The first hit went to a site called Raise the Minimum Wage which gave me the kind of graph I wanted to see:
How dumb do you need to be not to look at this graph and suspect that 1968 was chosen as the starting point because it was an upward spike? Here's another graph:
As you go upon your way this morning, watch out for propaganda.
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230 comments:
1 – 200 of 230 Newer› Newest»The higher the minimum wage, the fewer starting jobs.
Politicians don't mind fewer starting jobs. It's a bigger voting bloc for them.
That's an instability in the system, unless you can get women to stop voting.
If Walmart paid more, the jobs would be gentrified. Higher-worth employees would take them from the lower-worth employees.
When it comes down to it, the question is what trade off do we want? No one likes it, but no matter what you do with the minimum wage, everyone won't be happy.
This is why I don't make friends very often when talking politics. Because reality sucks for both sides on a lot of debates.
Fewer, but better paying jobs, or more, but not necessarily good paying jobs? Pros and cons to both sides, you just have to bite the bullet and make a decision.
The Left wants to frame this as the evil capitalists and penniless serfs.
If you reframe it as:
"It is illegal for any employee to accept work and wages for less than $15/hr"
It looks a lot more stupid as a policy and a restriction of freedom.
If one possesses only the skills to be worth $7/hr, nobody will hire you if the threshold is $15/hr and you will NEVER obtain the skills needed to be worth $15, if you can't work for #7 at some point.
This issue is an idiot-identifier. Anyone who argues in favor is telling you, outright, that they are economically ignorant.
IIRC, the minimum wage in the late 1950's was $0.90 to $1.00, which would equate to about $10 today.
There tends to be a lot of hullabaloo and predictions of doom, one way or the other, about increases in the minimum wage, but actually they just catch the official number up to approximately where the effective number is.
How dumb do you need to be not to look at this graph and suspect that 1968 was chosen as the starting point because it was an upward spike?
1969 was the last year the US Mint put 40% silver half dollars in circulation (they had removed it from dimes and quarters in 1965). The intrinsic value of our currency has lessened each year since, endlessly seeking new asset bubbles to grow and pop.
NPR talks about the minimum wage every other day. It drives me up the wall.
Set the minimum wage at $100 an hour, if it's so great.
I wish NPR would go through that thought experiment, so they might discuss the two obvious drawbacks to raising the minimum wage.
Do liberals even know what they are?
I'll give you a hint: one problem starts with a U, the other problem starts with an I.
The demand for $15/hr. is not going anywhere. That would hurt.
I think I'd like to see some economists do something crazy and offer to do math to index minimum wage to unemployment/workforce participation. So, as you have more unemployed people, minimum wage drops to help absorb the workers at the margins. As you have fewer, you get higher minimum wage to help people at the bottom.
Of course, this is just doing what we think the free market will do anyway, but, it'd be an interesting economics exercise.
It's unremarkable (but impolitic) to say that larger numbers of workers entering the work force (encouraged by both parties) drive down the cost of labor, especially at the bottom.
And, of course, a national minimum wage does not make much sense.
Alkali Flats is not New York City.
This issue is an idiot-identifier. Anyone who argues in favor is telling you, outright, that they are economically ignorant.
Some of the people arguing in favor are just using it to stoke class warfare politics. No matter what, it will always be used that way.
What the second chart reveals is that while the nominal minimum wage legislated by congress has increased at an accelerating rate over time, especially since 1968, real purchasing power has been eroded even faster by inflation.
Those graphs make me realize how badly I was being ripped off that summer of 76' when I worked 14 hour days at Six flags over mid America for 1.90 an hour.
how stupid do you have to be to NOT understand that wages are a function of the supply/demand for labor? Or that some labor commands a higher wage scale than other labor? In my view, it ties back to immigration, education, and the mantra of "a college education guarantees you better pay" (tell that to the Barrista with a philosophy degree and $100,000 in student debt)
I think that each opponent of the minimum wage should have to work for that at some point in their lives, though I suspect most of us have.I also think that the advocates of a higher minimum wage should have to run a business and learn what it's like to meet a payroll and higher workers in low skill jobs.I highly doubt that many have.
If you linked the Federal minimum wage from its inception, in 1938, to inflation, it would be roughly 2/3 what it is now. This is why people calculate from 1968 rather than 1938. You take the peak, assert that this is how it should be, and extrapolate from there.
and in the 50's the domestic situation was fairly stable, and business owners optimistic about their future.
Today ....
Let's hear what the Pope has to say:
“While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation. Consequently, they reject the right of states, charged with vigilance for the common good, to exercise any form of control.
A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules. Debt and the accumulation of interest also make it difficult for countries to realize the potential of their own economies and keep citizens from enjoying their real purchasing power. To all this we can add widespread corruption and self-serving tax evasion, which have taken on worldwide dimensions. The thirst for power and possessions knows no limits. In this system, which tends to devour everything which stands in the way of increased profits, whatever is fragile, like the environment, is defenseless before the interests of a deified market, which become the only rule,” – Pope Francis.
rhhardin: "If Walmart paid more, the jobs would be gentrified. Higher-worth employees would take them from the lower-worth employees."
The shift of focus from obamacare to the minimum wage is nothing more than a transparent attempt to change the subject to help the incompetent in the WH.
Nothing more, nothing less.
It's pointless to engage in discussions regarding policies related to minimum wage legislation.
It's all about protecting obama.
Republicans should ignore this latest "pivot" and continue to concentrate on the tsunami of pain that obamacare is causing and the folks responsible for enacting it.
Period.
Yes, we get it ARM.
Talking about obamacare is uncomfortable.
I think that each opponent of the minimum wage should have to work for that at some point in their lives, though I suspect most of us have.
I have worked for far less than minimum wage. Cf. Berkeley Symphony, where the union players get "scale," and the non-union players get ... well, "enough to pay for the parking." Berkeley Opera, when I was its concertmaster 20-plus years ago, was $10 a rehearsal, $15 a performance. Rehearsals being two-and-a-half hours long, you understand, and performances more like three.
ARM: "A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules."
Enough about obama and his admins implementation of the obamacare law.
What do you think about the minimum wage?
Since states can raise the minimum wage above the federal minimum, what is to complain about. Go to your state and get them to raise it, like some states have done so. Of course, those states have higher unemployment.
The shift of focus from obamacare to the minimum wage is nothing more than a transparent attempt to change the subject to help the incompetent in the WH
Yup. And don't forget Benghazi.
Blogger RecChief said...
how stupid do you have to be to NOT understand that wages are a function of the supply/demand for labor?
It's not about logic,reason or reality.
It's about political power and control over individuals and making those individuals subservient to the state.
Period.
I should add that I've written for "ten cents a word." If you are a fairly careful writer, that is also way under minimum wage. I have a program note that I'm working on now that is $350 for 2000 words, so the rate has improved. Still, it's going to take me more than enough time, in toto, to put it below minimum wage.
The original minimum wage is $4.07 in today's dollars. Several years back (6?) I spent a summer working as a laborer on a house framing crew for $8/hr. Considering the nature of that work, I'd say $4/hr is about right for someone tapping on a cash register.
gm: "Yup. And don't forget Benghazi."
Okaaaaaaay........
and......?
HAHAHAHAH!!! The Pope thinks that states are charged with vigilance for the common good! HAHAHAHAHAHAHAHA!!!!
Good one, ARM.
Now we know why the Pope should STFU when it comes to wage and hour laws.
The issue is cost of living. The issue is misalignments in economic development. The issue is free, but not equitable trade. The issue is millions of illegal aliens competing with similarly low-skill and low-knowledge Americans. The issue is progressive debt in both the public and private domains. The issue is the most expensive, but only marginally successful, education system in the world. The issue is expensive out-sourced or "green" energy production. The issue is Obamacare, which is a fiscal and political scheme consisting of increased revenues and subsidies. The issue is abortion of around one million Americans every year. This is a comprehensive dysfunctional or corruption convergence motivated by diverse interests.
Crimso,
Several years back (6?) I spent a summer working as a laborer on a house framing crew for $8/hr. Considering the nature of that work, I'd say $4/hr is about right for someone tapping on a cash register.
Well, that depends very much on how bitchy your customers are. Working a register can seriously suck. (Been there, done that.) Would rather have been framing houses, honestly.
Matthew Sablan said...
This is why I don't make friends very often when talking politics. Because reality sucks for both sides on a lot of debates.
This accurately characterizes very few political debates. The vast majority of debates are between people who recognize the tradeoffs and those who don't (or pretend not to).
Actually I liked the pope's quote, it revealed that the only happy people are the few rich ones.
Levi Starks said...
Actually I liked the pope's quote, it revealed that the only happy people are the few rich ones.
Think you might be missing the sarcasm.
I tweet this chart from time to time.
Jason:
The current pope has a notable obsession with money and wealth. To the extent that he even marginalizes the so-called "social issues", including unprecedented (classified by number of victims and viciousness) crimes against humanity (e.g. elective abortion). He seems to think that money and libertine (i.e. liberal) behavior will promote the moral development upon which his religion is founded.
The pope was being sarcastic? I think not.
When I worked for minimum wage at the mall, I believe it was $3.65/hr. I worked hard (OK, not hard, honestly, but harder than the rest of the teenage slackers), was named employee of the month and got raises twice in one summer.
But that's no way to raise your wages, the government should really do it.
Raise the pay of the enty level fast food worker who has just arrived in the business and you have to bump up the more experienced workers who have learned the job. And so on up the line. Minimum wage earners, and I have been one, do not remain so for long.
The pope has seen little of the world, especially of America where he would find that our poor live like Nero compared to the people he thinks of as poor.
Levi Starks said...
The pope was being sarcastic? I think not.
So the alternative hypothesis, which you are apparently promoting, is that the pope believes that the obsessive accumulation of wealth is the sole pathway to happiness.
Pope Benedict XVI spoke as much on economic issues, as did Pope John Paul II.
"Pope Benedict observes that too many economic actors were making decisions “based on very short-term thinking.” They lacked a commitment to “long-term consideration of the common good,” and by pursuing short-term gain in financial markets, they undermined the market itself. For this reason, markets, and financial institutions must be appropriately regulated for the common good."
I won't pretend to know what the pope thinks, I can only judge the value of his words.
AReasonableMan said...
Shhh.
Put the shovel down. Pay attention to what others are saying. You just might learn something.
Seriously,
The minimum wage worker here is making 13 times what a low wage earner in Mexico is making, I would recommend that anyone living in the USA earning the minimum wage not take too much comfort in the popes words,
When you consider that the vast majority of the worlds population lives on something like 2$ a day you will see who the popes words are actual directed at.
It's interesting to think of how a $15/hr minimum wage will play out in terms of a black market.
Chain stores and fast food restaurants will get hammered. Many non-chain restaurants will go under. But others will survive by illegally underpaying workers in cash. One example: My wife once worked as a short order cook in a dive bar. After a year the owner of the bar gave her a "raise" by paying her the same but reporting less of it to the IRS.
Professional lawn care services will follow the same pattern -- those that don't just fold. At the same time, individuals, working for cash, will fill the void. Teenagers that can't get work at a fast food chain or local grocery store will do well to mow lawns for cash.
Individual proprietors will flourish in this economy.
Last year we hired a carpenter to do some work on our barn. He based his estimate on us paying him $20/hour and his assistant $10/hour. His assistant was his teenage son.
Why place a disproportionate amount of the inequality burden on those employing minimum wage workers...
And the best take on the pope's comments...
..and Obamacare is still a disaster! You're Jedi mind tricks won't work on me!
As for the generosity of the pope -- I'd like a fresco, if he's got one.
How about if we translate those curves in cell phones and computing power.
Matthew Sablan is quite right. Higher wages might mean fewer jobs, but it also means the jobs that remain are better. It's a trade off neither side seems willing to look at.
That said, the reality is there is no strict inverse relationship between wages and unskilled jobs. Skilled labor is paid based on some assessment of the value of the work. Unskilled labor is paid based on whether someone else is willing to do it for less. The libertarian ideal of workers freely bargaining their skills is a fantasy. That's not how it works.
The "higher wages mean fewer jobs" claim is simplistic. Sure, there is a price-point in there somewhere where rising wages will eliminate jobs, but the current wage levels are not set at that point so you can't make the straight-line claim that minimum-wage opponents like to make.
It does no good, getting back to Matthew's point, to ignore the values aspect. What level of treatment are we willing to accept for people in the lower levels of society? My own value system tells me that a person with a full time job should be able to live on what he makes, two people with full time jobs should be able to raise a child on what they make.
If a particular job can't exist while paying a living wage (and I am not defining a "living wage," but would welcome a good-faith discussion on it), then maybe that job shouldn't exist. (Just as any product that can't be sold at a profit will be discontinued, maybe a job that won't support the person doing it should be discontinued.)
Is it really better to keep people toiling in penury than to be forced to look as a society at how we develop and employ our members' talents?
I'm not sure where the pope is going with his comments but he sounds like he comes from a failed third world country. Perhaps that is appropriate for a religious leader whose job is to represent his parishioners but he is definitely not an economist.
The question raised on Fox News is whether Pope Francis turns out to be the Catholic church's version of Obama who alienates long time friends and embraces enemies who will never be your friends.
http://www.foxnews.com/opinion/2013/12/04/pope-francis-is-catholic-churchs-obama-god-help-us/
"If a particular job can't exist while paying a living wage (and I am not defining a "living wage," but would welcome a good-faith discussion on it), then maybe that job shouldn't exist. (Just as any product that can't be sold at a profit will be discontinued, maybe a job that won't support the person doing it should be discontinued.) "
-- So, you'd rather those poor people who have to work two jobs or live in a really bad area, have... no jobs?
That's the flip side. You can't just obliterate low-paying jobs because, income equality. New jobs won't spring up to replace them (as McCain said, a lot of the jobs we've lost are just GONE. They're not coming back.)
If people can't feed their families on a minimum wage. Why not increase the Earned Income Tax credit? It would seem to do less damage to the economy. Isn't that is what it is there for?
Trickle-up poverty.
I think Heather has a better solution. We want more money in poor people's pockets, so why not stop taking so much from them, and stop forcing businesses to raise their prices?
Lowering the income tax (and other taxes/fees) is essentially the same as raising the minimum wage, only without pricing new workers out of the market.
Heather said...
If people can't feed their families on a minimum wage. Why not increase the Earned Income Tax credit? It would seem to do less damage to the economy. Isn't that is what it is there for?
Yay Heather! Shift the burden away from those providing jobs to unskilled labor. Unfortunately current EITC is unbelievably small unless you have a number of dependents (again with the perverse incentives!)
Chain stores and fast food restaurants will get hammered
Makes you wonder how retail chains like Costco can be profitable by starting their employees at 11.50/ hour, with great health insurance plans. Fast food joints like Moo Cluck Moo’s in Detroit and In N Out pay way above minimum wage. Maybe they're just better business people than the Walmart and McDonalds of the world.
Matthew Sablan said...
"That's the flip side. You can't just obliterate low-paying jobs because, income equality. New jobs won't spring up to replace them (as McCain said, a lot of the jobs we've lost are just GONE. They're not coming back.)"
McCain is correct that the particular jobs which have gone are not coming back. Part of that is due to one sided free trade in which the Chinese practice mercantilist trade policies and we give them unfettered access to out own markets. If the playing field were leveled and if we had a little more unfettered capitalism in our country with fewer, better thought out government regulations the jobs would come back. As manufacturing jobs give way to automation people need to be moved into service jobs. Thus service jobs will become a larger part of our economy. One of the areas in which service jobs provide a living for thousands of middle class people is the health care industry.
With the aging population healthcare jobs should be plentiful. Unfortunately the bean counters have decided that healthcare must not grow relative to the rest of the economy which ultimately means that the wages in the healthcare industry must be suppressed, fewer individuals will be employed in the healthcare industry, and healthcare must be rationed (hence the death panels).
When the government is screwing up 1/6th of the economy, is at war with other parts of the economy like the coal industry and produces destructive regulations (an example is mark to market) it is irrational to then turn around and complain because there aren't enough jobs and that the wages are too low when there are dozens of people competing for each job opening.
garage mahal said...
Makes you wonder how retail chains like Costco
We don't have to wonder, we know. But that's the difference between us.
Used to be when Congress was doing something reprehensible some member or two would wheel out some flag burning legislation and it would draw all of the media's attention for a week or so while Congress ground sausage. The minimum wage is the new flag burning, and Obamacare is the new sausage.
Makes you wonder how retail chains like Costco can be profitable by starting their employees at 11.50/ hour, with great health insurance plans. Fast food joints like Moo Cluck Moo’s in Detroit and In N Out pay way above minimum wage. Maybe they're just better business people than the Walmart and McDonalds of the world.
True. And Walmart and McDonalds will get hammered.
As I said.
Unfortunately current EITC is unbelievably small unless you have a number of dependents (again with the perverse incentives!)
It is not a no cost solution but if your goal really was a to close the income gap the EITC is a better way to go. I would increase EITC but also time limit it.
In truth Ann is right the minimum wage meme is a distraction.
Nearly every policy idea I've heard out of the administration has been driven by political coalitions, often crude and in need of 'organizing,' run by those thinking they know what is fair and just for everyone. These coalitions try and cram laws through and, failing that: message, demonize, blame and focus on 'the enemy'
Gov't is a big shiny toy run by 'the right people.'
Too many older cars on the road? Use the gov't to give money to car dealers and incentivize people to destroy perfectly good cars by giving them taxpayer money.
Veterans coming back from war? Try and round them up along with your political coalitions into Park Service jobs paid for with taxpayer money. I'd bet they'd unionize if they could.
Gun control? Use a tragedy and politicize the debate, rally around your righteous truth even if there's plenty of reasonable and Constitutional opposition.
Stir the pot. Divide and conquer.
Rising Health-Care costs? Make promises you can't keep, co-opt the Democratic party and pass a huge, backroom dealt pork-monster keeping the worst of the old system and adding huge layers of gov't bureaucracy filled with your pals and cronies...you guessed it.... paid for with taxpayer money.
Not a single vote from the opposition.
And the consequences which may well be causing more harm than good DON"T MATTER.
I see a pathetically cowed media, torn between market forces, cultural trends, technology and what are usually more liberal ideals bent under the race narrative, guilt, the office of the Presidency and the popular opinion-monster they've helped create.
This is the most inexperienced, progressive, further Left, biggest-gap-between-action-and-words Presidency of my lifetime by far.
Good luck with that minimum wage.
Same story, different day.
True. And Walmart and McDonalds will get hammered.
So Walmart is just sneaking by at 425 billion profit per year, even as taxpayers are subsidizing those low wages in the form of government aid for their workers? Somehow I don't think that is true.
...My own value system tells me that a person with a full time job should be able to live on what he makes, two people with full time jobs should be able to raise a child on what they make.
Three cheers for your values! Go start a business and employ both your values and lots of workers. I genuinely wish you success and fortune.
However, when it comes to your using government power to impose your values on the rest of us, please just shut up. I'm tired of having others lecture me about their morality and values demanding that we legislate more and more of what's done in society. We had a debate not too long ago about society's lack of authority to legislate minor things like abortion. Well, if society doesn't have the moral authority to weigh in on whether or not it's legal to kill an unborn child, it surely lacks the moral authority to tell me what wage I can accept.
As for morality, consider the following true example: Years ago I worked at a furniture mill. The mill employed a disabled man (nice guy, really low IQ) as sort of a custodian. The man "earned" minimum wage for his efforts. I used scare quotes because the rest of the employees really did the cleaning of the mill. The guy really couldn't even push a broom.
Why was he "employed" by the mill? The owner knew the man's family and wanted to help. The job gave the man dignity and some cash. If you got your way, would really insist that the mill owner pay $15/hr for this man's work?
McCain is correct that the particular jobs which have gone are not coming back.
Not necessarily.
Comparative advantage can shift back and forth for various reasons.
The left tends to see any market as a zero sum game. They tend to look at labor as a static entity rather than a flexible commodity.
Fixing prices, even for labor, results in black markets and a stagnant economy.
Who mentioned, above, for eliminating income taxes on workers on that level is working in the right direction.
Maybe garage mahal is a f***ing idiot who doesn't know what he's talking about.
http://www.bloomberg.com/news/2013-08-27/why-walmart-will-never-pay-like-costco.html
Garage, you need to learn more about Costco's Worker's Paradise. Hint-many of the workers y you see in your local Costco aren't directly employed by Costco and therefore not the beneficiary of that wage. In addition, Walmart and Costco are very different businesses with very different customer bases.If Walmart choose it's cosine base to be more like Costco, those who couldn't afford Costco would be out of luck.
Besides the problems caused by the government which contributes to low wages for the unskilled there is another issue I forgot to mention. When a government deliberately floods the market with foreign labor because supposedly there are jobs Americans won't do that is a deliberate attempt by the government to suppress the wages of those people who have to compete with the imported foreign labor. When a president like Obama schemes day and night to bring in millions of uneducated workers from other countries to compete with out own low skilled folks it is extremely cynical for him to express dismay when the wages for these jobs is low. It is even more cynical to blame the employers for the depressed wages when he knows full well he is flooding the market with competitors for our native born labor.
I'd like to know where the people are, Garage, who will implement the ideal of justice or fairness you seem to assume exist.
How much would you like the minimum wage to be?
How should McDonald's run its business and how much profit should it make in a year, assuming your numbers aren't pilfered from TPM?
How should franchisees be paid and what contractual obligations do they have to shareholders, employees, and customers?
Rusty said...
"McCain is correct that the particular jobs which have gone are not coming back.
Not necessarily.
Comparative advantage can shift back and forth for various reasons."
I agree with your position. The point I was making is that the manufacturing jobs are changing so fast that the new jobs will be different than the old ones. As manufacturing becomes more efficient fewer people will work in manufacturing and more need to move into service related jobs like healthcare.
Tim, w hen you reduce the number of jobs in ore to make the jobs better over all, the people with the highest skill level will get them, making things worse for those who most rely on the minimum wage.So while you're being nice to those who end up with jobs, you hurt the others.
While you're values are admirable, really you end up choosing different losers.I would guess that's not what you had in mind.
Saint Barry the Omniscient Provider can preach to me about minimum wage after his propoganda arm (OFA) starts to pay the interns!
I've worked for minimum wage. I don't have any great objections to raising the pay, but, realistically, there's an increase that will cause more workers to lose their jobs than to profit from the increase......Two facts about minimum wage jobs: they suck, and they're better than being unemployed........The utter suckiness of most minimum wage jobs has caused many young people to stay in school.
It's worth noting that 2013, minimum wages will buy goods and services that you could not purchase for a million dollars back in 1968. Capitalism is a golden goose not a ravaging beast.
My own value system tells me that a person with a full time job should be able to live on what he makes, two people with full time jobs should be able to raise a child on what they make.
My own value system tells me that a good and decent person should never die young of a terrible cancer. And also that all children should be above average, and cars should get a billion miles per gallon.
What are we waiting for, comrade? Let's pass a law and make it so!
Garage Mahal wrote: So Walmart is just sneaking by at 425 billion profit per year...
You're confusing revenues and profits.
And Garage -- Don't you want McDonalds and Walmart to go under?
I'm fine with that.
And I'm fine with my son getting more lawn-mowing jobs.
Henry: "You're confusing revenues and profits."
Garage doesn't understand the difference.
It's the same thing the lefties do when discussing ExxonMobils profit numbers. The lefties just quote the total profit number as if it is some magical stand alone figure.
Most of the LIV's like garage don't understand rate of return and profit margin.
I had a conversation with a "friendly" lefty some time back and was actually able to make her understand the key concepts and she was shocked to learn just how much greater the return on investment is for tech companies, hollywood production companies (talk about tax breaks!!) than for oil companies.
William: "Capitalism is a golden goose not a ravaging beast."
Irrelevant.
The left wants dictatorial control over you and your life.
Logic and rationality never enter into it.
taxpayers are subsidizing those low wages in the form of government aid for their workers
Why do people keep saying things like this? Government aid, with the notable exception of the EITC, generally shifts the labor supply curve in a direction unfavorable to employers. (If you can get food stamps, you can get by with working fewer hours; anyone who wants you to work the extra hours for them anyway will have to pay you more for it.)
Maybe Garage is right and Costco and Wal-Mart should just reorient their entire business models to serving affluent, educated consumers instead of the mass markets they serve now. Yeah, that's the ticket!
Screw the poor, like Garage says!
Also, Garage has a real problem with math. Wal-Mart books $425B in sales per year, not profits. Of course, for leftists, it's the emotion that matters. Not facts.
And Garage -- Don't you want McDonalds and Walmart to go under?
I prefer that Walmart treat their workers better, but that isn't going to happen. I prefer they didn't build in my community, but there is a Supercenter a mile from my house. It's estimated one Supercenter in Wisconsin costs taxpayers $900,000 per year. Not including all the small businesses impacted.
"NPR talks about the minimum wage every other day. It drives me up the wall."
Then you're obviously fortunate enough financially to not have to worry about the prevailing minimum wage. For many of your fellow working Americans it is urgently important.
If you make the min wage $100,000/hr people would only have to work one hour per year to earn a truly living wage.
Think of it: We could eliminate poverty entirely and everyone would only have to work one hour per year!
Then you're obviously fortunate enough financially to not have to worry about the prevailing minimum wage. For many of your fellow working Americans it is urgently important.
These professions of concern about people you don't know and don't care about...
Dumbest shit on the internet.
Steve Sailer often comments on the inverted status symbol of claiming to care about people you aren't related to.
Not including all the small businesses impacted.
SlideruleAid...I can see it now.
Globalization will tend to equalize wages in poor and rich countries, and automation reduces the value of routine work (sometimes to less than zero).
Both trends are the engines behind increasing inequality.
A job just can't pay more than the employee is producing in value (unless it's a government job, or subsidized). Thus a decrease in minimum wage seems inevitable if the value of low-skill labor itself is decreasing.
Yet the opposing worldview seems to be that minimum wage should just go up and up forever. And it just can't do that unless the value of this labor is also increasing.
In 1968 the minimum wage could increase without raising unemployment because demand for labor (and the products of that labor) was so strong that few were actually working for the minimum anyway. That is not the case today.
Raising the minimum wage to more than such labor is worth is an exercise in magical thinking- the labor isn't worth more just because you think it should be.
The bottom line is, either people earning minimum must learn to live with it, or there must be more transfer payments (EITC, SNAP, etc.) to provide a better life for those willing to work yet unable to produce labor of greater value.
4.7% of hourly wage earners are paid minimum wage per the BLS. Of that, the majority are between 16 and 19. 64% of them are part time.
Minimum wage jobs are important stepping stone jobs and to raise the rate will be to tamp down the demand. We already have a huge number of unskilled unemployed who could use these low paying jobs as a start: if they were available. Magical thinking to believe that raising the rate will help the working poor. This is a place where sanctimony and stupidity marry.
GarageMahal: How about surveying the people leaving Walmart and asking if they like the store and the prices. Try it. In the alternative go to your broker and sell short as much Walmart stock as you can afford. Or demand that your pension fund sell all the shares and redeploy those funds into a high wage cost enterprise of your choosing.
The US is an expensive place to live compared to Bangladesh. So, we have three alternatives, we pay a living wage that is higher than the world minimum or we supplement wages by government transfers of wealth or we have a completely desperate underclass of citizens.
I don't like either of the last two alternatives very much and Repubs don't like the second alternative. So, in many respects the first alternative, while not perfect, is the best of a the available alternatives.
Shouting Thomas said...
These professions of concern about people you don't know and don't care about…
This is offensive BS. Not everyone has spent their lives in a bubble of material comfort. You can't speak for the experience of others or who they have known. And, Steve Sailor is kind of a dick.
FiveWheels:
But that's no way to raise your wages, the government should really do it.
Anything else the Gummit should be in charge of besides, as you say, determining the dollar value of every individual citizen?
(Oh - I guess with the Afraudable Care Act, pooled health-care dollars redistributed by bureaucrats, we're well established with the Feral Gummit assigning dollar values to each.)
Thank you Michael at 1:43 - for the numbers I sort of knew but was too lazy to look up.
Not everybody has spent their lives in a bubble of material comfort.
No shit, Sherlock. And, you don't give a shit about the poor except when you're trying to score points on the internet.
I haven't spent my life in that bubble. Born poor and white in a shotgun shack in the middle of the cornfield.
And nobody gave a shit, and nobody gives a shit.
I never expected anybody to give a shit either, because people don't really give a shit about anybody beyond immediate family. So, I learned a decent trade... because I knew nobody gave a shit.
Of course, I was assisted in knowing that nobody gave a shit by all the asshole liberals who lectured me about my white privilege. This cleared things up.
Pretending to be vitally concerned about people you aren't related to is the status symbol of the idiot left.
> Lowering the income tax (and other taxes/fees) is essentially the same as raising the minimum wage, only without pricing new workers out of the market.
Minimum wage earners already don't pay federal income tax. They pay SSI and SDI (and get great return on SSI, unless they're black males[1]), but that total is about 10% employee side.
You could exempt them from both employee and employer side SSI to get the total to (around) 15% but that puts SS in an even bigger hole.
Numbers matter.
[1] In general, low-income folks get a pretty good return from SSI while those that hit the cap get around 0%.
However, black males get a lousy return from SSI because a huge fraction die in their mid 60s.
Low-income females get great return from SSI because they collect for years.
Low income white males are between these extremes.
SS would be in serious trouble if fewer folks smoked. (Lung cancer tends to kill folks before they can collect much. Cancer deaths aren't more expensive so ….)
One of the keys to creating a decent life is realizing that nobody outside of your immediate family gives a shit about you, your job or your ambitions.
You're on your own. Only fools don't know this. Lying, stupid poseurs on the web pretend otherwise.
Michael said...
Magical thinking to believe that raising the rate will help the working poor.
The problem here, of course, is that lifting the minimum wage will carry through to other low wage jobs. This is a typical Repub objection to increasing the minimum wage, which now, for the sake of sophistry, you choose to ignore.
Not same topic but some juxtaposition brought this to mind.
Andy Freeman said...
> Lowering the income tax (and other taxes/fees) is essentially the same as raising the minimum wage, only without pricing new workers out of the market.
Minimum wage earners already don't pay federal income tax.
Ironically Repubs spent much of the last election cycle bitching and moaning about all the poor people who didn't pay 'taxes'. Apparently this is not a popular strategy on the right.
Of course, another approach to raising wages at the low end that actually would work is to tighten the labor supply by strengthening border controls.
No self respecting union would suffer an influx of scabs, for example, to take their jobs, that the Democrats are foisting on their "most vulnerable" constituencies.
@ARM
You're a financial illiterate.
Raising the minimum wage will create a spiral of inflation that will ultimately result in low skill, low pay workers having no more buying power than at the beginning of the inflationary cycle.
My pay rate for high tech work is always 6 to 10 times minimum wage. Raise the minimum wage, and my rate will be raised to be 6 to 10 times that minimum. It's inevitable. I'm worth 6 to 10 times what a no skill worker is worth.
Result, no change in buying power.
You're seriously intellectually challenged.
So ST, you agree with the original premise that changing the minimum wage will affect a broad range of lower paying jobs?
Instead of "illegal aliens" we should just call them what they are "alien scabs."
ARM, how old are you anyway? Have you ever lived through an inflation?
tim in vermont said...
Of course, another approach to raising wages at the low end that actually would work is to tighten the labor supply by strengthening border controls.
I agree with this but the financial overloads who bankroll the Repub party apparently do not agree (see Hannity 2013, Overnight reversal on immigration, for further details).
As for who does and does not pay taxes, in Virginia, at $20k/year, the state [not the Feds, note] are taking almost $1000 of that, not including sales tax and other taxes/fees. Now, you might get some of that back after you do your taxes. But, up front, it is gone.
The first random tax calculator I found takes another $1,000 off the top from the Feds (assuming no dependents, only declaring yourself.) That seems wonky, but I'll be a sucker and trust the Internet.
A $15 hourly wage at a 40/week job comes out to... ~$26k/year.
So, huh. Funny how the minimum wage and taxes suddenly is something we have to think about, at least, up front, before deductions.
I see Shouting Thomas is back to being his usual irascible self.
Tom, aside from your presuming to know the financial circumstances of people I know, you ignore something we should all worry about: the pressure to keep wages low and benefits sparse, (or nonexistent), all in the name of "competitiveness" or to further enrich the Walton family and their despicable ilk, will similarly work to drive down wages and salaries all across the board, or will--as has already been the case for years--drive good (well-paying) jobs out of the country.
This is not just about the presumably lazy-and-shiftless-and-therefore-to-blame-for-their-own-languishing-in-shit-jobs wage slaves, but about all American workers and our disappearing job opportunities.
@ARM
Yes, raising the minimum wage will create an inflationary spiral that will ultimately raise everybody's apparent wages, and result in absolutely no change in relative purchasing power.
I guess this will make you happy, right?
We could print $1 trillion bills and give everybody a wheel barrow to haul their money to the store.
and by the way, I used to sell robotic welding systems. the selling point was not that the company could fire low wage workers, but take their existing staff and train them better to program robots to do the drudge work. Stopped by to talk to a friend who owns a business and who had bought several of the systems I sold. still the same people who had worked there for the last 15 years. But no new ones, at least in the fabrication department, because the older workers were tending 3 machines machines apiece, and all of the minimum wage types were in shipping, putting product in boxes.
I see where there is a burger making robot that can crank out 360 burgers in an hour. Sure, go on strike, it will make for an easier calculation to decide if the owner wants to buy a Burger-matic 360 or not.
@Robert
There you go.
No, I don't worry about anybody but myself and my immediate family. I don't sit up at night and worry about whether black guys are shooting each other and playing the baby daddy. No, no, no.
Americans voted for Obama and free stuff, thinking that would solve their problems.
They are getting it up the ass as a result. They deserve it.
I'm taking care of myself. And doing a good job of it.
AReasonableMan said...
tim in vermont said...
Of course, another approach to raising wages at the low end that actually would work is to tighten the labor supply by strengthening border controls.
I agree with this but the financial overloads who bankroll the Repub party apparently do not agree (see Hannity 2013, Overnight reversal on immigration, for further details).
you owe me a new keyboard after I did spit take all over this one. Which party is for amnesty again?
But enough of this sideshow. Let's get back to talking about Benghazi, the IRS, Obamacare, and the NSA.
RecCheif, you are getting immigration amnesty brought to you by the Republican house, whether you want it or not. They speak with forked tongue.
Oh hell,
Just give the working poor that trillian dollar coin and let them divvy it up among themselves.
Gee, I thought business was for immigration and labor was not.
Robert Cook said...
I see Shouting Thomas is back to being his usual irascible self.
That's rich coming from someone who claims anyone looking out for society's long term economic health is saying "I've got mine so fuck you". Expectations of reasonable decorum only go one way.
I agree that there is a wing of the Republican Party that hates the base of the party, and even works with Democrats to demonize and attempt to marginalize that base.
The Democrat Party is the party of billionaires, however, and they take care of their own.
The Koch Bros are the exception that proves the rule.
Those who agitate against the presumed unwashed hordes of millions of illegal immigrants pouring through our boarders and into our country, stealing all the jobs from native Americans are in the grips of a fever dream. To the degree there are immigrants--legal or illegal--residing here and doing jobs that might be done for higher wages by American citizens, it is a result of policies driven by the financial interests in the pursuit of driving wages down, because the "job creators" don't want to pay American wages!
Even if we build a Berlin Wall across the whole of our borders with Mexico and Canada, how do we keep the jobs from being automated or sent overseas?
We can't.
Marshal,
I guess you're not really familiar much with Shouting Thomas. To call him "irascible" is simply to describe him as he presents himself here and has done for years.
There are lots of jobs that can't be sent overseas that alien scabs now perform.
Robert Cook,
Many people who can't find other work have started their own businesses. Often, those people make very little money, especially in t the first few years. Why would the employees who work for them be entitled to a minimum wage, but not the business owners? Why is one group searching, but not the other? If you truly care about the condition of the poor, why should their status as business owners matter?
@Robert
When a man tells me he's self-interested and sinful, I tend to trust him.
When a man tells me about his charitable nature and wonderful ideals, as you do, I tend to suspect I'm in the company of a con man and scam artist.
Haven't been wrong yet in actual experience.
"That's rich coming from someone who claims anyone looking out for society's long term economic health is saying "I've got mine so fuck you".
Yeah, the "you don't care about the poor" canard is getting really old.
"Americans voted for Obama and free stuff, thinking that would solve their problems."
Well, no. They voted for Obama--foolishly--because they wanted something different and better than the truly despicable and miserable cohort of miserable shits who held office for the previous eight years. Obama is just a continuation of of that, with a less overtly or crudely bellicose manner. (And isn't that why we vote, in theory: in hopes we can elect those to office who will represent us to our favor and for the improvement of conditions for all?)
"They are getting it up the ass as a result. They deserve it."
As they were before Obama took office, and as they--we--will continue to do after he leaves office. No one deserves it, but as you seem to hate your fellow human beings, I'm sure you feel "they" do.
I meant "deserving" not "searching."
ARM Your reading skills are for shit. My point was in fact what you accuse me of ignoring.
agitate against unwashed hordes stealing jobs? (paraphrasing) Yes, I will. It's economics 101. With a large pool of unskilled labor from which to choose, the wages for unskilled labor remain stagnant at best. This is why those businesses that use unskilled labor are fine with amnesty and open borders. duh. And that calculation is not dependent on a party affiliation.
As far as the Republican establishment bringing us amnesty whether we like it or not, I believe that to be true. While it is a Democrat Party idea, it will take the stupid party to get it through.
As they were before Obama took office, and as they--we--will continue to do after he leaves office. No one deserves it, but as you seem to hate your fellow human beings, I'm sure you feel "they" do.
I've lived in Woodstock for 35 years, Cookie. And met many of the great bleeding heart lovers of humanity who speak your lingo.
In real terms, such people are always worthless scoundrels who cheat and backstab everybody around them, while spouting their grand ideals. You can bank on it.
Marshal said...
Expectations of reasonable decorum only go one way.
Those rascally liberals clogging up the internets with their foul-smelling ideas again. Ideological purity uber alles.
I don't know of anywhere here that pays minimum wage. Fast food, Walmart, call centers--they all start higher than minimum wage. Lots of help,wanted signs around.
It's the market.
Strong local economy, strong wages.
Marshal said...
That's rich coming from someone who claims anyone looking out for society's long term economic health is saying "I've got mine so fuck you".
For the record, that is exactly what Shouting Thomas is saying.
Michael said...
ARM Your reading skills are for shit. My point was in fact what you accuse me of ignoring.
Several people were making conflicting points, sorry if I conflated your post with others. You righties need to get on the same page on this one.
"When a man tells me about his charitable nature and wonderful ideals...."
One does not need in the least to be charitable or altruistic--and I make no such claims--to be concerned about income inequality or about rising numbers of one's fellow members of society in poverty. The most self-interested person should be concerned about such things because they threaten the stability of society at the macro level and the safety of civic life on the micro level. In other words, increasing poverty and misery will eventually reach all of us in one way or another, whether in the form of the loss of our own jobs or in the increasing barbarity and eventual collapse of the society around us.
" They voted for Obama--foolishly--because they wanted something different and better than the truly despicable and miserable cohort of miserable shits who held office for the previous eight years."
In the middle of the Bush years, I recall news stories of local businesses decrying the lack of available workers. I don't think anybody was getting the minimum wage. Now, we have the lowest workforce participation rate since when? Forever?
Heck of a job, Barry!
@Arm
Yes, that's exactly what I'm saying.
I've endured a lifetime as the punitive target of the quota system, so I learned to fight back in every way I could imagine and devise. The ultimate target of the quota systems was always poor white guys from the south and midwest. I realized this way back in college and devised a plan to fight back.
And, I won.
Fuck all you white liberals up the ass. I figured out how to short circuit your asshole game and win. If you don't like it, well fuck you up the ass again.
If you want to know how I did it, it'll cost you. Nobody gave a shit what happened to me except my family, wife and kids. I was always supposed to be the sacrificial victim so that blacks, women and gays can get more.
Nothing of any value is for free.
If you've got no skills and can't earn a living, tough shit. Figure it out on your own. I did.
ARM I believe most are on the same page here except for you and Cook who tend to believe that the small percentage of people on minimum wage should be paid up to twice as much as they are currently making without a corresponding exchange of effort The inflationary ramifications and hiring consequences are not taken into account in your happy sanctimonious world in which you love the poor and do nothing for them whilst conservatives start businesses and hire them and understand fully the cost of doing so.
One of the reason old farts are conservative is that we have seen all of the stuff the left pushes not work in the long run and cause damage that it takes a lot of suffering to get out of.
The first thing I thought the first time I heard Obama announce his ideas was "not again."
Now we have all of these young people telling us the same thins we told our parents with the same sincere belief in the rightness of our cause and the same ignorance of the effects of our cure.
Heck of a job, Barry!
How were things going when Obama took office? Oh, here it is.
Robert, have you noticed how things have Goren worse as the government's rule in the economy has increased?
AReasonableMan said...
The US is an expensive place to live compared to Bangladesh. So, we have three alternatives, we pay a living wage that is higher than the world minimum or we supplement wages by government transfers of wealth or we have a completely desperate underclass of citizens.
Notice the reality disconnect.
Even if a mandatory "living wage" imposed by government eliminates lower paying jobs, magically there won't be a desperate underclass.
In fact, that underclass will be made larger and more desperate.
"If you truly care about the condition of the poor, why should their status as business owners matter?"
Umm...Patrick, it doesn't matter, and...who's decrying small business owners? They're struggling and being swallowed up, too, by the national and multinational corporations and powerful financial interests.
Patrick,
I've noticed how things have gotten worse as the government has passed more and more policies intended to benefit the corporate and financial interests and as they have failed to pursue criminal prosecutions of the corporate and financial interests whose criminal behavior is poisoning the environment and stealing our nation's (the people's) wealth.
So why not a minimum wage for them?
ROBERT COOK: Agree that "concern" for the implications of poverty are important. I myself have both concern and a certain amount of altruism in that I spend both time and money on programs that help men get into the work force. But that last bit is not "concern" it is actually doing something. Waltzing around full of umbrage at the banks and bankers and capitalists and warmongers and this and fucking that does nothing for the poor and everything for the person doing the waltz. Concern is bullshit without action and action is not swanning around the internet typing lofty ideas
AReasonableMan said...
Those rascally liberals clogging up the internets with their foul-smelling ideas again. Ideological purity uber alles.
Apparently ARM doesn't understand ideological purity isn't relevant to my comment since it concerns tone rather than ideology. But we all know to him accuracy and relevance aren't important, only the attack matters.
Yes, garage, we had a housing bubble collapse. Just before the crisis, 58% of all US mortgages were subprime. Fanny and Freddy were buying them up as fast as they could (the Feds held 76% of them), decreasing underwriting standards as HUD jacked up the subprime quotas.
Heck of a job, Barney!
garage mahal said...
How were things going when Obama took office? Oh, here it is.
The spectacular ineptness of the last Republican administration's financial management makes it hard to take anything they say seriously. The only thing they are correct about is that the interest on increasing debts will eventually crowd out things we want to pay for.
Reagan/Cheney 'deficits don't matter' when we are in power hasn't been a big help.
Remember, Republicans are never, ever culpable for anything. Must have been somebody else's fault!
ARM: So, what is your take on easing and the implications, if any, on the subject at hand: minimum wage?
Robert Cook,
To the degree there are immigrants--legal or illegal--residing here and doing jobs that might be done for higher wages by American citizens, it is a result of policies driven by the financial interests in the pursuit of driving wages down, because the "job creators" don't want to pay American wages!
Indeed it is. So make that impossible. Mandate E-Verify. Prosecute people who employ people here illegally. And that emphatically includes the people with the illegal nannies and the illegal landscaping help. It probably means that no high-powered female lawyer with children will get a government job in the near term, but in the long run, some actual American kids might get work as nannies.
EDH said...
In fact, that underclass will be made larger and more desperate.
Well no because we will continue with transfers of wealth in the form of food stamps, unemployment benefits and other forms of support.
By allowing our economic system to develop in a way that favors one small sliver of society we have created a bunch of unpalatable options. Unpalatable even for us despised liberals. It would be much better if people received their income directly from their own labor.
The housing collapse was a bipartisan clusterfuck. It was intrusive bipartisan government policies that brought the house of cards down.
Michelle,
As to your last post, I think you slightly miss the point: the loss of good-paying jobs here is far less due to illegal immigrants taking away domestic jobs and far more to do with the transfer of those jobs overseas...or their simple elimination due to automation.
The expulsion of all illegal immigrants from our land would not result in a plethora of good jobs for Americans. It make available some jobs that are as poor-paying as the jobs Americans are already finding, increasing to a minimal degree the number of working poor who are American citizens, but it is not the key to our jobs problem.
That is a result of the reality that "jobs" (good jobs) are a drag on the profits of the "job creators."
Original Mike: You are correct as to the consequences of bipartisan enthusiasm to have universal home ownership. On the other hand, the borrowers were not compelled to borrow and tempted though they might have been to borrow more than they could repay they could and should have resisted on both moral and arithmetic grounds.
Fred Reed, as usual, states the obvious.
The work that we knew is disappearing.
Same thing throughout my life. The factory work that my parents thought of as their rightful inheritance disappeared. Computerization is erasing the jobs that my generation thought of as their rightful inheritance.
Economic life is chaos. The error in liberal thought is Big Ideas, thinking that systems can be set in place to control the chaos.
Survival is tough. Each new generation has to learn new survival skills. This is a good thing, although it seldom seems that way to humans in the moment. There is no way to make survival easy, except to devalue the content of your life to boredom. That's a poor tradeoff, but a seductive one.
Michael said...
ARM: So, what is your take on easing and the implications, if any, on the subject at hand: minimum wage?
Inflation remains low, but obviously the Feds don't give a shit about the poor or even the distribution of wealth. They are concerned with growth, after the Bush Great Recession.
Sure Michael, but if government hadn't set the table it wouldn't have happened. And the really sucky thing is, they're doing it again. The new Consumer Financial Protection Bureau is pushing for 3% down, low FICO mortgages. We just saw how that worked out the last time, and now we're going to do it again.
ARM: So you have no take on it.
The Bush Recession is now in its sixth year. the current pathetic rate of growth cannot be laid at Bush's feet. The chief executive of the country who has seen fit to visit but one time with the head of his most important piece of legislation is clearly not going to be credited with leading any recovery. Speech maker. Talker.
Original Mike said...
The housing collapse was a bipartisan clusterfuck. It was intrusive bipartisan government policies that brought the house of cards down.
This ignores the private 'financial advisors' and mortgage agents who were aggressively pushing this shit down people's throats or the role of real estate agents in obtaining loans fraudulently. When these fuckers lost their unproductive jobs it was hard to feel much sympathy - they had extracted their nut from the system. And yes many consumers were also stupid.
Ideology was another major factor. In particular Greenspan's belief in the magic rationality of markets. Somehow, even though the participants in markets clearly act irrationally, the markets themselves would be rational - magical rationality. Ideology blinds people to the bleedin' obvious, in this case a massive housing bubble.
Original Mike: Agree. Underwriting standards for non-minority borrowers remains much stricter than in the boom. On the commercial front the same holds true. CMBS is a fraction of its largest production years and underwriting is much stricter than earlier.
Michael said...
ARM: So you have no take on it.
Well, I assumed your point was regarding the effect on inflation, since this directly relates to the minimum wage we were discussing. Elaborate if I am wrong.
I could agree to increase minimum wage rate if the feds cut social welfare programs dollar for dollar but they won't.
If there were less workers going for those same jobs, the wages would go up. It wouldn't just be different people working at them. That is why we need to cut off the flow of alien scabs.
ARM: I'm not "ignoring" anything. I'm just identifying the proximate cause; destructive government economic policy.
@Michael: That's good to hear.
ARM's take on the housing crisis is like the farmer who leaves piles of corn and wheat out open in the barn and then blames the rats and mice for its disappearance.
When the govt forced lenders to start making bad loans, and provided an underwriter for those bad loans, the loans got made by whomever.
Pretending that an unfettered free market would go out and hand hundreds of thousands of dollars to people who had no way to pay it back without government interference is worse than delusional, it is plain stupid.
Robert Cook,
If illegal immigration doesn't make any difference to corporations, why should we tolerate it? I don't agree that it makes no difference, fwiw; wages in construction and in landscaping aren't what they were a few decades back, and it's perfectly obvious why.
But if if corporations will just get cheap labor whether there are illegal immigrants or not, oughtn't we at least to make the cheap labor domestic, citizen labor? There are things that aren't outsourceable. Like construction. And landscaping.
Too many comments to read them all, so to the first person who said, "the proper minimum wage is zero", is the thread winner.
How dumb do you need to be not to look at this graph and suspect that 1968 was chosen as the starting point because it was an upward spike?
Probably as dumb as most people that would go to that site and see the graph, I think. Classic confirmation bias with the readers, perhaps even with the author(s) and publisher of the graph itself? I can easily imagine an earnest young progressive blogger doing some cursory research, seizing on some seemingly favorable data and not consciously realizing they were cooking the books. Statistics is fun but tricky.
Here's what I think: Let the job market itself determine wages and salaries
tim in vermont said...
Pretending that an unfettered free market would go out and hand hundreds of thousands of dollars to people who had no way to pay it back without government interference is worse than delusional, it is plain stupid.
No shortage of asset bubbles in the past.
If the government's implicit guarantee of the largest banks is a major problem, which I agree it is, then shouldn't Republicans be pushing to break up these banks as fast as possible?
This analysis by the Federal Reserve should demolish the argument that the CRA had anything to do with the explosion of hallucinogenic mortgage lending. But it won't.
garage mahal said...
This analysis by the Federal Reserve should demolish the argument that the CRA had anything to do with the explosion of hallucinogenic mortgage lending. But it won't.
The general concept that those members of society with access to the least amount of capital caused the collapse of the major financial entities of the world's largest capitalist economy is so stupid that further analysis is unnecessary.
garage said...
Yup. And don't forget Benghazi.
What garage is saying is that Obama is the Teflon President and nothing really affects him.
garage... regardless of the CRA loans were being sold to people that couldn't pay them. What to do about it?
garage... Wal Mart made $6 billion in profit last year. Apple made $40 billion.
Re ILLEGAL IMMIGRANTS and the driving of wages downward:
30 years ago a good chunk of the people with whom I went to high school and thei families made good wages -- some of them union even -- by working in construction. I've known people from all types: heavy equipment, surveying, drywall, commercial painting, residential construction, pools, concrete, plaster, roofing, lumber sales and service.
Many of those jobs were physical and most depended on an expanding economy. However, present day every job I listed above is dominated now by low-wage illegal immigrant labor. You can't find an American who does carpentry or roofing or drywall or painting. The open-borders crowd got their way and the governments (state and Fed) ignored the influx of "willing to work for less" workers who drove all the tax-paying American citizens out of those lucrative trades. The unions didn't do squat to stave off this tide of illegal scabs. The result is that jobs that were "prevailing wage" (and if you know contracting or construction you'll know that term) in the main are now close to if not minimum wage jobs. I don't blame the Mexicans. I would have done the same thin g to feed myself and my family. But government "policy" that went expressly against the letter of the law is what created this shitty situation.
The current occupant of the Whitehouse is just more lawless and cavalier about the damage than most. And Republicans (the voters) are overwhelmingly against amnesty again. It is to the GOP's detriment that they ignore this cohort and hand us over in toto to the Tea Party. 'Cause the GOP ain't listening to them that brought 'em there. They are listening (as Cook says) to Wall Street and the Big Business.
Mike said...
The result is that jobs that were "prevailing wage" (and if you know contracting or construction you'll know that term) in the main are now close to if not minimum wage jobs. I don't blame the Mexicans. I would have done the same thin g to feed myself and my family. But government "policy" that went expressly against the letter of the law is what created this shitty situation.
So employers were entirely blameless in this situation? Such a one-sided analysis cannot be taken seriously.
"If illegal immigration doesn't make any difference to corporations, why should we tolerate it?"
I didn't say it makes no difference; I say it makes only a nominal difference.
My guess is most illegal aliens are working for small businesses rather than for the big corporations. The calamitous job losses in America are not largely due to jobs taken by illegal immigrants, but by the offshoring and elimination of jobs by the multinational corporations.
Let me ask you ARM:
Are employers who now do NOT comply with Obamacare, as the written law says to, to blame? What if they are acting on the expressed sentiment of our lawless president that he has unilaterally delayed the law a year? Is it delayed? What is the right answer?
In good faith I'll answer you: Of course they share blame. But if all your competitors have cheaper labor than you, your construction business won't last long. If the law looks away then they are encouraging this behavior. Ultimately the blame is on our ruling class.
Someone upthread made mention of Hollywood's many tax breaks. My apologies for being too lazy to find it and the time it was posted.
I, for one, would love to read what the followers of this blog have to say about the practice of Hollywood accounting:
http://www.techdirt.com/articles/20121018/01054720744/hollywood-accounting-how-19-million-movie-makes-150-million-still-isnt-profitable.shtml
Anyone with two brain cells should pick up on the astounding hypocrisy of the Hollywood elite: liberal actors preaching lefty redistribution, all the while working in a corrupt system where a smaller and smaller number of actors receive an ever larger piece of the pie; a system where accounting tricks hide as much profit as possible to avoid taxes.
I refer you to a documentary called "That Guy...Who Was in That Thing" - a film that profiles the ups and downs of being a character actor: http://www.imdb.com/title/tt2402200/?ref_=ttpl_pl_tt
Apparently, a character actor could make a decent living a few decades ago. However, the Hollywood pay structure is beginning to resemble the US as a whole: the middle is gone, while a greater and greater share of Hollywood salaries go to a handful of box office draws. A small, elite group of actors is hogging all the resources, leaving crumbs for the rest. Yet these box office draws are trotted out in front of the media, over and over, to shill for the Democrats and their various "fix inequality" schemes.
If there a better example of stunning hypocrisy, I'd like to see it.
Mike said...
Ultimately the blame is on our ruling class.
I think you are confused over who that ruling class is.
Politicians can and are bought and sold like so many pork futures.
The general concept that those members of society with access to the least amount of capital caused the collapse of the major financial entities of the world's largest capitalist economy is so stupid that further analysis is unnecessary.
This statement is so utterly stupid on so many levels, the first being that nobody has said such a thing, that I cannot summon the will to respond.
Not the first idiot who has presented this gigantic strawman argument, and probably, not the last.
Those citizens with the least amount of access to capital were given "liar loans" that required no income verification. (Hell the radio practically sung with all the "no verification needed" loan commercials!) And yet the impetus for all this stupid activity, the CRA and the coercion of banks to "make those loans" underwritten by Fan and Fred, is unworthy of blame by our resident socialist radicals? Who'd have thunk it?
Democrats are constantly promoting how they are giving away FREE STUFF! Forcing private for profit businesses to give employees higher wages than they merit is the ultimate Liberal dream campaign. Evil businesses are being forced to give some of their ill gotten profits made on the backs of their minimum wage employees slaving away at hard demeaning jobs. Punishes profits, business, the wealthy and capitalism benefits the poor innocent victims of capitalism. And it's free, since money taking money from wealthy businesses is a good thing.
He who makes the rules is the ruling class, don't you know ARM? Doesn't matter who sponsors them today or tomorrow, only that they hold onto the rule-making power.
Market forces are the opposite of crony capitalism, not an expression of it. You seem to have trouble with that concept.
AReasonableMan said...
The US is an expensive place to live compared to Bangladesh.
WOW!
People, people! The Pope has already explained that "The current financial crisis... originated in a profound human crisis: the denial of the primacy of the human person!" Why are you all going on about this economics and regulation stuff?
Fewer, but better paying jobs, or more, but not necessarily good paying jobs? Pros and cons to both sides, you just have to bite the bullet and make a decision.
I don't see the "pro" side for better paying but fewer jobs. Having people supporting themselves is a good thing independent of the actual money involved.
My guess is most illegal aliens are working for small businesses rather than for the big corporations. The calamitous job losses in America are not largely due to jobs taken by illegal immigrants, but by the offshoring and elimination of jobs by the multinational corporations.
It's just a guess, though. I doubt it's true. The supply/demand curve isn't a linear equation - remove eleven million people from the bottom of the job market and you may see a dramatic positive change in the lengths employers are willing to go to find and retain employees.
It's all academic, of course. The large corporations and the race lobbies have enough clout to ensure the entry of fresh waves of illegals until poor people in the US are no better off than their counterparts in Rio or Caracas.
Robert Cook: As to your last post, I think you slightly miss the point: the loss of good-paying jobs here is far less due to illegal immigrants taking away domestic jobs and far more to do with the transfer of those jobs overseas...or their simple elimination due to automation.
"Far less". "Far more". As you admit below, you're "guessing" that illegal immigration is simply a negligible factor. Why? The fact is that all of these things contribute to the economic woes of working-class Americans. Who exactly are you addressing here that doesn't understand that there are multiple factors contributing to the employment problems in this country? Ah yes, "those who agitate against the presumed unwashed hordes". Yes, I'm sure that's just about the level of Michelle's understanding, Robert.
The expulsion of all illegal immigrants from our land would not result in a plethora of good jobs for Americans.
It would most certainly improve the wages and job opportunities of a lot of Americans who used to work in sectors that have been taken over by illegals in many parts of the country, regardless of how many jobs have been lost due to other factors.
You really have no idea what you're talking about here, but it's a lovely illustration of how prior ideological commitment can make people so stupid about simple and obvious things.
Follow the money and you will see clearly. Most union contracts contain a clause that grants them automatic increases if the Federal minimum wage increases.
Follow the money and you will see clearly. Most union contracts contain a clause that grants them automatic increases if the Federal minimum wage increases.
'68 is pretty good starting point. Until that time, the minimum wage had been indexed to productivity, after, inflation. If we had continued to tie it to productivity, the minimum wage would now be between $16 and $21 per hour, depending on your measure of productivity.
you're obviously fortunate enough financially to not have to worry about the prevailing minimum wage. For many of your fellow working Americans it is urgently important.
Raise it. Unemployment goes up. Inflation goes up.
Raise it a little, it goes up a little. Raise it a lot, it goes up a lot.
What drives me up the wall is not the liberal urge to help the poor. What drives me up the wall is the liberal incompetence, the inability to understand economics, the simple-minded stupidity of thinking you can pass a law and make people wealthier, the inability to think critically or see any negatives in your urge to control economies.
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