Probably one of the scariest sentences I've read by a free marketeer

[ronburgundy]

A consumer of milk has no control over what the producer of milk pays his employees.

A consumer of labor does have that control.

Ksen, I think your emotional reaction is somewhat based on interpreting "labor" as "people that work for an employer". Thus the quote seems to imply that a human being is the same as a loaf of bread in how one can treat it.

"Labor" here means not a person but a particular unit of work done by a person, and "goods" are the product of that labor. The person's argument is that their is no way to separate what labor should be minimally valued or priced at from what the goods themselves should be minimally priced at. One is a major determinant of the other. Thus, by dictating minimum prices on labors, government is indirectly dictating minimum prices on goods. But many people would object to that latter if it were done more directly, because then they see how it actually impacts themselves rather than just a hypothetical employer.

The counter to that argument is that plenty of consumers pay more for goods under the assumption that the higher price means the workers are getting paid more.
A policy of directly setting consumer goods prices is stupid because it would have no impact on the pay the worker gets, which is the goal. Employers would still give the workers as little as they could get away with and be the only one's who profit off of minimum prices that are higher than they otherwise would be.
In contrast, setting labor minimums does impact prices. The owner of the goods who pays the labor directly controls the prices and sets the labor cost + materials costs as the bare minimum they are willing to produce the product for, then adds a profit margin.

IOW, the analogy between setting minimum wages and minimum consumer prices is not really "scary" in a inhumane and immoral sense, but just plain ignorant and moronic and completely ignores the fact that the point of policy is to address a problem, in this case of workers whose pay still lands them in poverty, and minimum prices on goods does absolutely nothing to address that problem.

 

[laughing dog]

The key to understanding ksen's argument is one should not forget that any unit of labor is usually performed by a person. So, a unit of labor is different than a unit of milk but not different than a unit of sophistry.

 

[ksen]

A consumer of milk has no control over what the producer of milk pays his employees.

A consumer of labor does have that control.

Ksen, I think your emotional reaction is somewhat based on interpreting "labor" as "people that work for an employer".

Actually I'm interpreting it as "labor" as "people".

Thus the quote seems to imply that a human being is the same as a loaf of bread in how one can treat it.

Right, and I find that thought disturbing.

"Labor" here means not a person but a particular unit of work done by a person, and "goods" are the product of that labor. The person's argument is that their is no way to separate what labor should be minimally valued or priced at from what the goods themselves should be minimally priced at. One is a major determinant of the other. Thus, by dictating minimum prices on labors, government is indirectly dictating minimum prices on goods. But many people would object to that latter if it were done more directly, because then they see how it actually impacts themselves rather than just a hypothetical employer.

There is also no way to separate what labor should be minimally valued and the fact that if it is valued too low there will be real life suffering involved someone and potentially their family if they have one.

I'd like to see us focus more on what's best for people rather than what's best businesses. Sometimes there's a conflict between the two and people should win out.

The counter to that argument is that plenty of consumers pay more for goods under the assumption that the higher price means the workers are getting paid more.
A policy of directly setting consumer goods prices is stupid because it would have no impact on the pay the worker gets, which is the goal. Employers would still give the workers as little as they could get away with and be the only one's who profit off of minimum prices that are higher than they otherwise would be.

No one is arguing for price controls on consumer goods.

In contrast, setting labor minimums does impact prices. The owner of the goods who pays the labor directly controls the prices and sets the labor cost + materials costs as the bare minimum they are willing to produce the product for, then adds a profit margin.

Most businesses are price takers. They typically do not set the price of the market they are engaged in. Therefore the impact upon prices is not as severe as business groups try to argue and it certainly isn't dollar for dollar.

IOW, the analogy between setting minimum wages and minimum consumer prices is not really "scary" in a inhumane and immoral sense, but just plain ignorant and moronic and completely ignores the fact that the point of policy is to address a problem, in this case of workers whose pay still lands them in poverty, and minimum prices on goods does absolutely nothing to address that problem.

Maybe I'm misunderstanding you but raising worker pay does help alleviate their poverty.

 

[Horatio Parker]

Commodities have no rights. People do.

 

[Loren Pechtel]

At the end of the day, labor is a good, no different than a loaf of bread or a gallon of milk.

They really believe there is nothing that might make labor different than a loaf of bread or a gallon of milk and their policy prescriptions show it.

:shakeshead:

He's right. Welfare is the job of government, not the business sector.

 

[Jayjay]

That and the milk won't starve to death or die of exposure if you don't pay it enough.

Labor ≠ Laborer

Just like milk is not a cow.

(ETA: A point made by several others before me, sorry for the repetition.)

 

[Axulus]

That and the milk won't starve to death or die of exposure if you don't pay it enough.

Labor ≠ Laborer

Just like milk is not a cow.

And paying for food with labor income isn't the only way to obtain it. I don't think anyone in the US or any first world country has starved to death in a long time due to not getting enough pay for labor.

 

[Random Person]

A gallon of milk is a unit of labor. Labor is a commodity just like everything else on the market. Humans aren't commodities, just their labor if they choose to sell it.

 

[Horatio Parker]

A gallon of milk is a unit of labor. Labor is a commodity just like everything else on the market. Humans aren't commodities, just their labor if they choose to sell it.

But using that resource entails responsibility. If your work costs a person a limb or causes a debilitating condition; that person must be taken care of, not discarded. IMO the comparison is meant to indoctrinate the notion that people have no rights as workers, they are things, not people.

 

[Juma]

A gallon of milk is a unit of labor. Labor is a commodity just like everything else on the market. Humans aren't commodities, just their labor if they choose to sell it.

Thry doesnt choose to sell it: they have to.

 

[dystopian]

Found it!

Here's the entire comment:

yellowjkt, even assuming that your analysis is true, many companies have it where salaried status typically comes with additional benefits that hourly does not have - such as paid time off (or increased length of paid time off), 401(k), higher bonuses, etc. Those additional benefits have to be factored into your analysis, otherwise its an apples to oranges comparison.

There are good arguments being made on both sides here, and if I may just add to the discourse. At the end of the day, labor is a good, no different than a loaf of bread or a gallon of milk. I wonder how everyone would feel if the government came out with a rule saying, you know what, a gallon of milk is $15 minimum, and a loaf of bread has to be at least $8 otherwise you cannot buy it. That's essentially what this decision (and the fight for $15/hr currently undertaken by the labor unions) is saying, only with the good of human capital.

Now you might think that comparing human labor to tangible goods is silly, but at the end of the day nobody is required to have employees (scary if that ever changes) so if you put onerous mandates on employment, you will get less employment, just like putting onerous mandates on milk and bread would result in less milk and bread purchased.

In this case, employers who are faced with increased salary thresholds, increases to minimum wage, and mandated employer paid insurance, are going to start looking for other avenues (less expansion, automated workers, different industries less labor intensive). It already happened in the auto industry decades ago. The last remaining bastion is the restaurant industry - the industry most highly impacted by this. The restaurant industry is under attack because they cannot pick up and move overseas like auto did. But watch in the coming years how many restaurants start drying up or turning to robots to make our food.

Okay, obviously opposing minimum wage on the basis of a 1:1 comparison to a gallon of milk is absurd. One can certainly say that services are goods, and that therefore labor is a good, though; which is why the sentence you bolded is not by itself particularly scary the way the OP implies it is.

I don't think that he's wrong when he says that employers will increasingly turn to avenues where they have to hire fewer workers if they have to pay them more... but they're going to do that anyway; and it isn't a good argument to not pay people a living wage to begin with.

 

[zorq]

The rich are getting richer. As you know, the incomes of the top 1% and top 0.1% are increasing at rates that far exceed the rate of median households.

The only way the owners of businesses can accumulate wealth a faster rate than their employees is by taking the excess value of the employee's labor for themselves. By excess value I'm referring to the value that exceeds the amount needed to sustain a fraction of the company and pay the employee. Some of that excess value produced by employees could surely be redirected back to the employees leaving a situation where the owners are accumulating wealth at a rate similar to that of median households.

Mandating a minimum wage increase helps to do this.

Yes, some businesses may go under directly because of a minimum wage increase. These are the businesses that already use minimum wage labor and are operating on the edge of profitability right now and already have owners who aren't taking obscene amounts of excess value from their employees. Readjusting their prices may keep them alive or if they do go out of business other more efficient companies will move in to capture the market share they have surrendered. Employees and customers of bankrupt inefficient businesses WILL find new employers and providers.

The market is resilient. It can easily handle small adjustments like this.

If your business is vulnerable to collapse due to minimum wage increases. I do feel sorry for you, but the health of the overall economy which depends in part on a lack of extreme inequality is the alter upon which your company is being sacrificed.

If that still sounds insensitive to you consider the opposite situation. Letting the market degrade the value of labor to the point where it no longer is able to sustain the people. The people will die.

There are other options of course like progressive taxation that would allow the government to care for and prevent the suffering of those on the bottom of the economic ladder, but that's another thread.

 

[untermensche]

At the end of the day, labor is a good, no different than a loaf of bread or a gallon of milk.

Yes, this is the nightmare of capitalism.

The human being is thought of as a commodity with a price.

Of course first humans are reduced to this.

Humans do not have market value. They are priceless incredibly rare creatures with a short lifespan, needs and desires.

They are merely forced to rent their labor in abusive destructive systems of control that rob many things so a tiny few can live like kings.

Capitalism is one baby step from slavery. It has many of the same features and better chains.

 

[RavenSky]

A consumer of milk has no control over what the producer of milk pays his employees.

A consumer of labor does have that control.

Ksen, I think your emotional reaction is somewhat based on interpreting "labor" as "people that work for an employer". Thus the quote seems to imply that a human being is the same as a loaf of bread in how one can treat it.

"Labor" here means not a person but a particular unit of work done by a person, and "goods" are the product of that labor. The person's argument is that their is no way to separate what labor should be minimally valued or priced at from what the goods themselves should be minimally priced at. One is a major determinant of the other. Thus, by dictating minimum prices on labors, government is indirectly dictating minimum prices on goods. But many people would object to that latter if it were done more directly, because then they see how it actually impacts themselves rather than just a hypothetical employer.

The counter to that argument is that plenty of consumers pay more for goods under the assumption that the higher price means the workers are getting paid more.
A policy of directly setting consumer goods prices is stupid because it would have no impact on the pay the worker gets, which is the goal. Employers would still give the workers as little as they could get away with and be the only one's who profit off of minimum prices that are higher than they otherwise would be.
In contrast, setting labor minimums does impact prices. The owner of the goods who pays the labor directly controls the prices and sets the labor cost + materials costs as the bare minimum they are willing to produce the product for, then adds a profit margin.

IOW, the analogy between setting minimum wages and minimum consumer prices is not really "scary" in a inhumane and immoral sense, but just plain ignorant and moronic and completely ignores the fact that the point of policy is to address a problem, in this case of workers whose pay still lands them in poverty, and minimum prices on goods does absolutely nothing to address that problem.

Good commentary, and I basically agree with what you have said but will note:

One is a major determinant of the other. Thus, by dictating minimum prices on labors, government is indirectly dictating minimum prices on goods.

I am assuming "minimum prices on goods" would be the direct and indirect actual costs of said product, but would not include a profit margin. As such, unless the direct and indirect costs - including labor costs - are so high as to cause the total product price to be rejected by "the market", the argument posed by the author of that post doesn't really hold water. (And if the relatively minimal amount of cost that would be added per product by paying a living wage causes said product to be unreasonably expensive, then perhaps they need to look at their entire business model)

In my opinion, the subtext to all arguments such as the one in that post is that increasing labor costs will decrease profit margins, and that is to be avoided always. And that, also in my opinion, gets back to the moral position that rich people matter more than poor people.

 

[RavenSky]

A gallon of milk is a unit of labor. Labor is a commodity just like everything else on the market. Humans aren't commodities, just their labor if they choose to sell it.

Not "just like any other" else we would not have worker protections design to protect the human beings behind that "unit of labor"

Oh that's right... Some people want to do away with those worker protections, too.

 

[ksen]

A gallon of milk is a unit of labor. Labor is a commodity just like everything else on the market. Humans aren't commodities, just their labor if they choose to sell it.

Not "just like any other" else we would not have worker protections design to protect the human beings behind that "unit of labor"

Yeah, I like how they think they can separate the labor from the laborer as if they're two disparate things.

And "choose" to sell it, lol. As if there's any real choice in whether or not someone can live without selling their labor to someone at whatever price the buyer is willing to pay. Man, I'm glad I chose to breathe oxygen today. Maybe tomorrow I won't feel like breathing any.

Oh that's right... Some people want to do away with those worker protections, too.

And the "some people" are typically very well off that don't have to worry where their next meal is coming from.

 

[Nice Squirrel]

Nothing destroys an organization's effectiveness quicker than monetizing your human capital.

 

[dismal]

Nothing destroys an organization's effectiveness quicker than monetizing your human capital.

What about free doughnuts in the break room?

 

[Frikki]

You're going on record saying there is no difference?

...

 

[Nice Squirrel]

Nothing destroys an organization's effectiveness quicker than monetizing your human capital.

What about free doughnuts in the break room?

Jiggerty-Twattery. Donuts are not monetization!