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On August 06 2013 10:26 Sub40APM wrote:Show nested quote +On August 06 2013 06:31 Rassy wrote:On August 06 2013 04:24 DoubleReed wrote:On August 06 2013 03:08 Rassy wrote:
No they are not normalising it, this guy is in the most far right wing of republicans.
This is no senator or even a congresman,its a nobody even in the republican party.
You are verry biased in presenting this as "The Republican Party continues to normalize the extreme elements of their party and make it more mainstream"
Annyway his message is quiet alarming, what if he is right?
The collapse of the american economy is predicted every year by manny conspiracy believers and doomdenkers but lately it seems to pop up more frequent,even though the economy slowly improves. Ted Cruz, Steve King, in my state we have EW Jackson (not to mention our whacked out state legislature). Rand Paul is a hopeful for 2016 and is also a neo-confederate. Rick Perry is far to the right than W ever was. And that's off the top of my head. This guy is actually a top Republican in Washington State legislature. I don't know why you think only federal "matters." And I think it's hilarious how you end your post going off the deep end and taking conspiracy theories seriously. And the rise in frequency is important because of how extreme one end of the politics is becoming. They are very much giving more voice to the extreme elements of their party. Of course people are going to freak out more. Therefor i see the usa economy as beeing alot more vulnarable and dependable on the world economies then it used to be, the current improvement in the economy has been possible largely due to the 85b a month wich the fed pumped into it. Besides europe china is also of great importance but by the looks of it now i dont think we can expect to much from china, the growth sleems to slow down quiet strongly there in the past few months wich will probably continue into 2014, specially if growth in europe and the usa wont pick up. So:it can go either way lol, i am leaning towards beeing positive but there are still a few big hurdles along the way. Have to quible with you here, how can a country that has a structural trade deficit with the rest of the world be more depended on the world economy?
If there is more demand for usa products from oversees,due to improving economys there then thats good for the usa economy and the trade deficit can lower. If oversees economys are verry weak and their demand for usa products lowers then that is bad for the usa economy and the trade deficit will increase.
There will still be a deficit (wich is balanced by the oversees economys buying usa bunds,thereby sending the monney back to the usa) but one situation is clearly better for the usa then the other.
If oversees bund buying is reaching its limits then it will be important for the usa to lower or at least stabelise their trade deficit to keep a balance between the dollars going out and the dollars going in, the balance is important else the usa economy will simply bleed dry.One cant keep printing dollars forever to make up for this.
The closer oversees bund buying gets to its limits, the more dependant the usa becomes on oversees demand to reduce or at least stabelise the trade deficit, keep a balance between the dollars going in and the dollars going out, and prevent interest rates from going up to strongly.
Its kinda interesting how things changed in the past 25 years btw, in 1987 the most important economic data for the financial markets was the monthly usa trade deficit, a sudden rise in the deficit was even one of the triggers for the crash in 1987. Now this figure is barely even looked at and the most important figures are the chicago pmi and the weekly jobless claims.
From 1980 up to 2000 the usa economy got ahead of the world economy, mostly due to the internet and computer revolution in wich the usa was leading,this kept the usa domestic demand the most important thing for the usa economy. Now the rest of the world is catching up and the situation is slowly reversing making exports and a more balanced trade account more important again,Thats a bit how i see it.
Scale gas and oil are a new revolution wich could keep the usa ahead but i am a bit sceptical about that.
Well:maybe a bit vague but this is how i see it. Check with your economy teacher to see what he thinks about it and let me know
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On August 06 2013 12:11 JonnyBNoHo wrote:Show nested quote +On August 06 2013 11:52 DoubleReed wrote:On August 06 2013 11:22 JonnyBNoHo wrote:On August 06 2013 10:01 DoubleReed wrote:On August 06 2013 09:22 JonnyBNoHo wrote:On August 06 2013 09:16 Gorsameth wrote:On August 06 2013 07:41 JonnyBNoHo wrote:Apparently there's a new paper out on minimum wages. Is the main effect of the minimum wage on job growth?
by Tyler Cowen
In their new paper, Jonathan Meer and Jeremy West report:
"The voluminous literature on minimum wages offers little consensus on the extent to which a wage floor impacts employment. For both theoretical and econometric reasons, we argue that the effect of the minimum wage should be more apparent in new employment growth than in employment levels. In addition, we conduct a simulation showing that the common practice of including state-specific time trends will attenuate the measured effects of the minimum wage on employment if the true effect is in fact on the rate of job growth. Using a long state-year panel on the population of private-sector employers in the United States, we find that the minimum wage reduces net job growth, primarily through its effect on job creation by expanding establishments."
In a slightly different terminology, the effect of the minimum wage may well be attenuated in the short run, but over longer time horizons there is a “great reset” against low-skilled labor. Link to blog.Link to paper. What is this even... Minimum wage isn't there to encourage or discourage job growth. Its there to ensure people can live off the work they do. Its there to prevent people from being exploited, especially in job area's with a surplus of workers like low skilled labor. A lot of people on the left claim that raising minimum wages doesn't affect employment. I've seen evidence both ways (although if it affects unemployment at all seems to be pretty suspect). But remember that we have skyrocketing profits and a corporate hoarding problem. We also have been hit with a massive recession, which is going to dramatically reduce demand. The idea is that putting more money into people's pockets (especially with people's massive debt) will increase demand, and therefore allow corporations to actually expand. If you only look at things supply-side, then people just say that it increases unemployment. I think there's a strong tendency for people, especially conservatives, to only look at everything as supply-side. As if corporations benevolently grant us things, rather than make cost-benefit analyses. But in reality, corporations don't expand if there's no demand to expand. Business investment is one of the most volatile major components in the economy. So if everything goes as you see it, there are very few economic gains from raising the minimum wage (most is eaten up by subsidy losses). If everything goes as supply siders see it, there will be a much larger loss to the economy. Businesses can and do expand without an increase in aggregate demand. They won't expand if the expansion isn't profitable though, regardless of demand. That's a weird thing to say. It sounds like you're hedging your bets (like "well I believe this because it has worse consequences than the other"). That's a bad mentality. That's the kind of mentality that gets scammed. Like a Pascal's Wager kind of thing. Whatever is true is true regardless of other possibilities' consequences. Honestly, it doesn't seem to have much of an effect at all directly on unemployment. Other factors seem to dominate it by quite a lot. Such as the continuing slash to public sector spending. Hedging my bet on a topic that isn't 100% settled fact is pretty wise in my book But anyways, why take the risk at all? Democrats (and liberals in general) could either wait for the economy to be stronger and then push to raise the minimum wage, or scrap the idea entirely and push for higher wage subsides.
You act like having a low minimum wage has absolutely no cost to real people. And aren't "wage subsidies" a much weaker idea in general? Doesn't that fuck up incentives way more than the minimum wage? Isn't that basically socializing the cost of labor while still privatizing profits?
But you do understand why "hedging your bets" will drastically favor the status quo, right? "Who knows what the effects of gay marriage will be. Let's not risk it." or "campaign finance reform could possibly make corruption worse! Let's not risk it." etc. etc. Doing things can always have the possibility of negative consequences. I doubt you consider any of these convincing for doing nothing.
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On August 06 2013 15:36 aksfjh wrote:Show nested quote +On August 06 2013 12:11 JonnyBNoHo wrote:On August 06 2013 11:52 DoubleReed wrote:On August 06 2013 11:22 JonnyBNoHo wrote:On August 06 2013 10:01 DoubleReed wrote:On August 06 2013 09:22 JonnyBNoHo wrote:On August 06 2013 09:16 Gorsameth wrote:On August 06 2013 07:41 JonnyBNoHo wrote:Apparently there's a new paper out on minimum wages. Is the main effect of the minimum wage on job growth?
by Tyler Cowen
In their new paper, Jonathan Meer and Jeremy West report:
"The voluminous literature on minimum wages offers little consensus on the extent to which a wage floor impacts employment. For both theoretical and econometric reasons, we argue that the effect of the minimum wage should be more apparent in new employment growth than in employment levels. In addition, we conduct a simulation showing that the common practice of including state-specific time trends will attenuate the measured effects of the minimum wage on employment if the true effect is in fact on the rate of job growth. Using a long state-year panel on the population of private-sector employers in the United States, we find that the minimum wage reduces net job growth, primarily through its effect on job creation by expanding establishments."
In a slightly different terminology, the effect of the minimum wage may well be attenuated in the short run, but over longer time horizons there is a “great reset” against low-skilled labor. Link to blog.Link to paper. What is this even... Minimum wage isn't there to encourage or discourage job growth. Its there to ensure people can live off the work they do. Its there to prevent people from being exploited, especially in job area's with a surplus of workers like low skilled labor. A lot of people on the left claim that raising minimum wages doesn't affect employment. I've seen evidence both ways (although if it affects unemployment at all seems to be pretty suspect). But remember that we have skyrocketing profits and a corporate hoarding problem. We also have been hit with a massive recession, which is going to dramatically reduce demand. The idea is that putting more money into people's pockets (especially with people's massive debt) will increase demand, and therefore allow corporations to actually expand. If you only look at things supply-side, then people just say that it increases unemployment. I think there's a strong tendency for people, especially conservatives, to only look at everything as supply-side. As if corporations benevolently grant us things, rather than make cost-benefit analyses. But in reality, corporations don't expand if there's no demand to expand. Business investment is one of the most volatile major components in the economy. So if everything goes as you see it, there are very few economic gains from raising the minimum wage (most is eaten up by subsidy losses). If everything goes as supply siders see it, there will be a much larger loss to the economy. Businesses can and do expand without an increase in aggregate demand. They won't expand if the expansion isn't profitable though, regardless of demand. That's a weird thing to say. It sounds like you're hedging your bets (like "well I believe this because it has worse consequences than the other"). That's a bad mentality. That's the kind of mentality that gets scammed. Like a Pascal's Wager kind of thing. Whatever is true is true regardless of other possibilities' consequences. Honestly, it doesn't seem to have much of an effect at all directly on unemployment. Other factors seem to dominate it by quite a lot. Such as the continuing slash to public sector spending. Hedging my bet on a topic that isn't 100% settled fact is pretty wise in my book But anyways, why take the risk at all? Democrats (and liberals in general) could either wait for the economy to be stronger and then push to raise the minimum wage, or scrap the idea entirely and push for higher wage subsides. Because if you believe our problem is demand side, then a solution would be to increase the disposable income of those most likely to spend it. You're right that subsidies could do this as well, but then you start messing with Ricardian Equivalence arguments. A straight increase to minimum wage cuts that out and mainly targets firms that overly rely on paying workers as little as possible.
If you want to increase demand I don't see how raising the min wage will do that. A big chunk will go to the government in taxes and lost transfers. More will be lost due to a reduction in hours / employment. On the flip side, the business will likely change their spending, potentially to a greater degree than the worker.
On August 06 2013 21:26 DoubleReed wrote:Show nested quote +On August 06 2013 12:11 JonnyBNoHo wrote:On August 06 2013 11:52 DoubleReed wrote:On August 06 2013 11:22 JonnyBNoHo wrote:On August 06 2013 10:01 DoubleReed wrote:On August 06 2013 09:22 JonnyBNoHo wrote:On August 06 2013 09:16 Gorsameth wrote:On August 06 2013 07:41 JonnyBNoHo wrote:Apparently there's a new paper out on minimum wages. Is the main effect of the minimum wage on job growth?
by Tyler Cowen
In their new paper, Jonathan Meer and Jeremy West report:
"The voluminous literature on minimum wages offers little consensus on the extent to which a wage floor impacts employment. For both theoretical and econometric reasons, we argue that the effect of the minimum wage should be more apparent in new employment growth than in employment levels. In addition, we conduct a simulation showing that the common practice of including state-specific time trends will attenuate the measured effects of the minimum wage on employment if the true effect is in fact on the rate of job growth. Using a long state-year panel on the population of private-sector employers in the United States, we find that the minimum wage reduces net job growth, primarily through its effect on job creation by expanding establishments."
In a slightly different terminology, the effect of the minimum wage may well be attenuated in the short run, but over longer time horizons there is a “great reset” against low-skilled labor. Link to blog.Link to paper. What is this even... Minimum wage isn't there to encourage or discourage job growth. Its there to ensure people can live off the work they do. Its there to prevent people from being exploited, especially in job area's with a surplus of workers like low skilled labor. A lot of people on the left claim that raising minimum wages doesn't affect employment. I've seen evidence both ways (although if it affects unemployment at all seems to be pretty suspect). But remember that we have skyrocketing profits and a corporate hoarding problem. We also have been hit with a massive recession, which is going to dramatically reduce demand. The idea is that putting more money into people's pockets (especially with people's massive debt) will increase demand, and therefore allow corporations to actually expand. If you only look at things supply-side, then people just say that it increases unemployment. I think there's a strong tendency for people, especially conservatives, to only look at everything as supply-side. As if corporations benevolently grant us things, rather than make cost-benefit analyses. But in reality, corporations don't expand if there's no demand to expand. Business investment is one of the most volatile major components in the economy. So if everything goes as you see it, there are very few economic gains from raising the minimum wage (most is eaten up by subsidy losses). If everything goes as supply siders see it, there will be a much larger loss to the economy. Businesses can and do expand without an increase in aggregate demand. They won't expand if the expansion isn't profitable though, regardless of demand. That's a weird thing to say. It sounds like you're hedging your bets (like "well I believe this because it has worse consequences than the other"). That's a bad mentality. That's the kind of mentality that gets scammed. Like a Pascal's Wager kind of thing. Whatever is true is true regardless of other possibilities' consequences. Honestly, it doesn't seem to have much of an effect at all directly on unemployment. Other factors seem to dominate it by quite a lot. Such as the continuing slash to public sector spending. Hedging my bet on a topic that isn't 100% settled fact is pretty wise in my book But anyways, why take the risk at all? Democrats (and liberals in general) could either wait for the economy to be stronger and then push to raise the minimum wage, or scrap the idea entirely and push for higher wage subsides. You act like having a low minimum wage has absolutely no cost to real people. And aren't "wage subsidies" a much weaker idea in general? Doesn't that fuck up incentives way more than the minimum wage? Isn't that basically socializing the cost of labor while still privatizing profits? But you do understand why "hedging your bets" will drastically favor the status quo, right? "Who knows what the effects of gay marriage will be. Let's not risk it." or "campaign finance reform could possibly make corruption worse! Let's not risk it." etc. etc. Doing things can always have the possibility of negative consequences. I doubt you consider any of these convincing for doing nothing.
The wage subsidies fix incentives. You want incentives for people to work and companies to hire - that helps the economy grow. You don't want incentives for people to work, but companies not to hire. That leads to more unemployment.
It's not socializing the cost of labor because the cost of labor doesn't start at a living wage. If you thing a living wage is morally the minimum someone should earn, than providing that income should be the responsibility of all society, not just the employer.
I don't think your impression of hedging is correct. Hedging just means you are managing your risk, not avoiding it all together.
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On August 07 2013 01:27 JonnyBNoHo wrote:Show nested quote +On August 06 2013 15:36 aksfjh wrote:On August 06 2013 12:11 JonnyBNoHo wrote:On August 06 2013 11:52 DoubleReed wrote:On August 06 2013 11:22 JonnyBNoHo wrote:On August 06 2013 10:01 DoubleReed wrote:On August 06 2013 09:22 JonnyBNoHo wrote:On August 06 2013 09:16 Gorsameth wrote:On August 06 2013 07:41 JonnyBNoHo wrote:Apparently there's a new paper out on minimum wages. Is the main effect of the minimum wage on job growth?
by Tyler Cowen
In their new paper, Jonathan Meer and Jeremy West report:
"The voluminous literature on minimum wages offers little consensus on the extent to which a wage floor impacts employment. For both theoretical and econometric reasons, we argue that the effect of the minimum wage should be more apparent in new employment growth than in employment levels. In addition, we conduct a simulation showing that the common practice of including state-specific time trends will attenuate the measured effects of the minimum wage on employment if the true effect is in fact on the rate of job growth. Using a long state-year panel on the population of private-sector employers in the United States, we find that the minimum wage reduces net job growth, primarily through its effect on job creation by expanding establishments."
In a slightly different terminology, the effect of the minimum wage may well be attenuated in the short run, but over longer time horizons there is a “great reset” against low-skilled labor. Link to blog.Link to paper. What is this even... Minimum wage isn't there to encourage or discourage job growth. Its there to ensure people can live off the work they do. Its there to prevent people from being exploited, especially in job area's with a surplus of workers like low skilled labor. A lot of people on the left claim that raising minimum wages doesn't affect employment. I've seen evidence both ways (although if it affects unemployment at all seems to be pretty suspect). But remember that we have skyrocketing profits and a corporate hoarding problem. We also have been hit with a massive recession, which is going to dramatically reduce demand. The idea is that putting more money into people's pockets (especially with people's massive debt) will increase demand, and therefore allow corporations to actually expand. If you only look at things supply-side, then people just say that it increases unemployment. I think there's a strong tendency for people, especially conservatives, to only look at everything as supply-side. As if corporations benevolently grant us things, rather than make cost-benefit analyses. But in reality, corporations don't expand if there's no demand to expand. Business investment is one of the most volatile major components in the economy. So if everything goes as you see it, there are very few economic gains from raising the minimum wage (most is eaten up by subsidy losses). If everything goes as supply siders see it, there will be a much larger loss to the economy. Businesses can and do expand without an increase in aggregate demand. They won't expand if the expansion isn't profitable though, regardless of demand. That's a weird thing to say. It sounds like you're hedging your bets (like "well I believe this because it has worse consequences than the other"). That's a bad mentality. That's the kind of mentality that gets scammed. Like a Pascal's Wager kind of thing. Whatever is true is true regardless of other possibilities' consequences. Honestly, it doesn't seem to have much of an effect at all directly on unemployment. Other factors seem to dominate it by quite a lot. Such as the continuing slash to public sector spending. Hedging my bet on a topic that isn't 100% settled fact is pretty wise in my book But anyways, why take the risk at all? Democrats (and liberals in general) could either wait for the economy to be stronger and then push to raise the minimum wage, or scrap the idea entirely and push for higher wage subsides. Because if you believe our problem is demand side, then a solution would be to increase the disposable income of those most likely to spend it. You're right that subsidies could do this as well, but then you start messing with Ricardian Equivalence arguments. A straight increase to minimum wage cuts that out and mainly targets firms that overly rely on paying workers as little as possible. If you want to increase demand I don't see how raising the min wage will do that. A big chunk will go to the government in taxes and lost transfers. More will be lost due to a reduction in hours / employment. On the flip side, the business will likely change their spending, potentially to a greater degree than the worker.
A big chunk won't go to the government in taxes, since the people most affected by minimum wage don't pay (much) in taxes. Unless you're talking about a secondary effect of rising demand as those affected by the raise have more money to spend, but then that's conceding minimum wage raise would increase demand...
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On August 07 2013 02:15 aksfjh wrote:Show nested quote +On August 07 2013 01:27 JonnyBNoHo wrote:On August 06 2013 15:36 aksfjh wrote:On August 06 2013 12:11 JonnyBNoHo wrote:On August 06 2013 11:52 DoubleReed wrote:On August 06 2013 11:22 JonnyBNoHo wrote:On August 06 2013 10:01 DoubleReed wrote:On August 06 2013 09:22 JonnyBNoHo wrote:On August 06 2013 09:16 Gorsameth wrote:What is this even... Minimum wage isn't there to encourage or discourage job growth. Its there to ensure people can live off the work they do. Its there to prevent people from being exploited, especially in job area's with a surplus of workers like low skilled labor. A lot of people on the left claim that raising minimum wages doesn't affect employment. I've seen evidence both ways (although if it affects unemployment at all seems to be pretty suspect). But remember that we have skyrocketing profits and a corporate hoarding problem. We also have been hit with a massive recession, which is going to dramatically reduce demand. The idea is that putting more money into people's pockets (especially with people's massive debt) will increase demand, and therefore allow corporations to actually expand. If you only look at things supply-side, then people just say that it increases unemployment. I think there's a strong tendency for people, especially conservatives, to only look at everything as supply-side. As if corporations benevolently grant us things, rather than make cost-benefit analyses. But in reality, corporations don't expand if there's no demand to expand. Business investment is one of the most volatile major components in the economy. So if everything goes as you see it, there are very few economic gains from raising the minimum wage (most is eaten up by subsidy losses). If everything goes as supply siders see it, there will be a much larger loss to the economy. Businesses can and do expand without an increase in aggregate demand. They won't expand if the expansion isn't profitable though, regardless of demand. That's a weird thing to say. It sounds like you're hedging your bets (like "well I believe this because it has worse consequences than the other"). That's a bad mentality. That's the kind of mentality that gets scammed. Like a Pascal's Wager kind of thing. Whatever is true is true regardless of other possibilities' consequences. Honestly, it doesn't seem to have much of an effect at all directly on unemployment. Other factors seem to dominate it by quite a lot. Such as the continuing slash to public sector spending. Hedging my bet on a topic that isn't 100% settled fact is pretty wise in my book But anyways, why take the risk at all? Democrats (and liberals in general) could either wait for the economy to be stronger and then push to raise the minimum wage, or scrap the idea entirely and push for higher wage subsides. Because if you believe our problem is demand side, then a solution would be to increase the disposable income of those most likely to spend it. You're right that subsidies could do this as well, but then you start messing with Ricardian Equivalence arguments. A straight increase to minimum wage cuts that out and mainly targets firms that overly rely on paying workers as little as possible. If you want to increase demand I don't see how raising the min wage will do that. A big chunk will go to the government in taxes and lost transfers. More will be lost due to a reduction in hours / employment. On the flip side, the business will likely change their spending, potentially to a greater degree than the worker. A big chunk won't go to the government in taxes, since the people most affected by minimum wage don't pay (much) in taxes. Unless you're talking about a secondary effect of rising demand as those affected by the raise have more money to spend, but then that's conceding minimum wage raise would increase demand...
Taxes and transfers. Combining the two yields very high marginal rates for many workers.
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It's not socializing the cost of labor because the cost of labor doesn't start at a living wage. If you thing a living wage is morally the minimum someone should earn, than providing that income should be the responsibility of all society, not just the employer.
I don't think your impression of hedging is correct. Hedging just means you are managing your risk, not avoiding it all together.
Isn't that the definition of "socializing cost"???
No, I just got confused with my own statement. Ignore that previous characterization. The reason I don't like the attitude you took is more because it's how people get scammed. The sort of "Well on the offchance that this snake oil does work I'd be stupid not buy it."
You should determine which is more likely to be true independent of the consequences of the possibilities. If you think it's likely to be true then just say that without the weird part.
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On August 07 2013 02:27 JonnyBNoHo wrote:Show nested quote +On August 07 2013 02:15 aksfjh wrote:On August 07 2013 01:27 JonnyBNoHo wrote:On August 06 2013 15:36 aksfjh wrote:On August 06 2013 12:11 JonnyBNoHo wrote:On August 06 2013 11:52 DoubleReed wrote:On August 06 2013 11:22 JonnyBNoHo wrote:On August 06 2013 10:01 DoubleReed wrote:On August 06 2013 09:22 JonnyBNoHo wrote:On August 06 2013 09:16 Gorsameth wrote:
[quote]
What is this even...
Minimum wage isn't there to encourage or discourage job growth. Its there to ensure people can live off the work they do. Its there to prevent people from being exploited, especially in job area's with a surplus of workers like low skilled labor. A lot of people on the left claim that raising minimum wages doesn't affect employment. I've seen evidence both ways (although if it affects unemployment at all seems to be pretty suspect). But remember that we have skyrocketing profits and a corporate hoarding problem. We also have been hit with a massive recession, which is going to dramatically reduce demand. The idea is that putting more money into people's pockets (especially with people's massive debt) will increase demand, and therefore allow corporations to actually expand. If you only look at things supply-side, then people just say that it increases unemployment. I think there's a strong tendency for people, especially conservatives, to only look at everything as supply-side. As if corporations benevolently grant us things, rather than make cost-benefit analyses. But in reality, corporations don't expand if there's no demand to expand. Business investment is one of the most volatile major components in the economy. So if everything goes as you see it, there are very few economic gains from raising the minimum wage (most is eaten up by subsidy losses). If everything goes as supply siders see it, there will be a much larger loss to the economy. Businesses can and do expand without an increase in aggregate demand. They won't expand if the expansion isn't profitable though, regardless of demand. That's a weird thing to say. It sounds like you're hedging your bets (like "well I believe this because it has worse consequences than the other"). That's a bad mentality. That's the kind of mentality that gets scammed. Like a Pascal's Wager kind of thing. Whatever is true is true regardless of other possibilities' consequences. Honestly, it doesn't seem to have much of an effect at all directly on unemployment. Other factors seem to dominate it by quite a lot. Such as the continuing slash to public sector spending. Hedging my bet on a topic that isn't 100% settled fact is pretty wise in my book But anyways, why take the risk at all? Democrats (and liberals in general) could either wait for the economy to be stronger and then push to raise the minimum wage, or scrap the idea entirely and push for higher wage subsides. Because if you believe our problem is demand side, then a solution would be to increase the disposable income of those most likely to spend it. You're right that subsidies could do this as well, but then you start messing with Ricardian Equivalence arguments. A straight increase to minimum wage cuts that out and mainly targets firms that overly rely on paying workers as little as possible. If you want to increase demand I don't see how raising the min wage will do that. A big chunk will go to the government in taxes and lost transfers. More will be lost due to a reduction in hours / employment. On the flip side, the business will likely change their spending, potentially to a greater degree than the worker. A big chunk won't go to the government in taxes, since the people most affected by minimum wage don't pay (much) in taxes. Unless you're talking about a secondary effect of rising demand as those affected by the raise have more money to spend, but then that's conceding minimum wage raise would increase demand... Taxes and transfers. Combining the two yields very high marginal rates for many workers.
We've been over the lost transfers thing. There's a small negative bump at ~$7k and ~$45k, but you're not going to hit any of those for any worker working more than 25 hours a week, and that's ONLY if they participate in Medicaid and CHIP.
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On August 07 2013 02:31 DoubleReed wrote:Show nested quote +It's not socializing the cost of labor because the cost of labor doesn't start at a living wage. If you thing a living wage is morally the minimum someone should earn, than providing that income should be the responsibility of all society, not just the employer.
I don't think your impression of hedging is correct. Hedging just means you are managing your risk, not avoiding it all together. Isn't that the definition of "socializing cost"??? No, I just got confused with my own statement. Ignore that previous characterization. The reason I don't like the attitude you took is more because it's how people get scammed. The sort of "Well on the offchance that this snake oil does work I'd be stupid not buy it." You should determine which is more likely to be true independent of the consequences of the possibilities. If you think it's likely to be true then just say that without the weird part.
It is a social cost. It always has been. You can't socialize a cost that is and has always been a social cost.
Let's declare that DoubleReed is responsible for paying all restaurant workers a living wage. If you say no, you're just trying to socialize a cost! You bastard!
And we are not discussing snake oil here. We're discussing a topic that isn't 100% settled in the academic community.
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You act like having a low minimum wage has absolutely no cost to real people.
And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway.
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On August 07 2013 02:39 aksfjh wrote:Show nested quote +On August 07 2013 02:27 JonnyBNoHo wrote:On August 07 2013 02:15 aksfjh wrote:On August 07 2013 01:27 JonnyBNoHo wrote:On August 06 2013 15:36 aksfjh wrote:On August 06 2013 12:11 JonnyBNoHo wrote:On August 06 2013 11:52 DoubleReed wrote:On August 06 2013 11:22 JonnyBNoHo wrote:On August 06 2013 10:01 DoubleReed wrote:On August 06 2013 09:22 JonnyBNoHo wrote:
[quote]
A lot of people on the left claim that raising minimum wages doesn't affect employment. I've seen evidence both ways (although if it affects unemployment at all seems to be pretty suspect). But remember that we have skyrocketing profits and a corporate hoarding problem. We also have been hit with a massive recession, which is going to dramatically reduce demand. The idea is that putting more money into people's pockets (especially with people's massive debt) will increase demand, and therefore allow corporations to actually expand. If you only look at things supply-side, then people just say that it increases unemployment. I think there's a strong tendency for people, especially conservatives, to only look at everything as supply-side. As if corporations benevolently grant us things, rather than make cost-benefit analyses. But in reality, corporations don't expand if there's no demand to expand. Business investment is one of the most volatile major components in the economy. So if everything goes as you see it, there are very few economic gains from raising the minimum wage (most is eaten up by subsidy losses). If everything goes as supply siders see it, there will be a much larger loss to the economy. Businesses can and do expand without an increase in aggregate demand. They won't expand if the expansion isn't profitable though, regardless of demand. That's a weird thing to say. It sounds like you're hedging your bets (like "well I believe this because it has worse consequences than the other"). That's a bad mentality. That's the kind of mentality that gets scammed. Like a Pascal's Wager kind of thing. Whatever is true is true regardless of other possibilities' consequences. Honestly, it doesn't seem to have much of an effect at all directly on unemployment. Other factors seem to dominate it by quite a lot. Such as the continuing slash to public sector spending. Hedging my bet on a topic that isn't 100% settled fact is pretty wise in my book But anyways, why take the risk at all? Democrats (and liberals in general) could either wait for the economy to be stronger and then push to raise the minimum wage, or scrap the idea entirely and push for higher wage subsides. Because if you believe our problem is demand side, then a solution would be to increase the disposable income of those most likely to spend it. You're right that subsidies could do this as well, but then you start messing with Ricardian Equivalence arguments. A straight increase to minimum wage cuts that out and mainly targets firms that overly rely on paying workers as little as possible. If you want to increase demand I don't see how raising the min wage will do that. A big chunk will go to the government in taxes and lost transfers. More will be lost due to a reduction in hours / employment. On the flip side, the business will likely change their spending, potentially to a greater degree than the worker. A big chunk won't go to the government in taxes, since the people most affected by minimum wage don't pay (much) in taxes. Unless you're talking about a secondary effect of rising demand as those affected by the raise have more money to spend, but then that's conceding minimum wage raise would increase demand... Taxes and transfers. Combining the two yields very high marginal rates for many workers. We've been over the lost transfers thing. There's a small negative bump at ~$7k and ~$45k, but you're not going to hit any of those for any worker working more than 25 hours a week, and that's ONLY if they participate in Medicaid and CHIP.
So what? My point was not that negative bumps exists. My point was that raising the minimum wage doesn't increase disposable income nearly as much as the wage increase. Even if you were to exclude this point, the business owner takes a hit to his or her income which can still result in an even greater change in spending.
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United States43673 Posts
On August 07 2013 02:58 DeepElemBlues wrote:Show nested quote +You act like having a low minimum wage has absolutely no cost to real people. And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway.
If people aren't making a living wage the cost is passed onto society in other means. Through welfare, through charity, through crime, through the justice system dealing with crime and so forth. People need to eat. Exploitatively low wages have negative externalities for which the company paying the wages doesn't pay.
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MIAMI, Aug 5 (Reuters) - Florida Governor Rick Scott is planning a new effort to purge non-U.S. citizens from the state's voter rolls, a move that last year prompted a series of legal challenges and claims from critics his administration was trying to intimidate minority voters.
Voter protection groups identified a number of errors in the state's attempt to identify people who are not American citizens on Florida's voter lists months ahead of the U.S. presidential election in November 2012.
The search also sparked several lawsuits, including one by the U.S. Justice Department, which claimed the effort violated federal law since it was conducted less than 90 days before the election.
"We were recently informed that the State plans to continue their efforts to remove non-citizens from Florida's voter rolls," Miami-Dade Elections Supervisor Penelope Townsley said in a statement.
In a letter sent to Florida election supervisors last week, Maria Matthews, Florida's director of elections, said a renewed effort to "ensure due process and the integrity of Florida's voter rolls" was being planned.
"This is all part of our ongoing and continuing efforts to identify potentially ineligible registered voters," Matthews said.
Source
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On August 07 2013 02:58 DeepElemBlues wrote:Show nested quote +You act like having a low minimum wage has absolutely no cost to real people. And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway.
What? Look, normally I would completely admit to this. But honestly this just came out of nowhere. I have not implied that there is no cost to raising the minimum wage to corporations (in fact I directly implied the opposite), and I didn't imply that rich people deserve to be hurt. You were just trying to turn the phrase on me, but dude try making some sense first.
How about you attack me on those things when I say them? I wouldn't even characterize this as an ad hominem or strawman. This is just a non sequitur. How about you criticize my violent attitude toward rich people when I say that I love beating up rich people. Is that really so much to ask?
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On August 07 2013 03:25 KwarK wrote:Show nested quote +On August 07 2013 02:58 DeepElemBlues wrote:You act like having a low minimum wage has absolutely no cost to real people. And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway. If people aren't making a living wage the cost is passed onto society in other means. Through welfare, through charity, through crime, through the justice system dealing with crime and so forth. People need to eat. Exploitatively low wages have negative externalities for which the company paying the wages doesn't pay.
Why should the company pay for those externalities? Low wages are the result of multiple factors, most of which the company is not responsible for.
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On August 07 2013 04:48 JonnyBNoHo wrote:Show nested quote +On August 07 2013 03:25 KwarK wrote:On August 07 2013 02:58 DeepElemBlues wrote:You act like having a low minimum wage has absolutely no cost to real people. And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway. If people aren't making a living wage the cost is passed onto society in other means. Through welfare, through charity, through crime, through the justice system dealing with crime and so forth. People need to eat. Exploitatively low wages have negative externalities for which the company paying the wages doesn't pay. Why should the company pay for those externalities? Low wages are the result of multiple factors, most of which the company is not responsible for.
If your business model is so awful that you can't afford to pay your employees a living wage, I don't think your business should exist.
If you can afford to, but choose not to, then that right there is the poster child for factors that the company is responsible for.
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On August 07 2013 05:05 Nightfall.589 wrote:Show nested quote +On August 07 2013 04:48 JonnyBNoHo wrote:On August 07 2013 03:25 KwarK wrote:On August 07 2013 02:58 DeepElemBlues wrote:You act like having a low minimum wage has absolutely no cost to real people. And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway. If people aren't making a living wage the cost is passed onto society in other means. Through welfare, through charity, through crime, through the justice system dealing with crime and so forth. People need to eat. Exploitatively low wages have negative externalities for which the company paying the wages doesn't pay. Why should the company pay for those externalities? Low wages are the result of multiple factors, most of which the company is not responsible for. If your business model is so awful that you can't afford to pay your employees a living wage, I don't think your business should exist. If you can afford to, but choose not to, then that right there is the poster child for factors that the company is responsible for.
If you get rid of all those business models the economy will be smaller :/
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On August 07 2013 05:16 JonnyBNoHo wrote:Show nested quote +On August 07 2013 05:05 Nightfall.589 wrote:On August 07 2013 04:48 JonnyBNoHo wrote:On August 07 2013 03:25 KwarK wrote:On August 07 2013 02:58 DeepElemBlues wrote:You act like having a low minimum wage has absolutely no cost to real people. And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway. If people aren't making a living wage the cost is passed onto society in other means. Through welfare, through charity, through crime, through the justice system dealing with crime and so forth. People need to eat. Exploitatively low wages have negative externalities for which the company paying the wages doesn't pay. Why should the company pay for those externalities? Low wages are the result of multiple factors, most of which the company is not responsible for. If your business model is so awful that you can't afford to pay your employees a living wage, I don't think your business should exist. If you can afford to, but choose not to, then that right there is the poster child for factors that the company is responsible for. If you get rid of all those business models the economy will be smaller :/
Or, more likely, prices will rise, supply and demand will figure out how much of said business we really need... And as a whole, we will stop subsidizing said business models.
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On August 07 2013 05:16 JonnyBNoHo wrote:Show nested quote +On August 07 2013 05:05 Nightfall.589 wrote:On August 07 2013 04:48 JonnyBNoHo wrote:On August 07 2013 03:25 KwarK wrote:On August 07 2013 02:58 DeepElemBlues wrote:You act like having a low minimum wage has absolutely no cost to real people. And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway. If people aren't making a living wage the cost is passed onto society in other means. Through welfare, through charity, through crime, through the justice system dealing with crime and so forth. People need to eat. Exploitatively low wages have negative externalities for which the company paying the wages doesn't pay. Why should the company pay for those externalities? Low wages are the result of multiple factors, most of which the company is not responsible for. If your business model is so awful that you can't afford to pay your employees a living wage, I don't think your business should exist. If you can afford to, but choose not to, then that right there is the poster child for factors that the company is responsible for. If you get rid of all those business models the economy will be smaller :/
Uhh... no. Stop thinking so supply sided, please.
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On August 07 2013 05:25 Nightfall.589 wrote:Show nested quote +On August 07 2013 05:16 JonnyBNoHo wrote:On August 07 2013 05:05 Nightfall.589 wrote:On August 07 2013 04:48 JonnyBNoHo wrote:On August 07 2013 03:25 KwarK wrote:On August 07 2013 02:58 DeepElemBlues wrote:You act like having a low minimum wage has absolutely no cost to real people. And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway. If people aren't making a living wage the cost is passed onto society in other means. Through welfare, through charity, through crime, through the justice system dealing with crime and so forth. People need to eat. Exploitatively low wages have negative externalities for which the company paying the wages doesn't pay. Why should the company pay for those externalities? Low wages are the result of multiple factors, most of which the company is not responsible for. If your business model is so awful that you can't afford to pay your employees a living wage, I don't think your business should exist. If you can afford to, but choose not to, then that right there is the poster child for factors that the company is responsible for. If you get rid of all those business models the economy will be smaller :/ Or, more likely, prices will rise, supply and demand will figure out how much of said business we really need... And as a whole, we will stop subsidizing said business models.
Yeah, prices will rise and demand will fall... and the economy will be smaller.
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On August 07 2013 05:28 DoubleReed wrote:Show nested quote +On August 07 2013 05:16 JonnyBNoHo wrote:On August 07 2013 05:05 Nightfall.589 wrote:On August 07 2013 04:48 JonnyBNoHo wrote:On August 07 2013 03:25 KwarK wrote:On August 07 2013 02:58 DeepElemBlues wrote:You act like having a low minimum wage has absolutely no cost to real people. And you act like significantly raising the minimum wage has absolutely no cost to real people. And not just rich people who deserve to be hurt anyway. If people aren't making a living wage the cost is passed onto society in other means. Through welfare, through charity, through crime, through the justice system dealing with crime and so forth. People need to eat. Exploitatively low wages have negative externalities for which the company paying the wages doesn't pay. Why should the company pay for those externalities? Low wages are the result of multiple factors, most of which the company is not responsible for. If your business model is so awful that you can't afford to pay your employees a living wage, I don't think your business should exist. If you can afford to, but choose not to, then that right there is the poster child for factors that the company is responsible for. If you get rid of all those business models the economy will be smaller :/ Uhh... no. Stop thinking so supply sided, please.
Uhh, why? The supply side doesn't exist? Hamburgers make themselves now?
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EPT
