food-chains offers benefits in conjunction with their MW that most businesses would have difficulty competing against. Thus, the draw of minimum wage may not be as daunting for the prospective McDonalds employee when he/she is also offered (taken from McDonalds website) the following:

Medical insurance*
Prescription drug coverage*
24-hour nurse line access
Vision discount*
Available dental*
Additional Benefits
Short-term disability*
Term life insurance*
401(k)*
Paid holidays*
Vacation*
Tuition Assistance*

So for example, the employee may not have the desire to excel from the fry station to the burger station, but with a tuition assistance program might have the incentive to go back to school.

Every single one of those things is available to all employed citizens in Australia; they are not additional benefits, they are basic human rights.

Oh, and we have a MUCH higher minimum wage than the US federal MW; indeed our nationwide adult MW is higher than that of any State in the US.

And we have one of the strongest economies in the world.