Sure, but a libertarian or conservative can make that same argument, and make it better. If a progressive sets out to improve the lot of poor people with a high minimum wage, and fails, then a liberatarian or conservative can point out the failing regardless of the value they place on setting up an economic system tilted to benefit the poor.
But only a progressive can argue that we have a moral obligation to take money away from rich people regardless of other concerns, because somebody having a lot more than somebody else is an injustice in itself a core social justice perspective. That’s why I say Moreno’s criticism is apt given a progressive framework; even if minimum wage hurts the economy and doesn’t help the poor, screwing over rich people is a good in itself and that may be sufficient to justify minimum wage laws.
Maybe not to you. That’s why I’m saying your argument (and maybe your perspective) isn’t completely progressive. But yes, taking money away from rich people for the sake of taking money away from rich people is absolutely a goal of a social justice oriented framework. If somebody has 10 times as much money as somebody else, that is an injustice requiring fixing regardless of how well-off the less wealthy person is in that equation, and regardless of the reasons for the discrepency.
Or so I’ve been taught!
Well, because presumably wages are intended to be paying for the worth of a person’s time, and it seems to me that a person’s time is worth at least what’s required to keep them alive, regardless of what labor they are doing. Even if they are being paid to stand in a corner and do nothing, by doing it they are paying the opportunity cost for their time, i.e., they could be out providing for themselves in some other way if they werent’ doing that job.
The fact that they are spending 40 hours manufacturing widgets instead of hunting and gathering implies that making widgets will provide them with at least what they would have gotten from hunting and gathering, in other words. And since we collectively don’t want (or can’t have) a society in which hunting and gathering is how a typical person sustains themselves, a minimum wage for adults working full time seems reasonable to me.
There’s also the fact that being homeless is more or less criminalized. If it was easier for a person to exist without an income, I might feel differently about it.
But like I said, it has problems.
Ya, a little bit. I think I made my argument from a basically individual justice perspective and not a social justice perspective, but maybe a little bit. This is fine with me, I’m a conservative, not a libertarian.
Maybe I missed it, but where is the inclusion of welfare benefits? How can your analysis be complete, Carleas, without considering the effect of minimum wage on welfare benefits? Would’t a large increase in MW affect those benefits and don’t the current proposals shift some cost from the public to the private sector?
Only if it didn’t lead to a drop in employment that to offset the cost per worker. I think Carleas does mention the unemployment connection, which goes to the effects on welfare.
It’s not deontology, per se. Deontology comes up later in my argument. I look at your OP and I do not see humility. Where is the added humility after I point out that many factors are not mentioned, presumably because they are hard to track?
Following the factors that are easy to track and ignoreing any other possible effects. Just because something is hard to track, there is no reason NOT to bring it into the discussion and include intuitive or looser weighing processes.
And it clearly works better in many complicated (in relation to time) situations.
No, we use intuition all the time. We use it in semantics. We use it to determine when we have analyzed something enough. We use it when prioritizing factors. We use it for body movement. We use it to minimize physical threats and safety. We use it in many parts of any rational process, in real time in the world.
there is no evading the use of intution.
You are responding as if I am saying: Go with your gut reaction. What I am saying is that your OP leaves out effects we know are there and are not easy to analyze statistically in neat little cause and effect chains.
Our intuitions function well in large sets of situations that neolithic people did not go through.
You used the word ‘tend’. I hope you can deduce my response.
Perfect example.
Only by appeal to those. No other effects on societal relations, effects related to diminishment of integrity and privacy, effects related to who gets to test whom and who does not - the affects of which will NOT be tested (iow we will not have a period testing Boards and presidents by unions, by third parties, to see if this improves business and what does the assumption there teach us. With children what are the effects of teaching them that they can be suspected and intruded upon by the powers that be on how they think of themselves as citizens when they grow up? There’s quite a bit more also.
This was a perfect example. Your default leaves out a whole range of factors, based on your intuition and that intuition has been formed by people who dislike real democracy, informed consent, dynamic citizens and more.
Sure, they are hard to track, some of these effects. But in your spreadsheets they will be given ZERO VALUE.
We are not simply production robots.
If the effects on production are the only ones what is problem with sweat shops and child labor?
So let me get this straight. You would be OK with Sweat shops in your region?
It may be an improvement for them or some of them. What are the other effects of having sweat shops become legal in your region?
As if the choices are of the same kind compared to when we had a commons, when there was land and frontiers, when those in power had responsibilites - if often handled poorly - to those in their areas. Now you sink or swim on your own without land, without a commons, without a role.
You repeatedly have a very circumscribed focus AND THIS IS BASED ON YOUR INTUITION, and in your case INTUITION IS A FACULTY, you think you can do without. This affects your intuition and necessarily your conclusions and the I have analyzed this correctly quale which keeps coming up for you - as it does for all of us, but your case, you do not notice the role played by intuition, and where you do, you try to stamp it out.
This leaves you a homo sapien using only part of his faculties.
The idea that we no longer need out intution except for some very basic physical situations means that you have not done enough introspection to see how you actually, not how you seem to think you, arrive at conclusions. Further you are not noticing how you have received intuitions, which of course seem obvious to you, related to cause and effects and a host of other things.
It is not about deontology being a replacement for consequentialism. I may have communicated poorly.
I see current and past consequentialism precisely limited by this kind of intuition denial - my decisions are rational and not intuitive - and lack of training, dampening of intuition.
My point about deontologism and ists is that they accept (at least functionally) that something we cannot prove is highly utilitarian or greatest good for the greatest number IN THE SHORT TERM can nevertheless be sussed out using THE FULL CAPABILITIES OF OUR BRAINS.
I see cane toads all over the place when the people who think it is all dominos make decisions.
They may be great snooker players, but unless they have better intutioins about the limits of their number analysis, they are dangerous.
I think your analysis in this paragraph is correct, and I think it points to one of the poor justifications of the minimum wage. It’s easy to point to specific individuals who will be benefited by the minimum wage, and those people are more concrete and easier to envision than the people who would be harmed by it. A person making money closer to what they deserve is a very clear mental image. A person who is simply never offered an opportunity because the minimum wage prevented the offer is much less intuitive to appreciate, but just as important.
There are two things going on that will tighten the labor market (I know ‘tighten’ was my term, and that it’s probably not a technically correct use of the term. By it I just mean that it generally make the market harder for employees, by reducing dynamism, increasing lock-in, and increasing pressure to prune the least-valuable workers. Such a market feels ‘tight’ to me in some synesthetic sense.).
One is that certain people who are not in the labor market (and thus not technically “unemployed”) will enter the labor market: high school students, stay-at-home parents, and the elderly are more likely to participate in the market if the minimum pay is raised. And these people will tend to be more affluent, which we can infer because, by hypothesis, they would choose not to work without the higher minimum wage. That increases competition, and will tend to displace vulnerable workers for more affluent replacements. I agree that some part of this increased competition is offset by increased spending, and by the redistribution from the top to the middle. But while I think this prevents a net increase in unemployment, I don’t think it prevents the demographics of those employed from skewing to the more affluent.
Second (and this will be more important as time goes on), human laborers will increasingly be replaced by automation. If we set a minimum price for human labor, we make automation much more appealing. And again, because automation will be an effective replacement for the least-skilled labor first, this effect will tend to displace the most vulnerable workers. We still have the offset that more spending by the middle class will tend to increase jobs, but the distribution of laborers who are left employed is again likely to skew affluent.
This seems again like a problem for the poorest workers. McDonalds is a business that caters to the least-well-off. If introducing a minimum wage will make such a business model untenable, then you have the double impact of increasing unemployment among low-skilled and vulnerable laborers, while simultaneously shifting services towards catering to the more affluent. Increasing prices to offset the minimum wage will price out the poorest people in society, who are also the most likely to be priced out of the labor market.
I think it is more likely that the low-end of the pay distribution within a company will bear the burden of the minimum wage than that the CEO will be paid less. And in any case, even in the idealized outcome you describe, the people at the bottom who lose their jobs or simply never get hired don’t benefit from the CEO getting paid less. Again, the redistribution seems to be from the top and bottom to the middle.
Yes, absolutely, it just doesn’t seem so when you ignore nuance and the effects of messy reality. Is accounting for reality a particularly lefty thing to do? Doesn’t seem to fit the stereotype
In this case, I think better is subjective. A libertarian might appeal to some supposedly inviolable set of rights, but if respecting that set of rights tends to stack the deck in favor of the top 10% of society, then the other 90% of society (or at least the progressive portion thereof) has a pretty strong complaint that the set of rights being put forward can’t be just because they don’t produce a just society. If your values are such that certain rights are inviolable regardless their consequences, you won’t find that argument compelling. If instead you value rights the extent they are instrumental towards a just society, you will.
Similarly here, if the libertarian’s argument is just to take certain rights as premises and the violation of those rights as de facto wrong, that argument won’t be compelling to someone who doesn’t care about rights unless they produce ends they see as just, and the libertarian argument will be very weak to that point.
I want to say that this is a straw man version of progressivism, but really progressivism is not monolithic, and surely there are those who self-identify as progressive who intend by that identity a support of any policy that will hurt the rich. In this thread, I haven’t defined defined the term, because my intuition is that the answers to the questions, “Do you consider yourself a progressive?” and, “Do you support a minimum wage?” are strongly correlated, and it’s sufficient to appeal to other likely correlates like support for equality and concern for the most vulnerable members of society.
But I actually don’t think that progressivism-as-eating-the-rich is a problem for my position: I’d argue that the minimum wage tends to benefit the rich and increase inequality in the long run, so if our goal is purely to reduce the wealth of the wealthiest, no matter the other consequences, we should still oppose a minimum wage.
I would bet that most people couldn’t support themselves hunting and gathering; humans are pack animals and don’t do very well living on their own. So if the opportunity cost is actually only the sub-subsistence product of hunting and gathering, is it therefore just to pay someone the sub-living-wage equivalent in cash for their time?
Though I recently extolled the virtues of messy reality, the interaction with welfare benefits seems a bit too messy. The welfare system seems to be a separate question. We could probably design (and I’m open to evidence that we actually already have) a system where the minimum wage reduces the burden on the welfare system. But that seems like it’s a bad welfare system. For instance, if we made welfare benefits contingent on working and didn’t adjust the payout schedule such that payouts dropped as the wages of the lowest-paid workers we raised, the welfare payouts would decrease as a whole. But at the same time, the most vulnerable members of society would be even worse off, because they would have less access to jobs and thus less welfare support. By contrast, we could make welfare payouts go to the unemployed alone, in which case increasing the minimum wage would put more very-poor people out of work and thus increase the welfare burden.
I have mentioned an unconditional income several times, and that’s my preferred welfare plan. But I would think that is a topic for a different thread. Is there a reason the questions are inextricable from each other?
But that’s just my point: adding humility doesn’t move the conclusion at all. The fact that we don’t know all the causes or effects in a complex system just doesn’t weigh in either direction on the question of what we should do.
I’m not totally opposed to intuition, but I don’t think intuition is a very strong argument in the face of significant countervailing evidence. We have a lot of effects we can track and measure and predict reliably. We also have unreliable intuitions about what’s best. If those conflict, we at least need a robust theory for why all the evidence seems to conflict with intuition, in which case we aren’t really relying on intuition any more, we’re using it to generate hypotheses that we then test empirically (or at least plug into a narrative with empirical results to create a overarching understanding of what’s happening in the system).
Perhaps you and I are using different definitions of ‘intuition’. I see concerns about the “effects on societal relations” and “diminishment of integrity and privacy” as more about values than intuition. I leave them out because they aren’t objective criteria. I don’t think there’s anything incoherent with saying “this is a good policy, unless you strongly value individual information privacy”. Just as I don’t think there’s anything incoherent in saying “you should reject the minimum wage if you value equality and the well-being of the most vulnerable members of society.”
No, because sweat shops are symptomatic of Very Bad Conditions. Rather, if there were sweatshops in my region, I would not consider making them illegal to be a good solution to the Very Bad Conditions of which they are a symptom. And I think such a prohibition could well exacerbate the Very Bad Conditions.
Ditto for child labor, since you mention it. People don’t want their kids to work in factories, and given the financial resources to allow their children to go to school or whatever else, people will avoid child labor without the need for regulation. But prohibiting it in advance of that is likely to hurt families who can’t get by without the additional income from the labor of their children. I’m not saying child labor is a good thing, quite the contrary. But it is a symptom, and you can’t cure the underlying ill by making its symptoms illegal.
I find this ironic, because you’re appealing to an intuitive idea about the effects of a minimum wage, while I’m the one pointing out the likely unintended consequences. I think the intuition is at least as likely, and probably much more likely, to ignore unintended consequences.
But taking a step back, what is/are the intuition/s that outweigh/s the evidence against a minimum wage?
One of the ‘realities’ is that deciding what to do with taxpayer money is much easier than deciding what to do with business money. The public trough is just so easily accessible. Business, on the other hand, is always kicking, screaming and lobbying over every penny.
I think this is a false and dangerous distinction. The minimum wage changes the price of labor and goods, it shifts social benefits and redistributes incomes. It may be paid by the business at the first point of contact, but if raises prices across the economy, the effect is quite similar to a tax – i.e., even though it’s paid by business, it still comes out of the public trough. It’s just a non-transparent tax.
And, as I argued at the outset, it has a lot of unintended consequences that make it worse than a simple flat payout to everyone. It’s paradoxical, I agree, but messy reality has a way of creating paradoxical outcomes.
That minimum wage is literally a secured base upon which a warranty is implied, of the sort spelled out in the bill of rights, vis. : the right to enjoyment of happiness,is easily dismissed as just that: an a warranted implication.
But the moral implication of such a warranty is very basic, and as to the question, as to who does an inflationary spiral hurts most: the worker//consumer-or the owner//producer-revolves around the double entailment of producer-as the owner and/or the worker.
Both, the worker and the owner/capitalist produce, in different senses, and production is the pivotal element in the formula. But to the question as to what is contained in production which really is common to both, is best defined by again reverting to the question : who gets most out of inflation? For it is a very basic character of limits, as minimum limits the value of per hour wage that it is not allowed to fall under.
Production and product demand can be manipulated, and inflated prices favor the rich, if wages can be raised as well. This creates inflation. But in order to keep product demand, wages have to be increased, as well. So where does the benefit lay?
The thing is: there is an unseen as yet upper limit as well. Where, simply the management of money supply, demand and production may falter. This is where we are, now, at a time, when the internationalization of world capital in toto, is yet to kick in.
The upper limit to individual capital holding I intuit to be one trillion dollars, and within a generation , this may come to be. I predict, this upper limit, can not sustain any modicum of a minimum wage, since dynamically, the emphasis will shift to upper limits.
So progressive opposition to minimum wage will seem to be an insubstantionally voiced cry in the desert, because, it will make little difference. That it is a progressive opposition, is also questionable, since basically, it is the very opposite: a regressive plan to rollback prices and wages, -to re-emphasize lower limits, to avoid the panick which may ensue in capital markets world wide, where the dollar will become as worthless as the penny has become in the course of only two or three generations.
This is a free wheeling intuitive approach of the big picture, the long run, where both: the worker and the capitalist may suffer. Rather then opposing a yet controllable process, leave limits where they are, and work with the substantial aspects of the dynamics behind the limits.
A minimum income also causes prices to rise. It also redistributes incomes.
The difference is that a person has a choice about which products to buy and from which company. There is a feedback system in place.
The buyer is paying someone to produce a product which he/she wants or needs.
People don’t have a choice in paying taxes. (Or to be more precise, middle class people doesn’t have a choice. The wealthy can avoid taxes.)
The taxpayer is paying to get services which he/she may need, use or agree with but also very likely that he/she is paying for services which he/she does not want or agree with.
I think that you equate the higher min. wage with the reduction of positions available, the opportunities available and I don’t see why. Since it is across the board, it might just lead to inflation. But if you add outsourcing and offshoring…then I can see your point. A higher min. wage makes labor in american soil higher. Then again, it is not always as clear cut as the math would suggest. Boeing’s 787 Dreamliner being outsourced to Japan and Italy cannot be explained by their lower labor cost. But that is only one industry. In as far as a job in McDonalds for example I don’t believe that the level of the wages creates demand. As long as there is demand there will be a need for labor, and increasing wages could actually increase demand. Your case for a negative effect due to higher wages is simply not there. Now, as I said, you could make a case that some jobs will be outsourced to India, China, Dominican Republic…sure, but that depends on the total costs of ownership involved and it applies only for certain industries. It makes little sense in the fast food sector.
I agree with you to some extent. Adequate wages might reduce the drive in employees to venture for something better, reducing turnover. I think that this applies only to some individuals and not across all employees. The most negative effect that I see is that dense cities need to lose some of their population. A higher wage would keep people from venturing into other areas of the country and perhaps increase the influx of people into these cities because they now can afford it.
Adequate wages remove at least the need of workers to keep not one but two or three jobs. A living wage may allow a worker to survive on only one job, creating openings in other markets. Bringing in more people into the workforce is not a bad thing. Maybe bare minimum jobs will be harder to get because the available applicants will have better resumes, attracted by the adequate wages…I can see that. I don’t think that this is a bad thing though. Competition, in my opinion, is good. It should be our goal to bring up people to a higher standard rather than guarantee a job to the most unqualified. I also don’t think that this is actually the case. In the use the current argument against immigration is that they are taking jobs away from American workers. I don’t buy that. In Alabama their anti-immigration laws affected farmers who rely on cheap undocumented labor. (buzzfeed.com/davidnoriega/al … .oveOBPBnO). Certain jobs are simply not being pursued by able American bodies and are somehow beneath them, which is why they fall into the hands of undocumented workers. Would a higher min. wage affect such jobs? I don’t know; all I know is that there is a broad spectrum of bottom of the barrel jobs and some go unfulfilled.
Agreed, tough it depends on the reliability of automation.
But why would they lose their jobs to begin with. Sure some workers will enter the workforce with capable resumes, but at the same time we have job openings left open by workers who are now able to survive with only one job instead of two. There is also the fact that some jobs go unclaimed by Americans where displaced American workers, if any, could gravitate towards. If indeed a non-worker today does so out of a choice because of secured affluence it is not a guaranteed that such workers would jump back in to get a job at McDonalds. I highly doubt it. But this is just as much speculation as saying that they will jump back in. Enough to say that there will be an effect, but I wouldn’t conclude based on what I know today that retirees, for example, will flock to employment lines at McDonalds any more that workers today would flock to agriculture jobs even with an increase in pay-- not when other prospects are there to be pursued.
Yes, I agree. I didn’t mean that point as a criticism of a minimum wage, but as support for the idea that a minimum wage isn’t ‘free’ just because it acts on businesses. Its effects are tax-like.
But the price increases from a minimum wage filter through society. If we have to pay the janitor more, then it costs more to wash the floor, and every business that has a moderately clean floor is going to have to increase its prices. If the price of collecting garbage goes up, every business that produces garbage is going to have to raise its prices. Choice won’t do a lot in this case, because the price increase will be pervasive (it will encourage people to avoid businesses and products that employ a lot of humans in their production).
So, again, the effect is tax-like: the price of almost all goods and services increases, effectively leaving people with less money in a poor attempt to redistribute wealth from the top to the bottom (but actually redistributing from the top and bottom to the middle). And as a tax, it is a regressive consumption tax: a millionaire and a pauper will pay the same increased price for a loaf of bread.
People don’t have a choice in the minimum wage either. If I need a job done that is worth $14/hour to my business, and the minimum wage is $15/hour, I am not allowed to hire someone at a price that makes doing that job worthwhile, even if there is someone who desperately wants to do the job for $14/hour.
Anyway, my point is just that the minimum wage is often treated as though it’s a ‘free’ policy, as though there’s no associated cost that society as a whole pays, and it just benefits people without costing anybody else anything. In fact, it operates much the same way as a tax, except that the cost tends to be payed by the least-well-off in society, those who are most sensitive to price increases. And it is non-transparent: the cost increases don’t accrue evenly across all good and services, but in complicated and hard-to-trace ways. I can’t see how this is better than a progressive tax on individuals that funds a minimum income at the same net social cost. The minimum wage seems more expensive and less effective to the same end.
At the extremes, it’s easy to see this effect. Say tomorrow, the minimum wage changed to $100/hour. No one could hire anyone for any job for less than $100. One likely outcome is that the corner store that makes a couple hundred dollars a day would lay off most of its employees. In the short term, businesses couldn’t afford to pay their employees that.
In practice, the minimum wage usually doesn’t work this way. First, increases are small, they’re generally phased in over a period of years, certain types of business and certain types of job are exempted. And I think (though I am less certain of this point) that even a significant increase in the minimum wage would, over the long term, be absorbed by the market in the form of inflation. I’m more certain that, for modest increases, the employment effects on net are few.
But despite that the net effect is roughly zero, the effect isn’t even across affected workers. There is a real increase in unemployment among minorities, women, and other vulnerable classes of worker.
And, as you point out, if the minimum wage doesn’t apply in all jurisdictions, the unemployment effects are going to be worse, as any job that can be done more cheaply in a neighboring jurisdiction will be outsourced. And as I mentioned before, automation will similarly increase unemployment if it costs less than the minimum wage to install and operate a robot that can do the job roughly as well. That will still be a problem in service sector jobs like fast food that can’t be offshored.
While the drive may decrease, there will also be an effect of reducing mobility for anyone whose labor is worth only slightly more than the minimum wage. For those individuals, there will be increased competition for fewer positions, and that will make them reluctant to leave an established job in search of something else.
I agree that it will affect different areas differently, but I think the effect would actually be to increase density. A rural general store has less earning potential than a city convenience store, so they may be less able to absorb the increased labor cost. Over time inflation would probably fix this too, but the lag may be fatal to many rural businesses. One thing the city businesses have going for them is that the raw number of their potential customers who will see a wage increase is greater, meaning their earnings are likely to increase as well.
I agree. Immigration creates more jobs than the immigrants occupy. But again, the effect is not uniform: low-skill workers are actually displaced by immigrants.
And I actually think the minimum wage is good for illegal immigrants, since more employers will be willing to risk hiring illegal workers who they can pay under the table at a lower rate.
To your last paragraph, I admit that my points about increasing labor force participation by people who choose not to be in the job market is speculative. I think it stands to reason, but so much of how minimum wage works across the whole economy is counter-intuitive.
Through consumerism? Immigrants don’t save money to pass to their children in the same way as non-immigrants?
… not to mention sending money to their families across the border.
But then we are talking about the best way of raising the minimum wage. 10.10 an hour would have different effects than a jump to 15.00/hr, a jump of 100% over the current mandated minimum. I don’t doubt that there would be a negative effect on employment levels because small business will not be able to easily absorb the higher labor costs, but studies do show that the benefits to remaining workers would be significant. A higher min. wage would lift many families out of dependency on federal government subsidies which could be directed to assist the 100 to a 150 thousand that are likely to be affected. How a particular company absorbs the higher costs is near impossible to determine because it is not always a math calculation, and certainly not easy to change the operations structures of a company (doing the same production with less employees would require such a change which might not be palatable to owners).
What I’ve been saying.
Nothing in this life is for free. But this is not new and it is why we have current tax exceptions for those that are unemployed or under-employed. In fact, it should be noted, for some it will not be convenient to exchange their federal subsidy for a paying job.
Well, to be fair, automation will be pursued regardless. Any automation that is proven to be effective becomes a norm by the force of competition. A higher min. might accelerate it, but leaving the min. the same will not eliminate automation form replacing workers across the globe. But I wonder how lower birth rates affect the overall available workforce when challenged by automation.
The reduction in positions due to an increase in min. wages will not be felt in all industries. I can see an effect in fast food restaurants, but these will probably be felt as higher prices on products and not a loss of opportunity in other industries. Since most low wage workers are youngters, some in college, I think that their prospects will be affected. Older workers will be challenged to gain a job in an industry that would cease to be the safety net, I don’t deny the challenge, but government can provide subsidies that could ameliorate their situation just as they do today.
I agree with you on this.
I think that some jobs are just too low skill. We have to account for human pride here. There is a reason why you will see a mercedes in subsidized housing and a pair of 200 dollar sneakers on a person living on welfare.
I agree, but it depends on oversight. I don’t think that fast food restaurants will be able to get away with what construction and agriculture get away with.
