The Minimum Wage

Making an independent "megathread" for the topic, as it comes up quite routinely; it'd be nice to have a thread in which we can simply say, "go there, read through it and you can get a good grasping of the arguments". Ideally, news topics regarding the minimum wage can go here, too.

So, with that, I shall presume that we are all aware of what the minimum wage is. Thus, I say this: are you for or against it? Whether you are or are not, why do you think this?

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I'm in favour of it because every argument I've heard about introducing it such as "Lol Inflation" or "Lol Unemployment" don't hold any water.

In favor, but not in favor of tying it to be a "living wage". (That is a fool's chase.)

There's only two arguments. Inflation or unemployment. No statistical evidence shows that relationship to be true at all, so I see no reason why we should condemn the working class to lower wages for no reason.

It's not the best tool but it is a tool to spread wages more favourably to the under-powered (the working class which typically have no unions or anything). Generally speaking, it'd be best if you had a super AI be able to determine everyone's wage according to the value they add to a company, most people would be making far more than minimum. Well maybe not that much more but probably more.

edited 28th Dec '11 11:20:26 AM by breadloaf

Arguments against it seem to be based mostly on the idea that, in order to be competitive in a global market, we need to lower our standards to that of third world countries. I believe it should be the other way around - we should strive to raise other countries up, not sink to their level. Even if we manage to create more jobs by dropping such bare minimum standards, what good is a job if it doesn't pay you enough to live a comfortable life?

And once that's brought up, discussion usually drifts to 'But any and all work is inherently character-building, so more work > less work, regardless of the quality of the work.' Which I strongly disagree with as a baseline philosophical concept.

Well there are theoretical points where it might hold water, to be honest. The value of labor in and of itself could be so low that raising the minimum wage would make costs rise above prices, and as such force either price increases or for businesses to shut down (who couldn't increase their prices for whatever reason)

The question is how common is this. To be more precise, is the gain from additional demand caused by increased wages higher than the loss from the jobs which are no longer viable. In most cases, the answer is a clear yes.

The second part of it, is that if people have more money, then they're willing and able to spend more on goods and services..ergo inflation..if true, this is an issue to be fought not via economic or government policy, but via social and cultural change, in terms of teaching people to respect the value of a dollar.

To further Karmakin's point about jobs you don't want to have, the argument about competing with other countries is basically worthless. If Slavelandia introduced slavery and paid people nothing and just whipped them to death, do we compete by introducing gulags? It's not a sensible argument to say that other people are earning less therefore our people should suffer just as much.

I don't think a First World nation has the right to abolish a minimum wage altogether.

That said, there's a limit to how much it will help to raise the thing. If you raise minimum wage high enough, companies can't or won't do business, and won't employ people at all.

I'm not an economist. I don't know what the best number is. It's probably somewhat arbitrary, though.

Well, it's probably something you can determine, it's just insanely complicated and possibly realistically impossible.

It's probably much better/easier to slowly raise it over time and watch the effects.

Yes, a higher minimum wage that people can actually survive on would be good. We need to stop screwing over the lower classes for the benefit of the rich, which is exactly what eradicating/lowering the minimum wage does.

I am of course in favor of a minimum wage, but I am curious as to why the minimum wage should not be a living wage.

I would have two categories of minimum wage: adult, which is the minimum wage for adults, and cannot be paid less, and adolescent, which is the absolute minimum wage and is only for people age 14 to 18, meant to give work experience more than money. A adolescent can apply to be eligible only for the adult wage under extenuating circumstances,such as family hardship.

The concept of a minimum wage is silly. The proletariat will always be paid exactly enough to survive in their society, no more, no less, except in a failing state.

The explosion of pay day lenders suggest that isn't true.

The explosion of pay day lenders also suggests that encouraging a pure demand state is also not the best idea.

That's just an irresponsible use of money. Telling people that they can have however much money they want at any given moment will result in them taking it. That's why so many people's lives have been ruined by credit cards, poor or no.

edited 28th Dec '11 11:38:36 AM by TheEarthSheep

Irresponsible use of money?

You better be trolling son, I volunteer at a credit union and I can say that most people who use a credit union aren't irresponsible, they are just desperate because they've been hit by a bill they can't afford to pay.

And yet the majority of Pay day loans is for Conspicuous Consumption items like plasma TV's.

Do you have a source for that Major Tom

Going into debt is rarely a good idea. If you don't have a concrete and absolute source of money to pay it off very quickly, you run some serious risks. *

And it isn't, a lot of the time. Countless people's lives have been ruined by that kind of business.

Edit: I mean, of course there are exceptions, for example medical bills, but taking an advance on a paycheck so you can afford, say, a repair job for your car, or food that you don't need, is irresponsible. You should usually wait to spend money until after you've earned it.

edited 28th Dec '11 11:47:02 AM by TheEarthSheep

Of course there should be a minimum wage. Why should people work and be paid barely anything? Abolishing it would only serve to make people who are already badly off worse off.

You couldn't raise it too high, I acknowledge that. But it should still be there, and it should stay above a certain level.

edited 28th Dec '11 11:54:39 AM by ArlaGrey

Except that people tend to need repaired cars to get to work to earn that paycheck.

Whoa Whoa Whoa!

A repair job on your car is NOT the same thing as buying a new flat-screen TV. In a lot of cases (maybe this shouldn't be the case, but well..better urban planning/mass transit ftw) it's an investment that allows you to get to your place of work in order to make more money.

For what it's worth, I actually think that Tom is right on that, not all the way of course...but enough. We are too materialistic as a society. Of course, this is something that generally speaking comes from the moderate to right portions of our society, with the "far left" being pretty much the only real vocal opposition to materialism. Hell, Occupy Wall Street was brought together by Adbusters. Fighting materialism is WHAT THEY DO.

Well, it's good to see that apparently Earth Sheep is all for the expansion of public transport. Wouldn't have thought that from him

Businesses compete for employees. Say you have three businesses for a population of twenty-five people. Each business employs five people. At this point, they can pay whatever they want, there will always be poor, desperate people willing to take the job. So with very little labor cost, the businesses' profits explode. Other businessmen elsewhere look and say, "Hey, the businesses there rock! I'll build one there!". So, three more businesses are established. But wait! Now the businesses require more employees than exist! So they have to compete with pay to get the employees, who now get paid well. Laissez faire, bitches.

You can take the bus for a week, it's not that big of a deal. If it's a choice between going into unnecessary debt and rubbing shoulders with someone you don't know, it's clear which one is irresponsible.

Public transport kicks ass, man. Just because I'm conservative doesn't mean I drive a Hummer.

edited 28th Dec '11 12:02:19 PM by TheEarthSheep

@Kara, do you have any stats that say most people who use payday loans with kneecappingly high interest aren't using it for essentials?