Ontario raising minimum wage to $15

[Bomb#20]

But that's a completely new argument. What you wrote was:

"Those employees are people, and the United States of America describes itself as a government of the people, by the people, and for the people. Which means that in a disagreement between a corporation and a worker over the value of that worker's labor, the worker should be in a much stronger bargaining position.

It is unethical to compromise the financial security of a person to benefit something that is NOT a person."​

Of course you were dehumanizing the shareholders.

The shareholders are not the same thing as the company.

True. What's your point? Nobody is doing the stuff you label "compromise the financial security of a person" in order to benefit something that is not a person. People do that stuff to benefit shareholders and managers and employees of corporations. They're not doing it to benefit corporations. You can't benefit a corporation. A corporation is a legal abstraction; it doesn't experience pleasure or pain.

The rights of shareholders to maximize the return on their investment is unhindered by economic regulations;

What country do you live in? The U.S. has all sorts of economic regulations hindering the rights of shareholders to maximize the return on their investment.

the shareholders aren't actually responsible for implementing those regulations or seeing that they are followed properly.

Sure they are; their degree of responsibility is limited by limited liability laws, but that hardly makes it non-existent. If they vote for board members who hire managers who flout regulations then the government gets to drive their stock price down, sometimes all the way to zero.

In fact, it is the other way around: the managers of the business have a responsibility to the shareholders to try and help investors realize their economic goals. If the government mandates there are certain things they must do in order to do business legally, then they have to make sure they have a business model in place that will be consistent with regulations and not cause their company to be sued, fined, or otherwise compromised by illegal activity. The shareholders are not responsible for the actions of the CEO, but if the CEO accidentally tanks his company by laundering money for the zetas, the shareholders are screwed.

Corporations, however, do not have a basic right to exist or even a right to be successful. They have a responsibility to live up to whatever obligations they have agreed to live up to. One of those obligations is to obey labor laws and business regulations. Those regulations are not so onerous as to make it impossible to do business, but if some businesses cannot operate without violating the laws, it should not exist.

Or else some of those regulations should not exist. You talk as though any regulation is automatically good. There was a time when Japanese-owned businesses were regulated out of existence. Should those businesses not have existed, since they couldn't operate without violating the laws?

But the question you were challenged to answer was "Why should the employer pay more than the labour is worth to them?"

For the same reason the employee should receive less than his time is worth to him.

That's a non-answer twice over. In the first place, there is no good reason to think an employee should receive less than his time is worth to him. And in the second place, if BOTH the employer should pay more than it's worth to him AND the employee should receive less than his time is worth to him, THEN there is no money-for-labor exchange rate that they both benefit from, which means they have no reason to agree to trade, so there will be no job, no employee, and no employer. There will just be two parties walking away from each other.

It should be noted, by the way, that the minimum wage does not in fact make employers pay more than the labor is worth to them. It makes labor worth more, by making it more scarce, by cutting some of the suppliers out of the deal.

That assumes that employers have some sort of magical clairvoyance as to the actual worth of a prospective employee.

No it doesn't. It assumes employers in aggregate have some basic ability to apply experience and arithmetic well enough to make rough estimates. They may be wrong, but the farther from right they are the more strongly the economy will rub their collective noses in their statistical errors.

The most you can say is that some employers will be RELUCTANT to hire more people if wages are higher, but that is a weak case; the demand for labor isn't associated with the COST of labor, but is instead dependent mostly on the number of workers needed to do the job.

This assumes that "the job" and "the number of workers needed" are constants. They're variables. If wages go higher, employers can respond by shrinking the jobs and accepting lower sales, which will let them raise prices enough to pay higher wages to the smaller number of workers required.

No, "the employees" didn't say so.

Yes they did. They got their elected officials to speak on their behalf in the form of "laws."

So why should the laws on this point be based on the will of the majority?

It isn't. It's based on the NEEDS of the majority.

Are you seriously claiming laws reflect not the will but the needs of the majority? Or are you abandoning your "Because the employees said so" argument and switching to a new argument?

We NEED to live in a fair and stable society that doesn't leave huge chunks of our population twisting in the wind with no easy way to improve their situation. We actually need this a lot more than shareholders need a slightly larger return on their investments, and CERTAINLY more than managers need to find it easier to keep their profit margins in double digits.

I don't perceive a society that leaves scabs twisting in the wind with no easy way to improve their situation in order to give the union guys who still have jobs a stronger bargaining position to be particularly fair to the scabs. You and the union guys will call that "We NEED"; but I'm not seeing why their needs trump the scabs' needs, and I'm not seeing why I need their needs to trump the scabs' needs. So when you tell me "We NEED" to ban the scabs from crossing the picket lines, I have to ask: What you mean "We", Kemosabe?

It's a balance between a "nice to have" and a "have to have." It would be nice to have high profits and high investment returns, but we HAVE TO HAVE a labor market that allows even the poorest workers to feed their families.

So your argument is what, that you can write "have to have" in all caps? Turning some of the workers who can't feed their families into non-workers in order that you can achieve your artificial goal of making sure everyone you still include in the "worker" category can feed his family doesn't strike me as a "have to have"; and I'll bet it doesn't strike a would-be-worker who's been turned away from job after job because there aren't enough jobs to go around as a "have to have" either. If the poorest workers can't feed their families then we richer workers can step up and feed them ourselves; that will cost us less than if we throw away the labor of the poorest employees on the altar of your folk-economics.

What is it you mean by "suppression of wages", other than that sometimes people agree on a wage among themselves instead of asking you to decide for them? What makes your preferred wage the magic reference point based on which all lower wages shall be defined as "suppressed"?

It isn't a matter of "preference" either. When the pay rate decreases compared to the real cost of living -- that is, fails to keep up with inflation or even decreases DESPITE inflation -- wages are said to be falling. When this is happening because a large number of employers are deliberately pressuring their employees to work for less money, this can be described as "suppression of wages."

Employers are usually deliberately pressuring their employees to work for less money; employees are usually deliberately pressuring their employers to pay more; businesses are usually deliberately pressuring their customers to pay more; customers are usually deliberately pressuring businesses to charge less. That's what competition is for. If businesses ever collectively succeed in getting employees to generally work for less than their labor's marginal revenue product, then businesses can increase their profit margin by hiring more workers, so they'll try to hire them away from one another, and businesses that raise wages will win that contest, grow, and become the new normal. So if that isn't happening -- if the going price of unskilled labor isn't keeping up with inflation -- that means either the businesses are conspiring with one another not to poach each others' unskilled employees, or else the marginal product of capital and/or skilled labor is rising relative to the marginal product of unskilled labor. I.e. the economy is becoming more knowledge-intensive. What a shocker that would be. Do you have reason to believe businesses are conspiring with one another not to poach each others' unskilled employees? Or are you simply labeling the circumstance that education matters more than it used to "suppression of wages"?

But if you scroll back through this thread, I believe I have been pretty consistent about the importance of the labor market keeping up with inflation in a way that prevents the growth of a large, permanent underclass.

Raising the minimum wage instead of moving toward a UBI or shortening the work-week strikes me as an excellent recipe for growing the jobless underclass. The employment rate has been in long-term decline for twenty years (for sixty years if you factor out women's liberation.) A major contributing factor is people dropping out of the job market in frustration because they've been looking for work for years but no one will hire them. If the goal is to prevent the growth of a large, permanent underclass, more jobs is far more important than higher-paying jobs.

But you haven't shown that paying $20000 for labor that causes a $20000 revenue increase produces toxic waste

That's because it is impossible to show that $20,000 worth of labor will actually produce $20,000 worth of revenue. Cost-benefit analysis DOES NOT WORK THAT WAY when it comes to labor. There are ways to measure performance and productivity in a business setting, but there is no coherent way to put a "dollars in/dollars out" value on a particular worker.

So what? It doesn't have to be for a particular worker. A statistical ensemble of the average minimum-wage worker in a typical unskilled job will do just fine. You're making a "This guy might have gotten cancer anyway; therefore there's no evidence smoking causes cancer."-type argument again.

On the other hand, paying a worker only $20,000 a year in a place where a living wage is calculated at $55,000 puts economic strain on that worker

No. It just doesn't. It reduces the economic strain on him, from $55,000 down to $35,000. The circumstance that you wish he was paid $55,000 does not magically turn $20,000 into toxic waste.

AND puts downward pressure on the average wage for his position across the industry.

Yes. Bingo. Correct. So have you given any thought to how it achieves that effect? It does it because the guy is willing to work for $20,000. If he held out for $55,000 then the business offering him $20,000 would produce no downward pressure. It would just be one more rejected offer among millions, the waste-paper of an economy. And the guy is willing to work for $20,000 because there aren't enough $55,000 jobs for everybody who wants one. The fact that the people trying to get the price up to $55,000 are trying to do it with a government-enforced price control instead of just unionizing like anyone else just goes to show they aren't doing it for the benefit of the scabs. They've sanitized their attack on their sacrificial victims -- dressed it up as an attack on the employers in exactly the same way Sweden dresses up its attack on prostitutes as an attack on johns -- but it's still a choice to hurt unemployed people for the benefit of those lucky enough to still have jobs.

So these workers remain poor, despite their being employed and productive. Their children remain poor, despite their parents working diligently all their lives. And in the case that their pay rate continues to fall far below the rate of inflation, their children are actually poorer than their parents were.

This is deleterious to the economy and to society as a whole.

So instead you sentence unemployed people to remain poor, despite their being willing to work. Their children remain poor, despite their parents looking diligently for work until they lose hope. What do you think seeing that does to their children?

When you kick some poor people out of their jobs in order to make different poor people richer, that shortens their life expectancy.

Why are you so convinced that there's a specific group of poor people that will suddenly become unemployable if the minimum wage goes up?

In the first place, the argument stands even if it isn't a specific group. When there are a lot more job-seekers than jobs, a lot are going to be jobless at any given time, even if everybody periodically gets a turn at having a job. And in the second place, it probably will be a specific group, but nobody said it was sudden. The transition from cycling between working and pounding the streets for months, to giving up in frustration, often takes years. But the long-term boundedness of the unemployment rate in the face of the long-term decline in the employment rate points to a population of discouraged workers who became de facto unemployable when anybody looking to hire will have other options with more recent experience and more provable work ethic.

It sounds like you've convinced yourself that there is a certain segment of the labor pool who would never get hired at all unless they were cheap. That is an illogical assumption; employers will still hire them at the lowest rate they possibly can, whatever that rate happens to be.

That's an illogical assumption; employers will not hire more of them than they'll benefit from just because more of them are available. And whether it's always the same people in the labor pool that are left behind, or landing a job is winning a lottery and there's always another lottery for them to enter, either way the reality is that some people will be unemployed because you won't let them be cheap.

 

[Don2 (Don1 Revised)]

The shareholders are not the same thing as the company.

True. What's your point? Nobody is doing the stuff you label "compromise the financial security of a person" in order to benefit something that is not a person. People do that stuff to benefit shareholders and managers and employees of corporations. They're not doing it to benefit corporations. You can't benefit a corporation. A corporation is a legal abstraction; it doesn't experience pleasure or pain.

Ensuring a corporation's longevity is benefiting it. There is nothing about the word "benefit" that means it only applies to living things. Experiencing pain and pleasure are not benefits. For example, a person's benefit of health has little to do with pleasure and pain, though lack of pain and increase of pleasure may help somewhat, they are only tangentially related to the concept of benefit.

Regarding what benefits people associated to a corporation, that need not be aligned logically or aligned to the same extent. Imagine there are 3 people working and owning a corporation. They may all do a thing in the interest of the corporation (profit and sustainability) that none of them personally (not as a corporate member) would do politically, like say offshore labor to China. None of them may discuss their politics and ethics in the workplace as is typical for people to do and assume all the others are aligned with the corporate plan. For larger corporations, shareholders often don't know what is going on and many corporate persons often disagree with certain projects or methods but then they get left out of those or practically speaking have to do them anyway.

 

[Crazy Eddie]

The other is less obvious, but it should jump out at anyone who studies a supply-and-demand chart like the one I posted here.

It's an interesting idea, but I'm sure you're smart enough to know that the relationship between wages and skill is not nearly simplistic enough to be accurately represented in a line graph.

- - - Updated - - -

"The left" are only resistant to the idea of trying to implement UBI at the expense of other priorities, like universal healthcare, corporate tax reform, Glass-Stiegel and the Volker Rule.

Bullshit. UBI isn't even on the table.

It is in THIS thread.

 

[ZiprHead]

"The left" are only resistant to the idea of trying to implement UBI at the expense of other priorities, like universal healthcare, corporate tax reform, Glass-Stiegel and the Volker Rule.

Bullshit. UBI isn't even on the table.

It is in THIS thread.

Agreed. It's like debating how many angels can dance on the head of a pin.

 

[Crazy Eddie]

The U.S. has all sorts of economic regulations hindering the rights of shareholders to maximize the return on their investment.

That's a matter of perspective, but in that case the minimum wage would be just one of many, would it not?

In fact, it is the other way around: the managers of the business have a responsibility to the shareholders to try and help investors realize their economic goals. If the government mandates there are certain things they must do in order to do business legally, then they have to make sure they have a business model in place that will be consistent with regulations and not cause their company to be sued, fined, or otherwise compromised by illegal activity. The shareholders are not responsible for the actions of the CEO, but if the CEO accidentally tanks his company by laundering money for the zetas, the shareholders are screwed.

Corporations, however, do not have a basic right to exist or even a right to be successful. They have a responsibility to live up to whatever obligations they have agreed to live up to. One of those obligations is to obey labor laws and business regulations. Those regulations are not so onerous as to make it impossible to do business, but if some businesses cannot operate without violating the laws, it should not exist.

Or else some of those regulations should not exist.

Those regulations exist to serve the public good. Corporations exist to make profit. Between the two of them, society needs the former a lot more than it needs the latter.

You talk as though any regulation is automatically good.

Any regulation is SUPPOSED to be good, and the extent to which it accomplishes that good is the basis on which it is judged. You cannot say the same thing of for-profit corporations.

But the question you were challenged to answer was "Why should the employer pay more than the labour is worth to them?"

For the same reason the employee should receive less than his time is worth to him.

That's a non-answer twice over. In the first place, there is no good reason to think an employee should receive less than his time is worth to him.

Exactly.

And in the second place, if BOTH the employer should pay more than it's worth to him AND the employee should receive less than his time is worth to him, THEN there is no money-for-labor exchange rate that they both benefit from, which means they have no reason to agree to trade, so there will be no job, no employee, and no employer. There will just be two parties walking away from each other.

Thus a perfectly balanced "fair wage" is extremely unlikely to occur; either the employer will pay more than he wants to, or the employee will get less than he wants to. SOMEBODY is going to loose out in this case.

The point of the minimum wage is to offset the negative effects of a loss for those least likely to win. Namely, workers on the lowest end of the income bracket who are in the weakest possible position to negotiate for a better wage.

No it doesn't. It assumes employers in aggregate have some basic ability to apply experience and arithmetic well enough to make rough estimates.

Hiring or not hiring an employee is about judging character, not arithmetic. A good manager hires a worker because he feels he is a good fit for the company and will benefit the team by working hard, following instructions and learning his job well enough to make life easier for everyone. An estimate of the worth of that worker's labor isn't really going to factor into that; the employer will offer what he can afford to pay, not some value he's calculated for the employee's worth.

This assumes that "the job" and "the number of workers needed" are constants.

No, it assumes that employers are able to get a rough estimate of their own staffing needs even accounting for variations.

You made the same assumption just now about employers estimating a worker's value. Really, the only difference between you and me is that I don't think the value of an employee can be quantified to a specific dollar amount and I KNOW FOR A FACT that many employers don't even bother to try.

It's a balance between a "nice to have" and a "have to have." It would be nice to have high profits and high investment returns, but we HAVE TO HAVE a labor market that allows even the poorest workers to feed their families.

So your argument is what, that you can write "have to have" in all caps? Turning some of the workers who can't feed their families into non-workers in order that you can achieve your artificial goal of making sure everyone you still include in the "worker" category can feed his family doesn't strike me as a "have to have"

Interesting as that is, it's far from clear that raising the minimum wage would actually have that effect.

Employers are usually deliberately pressuring their employees to work for less money; employees are usually deliberately pressuring their employers to pay more; businesses are usually deliberately pressuring their customers to pay more; customers are usually deliberately pressuring businesses to charge less. That's what competition is for. If businesses ever collectively succeed in getting employees to generally work for less than their labor's marginal revenue product, then businesses can increase their profit margin by hiring more workers, so they'll try to hire them away from one another, and businesses that raise wages will win that contest, grow, and become the new normal. So if that isn't happening -- if the going price of unskilled labor isn't keeping up with inflation -- that means either the businesses are conspiring with one another not to poach each others' unskilled employees, or else the marginal product of capital and/or skilled labor is rising relative to the marginal product of unskilled labor.

OR the demand for unskilled labor continues to outstrip the supply at a high enough rate that wages will continue to fall even while the marginal product of unskilled labor rises. This is EMPIRICALLY true whatever other theoretical projections you can make about the market: there are a lot more potential workers than there are jobs for everyone.

There's also a category error your committing in assuming that only "unskilled labor" is affected by this. Even the rate of skilled labor tends to stagnate if the compensation rate is being compared to a far lower baseline; workers making 200% of the minimum wage would find it that much easier to argue for a pay raise if the minimum wage is rising to approach their existing salary.

Raising the minimum wage instead of moving toward a UBI or shortening the work-week strikes me as an excellent recipe for growing the jobless underclass.

Only based on your false assumption about Human Resource generalists being labor-rate bean counters. It bears repeating that "minimum wage is too high" is not even among the top ten reasons for firing employees or rejecting applicants, and it's doubtful it would be even with a raise to $15.

So what? It doesn't have to be for a particular worker. A statistical ensemble of the average minimum-wage worker in a typical unskilled job will do just fine.

Sure it would. And if employers and HR departments ever actually DID that, it would be a relevant point.

You're making a "The best way to cure cancer is to stop smoking" type argument.

So have you given any thought to how it achieves that effect?

I've only explained it in detail half a dozen times in this thread so... no?

It does it because the guy is willing to work for $20,000.

Nope. It does it because the guy believes -- possibly correctly -- that he is unlikely to get a better offer any time soon. This is "willing to work for $20,000" in the same sense that a guy in a movie theater is willing to pay $8 for a tub of popcorn. It's the only popcorn he can buy, and he wants popcorn, so he's just gonna have to deal with it.

When you kick some poor people out of their jobs in order to make different poor people richer, that shortens their life expectancy.

Why are you so convinced that there's a specific group of poor people that will suddenly become unemployable if the minimum wage goes up?

In the first place, the argument stands even if it isn't a specific group. When there are a lot more job-seekers than jobs, a lot are going to be jobless at any given time, even if everybody periodically gets a turn at having a job. And in the second place, it probably will be a specific group, but nobody said it was sudden. The transition from cycling between working and pounding the streets for months, to giving up in frustration, often takes years. But the long-term boundedness of the unemployment rate in the face of the long-term decline in the employment rate points to a population of discouraged workers who became de facto unemployable when anybody looking to hire will have other options with more recent experience and more provable work ethic.

That doesn't actually answer the question, though. You keep pushing this theory that the minimum wage increase would make a certain group/category of workers unemployable. If, as you put it, the "argument stands," what exactly does it stand ON? Or is that just the assumption that HR people and employers have some sort of magic formula they use to calculate the labor value of every employee and then immediately reject/fire them if they don't fit the formula?

employers will not hire more of them than they'll benefit from just because more of them are available.

I agree. But again, "benefit" is NOT measured as a function of productivity minus wages. Mainly this is because productivity is hard to quantify relative to wages for any given employee, and because, despite what you might think, you cannot actually put a price on competence.

 

[laughing dog]

"The left" are only resistant to the idea of trying to implement UBI at the expense of other priorities, like universal healthcare, corporate tax reform, Glass-Stiegel and the Volker Rule.

Bullshit. UBI isn't even on the table.

It is in THIS thread.

Agreed. It's like debating how many angels can dance on the head of a pin.

Exactly. And assuming that one could count those angels (i.e. specify the level of UBI and how it is implemented) there is no UBI in practice, nor is there likely to have any UBI anytime soon. So comparing the expected outcomes of change in current policy tool (the minimum wage) with the expected outcomes of an untried, theoretical policy that has no chance of current enactment is, at best, a pointless exercise.

 

[Loren Pechtel]

Showing a bunch of temporary causes doesn't mean there aren't permanent changes also.

There is no such thing as a "permanent condition" in business. Long-term, perhaps, but not permanent.

By the time it's been long enough for one turnover of employees it might as well be permanent.

There's a limit to how much you spend, though. When you keep your workers on low hours the best ones are more likely to leave.

Did I not just run the numbers for you and show that you would have to reduce the hours of five workers by one hour a day to get the same effect of firing one of them? One hour a day isn't a whole lot. And that isn't even the ONLY solution to that problem, since raising productivity by other means is also dooable.

Might not be a whole lot but it still will encourage the best to leave.

And I note another variation on the infinite pool of profits garbage here. There's nothing else they can do to increase productivity--if there was they would have already done so.

 

[Loren Pechtel]

That's a great analogy.

Nah. The welfare cheque isn't reducing the grocer's operating costs, and the grocer isn't claiming he'd go out of business without that reduction in operating costs. It's barely analogous.

I take it you mean to imply that the welfare check is reducing the employer's operating costs. What's your evidence for that hypothesis?

I don't need any - it ain't me objecting that a load of businesses would go bust if they had to pay employees enough to live on.

It ain't me making that objection either. It is you objecting that the welfare check isn't reducing the grocer's operating costs. If you don't need any evidence, does that mean you're withdrawing your objection to JP's contention that I made a great analogy?

, and the grocer isn't claiming he'd go out of business without that reduction in operating costs. It's barely analogous.

I expect if there were a mass political movement trying to order grocers to supply poor people's food needs at grocers' expense, a typical grocer would start claiming he'd go out of business if that burden were assigned to him.

Indeed, which puts grocers in the position of tax payers with respect to unlivable wages. The mass political movement is effectively saying that it is not the responsibility of consumers to bear the full cost of groceries.

I lost you. Which mass movement is effectively saying this? The "living wage" movement? If that's who you mean, how are you getting that from what they say? Are you arguing that the movement is right or wrong about whose responsibility "the full cost of groceries" is? And, assuming you have an opinion about whose responsibility that is, why do you believe there exists any such thing as "the full cost of groceries"? The process that produces groceries produces a lot of other things too. Allocation of the production costs among all the types of produced products is an exercise in metaphysics, not economics.

She should hire a worker who will increase her revenue by as much she needs to at least break even. If she can't find one, she should go out of business in a market economy because she doesn't have a viable business plan.

I.e., she should hire a different worker. I.e., you choose option two. I.e., the first worker should be stuck with a $30000 problem instead of a $10000 problem. I.e. you grabs his duds and his picks as well, and you hurls 'em down the pit of hell.

If hiring an individual means hurling everyone else down the pit of hell, you place a huge burden on employers.

I lost you again. How does it place a huge burden on employers if hiring an individual means hurling everyone else down the pit of hell? Did you perhaps mean "place a huge burden on employees"?

Assuming that's what you meant, hiring an individual doesn't mean hurling everyone else down the pit of hell. There are two viable ways to avoid hurling everyone else down the pit of hell while still making it rational for employers to hire all the unskilled laborers willing to work for them. The first is the obvious one that's already been proposed here: a UBI.

The other is less obvious, but it should jump out at anyone who studies a supply-and-demand chart like the one I posted here.

The reason people arguing for a minimum wage choose to hurl somebody down the pit of hell is the same as the reason union coal miners beat up blacklegs -- because the workers are collectively giving up the little lower yellow triangle in order to get the big upper blue rectangle, and the yellow workers and the blue workers are different workers. There's a conflict of interest, and the blue workers figure the yellow workers ought to be willing to take a hit for the team, even though the blue workers won't also be taking a hit for the team. So the direct solution is to eliminate the conflict of interest, by making the blue workers and the yellow workers the same workers. Have every blue worker give up enough of his share of the blue rectangle to a yellow worker to turn that yellow worker blue. Since getting unskilled workers the monopoly price for labor requires reducing the total amount of unskilled labor, reducing it enough to jack the marginal revenue product of the labor up to the monopoly price, why not share the reduction in that total amount equally among all the unskilled workers, instead of inflicting the whole reduction on an unlucky few who are rendered jobless?

Which is to say, we can get the main benefits of a minimum wage increase without the worst harmful side effects, simply by shortening the work week.

At least you admit to the harm caused to the yellow workers. Most on the left pretend they don't exist, it's only the blue.

And note that while on your chart the blue is larger than the yellow it comes down to the slope of the lines. Shallower slopes mean less blue and more yellow.

 

[laughing dog]

At least you admit to the harm caused to the yellow workers. Most on the left pretend they don't exist, it's only the blue.

And most "libertarians" and free market evangelists pretend there is only yellow.

And note that while on your chart the blue is larger than the yellow it comes down to the slope of the lines. Shallower slopes mean less blue and more yellow.

Which is why people like bomb#20 and myself say it is an empirical question whether a given increase in the minimum wage yields a net benefit or a net cost. Yet, you continue to argue that it is always a net cost (or harm).

 

[Canard DuJour]

That's a great analogy.

Nah. The welfare cheque isn't reducing the grocer's operating costs, and the grocer isn't claiming he'd go out of business without that reduction in operating costs. It's barely analogous.

I take it you mean to imply that the welfare check is reducing the employer's operating costs. What's your evidence for that hypothesis?

I don't need any - it ain't me objecting that a load of businesses would go bust if they had to pay employees enough to live on.

It ain't me making that objection either. It is you objecting that the welfare check isn't reducing the grocer's operating costs. If you don't need any evidence, does that mean you're withdrawing your objection to JP's contention that I made a great analogy?

No.

, and the grocer isn't claiming he'd go out of business without that reduction in operating costs. It's barely analogous.

I expect if there were a mass political movement trying to order grocers to supply poor people's food needs at grocers' expense, a typical grocer would start claiming he'd go out of business if that burden were assigned to him.

Indeed, which puts grocers in the position of tax payers with respect to unlivable wages. The mass political movement is effectively saying that it is not the responsibility of consumers to bear the full cost of groceries.

I lost you. Which mass movement is effectively saying this? The "living wage" movement?

No, your hypothetical "mass political movement trying to order grocers to supply poor people's food needs at grocers' expense"

If that's who you mean, how are you getting that from what they say? Are you arguing that the movement is right or wrong about whose responsibility "the full cost of groceries" is? And, assuming you have an opinion about whose responsibility that is, why do you believe there exists any such thing as "the full cost of groceries"? The process that produces groceries produces a lot of other things too. Allocation of the production costs among all the types of produced products is an exercise in metaphysics, not economics.

She should hire a worker who will increase her revenue by as much she needs to at least break even. If she can't find one, she should go out of business in a market economy because she doesn't have a viable business plan.

I.e., she should hire a different worker. I.e., you choose option two. I.e., the first worker should be stuck with a $30000 problem instead of a $10000 problem. I.e. you grabs his duds and his picks as well, and you hurls 'em down the pit of hell.

If hiring an individual means hurling everyone else down the pit of hell, you place a huge burden on employers.

I lost you again. How does it place a huge burden on employers if hiring an individual means hurling everyone else down the pit of hell? Did you perhaps mean "place a huge burden on employees"?

No, I meant employers. How does it not place a huge burden on employers if hiring an individual means hurling everyone else down the pit of hell?

Assuming that's what you meant, hiring an individual doesn't mean hurling everyone else down the pit of hell. There are two viable ways to avoid hurling everyone else down the pit of hell while still making it rational for employers to hire all the unskilled laborers willing to work for them. The first is the obvious one that's already been proposed here: a UBI.

The other is less obvious, but it should jump out at anyone who studies a supply-and-demand chart like the one I posted here.

The reason people arguing for a minimum wage choose to hurl somebody down the pit of hell is the same as the reason union coal miners beat up blacklegs -- because the workers are collectively giving up the little lower yellow triangle in order to get the big upper blue rectangle, and the yellow workers and the blue workers are different workers. There's a conflict of interest, and the blue workers figure the yellow workers ought to be willing to take a hit for the team, even though the blue workers won't also be taking a hit for the team. So the direct solution is to eliminate the conflict of interest, by making the blue workers and the yellow workers the same workers. Have every blue worker give up enough of his share of the blue rectangle to a yellow worker to turn that yellow worker blue. Since getting unskilled workers the monopoly price for labor requires reducing the total amount of unskilled labor, reducing it enough to jack the marginal revenue product of the labor up to the monopoly price, why not share the reduction in that total amount equally among all the unskilled workers, instead of inflicting the whole reduction on an unlucky few who are rendered jobless?

Because that assumes so-called 'perfect competition' where, absent MW/unions, "it's rational for employers to hire all the unskilled laborers willing to work for them." Real firms overwhelmingly stop producing/hiring before that point because they're constrained by demand for the product of labour (in turn constrained by ..wait for it.. wages). Given which, the non-union guys are not trying to join the workforce by entreating the union guys to share wages, they're trying to replace the union guys by offering wages back to the employer. That is why union miners fought blacklegs.

Also, I don't accept that getting unskilled workers the monopoly price for labor necessarily requires reducing the total amount of unskilled labor. Income effect, velocity of money etc, variables not depicted.

Which is to say, we can get the main benefits of a minimum wage increase without the worst harmful side effects, simply by shortening the work week.

 

[Jolly_Penguin]

"The left" are only resistant to the idea of trying to implement UBI at the expense of other priorities, like universal healthcare, corporate tax reform, Glass-Stiegel and the Volker Rule.

Bullshit. UBI isn't even on the table.

It is in THIS thread.

Agreed. It's like debating how many angels can dance on the head of a pin.

Exactly. And assuming that one could count those angels (i.e. specify the level of UBI and how it is implemented) there is no UBI in practice, nor is there likely to have any UBI anytime soon. So comparing the expected outcomes of change in current policy tool (the minimum wage) with the expected outcomes of an untried, theoretical policy that has no chance of current enactment is, at best, a pointless exercise.

The only reason UBI isn't "on the table" is because people refuse to put it there. That includes each of you if you are not putting it there. Arguing against something because it "won't happen" is very much a self fulfilling prophecy.

 

[laughing dog]

"The left" are only resistant to the idea of trying to implement UBI at the expense of other priorities, like universal healthcare, corporate tax reform, Glass-Stiegel and the Volker Rule.

Bullshit. UBI isn't even on the table.

It is in THIS thread.

Agreed. It's like debating how many angels can dance on the head of a pin.

Exactly. And assuming that one could count those angels (i.e. specify the level of UBI and how it is implemented) there is no UBI in practice, nor is there likely to have any UBI anytime soon. So comparing the expected outcomes of change in current policy tool (the minimum wage) with the expected outcomes of an untried, theoretical policy that has no chance of current enactment is, at best, a pointless exercise.

The only reason UBI isn't "on the table" is because people refuse to put it there. That includes each of you if you are not putting it there. Arguing against something because it "won't happen" is very much a self fulfilling prophecy.

I am not arguing against UBI. According to you, Canada is more progressive and liberal than the USA, and UBI is not on the table there. Until UBI is in practice or seriously being considered in Canada, UBI is a meaningless standard to use as comparison in Canadian policy. That is due to practical reasoning, not to the relative merits and demerits of UBI.

 

[Jolly_Penguin]

According to you, Canada is more progressive and liberal than the USA, and UBI is not on the table there.

Except that it is, as a simple Google would show you. We have been pushing it here in Ontario for quite some time, and we are headed towards a pilot project for it.

https://www.thestar.com/news/gta/20...me-in-ontario-gets-strong-public-support.html

But it won't be in place here universally until well after the dramatic increase in minimum wage, so people will suffer. The OP is about that; No extended support will be there in time for those hurt by the effect of raising the minimum wage here.

 

[laughing dog]

According to you, Canada is more progressive and liberal than the USA, and UBI is not on the table there.

Except that it is, as a simple Google would show you. We have been pushing it here in Ontario for quite some time, and we are headed towards a pilot project for it.

Good for you. But a pilot project is not universal or comprehensive.

https://www.thestar.com/news/gta/20...me-in-ontario-gets-strong-public-support.html

But it won't be in place here universally until well after the dramatic increase in minimum wage, so people will suffer. The OP is about that; No extended support will be there in time for those hurt by the effect of raising the minimum wage here.

Actuallly if you bothered to read your own link, it is a pilot project, so there is no guarantee it will ever be universally in place. Whether or not people will suffer (and to what extent) is an empirical question. It is empirically possible that people will suffer more under UBI than under the minimum wage.

 

[Crazy Eddie]

There is no such thing as a "permanent condition" in business. Long-term, perhaps, but not permanent.

By the time it's been long enough for one turnover of employees it might as well be permanent.

Nope. Conditions will have changed by then and the company may be looking for new employees or may be looking to fire even more employees for totally different reasons. The original conditions are no longer valid in that case.

Might not be a whole lot but it still will encourage the best to leave.

And I've already told you that "Not being paid enough" is not even in the top ten list of reasons employees quit their jobs. Actually of the top 20 most often cited reasons, "insufficient pay" and "insufficient hours" are usually in the bottom five. The most common reasons involve personality conflicts with managers, co-workers, or corporate culture in general.

But "the best" employees don't quit their jobs just because their hours got cut by an hour a day. In the first place, this is because "the best" employees wouldn't be the ones making minimum wage at that company anyway and wouldn't have their hours cut, but even if you DID cut the hours of your best employees, they still wouldn't leave the class just for that. This is because, in the second place, professionalism and adaptability are part of what goes to making a good employee, and someone who would rather leave your company that work with changing conditions is probably not somebody you're going to miss.

And I note another variation on the infinite pool of profits garbage here. There's nothing else they can do to increase productivity

There's ALWAYS something you can do to increase productivity. It's not always easy, but it's always possible.

 

[Crazy Eddie]

"The left" are only resistant to the idea of trying to implement UBI at the expense of other priorities, like universal healthcare, corporate tax reform, Glass-Stiegel and the Volker Rule.

Bullshit. UBI isn't even on the table.

It is in THIS thread.

Agreed. It's like debating how many angels can dance on the head of a pin.

Exactly. And assuming that one could count those angels (i.e. specify the level of UBI and how it is implemented) there is no UBI in practice, nor is there likely to have any UBI anytime soon. So comparing the expected outcomes of change in current policy tool (the minimum wage) with the expected outcomes of an untried, theoretical policy that has no chance of current enactment is, at best, a pointless exercise.

The only reason UBI isn't "on the table" is because people refuse to put it there...

If I was a member of the U.S. Congress, I would put it there; I would personally sponsor the bill to implement it once we had fully figured out universal healthcare and free public education through undergrad.
If I was amember of the U.S. Senate, I would put it on the table; I would personally sponsor the bill to implement it once we had fully figured out universal healthcare and free public education through undergrad.

But I'm not, and neither are you, ergo it is not on the table.
Is anyone else in this thread in a position to put that proposal "on the table" as it were? No? If we took a vote on implementation to hammer out the details of it, it would probably pass, but none of us have any power to make that happen, so saying:

That includes each of you if you are not putting it there.

Is bullshit. "The table" that each of us can actually put things on is a LITERAL TABLE which is exactly as much territory as we actually control.

In the mean time, we have more important battles to fight with the people who actually run things in this country. Universal healthcare, welfare reform, police reform, free education, reduction of creeping militarism and imperialism, just to name a few. Universal Basic Income is somewhere on the agenda, but it's item number 30 on a list of 35 things we're going to need to get done and every single one of those things is a massive pain in the ass to achieve (and that assumes that we only have to achieve them once; at this point we're going to have to go back and re-implement the voting rights act before the decade is out).

Arguing against something because it "won't happen" is very much a self fulfilling prophecy.

It's not a prophecy when the people saying "won't happen" are the people in charge.

 

[Jolly_Penguin]

But a pilot project is not universal or comprehensive.

No, but it is headed in the right direction, and we are pushing for it, which is more than can be said for you lot. We are not saying that it isn't on the table so talking about it is like counting angels of the head of a pin. We are not saying it won't happen so why bother. When you support a Clinton instead of a Bernie, or otherwise project a defeatist attitude of "no we can't" instead of "yes we can", you are doomed from the outset.

If I was a member of the U.S. Congress, I would put it there; I would personally sponsor the bill to implement it once we had fully figured out universal healthcare and free public education through undergrad.
If I was amember of the U.S. Senate, I would put it on the table; I would personally sponsor the bill to implement it once we had fully figured out universal healthcare and free public education through undergrad.

But I'm not, and neither are you, ergo it is not on the table.

You really think you need to be a senator or a congressman to get anything done? If so, then run for office.

Otherwise you can encourage others who are running or who are already members to adopt your causes. You can apply all sorts of public pressure on them. It isn't rocket science in a democracy, or even quasi-democracy like the USA.

The only hope you have, for UBI, for minimum wage increase, for universal single payer health care, or for any other cause you want enacted is to push for it and apply pressure for it. The U.S.A. used to be a country of can-do attitude. You put through the New Deal. It appears instead that you now view such a step forward as an impossible pipe dream not worth discussing. That makes you part of the problem.

 

[laughing dog]

No, but it is headed in the right direction, and we are pushing for it, which is more than can be said for you lot. We are not saying that it isn't on the table so talking about it is like counting angels of the head of a pin. We are not saying it won't happen so why bother. When you support a Clinton instead of a Bernie, or otherwise project a defeatist attitude of "no we can't" instead of "yes we can", you are doomed from the outset.

You have yet to implement it. In fact, according to your article, it has yet to be decided where the pilot will be applied or how it will be applied.

BTW, if you bothered to google basic income maintenance pilots  Basic_income_pilots), you'd know that the first income maintenance (UBI) pilots in North America occurred in the USA in the 1960s - long before anyone in Canada bothered to try it, and that one is going on in Oakland, CA since 2016. So, you can swallow your condescension until the results of your undefined pilot project come in.

 

[Loren Pechtel]

And most "libertarians" and free market evangelists pretend there is only yellow.

And note that while on your chart the blue is larger than the yellow it comes down to the slope of the lines. Shallower slopes mean less blue and more yellow.

Which is why people like bomb#20 and myself say it is an empirical question whether a given increase in the minimum wage yields a net benefit or a net cost. Yet, you continue to argue that it is always a net cost (or harm).

There's another factor you are missing:

The graph only looks at the area of the yellow and blue--but that's assuming a dollar is a dollar. That's not reality: The fewer dollars we have the more we value them. Moving a dollar from the yellow to the blue isn't neutral, it's a negative.

Furthermore, yellow workers tend to become blue workers in time--but if you kick the yellow workers out they have no chance of becoming blue.

In the past the yellow workers were black and people quite rightly rose up and objected. Now, though, you want to abuse a group.

- - - Updated - - -

Because that assumes so-called 'perfect competition' where, absent MW/unions, "it's rational for employers to hire all the unskilled laborers willing to work for them." Real firms overwhelmingly stop producing/hiring before that point because they're constrained by demand for the product of labour (in turn constrained by ..wait for it.. wages). Given which, the non-union guys are not trying to join the workforce by entreating the union guys to share wages, they're trying to replace the union guys by offering wages back to the employer. That is why union miners fought blacklegs.

You're assuming the demand for labor remains constant. In practice when wages go down the demand goes up.

 

[laughing dog]

There's another factor you are missing:

The graph only looks at the area of the yellow and blue--but that's assuming a dollar is a dollar. That's not reality: The fewer dollars we have the more we value them. Moving a dollar from the yellow to the blue isn't neutral, it's a negative.

Really - you are capable of accurate interpersonal comparisons of value?

Furthermore, yellow workers tend to become blue workers in time--but if you kick the yellow workers out they have no chance of becoming blue.

Why do you assume that any reductions are in jobs versus hours worked?

In the past the yellow workers were black and people quite rightly rose up and objected. Now, though, you want to abuse a group.

How do you come up with such straw men?