Minimum Wage

Sorry I was too busy being awesome...

What did I miss in the last 4 pages?

Saw something about the devil rq when I tried to back read.

The Devil went down to Georgia. He was lookin' for a soul to steal.
He was in a bind 'cause he was way behind. He was willing to make a deal
When he came across this young man sawin' on a fiddle and playin' it hot.
And the Devil jumped upon a hickory stump and said "Boy, let me tell you what."

"I guess you didn't know it, but I'm a fiddle player, too.
And if you'd care to take a dare I'll make a bet with you.
Now you play a pretty good fiddle, boy, but give the Devil his due.
I'll bet a fiddle of gold against your soul 'cause I think I'm better than you."

The boy said, "My name's Johnny, and it might be a sin,
But I'll take your bet; and you're gonna regret 'cause I'm the best there's ever been."

Johnny, rosin up your bow and play your fiddle hard.
'Cause Hell's broke loose in Georgia and the Devil deals it hard.
And if you win you get this shiny fiddle made of gold,
But if you lose the devil gets your soul.

The Devil opened up his case and he said, "I'll start this show."
And fire flew from his fingertips as he rosined up his bow.
And he pulled the bow across the strings and it made an evil hiss.
And a band of demons joined in and it sounded something like this.

When the Devil finished, Johnny said, "Well, you're pretty good ol' son,
But sit down in that chair right there and let me show you how it's done."

"Fire on the Mountain." Run, boys, run!
The Devil's in the house of the rising sun;
Chicken's in the bread pan picking out dough.
Granny, does your dog bite? No, child, no.

The Devil bowed his head because he knew that he'd been beat.
And he laid that golden fiddle on the ground at Johnny's feet.
Johnny said, "Devil, just come on back if you ever wanna try again,
I done told you once—you son of a ***—I'm the best that's ever been."
And he played:

"Fire on the Mountain." Run, boys, run!
The Devil's in the house of the rising sun;
The chicken's in the bread pan picking out dough.
Granny, will your dog bite? No, child, no.

Sorry I was too busy being awesome...

What did I miss in the last 4 pages?

Saw something about the devil rq when I tried to back read.

You know what this thread needs:

We’ve the news that Target is going to raise wages for everyone to a minimum of $9 an hour. Obviously this is being driven by the way that Walmart and TJMaxx have recently announced that they’re going to have starting wages of well above the current minimum wage. Plus, of course, the fact that the whole labor market is tightening and people are just having to pay higher wages to get the labor they want. Or, as we might realistically put it, the labor market is working. We could therefore simply state that no more discussion about the minimum wage is needed. Hey, wages are going up without everyone having a screaming catfight in Congress so why not just let wages go up without a screaming catfight in Congress? Sadly, that would betray the point and purpose of politics, which is to have catfights so that Very Important People can be seen to be doing something so that they will get voted for.

The clear and obvious truth is that the correct level for a minimum wage, a legal one that is, is zero dollars per hour. After all, there are plenty of people who do work for that sum and are entirely happy doing so (the other name we have for this is “volunteering” and yes, it really does happen). Further, if we didn’t actually have a minimum wage then it’s very difficult indeed to work out how we’d ever have any unemployment. We’d still need to have a welfare system, of course we would, in order to top up the incomes of whoever it is that we think isn’t earning enough to provide what we consider to be a decent lifestyle but it would be a much simpler system without that block of a minimum wage preventing those who want to work from being able to find work. However, I think we all know that that’s not going to happen even if it should. Which brings us to two very interesting things being said about that Target $9 an hour announcement:

‘Fixating on some single number to us, on an average number is unimportant. It’s about being competitive locally at a store level within a marketplace,’ he said. He also noted that Target already paid more than $9 per hour in places where wages were high, like New York and North Dakota.

So why is Target changing its tune? The decisions of Walmart and T.J. Maxx to set their own national minimums may have forced the company’s hand.

But Mulligan’s broader point was absolutely right, and it applies not only to Target but also to how we think about minimum wage laws nationwide. It doesn’t make sense to set a uniform minimum wage across the country, and then hope state and local governments raise them as needed. It would make more sense to have a federal system in which the local minimum wage in each area is more connected to local economic conditions.

Strangely, however excited Vox gets about that as an argument in favor of a minimum wage it’s actually an argument against one. For Target obviously gets the point that it’s going to have to pay whatever it takes to get the labor that it wants. That necessary rate being something that Target’s local boots on the ground management can work out a great deal better than any Congresscritters, or even some lower level fool in the State Capitol. But again, that’s not an argument that’s going to get accepted and we must approach public policy from the point of view of what people generally believe is true rather than what is actually true. Yes, even though there may be a wide chasm between the two.

Which brings us to this mentioned in that piece at Vox:

But just hoping cities and states raise their minimums on their own isn’t a great policy. Minimum-wage laws can get tied up in prolonged political fights in state legislatures, meaning minimum wages end up reflecting state and local politics, not state and local economies, as University of Massachusetts-Amherst economist Arindrajit Dube wrote in a 2014 paper.

As economist Jared Bernstein wrote last year, Dube’s way is a better way: Dube proposed that state and local minimum wages be based at half the local median wage, a level he says is consistent with the US minimum wages of the 1960s and 1970s, as well as with standards in advanced economies.

That paper is here. Bernstein is of course wrong. That shouldn’t actually need to be said, only the manner in which he is so changing from subject to subject. Here, there’s absolutely no reason at all why the minimum wage today should have any connection at all to either where it was decades ago nor to what it is in other countries. What we want to know is what is the rate at which it does the least harm we can engineer while still putting the issue to bed once and for all? And believe me Bernstein really would be whining in a decade’s time if it really was just indexed to inflation and then left alone. For it would then become ever more detached from the median wage itself for it is true that, over the decades, wages rise faster than inflation. That’s why we’re richer than our grandparents.

However, Dube’s proposal does have merit if we make just a couple of small changes. As I’ve said around here many a time we know that a minimum wage which is “too high” causes significant unemployment effects. We also know that a “low” one has near trivial effects in every dimension. The reason being that just about no one gets paid a low percentage of the median wage. The difficulty is defining what is low or too high. And the best evidence we’ve got, which to be fair isn’t actually all that good, is that the significant unemployment effects happen when the minimum is 45-50% of median. So, I would set it at 45%, where we think those bad effects start, not the 50% that Dube uses where they really start to bite.

Secondly, in that paper Dube seems to be using “median full time wage” which is subtly different from “median hourly wage.” The second will be lower. For the joint reasons that part timers generally get paid less per hour than full timers yet some significant number of hourly paid and minimum wage workers are part time. We should therefore be using median hourly wage, not a pro rata working of median full time wage. This will drop his estimated wage numbers a bit.

The one major change that we need to make is that the minimum wage is not equally binding upon all labor market participants. It binds most harshly, of course, on the young and untrained. And even more so upon those who are discriminated against for any other reason: those of unfavored ethnicities perhaps, those coming out of prison or those who have been subjected to the appalling inner city education systems. All of these people need a distinctly lower than the general minimum wage rate to get them priced back into the labor market. So, in common with many of the European countries Dube talks about there should be a lower youth minimum wage. From memory, my native UK has as many as four different rates. 16-18, 18-21, an apprenticeship rate and the general adult one. It is only that adult one that is up around the levels of the US minimum wage.

By now of course I’ve annoyed everyone. Those to the right of me (OK, I’m so free market that there’s not many of them, so, say those 49% of the population between me and the center) are outraged that there’s still going to be a minimum wage and everyone further left is apoplectic that it’s not going to be very much higher than it is now. And, for the young, lower than it is now. But I still think that it’s probably the best deal we’re going to be able to cobble together. A minimum wage that is at 45% of local median hourly wages, with a lower rate for the young, upgraded each year as the median wage calculations are done. Not that this is going to happen of course, but I do think it’s about the best that we could do, given what everyone already believes.

Some states habitually wait for the federal minimum to be raise before even discussion raising their state minimums. Idaho is notoriously at the federal minimum. And, while cost of living here is much lower than most places, $5.35/hr or whatever it is now, is less than half of a living wage for a single person with a roommate. I was making nearly 7 times that and my wife still had to work for us to have a house, cars, insurance, savings, etc. I don't think fast food should be a living wage for a family at all, but when you can make 2-3 times the minimum wage panhandling, there is something very wrong with the goalposts.

Doesn't matter, period.

If the residents of a state / city / county want to raise the minimum wage then they can do so without any interference from the federal government.

Your argument is extremely illogical as you assume residents have no agency and that you, ohh so wise and grand you, know what is best for them and will give it to them regardless of how they feel about it. The residents of Idaho have 100% control over the laws of Idaho, they have far less control over the laws that govern the entire country. Liberals always want to force their own rules down everyone's throats whether they want them or not. The residents of California should not be deciding the laws nor wage of Texas just as the residents of Texas shouldn't be deciding the laws of wages of California.

Federal minimum wage is dumb because each state has a different economy, and many times each county / parish can have a different economy. The minimum wage for Seattle will be different then San Diego which will be different then New York or some small town in Missouri.

Local minimum wages on the other hand are perfectly fine since it's local government aimed at local residents and local business's. If the amount is too high for the local economy to support then there will be a very noticeable effect and it will be reascended by those same voters it applies to. If it has a positive effect it will be on those same voters.

Your argument is extremely illogical as you assume residents have no agency and that you, ohh so wise and grand you, know what is best for them and will give it to them regardless of how they feel about it. The residents of Idaho have 100% control over the laws of Idaho, they have far less control over the laws that govern the entire country. Liberals always want to force their own rules down everyone's throats whether they want them or not. The residents of California should not be deciding the laws nor wage of Texas just as the residents of Texas shouldn't be deciding the laws of wages of California.

What point are you making, exactly?

I get that state government is more effective. Indeed, about 1/3 of the states have a higher-than-federal minimum wage and they represent FAR more than 1/3 of the US population, so there's a conclusion to be drawn from that. But we have a federal government and, again, if a basic majority of the US population has a higher-than-federal minimum, whether there is a federal minimum seems slightly irrelevant.

Unless you're advocating for a dissolution of the American Empire into ~54 separate states (in the real sense of the word), possibly arranged in an EU-type system. Which I wouldn't necessary decry, but I don't think this would be the right place to talk about why our current nation system is ridiculous.

This is kind of silly in this day and age though. Between online shopping and a greater ability to travel around the country/world, living somewhere where the local economy or the state is at the bottom of the chain hampers you pretty harshly.

I grew up in KY, and while they've always been above the minimum they weren't far above it. Those first few steps and life experiences elsewhere in the world were a hard pill to swallow when you'd go to get food, buy a car, rent a home, etc, and your wage was no where near an amount to cover those costs. I distinctively remember attending some management training that was out of state for McDonalds when I was 18. Personal expenses beyond travel weren't covered, yet a single real meal took nearly 50% of my daily earnings. We've become a more connected world, I don't think wages following a similar pattern would be an overall bad thing in the long run.

The problem with 'minimum wage doesnt mean anything to those that make more than min wage' is ludicrous. What if min wage is 8 bucks and I make 10 bucks. Min wage is then set to go up to 10 bucks. Does that mean I now make 12 bucks? Negative it means I continue making 10 bucks.

Also, every time minimum wage is increased, there's an increase in wages for everyone exactly because employees who are making more than the minimum are valued above the minimum.

If you're making over the minimum wage and the minimum goes up, you still get paid the same. To think otherwise is daydreaming. Unless your new pay is under the new minimum, then congratulations, you in the same boat as everyone else now.

The problem isn't that these jobs pay too little, it's that these jobs shouldn't be counted on to earn a living at all.

What about the people in the middle?