I got two items in my inbox telling me how stupid liberals are. I read the articles in question and find myself wondering instead how stupid conservatives are.
The first is from the NY Post: Sorry, liberals, Scandinavian countries aren’t utopias. Did anyone say they were? By comparison, maybe, but already we have a straw man right in the title. They complain that obviously Denmark is a failed state because they have much higher taxes than America. Why, yes, no one claims that we can magically get better services for free. But then the rest gets downright embarrassing: Danes are less sexy and macho, they have high suicide rates, they aren’t a wonderful tourist destination (What? They’ve never heard of Copenhagen?), there aren’t as many really rich and really poor people, and everyone is middle class — no tall poppies allowed. And they are all about equality and sharing.
So Danes operate on caveman principles — if you find it, share it, or be shunned. Once your date with Daisy the Sheep is over, you’d better make sure your friends get a turn. (Bestiality has traditionally been legal in Denmark, though a move to ban it is under way. Until recently, several “bestiality brothels” advertised their services in newspapers, generally charging clients $85 to $170 for what can only be termed a roll in the hay.)
Hmm. Denmark might want to sue for defamation there.
We have a few Danes who read this site. They might want to chime in: I think they’ll tell you it’s not a perfect country, because no country is, and that some of the criticisms might be on the mark, but that the article ignores all the virtues of Scandinavia…or pretends that some of the virtues are horrors.
The second article is from Young Conservatives: San Francisco Raises Minimum Wage 14%, Guess How Chipotle Responded?. Is it that hard to guess? Chipotle raised their prices to compensate. This is somehow supposed to be a surprise to liberals, who are clueless about the idea that better services might cost more…as the sad conservative at the NY Post thought.
Liberals seem to think money just magically appears in a business owner’s hands, dropped in big, brown sacks marked with a dollar sign on them by unicorns and pixie fairies, and the reason these people don’t pay employees is to horde their treasure like Smaug from The Hobbit.
Sorry to destroy your fantasy world, Mr. Liberal, but that isn’t how this works.
You see, businesses rely on profit to survive. Much of the money a company makes goes toward paying the cost of keeping the doors open, leaving a small percentage for the owner to pocket as personal income.
If you raise the minimum wage, you’re adding to the cost of running the business, leaving less money to keep the company open, and less for the owner to live on.
In order to make up for the loss in revenue, a business either has to fire employees, raise prices — like Chipotle — or both.
Yes, people in San Francisco will have to pay a little more for their burrito, which will move money from the pockets of people who can afford Chipotle to the pockets of people who work at Chipotle. That is the desired result.
Of course, it’s also not a perfect result, because it’s shifting money from the middle class to the poor, rather than from the rich — the kind of people who own a Chipotle franchise — to the poor, but it’s a reasonable first step to help people out of poverty, or to help poor workers feed their kids.
You might be surprised, Mr Conservative, that liberals actually do understand that it costs money to build infrastructure and ease inequity. Boy, are you in for a shock when you realize that the liberals actually think the top 1% ought to be paying more for the benefits of society!
First of all: Tom Weiss, please don’t.
The minimum wage point is so stupid. They always point that out as if to say “therefore minimum wage is a bad idea!” Never mind that it’s not minimum wage that would cause prices to go up but the refusal of millionaires to pay more to their workers. Corporations and the 1% are all of a sudden reduce to forces of nature who can’t be accountable for their actions. The hike in prices or the laying off of employees must be directly linked to idea that people putting in full-time hard work deserve to be compensated enough to support a family in a slightly more comfortable way.
Conservatives suffer from a serious case of Dunning Kruger on economics. They’ve balanced a checkbook, so they assume they know everything there is to know and anyone who disagrees with them must be missing one of the basic principles by which their checkbook was balanced.
The idea that others might have a more sophisticated view of economics where my income is your spending and vice-versa, and so making everyone richer makes everyone richer (for example) is entirely outside their intellectual horizon.
And some of them have degrees. In Economics.
It’s a little hard not to despair at the state of that discipline.
Sorry, Mr. Conservative, the world isn’t 6000 years old, jesus didn’t ride dinosaurs, and pi isn’t equal to 3, no matter how badly you want to believe it.
Slavery, as you always are proposing, is not a viable economic system.
Nuclear annihilation of every man, woman, and child in Iran, as you always are advocating, will not solve any of the problems in the middle east.
Making your own strawman arguments and associating them across an entire group of people holding diverse views and opinions is not a debate.
Unless the price increase on the burritos (and EVERY OTHER DAMN PURCHASE IN THE AREA) was proportional to the increase on the minimum wage, it’s still going to be a net gain for the lowest tier workers, and even those just above them (minimum wage increases also put pressure on the next couple tiers to increase wages–if someone can make as much flipping burgers as they can as a stock clerk or landscaper, they may as well apply for those jobs, instead).
However, if the companies were increasing their prices that much, that’s generally solely out of a dickish desire to maintain income inequality.
Stupid liberals: Sure, Denmark sounds good, but high taxes and no super mega ultra rich people!! Also, bestiality!!!!
Stupid liberals: Increasing the minimum wage by 14% raised the prices of Chipotle products by….10%!!!
Much logic, super reasonable.
————
Kyle Smith, author of the New York Post article which was from January, has also written some charming sounding articles recently: http://nypost.com/author/kyle-smith/
“The key ingredient to GOP success – Hope”
“Addiction is not a disease – And we are treating addicts incorrectly”
“Dear President Obama, you are no Ronald Reagan”
“Democrats veer left then blast everyone else for being right wing” (This is the complete opposite of reality, for those not already aware of that)
“We need a resistance movement to stop out of control government”
“Women are not capable of understanding ‘Goodfellas'”
And he has an article about a climate change documentary that has “climate change fanatics” in the first sentence.
Oh, yeah, most of his articles are actually about pop culture, but every third one is about politics for some reason, I guess. Also, one of his statements about Denmark is that are bunch of people who are basically all the same, a mindless collective. Which just strikes me as ironic, considering that the titles of his political arguments all scream “Dittohead Number 79852362”. Just yet another instance of a conservative accusing others of fault in the areas where they themselves are weakest.
Given the conservatives opposition to taxes, I always thought they are the ones who don’t understand that it costs money to build infrastructure.
Steve Ells, who serves as Chipotle’s chairman in addition to co-CEO, made $25.1 million last year. You damn liberals! How will poor Steve Ells survive on less than $25 million a year? It’s like you don’t even think of the consequences of your actions…
Yes, the owner can show you the wages book which proves that his weekly income is not much more than the wages of an ordinary worker. What does not appear in the wages book, however, is the owner’s $250,000 annual bonus.
Chipotle corporate profits rose 52 percent in 2014. Sic, 52 percent. How much did your salary go up, Mr. Conservative? And yet they can’t afford to pay a living wage. Poor l’il fellas. Well, that’s the greed of the line worker for you, always looking for a few more pennies in wage and benefits, at the expense of shareholders. It’s tyranny, I tells ya, tyranny!
As for Denmark, well, they always show up Top Three in that annual Happiness Index review. It sucks to live in a country with a low GINI quotient and awesome public infrastructure and free college and spectacularly healthy people. Sucks donkey dick. We shouldn’t stand for it, and I think the Republican candidates should be asked point-blank what they plan to do about The Danish Dilemma. Drones are probably the answer.
Australia has a minimum wage of almost $20(AU) per hour. Yes, prices are high there, especially on food, both in restaurants and supermarkets. But it also has two interesting effects. First, people can afford the high prices. But second, and more important, young people WANT jobs! Imagine for a moment that you asked a bunch of high school seniors what they plan after graduation, and they replied enthusiastically that they wanted to work!
I wish I could say it’s just super rich business guys exploiting working people, but the problem of income disparity (greed?) runs deeper. My partner works for minimum wage at a San Francisco non-profit. Fortunately they also cover some of the BART cost or it would hardly be worth going to work. It’s disturbing to note that a couple of key people in the organization make in the $200k range while most of the staff earn minimum wage. It also appears that most of the staff haven’t had a raise in some years, except those mandated by the government. Perhaps there’s something in our nature that drives us to create echelons in every human enterprise.
So have I. And it surprised me to see that from the very first day, the instructor was lying openly and blatantly (putting up graphs that he didn’t even bother to change the axis on, telling us they showed the positive effect of deregulation, because you could see all these wonderful increases from 1984 to 2003. The x axis read 1964 to 1983, and I was apparently the ONLY student in the class who even noticed, including my liberal environmentalist friends who just kept on noticing that the teacher was a ‘nice guy’ and very friendly. Ergo, he wouldn’t lie blatantly while expecting his class not to notice).
Economics courses are deliberately structured to assure that students are introduced to only one point of view and do not see the opposing evidence. There are exceptions, of course. My first economics course was much more balanced, but after that, it all went downhill.
“They complain that obviously Denmark is a failed state because they have much higher taxes than America.”
Let’s see…higher taxes, but little or no insurance premiums…no bankruptcy from health care costs…
Sounds like a wash to me…
At least Chipotle’s response is better than how Walmart founder Sam Walton might have responded, and simply skirted the law (at least until the courts told him he couldn’t). If nothing else, he was successful enough to create a multi-billion dollar utopia for his now obscenely wealthy family. Take that, Denmark!
Sorry to those who may be dreaming of their own Walton-esque future, but I will take the collective health and well-being of the country as a whole over the Bond villain fortunes held by a handful of incredibly lucky Americans.
Someone is having trouble with math. This isn’t very difficult. It took Google all of 0.37 seconds to find the Chipotle annual reports. And it further took me 30 seconds of scrolling through the 2014 report to find this, from the Statement of Income:
Revenue $4,108,269
Labor Costs 904,407
(Those are in thousands of dollars, by the way)
Here’s where the math comes in. Divide those numbers to find that labor is 22% of their total operating cost. So, if we assume everyone at Chipotle makes minimum wage, and we raise those wages by 14%, how much should prices rise to make up for that?
C’mon, you can do it!
Right, 14% * 22%, or 3.1%.
So that’s the most prices should rise. In reality, as BeyondUnderstanding points out above, there is a lot of fat that could be trimmed in upper management. And of course a huge number of employees who are already salaried and won’t be affected by this, so the real number will be a lot less. Like, possibly even zero, if they want to keep their prices competitive.
So, raising their prices by 10%? I wasn’t aware that Chipotle was in the seafood business, but something sure is fishy here.
I don’t think revenue is the same as total operating costs, unless profits are considered as an operating cost?
What does actual economics literature have to say about minimum wages? Well….
http://www.sciencedirect.com/science/article/pii/0014292195000356
http://www.sciencedirect.com/science/article/pii/0047272793014113
http://www.sciencedirect.com/science/article/pii/S0047272797000856
http://www.sciencedirect.com/science/article/pii/S0014292100000660
http://www.sciencedirect.com/science/article/pii/S0927537109000025
http://www.sciencedirect.com/science/article/pii/S0014292197000329
Verdict: May increase employment, usually doesn’t reduce employment that much, reduces prices in certain situations, distributes wealth better to some degree, generally increases worker welfare (though there are other articles that make the situation even less clear cut than that. Economics is a very messy, murky science).
Johnny Vector
Look, don’t you come in here waving your facts around. The children might see! And then… then… Oh, won’t someone think of the children!
As a “Scandic” (it’s Nordic) I can say to the author: oh yes, and don’t even mention the horrible weather, unintelligible languages, lack of American football and baseball, long distances. Oh, and did I mention bad weather? Please don’t come for a visit and definitely don’t move here. And under no circumstances look up any lists of patents, major businesses or creative arts produced per capita. Just chant with me: “America is the greatest country on earth! USA, USA, USA!”
What were we even talking about? No, not northern Europe. Must have been Paris, Berlin and Milan.
I don’t think that word means what they think it means. Even so, a small percentage of a huge number is still a big number. Would paying your workers an extra $5/hr (5$/hr*8hr/day*5days/wk*50wks/yr = $10k/yr; * 50 employees = $500k/yr). Will that really impoverish a CEO, who rakes in >$1M/yr. I think not. $500k/yr is still pretty tidy.
I know Kyle Smith’s dropping is an ‘opinion piece’, but is the NY Post so vile that they don’t mind printing outright lies? I know you were snarky PZ with the suing for defamation, but yeah, why shouldn’t a country be able to sue for at least damages when a newspaper prints outright lies about the country?
Then about the young conservatives piece:
Strawman.
We know, strawman again.
Not really. A business not making profits can survive just fine, in a lot of cases this is even a generally accepted business strategy. Have they not heard of startups? Do they really think every viable company cranks out a steady profit? Do they not realise a lot of smaller companies don’t really have profits after all costs and the owner paying themselves a wage?
Poor Chipotle, only having a profit margin of 10% in a highly competitive market!
This also brings me to another point: economics theory tells us that in a ‘perfect market’, the profit margins of all competitors fall to 0%. Isn’t this perfect market without any outside interference something these libertarian assholes always whine about? So why whine now about falling profit margins? They should sheer them on! The invisible hand works!
I will file this under ‘not even wrong’.
Or have less profits. Or reorganise their business. Or cut costs elsewhere. Or…. So now we have a false dichotomy.
Conservatives lying their asses off (and not knowing anything about economics)? Well I never…
Johnny Vector: Please note that the financials are for the whole company. The prices are just increasing by 10 to 14% in San Francisco (and beef prices increased by 4% at other locations, but the idea that that is related to the San Francisco minimum wage is just the assumption of the conservative clown writing the relevant article). It is entirely possible that labor costs are a much larger percentage of their operating costs in San Francisco than elsewhere. (It is also entirely possible that the San Francisco restaurants are significantly less profitable than other restaurants in the chain. Or are significantly more. You can’t really tell from data from the company as a whole.)
( In addition: It’s total operating costs were $3,397,469,000 with a net income of $445,374,000 with a labor cost of $904,400,000, so it is more like labor is more like 25 or 26% of Chipotle’s overall operating costs, but none of that matters that much)
iknklast
I don’t have the same experience. Then again, I studied economics in Europe. Every time I read about economics education in the US of A it tells me it is more akin to an indoctrination camp than really about the science. Then again, maybe I only read about the horror stories.
Anteprepro: Certainly. I was just looking at the overall picture, and making the point that labor costs are a small part of the total cost of the product.
Not to mention that franchises have become their own world of screwing the little guy, which in this case is the franchisee. The amount of revenue from the SF franchises that has to be sent to corporate HQ may in fact force them to raise their own prices more than what an overall analysis would show. Course that isn’t exactly a raging argument in favor of the conservative position either.
As I noted at 22, Chipotle made $445,374,000 in profit last year. And $904,400,000 in labor costs. It has 53,000 employees, for an average of 17k per employee for the year. As noted by Beyond Understanding at 7, the CEO earned $25 million. A mere five and half percent of profits, or half of that it came from labor costs. Such a small percentage. So meager. And it only translates into earning as much as 1,470 of the lesser workers, the peons.
Johnny Vector: I could definitely see that happening, and you are absolutely right that an increase in labor costs of X% probably shouldn’t be raising prices X% unless labor was their biggest cost by quite a margin. Which, in this case, it probably isn’t.
Sorry, wildlife lovers, Yellowstone Park is not a natural wonder. There are no cineplexes nor high-end retail outlets. The restaurants are low-end and far and few between. The road infrastructure is minimal. This last is utterly inexcusable as what few roads there are are right next to literally miles of undeveloped land. This land is so under-utilized that bison, elk, and bear feel free to roam across it at will.
Two comments related to wages:
(1). When I first had a real job, minimum wage was $1 per hour… movies were 75 cents, gas was 35 cents per gallon, McDonald’s hamburgers were 15 cents and a mid-range car was $2,000. 50 years later minimum wage is @ $10 per hour and prices are @ ten times what they were. So what drove what? Did rising wages inflate prices or did rising prices push the minimum wage? I don’t know the answer but it seems apparent that there’s a connection and if that’s true then a rise in minimum wage to $15 per hour will eventually result in price increases to the point that there is no real gain in purchasing power.
(2). My wife and I used to go out to dinner every Friday night, out to brunch every Saturday and probably out one other time per week. Nothing fancy, my weekly outlay was around $40. But prices have gone up to the point that we only go out once every week or two now. I’m sure that the wait-staff, the cooks, the bussers and the dishwashers need (and maybe deserve) higher wages to live but I can no longer afford restaurant prices. My $40 dollars only gets us one meal out now. If prices rise much more we will cease to go out all together. In the long run, this can’t be beneficial to restaurant workers.
Scratch a conservative and you’ll find a Randian Objectivist under their skin who sees himself/herself as a mistreated brilliant capitalist hero surrounded by looters who are holding them back.
iknklast @ 12 — My degrees are in biology, but as an udergraduate senior I took an intro economics course, where most of the students were freshmen aiming at becoming businessmen. But I was the one who knew the answer to the new assistant professor’s first question of economics: What is money (whatever people say is money). I also had the answer when he explained that it made no sense to keep savings when you can borrow and invest, except for people in his own position.. Why? (Because as a first-year Asst. Prof, you are deeply in debt and need savings for safety’s sake — you have no additional borrowing power). And I was the only one to understand the importance of an increasing or decreasing rate of change in income or debt (second derivative).
He gave me an “A”, one of the few I got as an undergrad. I hope he succeeded in his chosen field, but he struck me as something of a subversive, trying to understand and teach about the “dismal science” as a real-world phenomenon, rather than as a mysterious “invisible hand”.
Being called ‘stupid’ by the NY Post or the Young Conservatives is a bit like being called ‘evil’ by Joe Stalin. Projection – it isn’t just for movie theaters anymore.
There’s really little point in arguing with people like this. They are basically in the mode of politics as team sport. So whatever their team does is 100% great and whatever the opposing side does is 100% wrong.
I’ve often said that I could turn the entire male side of the Republican party gay just by having Barrack Obama come out with strong support for heterosexual sex.
Die Anyway,
It’s not easy giving a short answer to your comment, but maybe this will help: your comment only makes some sense if you were talking about a society in which every person got exactly the same wage. This is certainly not the case here, in fastfood joints like the one under discussion, the wage gap between the highest paid and lowest paid employees is enormous. A minimum wage ‘forces’ companies to skew the wage distribution in a more favourable way towards lower paid employees. This can have multiple effects, depending an a lot of external factors, and of course on the policy decisions taken by the company.
An important factor in this discussion is how much of the increased costs can be charged to the consumers. The costs that cannot be charged eat into the profits of the company. Economics tells us that only a monopoly can ‘get away’ with charging all of the increased costs to the consumers.
If the fuckwits had been given the opportunity to benefit from a Danish state-funded education maybe they wouldn’t be so damn stupid.
Btw, the reason bestiality only recently became (explicitly) illegal is because it’s such a fricking non-issue. We’ve had animal abuse laws for a very long time. When the bill made it to parliament it was mostly shrugs all around. Only the libertarians voted against and only because they considered it populist bs and a waste of time.
Personally I think it exemplifies the hypocrisy of claiming to care about animal welfare while supporting a huge meat industry (the politician who introduced the bill was the minister of agriculture ¬_¬).
I’m currently pissed off at about half of my fellow citizens, so I’ll be the last person to claim that I live in a utopia, but Denmark is demonstrably doing better than the US on a large number of issues.
Talk about silly. Especially the bit about having to pay higher taxes for better services. Duh.
That same principle is behind universal healthcare, free higher education and a lot of other progressive concepts: Everybody chips in so that nobody has to go without a reasonably high standard of living and access and so on.
That he considers higher taxes to be a failure of “liberal ideas” (urgh; I’m German and I hate how the word “liberal” is used in the USA, because I’m very much against our liberal party(s) despite being clearly on the “liberal” end of the American spectrum) just shows he either doesn’t understand the ideas’ basis or simply equates not liking the idea with it being a failure.
Also, it’s been a while since I looked this up, but Denmark was or still is the country with the highest equality of opportunities in the world. That’s due to these policies. Being born to rich people is less important there, being good at your job matters more for your personal success. American Conservatives should be in favour of that, but they usually aren’t.
No, the money comes from consumers. They get their money from the wages that a business pays them. It’s a cycle.
If one part of the cycle dries up, e.g. by wages stagnating like they have in recent times, then the whole cycle suffers. Less money going from business to consumer means less money going the other way. So, sure, Chipotle will lose money from having to pay their staff more. But the flip side to that is that other companies will have to pay their staff more, which will mean those people can go to Chipotle more often, which will improve business.
It’s about time businesses recognized that workers are more than just a drag on resources, they’re active participants in the economy. If they get starved then the whole economy stagnates.
Copenhagen is the best place I’ve ever visited! I’m move there in a heartbeat if it wasn’t for two things. My husband has said ‘hell no’ and I have a distinct lack of knowledge of Danish. But if the first were to change, I’d start working on the second!
Die Anyway @ 28
In your second anecdotal example, you left out why your $40 restaurant cash shouldn’t increase over time. Shouldn’t you be factoring in your wage increases over time, and therefore adjusting your restaurant budget?
#37 The really smart thing to do would be to move to Malmö in Sweden. It’s only about 20 minutes away from Copenhagen on the train and it’s a bit cheaper to live there. I think Swedish is much easier to learn than Danish too …
I’ve always been fascinated by the obsession conservatives in general and U.S. conservatives in particular have with Scandinavian countries. My favorite was an op-ed article about Sweden in a paper in Phoenix, Arizona when Reagan was up for re-election. Apparently Sweden was beset by feral gangs roaming the streets and robbing old ladies, who were terrified about setting a foot outside. The infrastructure was breaking down, with raw sewage flowing in the streets and rabid dogs and rats biting people. When I looked around, my explanation for this hyperbole was that conservatives in the U.S. really, really need there to be no contrary examples to their bullshit at all … or people might start asking questions. Having well-functioning social democracies about the place gives the U.S. plebs ideas way above their station. Alternatively, it might just be a case of Ford Prefect being right: when Earthmen stop talking, their brains start working (although substitute “US Conservatives” for “Earthmen”)!
Die Anyway:
Check out this page: http://www.dol.gov/minwage/chart1.htm
It’s a nice, simple chart. The column that’s key is the last one–the effective minimum wage in ‘2012 dollars’. This is the one that correctly pins down the effects of inflation. (Some things are trickier than just saying they cost more. A car from 1950, built today, would have both positive and negative impacts on its price that have nothing to do with inflation or labor costs.)
Note that the minimum wage had the highest purchasing power in the 50s and 60s–roughly equivalent to 9-10 dollars an hour. It started to decline in the early 70s–which ultimately led to the perfect lousy markets for Reagan to come in peddling his voodoo economics.
Oh my, how much lies can fit in two conservative articles. Since people have addressed the min. wage issue (another example: Walmart has recently raised wages for over 100,000 workers by 24% compared to the federal minimum. Have Walmart’s prices rose by a quarter as well? Could it be that even a Walmart CEO is smarter than the average Young Conservative?) I’ll address the suicide issue: It’s bullshit.
Here are WHO numbers for 2012:
USA has a weighted* suicide rate of 12.1 per 100k, versus Denmark’s 8.8 per 100K (Sweden’s 11.1 and Norway’s 9.1)
*It’s important to note that this is a weighted average. WHO explains:
Basically, when you factor in the large age disparity between the US and Scandinavian populations you’ll see that US actually has a higher rate of suicide.
@10 Johnny Vector
The raise was to cover their non-scientific anti-GMO stance. Or, they were greedy and wanted to kick up CEO compensation a few extra million….because….utopia!
zenlike@33
I’m not sure there is an ‘answer’. Note that I didn’t suggest a solution in my original comment, only offered some personal experience that *might* be relevant in this discussion. I would bet that 50 years from now we could have the same discussion about minimum wages, costs and profit… but I won’t be around by then to collect (or pay) on the bet.
Kevin Anthoney@36 basically says what I was getting at. It’s a cycle. In the short term the hourly workers get a boost but over time, 10 – 20 – 30 years, it evens out. Workers will go from $10 to $15 to $20 per hour and find that rent has doubled, food has doubled, clothing had doubled. As I said above, 50 years of work experience has convinced me that minimum wage and prices are somehow chained to each other.
And another thought has occurred to me as I contemplate this topic. We, in America, are in an era when the Baby Boomers are retiring. The percentage of people on fixed incomes is going up. If wages go up, and if I’m correct that prices are chainlinked to wages, then retirees are going to have a harder time making ends meet. If you are already spending 100% of your income and prices go up 10%, you can’t pull an additional 10% out of thin air. Something will have to be cut back. In my experience, entertainment is what gets cut so that segment of the economy will take the biggest hit. What I don’t know is if people on a fixed income are a large enough population to make a noticeable difference in the economy but for sure they will be effected.
I took economics in Oklahoma and Texas. ’nuff said. But, since the book itself had the faulty graphs, I suspect it’s more widespread than just Texoma.
Scientismist – I was also a biology student taking economics (specifically, I was in environmental science). My professor like to hike and visit recreation areas, so he cast himself as an environmentalist, even though the majority of his environmental economics class was how to maximize your profits by cutting the forests down a few years earlier.
Die Anyway #28
You’ve already got some answers and a useful set of data from freemage #40. I would like to chime in with a more visual representation from FRED. You can play with the Graph’s settings, data and transformation to suit your needs. Regardless, you’ll see that the rise in real median income doesn’t have that much to do with min. wage laws, and much more to do with the boom/bust business cycle (you’ll note that the Bush the younger’s years were an abnormality in that there was no real growth during the boom, and that Obama’s years are characterized by a lack of the business cycle altogether due to the depression).
As anteprepro #17 has shown, min. wage is important for worker welfare and increased equality, but likely has no negative nor any major positive effect on the GDP as a whole. However, since inequality and lack of welfare are politically destabilizing factors, and because political instability can harm GDP greatly, high min. wage (to a point, naturally) are a very good long-term economic policy. And it’s the right thing to do, too!
Furthermore, regarding your observation:
Look at this another way. 50 years ago, how much would it have cost you to subscribe to all the major news agencies, magazines and other educational or recreational material at once? How much does your internet connection cost today?
While you think that comparing the prices of the same good can tell you something about the general well-being, in reality our consumption has changed and you must look to the average of many other items to determine actual prosperity or lack of thereof. As an aside: Gas (as well as food, and is some places, water) is the worst possible metric to choose since it’s supply can vary vastly depending on external forces that aren’t controlled by your economy.
Lastly, you asked what drives what. The answer is that min. wages are usually determined by changes in CPI (=consumer price index), so the min. wage increases usually lag behind a rising CPI. However, since inflation can be determined by a change in both the wages and the CPI, and the fact that CPI can fall during recessions, but the min. wage is never decreased means that the actual relationship between the two is pretty messy.
Olli Pehkonen @ 19
Enough said! I should be there tomorrow around midnight.
Will the sun still be out?
Maybe you could show me around!
What are the immigration policies again?
Do you have a spare room?
Oh, we”re going to have so much fun!
I was watching an on demand movie last night and when I was done it went to the tv channel I was on and they had a show about luxury homes. This mansion of marble and chandeliers and gilded fixtures and huge expanses of empty space made me angry. Very angry. Every shot of a new room made me wonder how many homeless shelters could have been paid for, how much of that money could have gone into clinics, just how wasteful the whole thing is.
I had to turn it off very quickly.
Not living in Denmark, (just the Netherlands but it has quite a few of the same policies).
I went through the article and stopped when he complained about the toll being higher then on the George Washington bridge. At that point the distortions became just to blatant
2nd paragraph:
Massive taxes, true we tend to have a higher effective tax rate on the people considered rich since they have the ability to carry that burden (40%+ vs about 25% in the US once you get into the 100k+ income bracket).
Benefits, why yes we tend to see society being better of if the (jobless) poor aren’t desperate so we tend to give them just enough cash and subsidies that they can afford a roof and food, which gives them time to look for a job instead of for money (and unless you are an exception, single mom or have a permanent disability for example, that is what is required to get the money). You’d be surprised how few people don’t want to work.
Ad hominem for being socially and family oriented.
3rd paragraph
4 Ad hominems before making 1 wrong argument showing he doesn’t know economics.
Amount of hours worked per person is not productivity. Heck to keep a productive industry with that claimed 28 hour average workweek requires a very high productivity.
Ad hominem.
Past the big thumb.
As if people holding those happiness surveys do not understand the principle of confounders. Does not back up claims that the survey is wrong or the claim that Danes themselves dispute the survey other then by pointing out that Danes behave differently in traffic then the guy who wrote a book he agrees with. Or behave differently in social conversations then that guy.
Then some more ad hominems.
Best one is that one about Mr, Maersk not behaving as a billionaire should behave (according to Kyle Smith) which is the fault of the Danes.
After they need a drink.
Starts of with another ad hominem.
Then a lie. Effective tax rate for high incomes is between 40% and 45% in Denmark.
Another lie. There are 2 toll bridges in Denmark and neither is the equivalent of a bridge meant to cross a river, these are meant to cross the strait between Denmark and Sweden. The bridges are the Storebælt and the Øresund. The first is about 12 times longer then the George Washington Bridge (the GWB costs $14 for a nomal car to cross), the second only 5 times longer. Not sure where he got his toll price from seeing neither has prices that translate to $45. I’m guessing the Øresund seeing that the Storebælt (€33 or $36 normal car single trip) charges 2.2 times more then the GWB bridge. The Øresund charges (€52.00 if you pay at the bridge) more for but it also has an artificial island (that is the 2 to 3 times length of the GWB bridge) and tunnel after that you pay for (that is the 3 times length of the GWB bridge).
So yes you pay more but you get a LOT more road to travel on per €/$. And worse it is well maintained road/bridge/tunnel where the GWB in 2011 was starting to get long in the tooth at 80 years it started to require a complete overhaul of the suspenders (which was already deferred from 2001 but a study said it had to be started now).
To quote Michael Goodwin‘s paraphrase of Adam Smith, “Low wages and high prices are the same damn thing!”
Once upon a time in a galaxy far, far away, there used to be an american international company whose CEO made 40 – 70 milion dollars a year in wages, not counting his shares revenue. This same CEO has tried – and to some extent succeeded – to gut unions in EU divisions of his company by the threat of moving business to China and Brazil unless they bend to his will and shut up – and then moved the business anyway after they folded. In the meantime he claimed that no bonusses will be paid to employees and no wage rises above inflation level, because the business is hard and times are bad. The only indicator of good business for him was the increase per share.
The company in question had approx 60 thousand employees worldwide. That meant, that this particular CEO could literally give 500-1000 $ as end year bonus to each employee and still get very handsome 10 milion $ a year for his personal use, which is more than anyone can actually need.
And that is only the CEO, other managers higher in the company hierarchy were overpaid only slightly les insanely.
After the company was bought by another – german – company, one of the first things the new german CEO did was to publicly criticise this practice, where managers are ridiculously overpaid far beyond reasonableness.
Story continues on in real life….
_____________
Die Anyway I offer you above written anecdote and these data -click- to think about outside of the scope of your extremely limited USA centric view. As you can see, all the strongest EU economies have higher income for workers than US, and lower incomes for CEOs. And literally all EU countries have lower CEO to worker income ratio.
There is a world outside of USA, and outside of your personal experience. And that world shows clearly, that at least large US companies can increase the income of their employees significantly without increasing their prices one tiny bit, if only conservative CEOs were not so sick greedy. And if USA elected progressive taxation, another thing that most EU Countries have.
Part of the problem is, that those millionares cannot and do not spend that money (because it is simply impossible), so they really “invest it” which means they use it to accumulate more of it on and on and that harms the economy. Trickle down economics indeedy -click-.
Donnie @42:
Yeah, as more people start to understand the reality of that exquisite little lie, Chipotle is going to have to pay more and more money to fake scientists for their FUD. Also, who do you think you are, trying to get me started on anti-GMO crap? I was working so hard not to bring it up! I just want to show the anti-GMO people a stalk of teosinte and ask them how they think that got turned into corn.
Wait, Todd Rundgren is playing at Chipotle? Maybe it’s worth paying extra for stupid non-science after all! Oh, you mean the other kind. Never mind.
Honestly, the explanation they give for the Chipotle deal doesn’t make sense. Chipotle’s motivation is to maximize their profits. Not just stay in business, not make $x where x is some specific target value, but *maximize*. As a publicly traded company, they’re probably even contractually required to do this. So if they think they can take in more money by raising their prices 10%, they’ll do it, and if they think that raising their prices 10% will lower their sales figures enough to reduce their overall intake, they won’t. Whereas the claim advanced in the article, that Chipotle was forced to raise their prices in order to remain profitable, can only be true if Chipotle was knowingly charging suboptimal prices before the wage hike — that they knew they could increase their profits by charging 10% more, but for some reason held off on doing so until it became necessary. I find this implausible.
If there is a connection between the wage hike and the price rise, there’s a much more sensible explanation: that Chipotle has adjusted their maximal-profit calculations to account for customers who are getting paid more. The only problem is that this explanation makes us see Chipotle as run by profit-driven capitalism, rather than by beleaguered underdogs struggling for survival in the face of runaway government interference.
Once you realize that the profits all go to shareholders, who don’t even necessarily contribute to the functioning of the company, you start to question the utility of the whole enterprise. Why should I care about rich scumbag investors?
You mean one fewer vacation home? Oh, the hardship!
@#7, BeyondUnderstanding
Despite the terrible prime rate, you can still get more than a 1% rate on a savings account in the U.S., which means that if you make $10 million after taxes, you can immediately put the money in a bank and retire, living off your six-figure income of pure interest. And that’s just a plain savings account — the more risk you are willing to tolerate, the higher you can “earn”; $5 million in a savings account plus $5 million scattered among a bunch of higher-risk, higher-yeild investments would still be “safe” but probably make a lot more. Since the highest tax bracket on direct income paid in cash is now 39.6%, that means anyone whose pre-tax income is $16556295 or more is basically gauranteed a six-figure income for life, even if they never work again. Considering that whole families routinely live on a fraction of that amount, it is more than enough.
In other words: anything anyone is paid above the magic sixteen-and-a-half-million number is automatically excessive, because they are already paid enough to retire immediately. This guy is about eight and a half million dollars per year above that amount; that’s a fair chunk of change which could be applied to his workers. (And that’s assuming that you think his services to the company are so valuable that he should be rewarded at a rate which would let him retire rich after working only one year.)
AlexanderZ #45:
“high min. wage (to a point, naturally) are a very good long-term economic policy.”
Okay, that’s all well and good to say, but “to a point”—What point? How do we measure the correct point to set wages? I think everyone, regardless of politics, would agree that suggesting a $100/hr minimum wage is ludicrous, as the sudden influx of cash would induce hyperinflation. But how much of an increase is good (won’t induce catastrophic inflation)? Why stop with a paltry raise to only $10/hr, would we not be safe with $20/hr? The AFL-CIO splits the difference at wanting $15/hr—is that too much or not enough?
I’m not an economist, so for me this is all “armchair theorizing”—however, if anyone here is, I would greatly appreciate knowing what tools exist for determining the appropriate wage level.
Ever hear of a living wage? It can vary from community to community, but the idea is that wages are high enough to simply be able to make basic ends meet. Shelter, food, etc.
A conservative friend of mine sent me an article with the Chipotle story in it. Also in the same article it said that beef prices went up 4% at the same time. Chipotle was going to raise their prices because of the rise in their ingredient prices so why are the conservatives up in arms about that???
They value “business costs” over humans all the time.
Not only silly on economics, but sexist too:
As if only men could be liberal.
(Or CEO’s. Or business owners. Or whatever.)
The Vicar @55:
I think you forgot to take account of two things:
1. Inflation. Banks pay 1% on savings, OK (not in my account – I still get 0.01% last I checked). But inflation is running closer to 2%. That means real return is negative: every year, sure you have more dollars in the bank, but they can’t buy as much as last year. So your money is going down even if you don’t use any of it.
2. Lifetime. Why leave your descendants an inheritance? Let’s say I’ve got 1% interest, 2% inflation, and I want to spend 100k a year (in today’s dollars, so my burn rate increases every year). I want to have enough money to live to be 110, just in case. I need a bit over ten million. My cat can have the remaining crumbs (about 3 million if I keel over at age 100).
OK, so the Chipotle is making 2.5x as much. Every year.
I am wondering the same thing raised by BeyondUnderstanding @38.
@numerobis(#60):
Million/Billionaires get the same % on the money they have in their bank accounts.
That is the advantage of not having to put it in a savings/checking account.
Actually, I don’t think a minimum wage increase would be reflected in much higher prices. If the businesses are maximizing profits, then increasing the production cost doesn’t increase the maximum profit price enough to fully offset that increase. In essence, if Chipotle tried to increase the prices to completely offset that cost, then they’d have fewer customers and make less money than if they only partially offset the cost.
So a minimum wage increase would shift a fair amount of money from the rich to the poor (i.e., much of the wage increase would come out of Chipotle’s profits). The middle class would likely have wage increases that would offset the higher prices.
Alexander #56
Nobody knows. Not Robert Reich who’s basing his preferred wage on previous real min. wage. Nobody. Min. wage has never been raised so high that it had a noticeable direct effect on the economy. In any country. Ever. For that reason, given inflation can be compensated by other means (again, up to a point), and that as long as there are people earning above the min. wage (and production has other costs besides workers) would always be below the rate of change in the min. wage. At least that’s what basic economics says. There might be hidden problems, but nobody really knows about them because it has never been done and all research shows that min. wage isn’t such a big deal economy-wise, but very important socially.
Nerd of Redhead #57 has it right – the goal is to make sure that workers stay above the poverty line. 15$ is already the minimum wage in one city in Washington, so it’s safe bet. Even 20$ is likely a safe bet. If you want to be super safe you can define the new min. wage to reflect the living wage in every state, thus creating a self-correcting experiment since the min. wage would adjust itself based on the economical realities in each state.
Actually, given the current deep recession any increase in wages and any increase in inflation would be a blessing, so we can certainly take risks (even though there aren’t any).
The Times indicated that Danes are less sexy and macho. But VIggo Mortensen did his own sword fighting and many stunts in TLOTR movies. I think the slur on Viking manhood is refuted. If the right wing can’t even get that right, they have no hope in economics.
It may move some money from the wealthy to the poor.
People who assert that free markets are good and work efficiently, and minimum wages increase costs so therefore raise prices are contradicting themselves.
Free markets set prices at what the market can bear, raising the cost of production does not raise what the market can bear, prices may rise but only as far as customers are willing to pay.
There are points at which, for business to continue, profits decrease instead of prices rise.
People who argue minimum wages must push prices up seem to be claiming all business is cost plus. Cost plus is a great way to steal from the public who’s government corruptly gives such sweetheart deals to contractors, but it isn’t how free markets operate. If a market is operating on that basis there’s an additional problem in that it is not a free market.
Those complaining about minimum wage increased, like to fallaciously pretend the increase only falls upon company X. When it in reality falls upon everybody the same who pays minimum wage. Therefore, all the cheap burger joints face the same squeeze on costs, and have to raise the prices about the same to cover the costs. So no advantage is gained by any of them.
Now if only McD and Walmart had to increase their wages….then would they have an argument.
I often mention to people here in Texas how much I loved living in California, and I’m often told “But the taxes and the cost of living are so high there!”
I’m quick to answer that we were happy to pay the state income taxes in return for better infrastructure and standard of living. Public transportation is great there, while most Texas cities assume that everyone wants to drive a big honking truck.
Property taxes are actually cheaper in CA. than in TX.
We had no air conditioning bills there , since the daily year-round high was 65 degrees.
Food was fresher, cheaper and better tasting in CA. We lived next to some of the fields that provide fruits and vegetables to the rest of the country.
Since lower-waged people such as sales clerks and wait staff seemed to be better paid in CA, I found the level of service to be better there.
I would much prefer to retire in CA than in TX. If I should ever require a skilled care facility, I would rather know that the employees who take care of me are able to live on one job, rather than those in TX who often have to juggle two or more jobs because of the ridiculously low wages.
We were able to live quite comfortably in CA, and found that we spent less overall than we do in Texas.
I’m sure that there are similar stories from those living in Denmark. Conservatives simply can’t understand that there are better ways to live outside of their bubble.
Taxes.
Are fees.
For living.
In a.
Civilized.
Society.
I have now seen the waters first hand: at a local public university, all of the salaries for senior technical staff positions (ALL OF THEM) are set at a rate for entry-level technical positions in the real world.
So.
The technical expertise isn’t available in-house, thus contracting/outsourcing is the only option (because Stuff Has To Get Done™), which costs 5x – 10x the amount it would take to hire someone.
Or, put another way:
* Lower taxes => lower salaries => spend more money.
* Raise taxes => raise salaries => save money.
usernames:
That’s part of the goal. It’s more money overall, but the important part is that the money is going to a consultancy with a CEO.
AlexanderZ #64 (and Nerd of Redhead #57):
If that is true, then why do the loudest voices in this discussion limit themselves to advocating for single, momentary increase? “Making sure workers stay above the poverty line” is not hard: rather than locking minimum wage to some numerical value, use an ongoing measure of inflation like the CPI. (This is twice as important when you consider the national minimum wage was increased in 1996 and 2007.) Where is the appeal in doing this same dance routine around regressive ‘Thuglicans every decade? Is it really too much to ask that the problem stay solved?
Alexander at 71:
Alexander at 56:
I am actually baffled. So it is difficult and complicated to come up with a simple, one time number to temporarily solve a problem and alleviate poverty, but it is trivial to calculate a value tied to inflation in such a way that ensures that are all workers are above the poverty line, for all time?
Just to expand on AlexanderZ @41, concerning the incredible bullshittery of the suicide allegation:
Here’s the WHO’s breakdown of suicide by gender and age in Denmark, 2006. And here’s the same breakdown in the United States, 2001.
Notice that (reported) suicide rates in Denmark are much higher than in the US for people 65+, and much MUCH higher for 75+. That’s almost certainly because assisted suicide is legal there, and assisted suicide in general is far more socially acceptable than it is in the US. And since Danes are healthier than Americans, they’re also more likely to live to an advanced age and then enter a slow decline.
Notice also that suicide rates for people under 55 are lower in Denmark than in the US…and in particular, for young men under 25, 2-3 times lower. (US boys under 15 are 3 times more likely to kill themselves than Danish boys.)
So: in Denmark, more elderly people are committing suicide—often with medical assistance—so they can have a more comfortable death. In the US, more young and middle-aged people (mostly men) are committing suicide because they find life intolerable and have ready access to weapons. America really doesn’t come out ahead here.
Oh, and the antidepressant thing is also bullshit. Overall (diagnosed) depression rates in the US and Denmark are not statistically different; if depressed Danes use more antidepressants, that’s probably because they have, y’know, actual access to health care.
Alexander #71: I’m pretty sure almost everybody in this discussion would favor indexing the minimum wage. I’m not so sure it should be based upon the CPI, however. The minimum wage should really increase along with productivity (i.e., economic output per worker), which increases a bit faster than inflation.
Anton Mates (#73)
And maybe life wouldn’t be so intolerable for American males if they weren’t all expected to be so ridiculously macho.
The suicide rate is highest among marginalized groups, such as gay and trans people. While being macho may have something to do with it for some people, I don’t think it’s the main factor (except perhaps in that one of the ways to be “macho” is to abuse people).
I’d say that minimum wage law is working as planned if Chipotle raised prices instead of cutting jobs. Slightly higher prices are the best outcome out of three possible ones: fewer jobs, higher prices, less investment into businesses (meaning fewer jobs in the longer run).
If it was just Chipotle facing a wage hike, they would be in trouble – they would be heavily constrained in how much they could raise their prices. But since all its primary competitors are facing the same constraint, they should be fine. It would only be a problem if the higher prices cause a shift in the consumption mix of its customers, such that they shift over to different restaurants or eating out less as a result of those price increases.
Jason Dick (#76)
First, where did I say anything about it being the “main factor”? Second, you don’t see a causal link between obligatory macho-ness and rates of suicide among gay men and trans people?
Brett #77:
A number of studies have shown that the minimum wage has little to no impact on unemployment. There would almost certainly be some shifts, as certain businesses become less profitable and shrink, but others are likely to grow as a result of a minimum wage change.
Also, some of the cost of the wage increase is offset by the workers being more productive. If you have lower turnover, for example, you spend less money finding and training new employees. Paul Krugman goes into some detail here:
http://krugman.blogs.nytimes.com/2015/06/10/notes-on-walmart-and-wages-wonkish/
So overall, a moderate increase in the minimum wage may not increase prices at all in aggregate.
Oh noes, those naughty danes are all into bestiality?
Oh wait, it was made illegal earlier this year, apparently: http://www.reuters.com/article/2015/04/21/us-denmark-bestiality-idUSKBN0NC1YM20150421
On the other hand, in honest, god-fearing, upright, non-socialist, the US of A, it is apparently still legal (or at least, not explicitly illegal) in over a dozen states. Fancy that. https://www.animallaw.info/topic/table-state-animal-sexual-assault-laws
rey fox
I admit I have some trouble with your question of why should you care for “rich scumbag investors”
While I have no great love for the 1% I realize not all investors are members of the 1%. Many if not most retirement funds are backed by investments in stock in public companies and governmental and corporate bonds held by mutual funds there simply is no other way to make savings grow ahead of inflation certainly not a bank savings account. One of the problems in the system as we have it is the only stock holder that the CEO’s are really interested in is themselves and their options. To further their power and influence they have rubber stamp boards that are supposed to in theory represent the stockholders and other stake holders (including labor) in the business but in the end just represent senior management.
I have heard it advocated for a much more democratically operated system
uncle frogy
Whaaaat? I’ve been such a fool! All this time, I never once realised that, when I pay money to a business, it’s this money that goes toward paying the workers! I thought that money went to a factory where they turned it into cheese (why else call it cheddar, hmmmm?) and that workers were paid with totally different forms of money that came from the Netherworld. (I almost wrote Netherlands, but then I realised that this is actually a place…)
Oh, conservative pseudo-journalist, however would I navigate this world without your support? I simply do not know.
(Awooga awooga. Sarcasm alert. Awooga.)
I’ve spent about a year in Sweden altogether, though never for more than 4 weeks at a time, usually a week or two. I speak Swedish. I’ve been to Denmark several times and Norway a few times and Finland once.
In English-language discussions (whether USA, UK, Australia, …), two points of view about Scandinavia seem to dominate, both usually put forward by people who have never been there: 1) it is heaven on Earth, only better, and 2) the society is dysfunctional because of liberal (in the U.S. sense), socialist, etc policies.
1) was never completely true but there was a time, decades ago, when it was much more true than today. Many U.S. liberals (in the U.S. sense) are guilty of basing their impression on Scandinavia in the 1950s through the early 1970s, when something like a social democratic paradise really did exist, especially in Sweden. Alas, things have been moving to be more inline with other “western democracies” and it has mostly been a change for the worse.
2) is complete bullshit. (There are some policies which have been implemented in the last 15 years or so which haven’t really worked, but these are usually not things most English-language pundits are even aware of.)
There is also a myth that Scandinavia is enlightened with regard to sex, nudity, pornography, prostitution, etc. Well, compared to the USA or Saudi Arabia, sure, but that is not saying much. (There is a movie where someone from the US is in Sweden and, purely by chance when trying to escape from someone else or something, he walks into a meeting of a nudist club. Yes, nudist clubs exist, but there aren’t so many that the random foreigner would just happen to bump into a meeting by chance.)
Sex in general: Yes, an enlightened attitude, but not more so than in German and Dutch-speaking countries, say. Nudity? Almost all saunas are separated by gender or require clothing, so definitely very hung up compared to German and Dutch-speaking countries, where almost all are a) mixed and b) have nudity required. Nude swimming and so on is possible at certain places, but not as much as in some other European countries (but, again, more than in the USA or Saudi Arabia). Pornography? Yes, though a) this is changing somewhat and b) easily available internet porn has changed things completely in almost all countries. The Scandinavian countries were the first to legalize hard-core porn, and it was available at general newsstands, not just in sex shops. Prostitution? It used to be a similar situation to many other countries on the continent, i.e. legal, though for various reasons it was never as popular as elsewhere. There has been a big change here, though, in the last couple of decades, making prostitution illegal for the buyer but not for the seller. This is completely driven by ideology, is based on the myth that all prostitutes are forced into it, and has actually made the situation of prostitutes worse, for a variety of reasons.
When I was last in Sweden, about a month ago, by chance I found an interesting paperback at the airport, Fishing in Utopia by Andrew Brown. (Just Google it; the first several hits are about the book.) This was written by an Englishman who lived there for many years and had a Swedish wife and had a child with her and speaks Swedish, so he’s an insider. On the other hand, he can write from the perspective of an outsider. He left Sweden when, for different reasons, his marriage and the old Swedish society fell apart, and returned years later to take stock. It is a wonderful book and probably the only book written by a foreigner which gives a realistic impression, both of the good (more in the past) and the bad (more of that today). (Of course, conservatives will always have the problem that they will perceive even good things to be bad if they go against their ideology.) Anyone even remotely interested in Scandinavian society should read it.
The increase is necessary to get it back to where it should be, as it hasn’t been indexed for inflation or cost of living. Rethug policies.
Aww…thanks for thinking of me.
The actual result will be less people working at Chipotle, or, more precisely, any of the other, smaller restaurants or shops which can’t afford the additional costs. Places like this bookstore: http://finance.yahoo.com/news/minimum-wage-hike-closes-san-213700882.html
The actual result didn’t move money from the rich to the poor – or the middle class to the poor. The actual result has been to tell the poor they’re out of a job.
Additionally, when you increase labor costs you incentivize business owners to find ways to increase productivity through automation.
Here’s a thought experiment – why set the minimum wage at $15/hour? If you’re interested in everyone earning a living wage why don’t we set it to $25/hour? How about $35/hour? If the law of supply and demand doesn’t apply to labor then why not raise the minimum wage to $100 an hour? (Hillary Clinton makes $400,000 an hour but we don’t have to go to that extreme to prove my point.) What is the limiting principle for setting a minimum wage, if we’re going to throw market considerations out the window?
But of course we can’t throw them out the window, can we? The socialists haven’t yet won and the entirity of the US economy isn’t yet nationalized, so that damnable free market still plays a role. So you have to pretend like you’re helping workers at the bottom end of the wage scale when you’re really helping less of them get a job, interfering with the free exchange of goods and services and hurting their chances for a better life.
anteprepro #72:
Three things in response: first, you won’t ever get positive answers on the internet if you storm in, blather ignorant nonsense, and wait for polite correction. (To start: “polite” and “internet” are like “flame” and “gasoline”, you’ll only ever see them together for brief periods.) So some of that is mere posturing: woe is me, please help; part is that I know I am ignorant of the details and will over-simplify based on what people say.
Second: inflation over time gives wages a “half life”: your money will buy half as much stuff after 34.3 years with 2% inflation, and half in 22.7 years with 3%. It doesn’t take nearly this much reduction to put someone below the poverty line if (as Obama has been advocating) a raise from $7.25 to $10.10—which implies an ~30% reduction—is the appropriate minimum. Depending on how close you target wages to that line, even a 1% reduction might be enough to sink families into poverty. You quoted me saying “I’m not an economist”—so yes, in my ignorance it is that easy to lock wages in step with inflation, even while I don’t know the proper measure of either. I agree that maybe the CPI isn’t the right measure—but a few searches online after Nerd of Redhead’s post suggesting it seems to show that’s what every government program uses. If that is a bad measure, at least we’re with professional company in using it.
Finally, this entire discussion has been filled with links about how wage increases do not drive unemployment or inflation—so there doesn’t seem to be any sort of downside or “hidden catch” to tying wages to inflation. (How we determine that initial number is still unanswered; I suspect that calculation has lots of complexity, since nobody seems to offer a basis to calculate this number.)
Jason Dick #74:
You know, in a purely abstract fashion, I agree. As mentioned above, I was using the CPI based on the suggestion of another poster (and the fact that it appears to be the government’s preferred method). I don’t know what the correct index measure to use for wages—I keep saying I’m just a layman and want to hear from an expert. However, if you’ll let me indulge in some “wishes were fishes”, castle-in-the-sky hypothesizing…
I would wholeheartedly get behind any politician who stated their goal was to target the economy toward ~1% deflation over the long haul. Not only would this reshape the wages fight into a somewhat ironic battle to defend the status quo against “conservatives”, it would mean all the retirees who are living on a fixed income (something currently unaffected by minimum wages but independently linked to inflation) don’t lose purchasing power over time.
Frankly, this is the point where I’m the most sure that actual economic knowledge would be most helpful. To me, if arguing that 1-2% inflation is, even over decades and centuries, perfectly sound economic policy, I really want to know what the danger is of shifting the needle ever so slightly to target some other number. (First off, looking at a chart of historical inflation and the dates of recessions doesn’t show any obvious link between economic downturns and inflation rates—again, not an economist, so maybe the danger lies elsewhere. Nevertheless, with the unseen danger still in mind: our current inflationary regime seems to have concentrated a lot of wealth at the top. Maybe gradual deflation works in the opposite fashion? I don’t know for sure, but it does seem possible—but nobody has come forward in this thread with the sort of credentials to answer these questions.)
Are you really that ignorant and arrogant, or are you just playing stupid? You have no credentials, and yet you blather away.
I made minimum in 1970, which was $1.75/hr. Given the ten fold increase in things, $15 minimum wage is not out of line with inflation and cost of living.
Exactly what you have done. Look at theyself before you complain about others.
Hurray. Here comes Tom Weiss to another thread where they can ignore facts, evidence, and logic and just blurt out the same inane and refuted arguments they have in every other discussion. Gibbertarians gotta gibber.
In The Netherlands, a majority of economists are social-democrats.
Tom Weiss, #85
It’s not a free exchange of goods and services. It’s a matter of resources horded by the historically oppressive privileged white class which is still disproportionately horded by them. And they continue to do this under the guise of your horseshit “free market” idea because openly doing it through racism like they did before wouldn’t fly so easily anymore.
In addition to being immoral scum, you are also hopelessly ignorant (and evidently proud of it). You’re a laughing stock.
Btw, I already provided evidence to doubt the grim “people will be unemployed!” picture of the minimum wage that Tom Weiss simply assumes to be true. Right there way back at 17. But Tom Weiss has an aversion to facts so watch them as they can continue those inconvenient details and provide zero good evidence for their own position. It is as predictable as the tides.
So this fact I presented @85 http://finance.yahoo.com/news/minimum-wage-hike-closes-san-213700882.html, illustrating actual people who lost their jobs due to the very minimum wage hike we’re talking about, means nothing? Talk about an aversion to facts…
And while you’re averting your eyes, perhaps you’d like to take a shot at my thought experiment. Why not raise the minimum wage to $100?
Go…
I habe six scholarly articles and you bear it with one news article about one city. You are just so amusing.
Try this that refutes your sorry ass.
http://www.jstor.org/stable/2677856?seq=1#page_scan_tab_contents
We aren’t averse to facts, you are. Liberal economics work, whereas your liberturd economics don’t.
Bonus points: the news article is about one business. One. That was the best you could do. You are a fucking clown, Tom Weiss.
Places like this bookstore…
You really haven’t been paying attention these past few decades, have you, Tom? Bookstores both big and small, global chains and local icons, have been folding for well-documented reasons that have NOTHING AT ALL to do with minimum-wage hikes. Either you’ve never paid any attention to the decades-long conflict between “bricks and mortar” bookstores and online ordering, or you’re just ignoring all that in a deliberate attempt to blame liberal policies for everything that goes wrong in any line of business anywhere.
Seriously, Tom, who the fuck do you think you’re fooling?
…perhaps you’d like to take a shot at my thought experiment.
Perhaps YOU’D like to take a shot at getting your head out of your ass and observing what’s really happening in the real world, instead of hiding in a bubble and calling it “thought experiments.”
anteprepro
I was a little short with your evidence – I didn’t give it full consideration. You cited several papers (abstracts only), almost all of them at least a decade old, stating either minimal negative employment effects of a minimum wage or no effects. Here is an actual paper (http://www.nber.org/papers/w12663.pdf?new_window=1) and this is from the abstract:
This about that last sentence and then think about the group a minimum wage hike is supposed – by your reasoning – to help. The least-skilled, poorest people who need minimum wage jobs the most are the ones losing their jobs as a result of your misguided offer of help.
@ Tom Weiss #85
Re. your thought experiment… no one’s denying that raising the minimum wage raises costs. We’re saying that raising the minimum wage to the calculated living wage raises costs by an acceptable amount. Available data seems to back up that premise. We are saying that no one is going to bankrupt, and therefore there is no reason not to do it. “Oooh, it raises costs” is not an argument in and of itself. What matters is whether employers are capable of paying a living wage while still keeping their business running. They can, so they should, because what right do they have to condemn their employees to a substandard of living just to ensure they get a bit of extra profit?
Except this bookstore, if you had bothered to read the article, specifically cited the minimum wage as the reason for its closing.
Here is the owner himself:”Although all of us at Borderlands support the concept of a living wage in principal and we believe that it’s possible that the new law will be good for San Francisco — Borderlands Books as it exists is not a financially viable business if subject to that minimum wage.”
So…who’s head is up who’s ass Bee?
Thumper, #99
You’re gonna get the usual broken record here.
Free market so the workers should move or switch careers to find better pay. Because that’s easy. Corporations paying a little more so people can live more comfortably while working 40 hour weeks is just too unreasonable. That’s oppression.
Any wage that isn’t a living wage is nothing but a hidden subsidy to the companies. Because unless you think that people freezing and starving to death is OK (hi Tom Weiss), somebody has to pay for that.
It’s an especially cruel way to subsidize the company: You make workers beg for additional benefits, paint them as greedy, lazy, whatever and you make sure that they remain poor for all their lives.
Also, there’s something everybody with a teeny tiny bit of edcuation in economics knows: Increasing the income of different groups has different effects. Increasing the income of low-income people boosts local economy becuase almost 100% of the increase will be spent on goods locally. Increase the income of the middle class and you increase demand for things like houses and cars. Increase the income of the 1% and you don’t increase consumption much. Because, as my economics teacher used to put it, there’s only so many steaks you can eat in a day.
unclefroggy
1. Change the way people save for their retirement. Funds are a really bad way, because if they crah, as has happened in 2007/08, people lose their savings.
2. You can have generous tax-free limits for investment gains that are in certified retirement funds.
+++
As for taxes: I’m German. We pay too much and too few. We pay too much on income, because for years the tax tables have not been adjusted to inflation. So while the money we’re making now from work may only be worth the same as (making numbers up, just to illustrate the point) 30.000 € were in 1990, we’re paying taxes in the same income bracket as somebody who made 60.000€ in 1990. Income from investment, OTOH, has seen a massive tax decrease. It used to be taxed the same as your income tax, so if you paid 40% on your work income, you paid 40% on your investment income. Now you pay 25% flat on investment, which is a travesty. If you have enough money so you don’t have to work for 60.000€ you pay less than a family where two people work their asses off for 60.000€.
+++
Nerd of Redhead #84 and #87:
First, let me apologize for overlooking your basis for minimum wage numbers. That is perhaps not the most reasonable basis to generate a number—it seems to carry far too much personal weight to apply so broadly—but you did indeed provide a basis.
This discussion always makes me think about one of the greatest English language orators of all time, and one of his most quoted speeches (emphasis mine): “We choose to go to the moon. We choose to go to the moon in this decade and do the other things, not because they are easy, but because they are hard, because that goal will serve to organize and measure the best of our energies and skills, because that challenge is one that we are willing to accept, one we are unwilling to postpone, and one which we intend to win, and the others, too.”
Now, Kennedy was speaking almost entirely of scientific endeavors for this speech when he said “other things”, but the same words ring true across a far broader spectrum of proposed government programs. So I ask your opinion: does the rhetoric from our current generation of politicians sound like they treat poverty alleviation as a problem they are “unwilling to postpone and intend to win” or are they letting the stubborn resistance of the Party of No grind them down until they lose sight of the real goal here?
You may intend it as an insult, but “ignorant” is a crown I would accept and wear with pride. I have always believed that listening to other people, rather than insulting them, was the only way we can improve both as individuals or as a society. If that means I come off as “ignorant” for the solutions I propose or asking questions you consider elementary, I will not be shamed by it.
And really, I was viewing my attitude of (partially feigned) ignorance and questioning in contrast to the blind, unthinking attitudes portrayed in the links PZ’s originally posted. Against that yardstick, are you still willing to call me arrogant?
How stupid can Liberturds be:
Real economic data:
http://www.cepr.net/blogs/cepr-blog/2014-job-creation-in-states-that-raised-the-minimum-wage
Which means they are circling the drain to bankruptcy, and are trying to make a liberturdian point, which they don’t. Typical of liberturd “evidence”.
Whereas I have supplied bigger economic looks than a single store. YOU LOSE.
Explain.
You are preaching, without showing evidence to back up your claims, or that you questions should be taken seriously. You want experts to weigh in, which says “don’t bother me with your opinions, I will listen only to experts”. In other words, you don’t want to listen.
This is the authoritarian conceit. You presume to know (1) what employers are capable of, (2) what constitutes a living wage, (3) what it takes to keep a business running. Each of those things are unknowable for the hundreds of thousands of businesses you propose to affect with a minimum wage increase. We can talk in generalities and economists can do studies but ultimately what you’re doing is substituting your judgement for theirs. You’re saying to both a business owner and a potential employee, “I dont’ trust either of you, therefore I’m going to tell you both what you’re going to do and how you’re going to do it, and I’ve got a gun so you must not disobey.”
The frustrating thing is that none of this is necessary. The market ably determines prices for good and services, but for some reason progressives don’t want it to determine the price for labor. I would prefer to treat everyone as equal and trust that they, not I, know what is best for them.
Yes and one of the big issues, that I’m sure is completely ignored by those like Tom Weiss, is who picks up the tab when companies don’t pay their workers a living wage? In short, the American people.
Walmart’s low-wage workers cost U.S. taxpayers an estimated $6.2 billion in public assistance every year.
Although, to be fair, I’m sure the typical Libertarian response would be to blame all the government assistance and petition for it’s removal. You know, cause maybe if their kids get hungry enough, that might motivate those lazy poor enough to… I don’t know… work harder?
You presume to know (1) what employers are capable of, (2) what constitutes a living wage, (3) what it takes to keep a business running.
At least we’re trying to get a good read on such things, by actually observing real-world events. That’s more than you can say.
Each of those things are unknowable for the hundreds of thousands of businesses you propose to affect with a minimum wage increase.
“Unknowable?” Really? The only people who use that word are backward, ignorant authoritarians who can’t stand the idea of other people thinking for themselves and solving their own problems. The fact that you use it once again proves that your libertardian ideology is more a backward religion than an actual political-economic philosophy.
Seriously, Tom, if all of those things are “unknowable,” as you just said they are, then you can’t possibly know whether your free-market philosophy even works.
It’s pretty fucking stupid to say it’s “unknowable” what it takes to keep a business running, when so many people seem able to do just that, all over the world, both with and without regulation. Do you ever even listen to yourself?
A quick correction to an earlier post, #73.
While there is somewhat public support for legalizing assisted suicide here in Denmark, it is absolutely NOT legal at this time. Assisting someone with suicide, however well-meaning and caring you are, will very likely result in you being charged according to danish penal code, article 240 (about assisted suicide). If you’re lucky, you’ll be charged with article 239, which I believe is the lesser of the two.
Except this bookstore, if you had bothered to read the article, specifically cited the minimum wage as the reason for its closing.
Yeah, business owners have NEVER been known to be incompetent, make fatal mistakes, or try to blame others for their own failures.
If only ONE small business blames a particular policy or circumstance for its failure, chances are they’re wrong. You need a PATTERN of business failures — as in, plural — before you can even think of blaming a policy or circumstance that applies to businesses in general. Where did I learn that? In the very same ECON 101 class where you get your entire free-market microeconomic religion.
Oo, just found a good article summing up the general ideas economists have in regard to the minimum wage, including allusion to at least one of my studies and the author of the one study The Clown Prince of Glibertarianism could find: http://www.washingtonpost.com/blogs/wonkblog/wp/2014/01/04/economists-agree-raising-the-minimum-wage-reduces-poverty/
There is debate about the effects on employment but even the “minimum wage opponent”‘s research agreed with the findings that it alleviates poverty.
I was completely baffled by Tom Weiss‘ use of the word ‘authoritarian’ in previous threads. Now I finally caught on: just like any good right winger using words like ‘liberal’, ‘socialist’ or ‘communist’ for things they don’t like, Tom has chosen to use the word ‘authoritarian’ to denote everything he doesn’t like or understand.
Suffice to say, Tom is completely clueless of economics, and a prime example of Dunning-Kruger at work.
For those of you unaware of the fine comedic stylings of Capitalist Lord Weiss, and who are just in the mood for a bitter, soul-wracking chuckle, here are the two recent threads where his prior turds have the made the biggest splash:
http://freethoughtblogs.com/pharyngula/2015/07/07/so-they-were-little-more-than-script-kiddies-after-all/
http://freethoughtblogs.com/pharyngula/2015/07/11/it-could-be-worse/
Please note that it does actually get worse in the It Could Be Worse thread: it ends on a rather unfunny note, due to some misogyny rearing its ugly head. Anyone surprised?
You presume the same things. We have a better understanding of economics that doesn’t rely upon well refuted and illogical slogans like you use.
LIving wage is definable. You just don’t like the definition, so you don’t believe it can be defined, which is more sloganeering. More obtuse ignorance and arrogance on your part.
Germany half a year ago raised minimum wage significantly. NO negative economical effects ensued, NO increase of unemployment. What did occur was LESS dependancy on “gubmint handuts to lazy peepl”. Despite libertarians predicting the opposite, their doomsday scenarios did not realize in the slightest. You can find this information in a few seconds using google.
Tom Weiss, your theory has been falsified by real-life experiment, you dishonest hack.
I am not intersted in your response, because you contradicts yourself again and in this thread, I am putting it here for those who do not have shit for brains.
Thank you, before-before-supportive, for those links. Here’s the bit of pure stupid misogyny on Weiss’s part that took less than a second to jump out at me:
If there is any sense of coercion it is of her own creation.
Yep, he really did say “the silly emotional woman only imagined she was being coerced.” This is libertarianism at its most clueless, most reactionary, most posh-white-male-American-centered, and most morally retarded.
Tom Weiss_acre wrote:
So, telling employers to raise the minimum wage of their least paid workers causing the employers to fire those workers, is a “misguided offer of help”? Who is really being greedy here, and refusing to release even a modicum of their PROFITS to people who are working for money to pay for food?
To blame increasing minimum wage requirements, while disregarding the employers actions, is the actual misguided outlook.
As for your hypothesis query: “mimimum wage” is not an arbitrarily assigned amount. It is derived from the cost of living: the minimum required to provide adequate food and basic utilities and housing. So, to ask, “why not $100/hr??”, is out-of-range. So that hypothesis can be dismissed without consideration.
Also, it’s “funny” (in a really tired, stale and unfunny sort of way) how libertards like Weiss only say that wage-hikes at the BOTTOM of the pile cause unemployment and general economic havoc. What about wage-hikes for CEOs, or shareholders getting bigger cuts of profits? What about across-the-board raises for middle-managers or VPs? Don’t they cause the same problems for the same reasons?
Just for kicks I took a look at the link Mr. Weiss provided. First of all, it’s not a peer-reviewed paper, it’s a think tank report. Secondly, it does not use any of the standard meta-analysis tools, as far as I can tell. Indeed, it has just one set of tables at the end, summarizing the papers they studied. So, very difficult to draw any conclusions. But the tables are a nice summary, so let’s look at them.
Just looking through the studies in Table 1 (studies on the effect of minimum wage in the US) that don’t have anything in the “criticisms” column, the studies that show negative elasticities appear to be mainly in the range of -0.1 to -0.2. So, what if things are on the worse end of these studies? That would mean the elasticity is -0.2, which is to say (if I understand it right), that employment decreases by 0.2 times the increase in wages. So if we go from $7.50/hr to $10.00/hr, that’s a 33% increase. Multiply by 0.2 to about a 6% decrease in employment.
So (again, this assumes the true answer is at the worse end of the study results), 6% of minimum wage earners lose their jobs, while the 94% of them who keep their jobs get a 33% increase. Total net increase in payments to workers from companies is 0.94 * 0.33 – 0.06 * 1.00, or a 25% increase.
Since we’ve already determined that these workers can’t support themselves at those pay rates, that’s a 25% decrease in government assistance to the minimum wage workers.
This, and once again, this is the worst case interpretation of that paper, does not sound like a bad thing. And of course assuming we’re at the bottom end of the range is not the most sensible way to interpret the data. Just the fact that the results have so much scatter shows that other factors are far more significant.
Raging Bee @ 18
Yeah but then that’s smart businessmen making an educated decision. Not the evil government meddling in your business operations.
I think it’s more telling that most CEOs would rather let their business go belly-up rather than take a pay-cut themselves.
@ Saad #101
Yeah, I could predict the answer I was going to get as I was typing. But still, I’ll keep plugging away in the hope that he’ll one day grow a conscience.
@ Tom Weiss #106
Why must you insist on being such a moron? “Authoritarian conceit”? The living wage is the minimum hourly rate necessary to meet the cost of living in a given location. MIT even have a living wage calculator for the US. What, you’re insisting that people ought to have the “freedom” to not earn enough to pay their bills from one job? You utter fuckwit. No, I suspect this more about the employer’s “freedom” to pay someone so little that they are forced to work two jobs just to pay the bills. ‘Cause they have the right to keep costs down, don’cha know. A world where the owner of a company has to take a miniscule hit to their profits is not a world worth living in!
Tell you what. Show me one company where the owner’s quality of life will be significantly impacted by this. I’ll wait.
And what’s a gun got to do with anything? No, I don’t have a gun, and do not wish to own one. The fuck is wrong with you?
Is Tom “people can choose not to eat” Weiss at it again? How tiresome…
What strikes me about the articles and dear beloved Tom, is how simplistic the thought process is. Paying more in taxes or for good automatically equals bad. It doesn’t matter what good comes from paying more. It’s greed and nothing more, like toddler saying “MINE, MINE, MINE”. I don’t mind paying more for a burrito, if I know I’m helping the person putting it together live a better life. I don’t mind paying taxes if they are going to good schools and health care, indeed we moved to an area with one of the highest property tax rates in the city just for the benefits.
Tom,
Let me guess a minimum wage increase is violence? I don’t trust business owners to do whats best for their employees. History is pretty clear that business owners will take advantage of their employees as much as they can, working men, women, and children to death to earn a bigger profit.
Hail the mighty all knowing market!! It knows what is right and would never be wrong. Just close your eyes and let the market decide who should die in the streets.
Anyone who puts in 40+ hours/week doing work that is absolutely required in order for people in the corporate world to have Ferraris, swimming pools, and fine dining deserves a wage which lets them comfortably provide for the basic needs of their families.
We do know. This is simple stuff.
We also know you are an idiot. This is also simple to see.
What strikes me about the articles and dear beloved Tom, is how simplistic the thought process is.
It’s the same sort of simplemindedness that drives nearly all of the backward religions that have hindered human progress: take one really simple and apparently-internally-consistent set of rules, make a full-blown religion out of it, and henceforth automatically assume and assert that the rules are adequate to explain EVERYTHING in the known Universe — and never bother to verify or fact-check any of your assertions. Libertarians make a full-blown religious worldview out of ECON 101 in pretty much the same way as Christians insist that the Bible (at least the parts they like) answers all questions about everything. And like the new and hyperactive convert, libertarians simply take the most basic ECON 101 principles as the whole of all knowledge, stop learning, and don’t even move on to ECON 102.
Seriously, one of the first things an econ teacher tells you is that the principles of economics are just that — general principles of economics, not ironclad laws of nature. And that’s one of the first things libertarians totally disregard as they build up their pretense that they know everything.
Johnny Vector # 119 First of all, it’s not a peer-reviewed paper, it’s a think tank report.It’s a right-wing think tank, with invisible patrons. Which makes their analyses bought and paid for, and not to be trusted.
Yeah but then that’s smart businessmen making an educated decision.
Smart businessmen like Donald Trump? Or smart businesswomen like Meg Whitman and Carly Fiorina?
Wow, Nerd, there are no words to express how surprised I’m not.
Dang, borked the blockquotes #127. Quoting Johnny Vector up to the link, then the link and my conclusion.
*preview doesn’t work at work*
Thanks, Nerd! I couldn’t tell for sure which way they leaned, so I simply looked at the paper itself. The lack of any standard meta-analysis did kind of telegraph the point that they were searching for a particular answer. Too bad for them that even after all that brewing they still ended up with such weak tea.
Here’s a clue: If you cannot pay your employees a wage they can live on, you do not have a “job” to fill. Rather, you are sponging off of society to support the people making money for you.
Unless the employer pays a living wage, it is the employer who is the cheat.
Charly
Small correction: For the first time we actually HAVE a minimum wage. Too low and employers are trying to cheat their employees, like deducting 50ct an hour for “private consumption” from waiters, whether they drink their employer’s tapwater or not.
But yeah, the effect is as decribed: less people who need benefits in spite of having a job.
+++
Also, who’s betting: Tom Weiss has never heard of the “Tragedy of the Commons”
Raging Bee @ 118:
I hope that was a typo.
Thumper @121:
Thank you for that MIT living wage link!
a_ray @132
QFFT
Companies paying less than a living wage – and of course the CEOs/shareholders/other individuals deciding to do this – are parasites.
Giliell
No bet. IME, almost all libertarians have heard of it, although none of them appear to have actually read it. Generally it’s name checked as a justification for abolishing the commons entirely and privatizing everything. In fact, the conclusion that Hardin’s paper arrives at is that the proper solution to the titular tragedy is the same process that created the commons in the first place: mutual coercion mutually agreed upon, i.e. democratic governance.
Nerd of Redhead #105:
The minimum wage has been increased about 20 times since initially instituted in the US, but the past few raises seem to follow an irregular, not-quite-decade cycle: ’78, ’89, ’95, 2006. Each and every time, the same arguments have been trotted out on both sides, and the cycle restarts. History has made it clear merely changing the wage number lasts only a brief period before fiscal policy lets the poverty line “catch up” to the increased wages.
Kicking the can down the road is easy, but the constant struggle may cause a loss of focus (plus it keeps giving the Republicans the opportunity to whittle us down to a weaker “compromise” position that does not suffice). As a result, facing the root cause head on and seeking a permanent resolution is much more desirable to me. “We do this not because it is easy, but because it is hard.” Why do our leaders seem reluctant to propose solutions, hard they may be to pass, that seem to clearly ensure this ensures the song-and-dance routine we’re currently playing with Republican opposition does not recur ever again?
If all we have are opinions, then on what basis can we truly weigh opposing views or suggestions? You say inflation is measured by the CPI but then someone [Jason Dick #74] comes along and says “No no, wages should track productivity instead of consumer prices”. Should that suggestion be considered seriously, or dismissed offhand as a smokescreen for some hidden agenda?
Asking for “expert”s doesn’t mean I only want to hear from Paul Krugman or some PhD in Economics—this is the wrong forum for that. All I really care about is seeing some‐ANY—basis for your statements: research papers, op-ed pieces, Wikipedia … something so that I can immediately know when people are staying grounded to reality and when they’re just blowing smoke. If asking for expertise is inappropriate, what method do you suggest?
Alexander
1. The minimum wage is not the only factor in the equation.
2. Fiscal policy is one thing, inflation another, other government programs a third one. Thee are many that I’m missing. Which direction has each of these moved?
I learned this from my grandpa, a devoted trade unionist and scialist: If you don’t care for the problems that people have NOW, you won’t get them to fight for the future. Why should they trust you with their lives if you don’t show enough care for their conditions right now? Or as a friend of mine said: The left-wing opportunist says “all or nothing” and ends up with nothing.
Dalillama
I wasn’t even thinking about the depths of the problem, more about the simple observation that an individually logical and rational decision leads to a bad outcome for the whole community which in return negatively affects the community. Because that seems to me to be the libertarian cornerstone: individual employers will do what’s best for them end therefore the result will be beneficial for all of us.
BTW, has Tom Weiss ever explained how low-skilled workers benefit from the existence of jobs that pay so little they can’t survive on them?
re 138:
consider the consequences.
While it may be better, long term, to let prices return to a lower value due to market forces of “being too expensive for the masses to buy”. I advocated that myself, at one time and was quickly admonished with documentation about the actual danger of deflation vs. inflation. The short term cost, of having the masses unable to buy those goods, is much worse.
To reiterate what I’ve heard many times from many sources: raising the minimum wage, even increasing prices as a result, is an overall improvement to the economy. The value of money is as it flows, not if it languishes in a bank, labeled as “profit”.
Alexander #86:
That would be incredibly destructive, and drastically redistribute money towards the rich. The problem here goes by the name, “downward nominal wage rigidity.” This basically means that for whatever reason, employers are loathe to cut wages in dollar terms. See here for some data:
http://krugman.blogs.nytimes.com/2011/07/09/why-are-wages-still-rising-wonkish/
In practice this means that employers fire more people, which means that an economy with deflation is an economy with heightened unemployment/underemployment.
It also has the problem that it would increase the real cost of loans for many people, likely causing many to default.
Bear in mind that in the US, the period with the highest average inflation (the postwar era) was also the period with both the fastest economic growth and fastest increase in real incomes for the poor and middle class. There are surely other reasons why this is true, but it does demonstrate that moderate levels of inflation (at least 5%) are nothing to be worried about.
As inflation increases, theory says that a number of economic inefficiencies start to become more prominent (personally, I doubt they’re noticeable until at least 7% inflation). But low inflation creates huge dangers for the economy: when there is a crash, the central bank tries to buoy the economy by lowering interest rates. But it can’t lower interest rates much below zero. This places a floor on how effective monetary policy can be.
If you start from a higher inflation level, then interest rates before the crisis are likely to be higher, which means the central bank has more room to stimulate the economy. The lower inflation is, the less room the central bank has to maneuver. Inflation probably doesn’t have any impact on the risk of a financial crisis, but it has a large impact on the central bank’s ability to deal with such a crisis.
There is the outside possibility of using fiscal stimulus instead of monetary policy to stabilize the economy, but in practice governments have a terrible tendency to cut spending when the economy tanks (which is actively destructive to both the economy and the government’s ability to pay its debts).
Scandinavian countries (and to a lesser extent Western European countries in general) come up pretty often in U.S. Political debate because they represent the ideal society for strong liberals (in the U.S. Sense of the word) and everything that should be avoided for strong U.S. Conservatives. Never having lived in Europe, I don’t think I can fairly compare the two. I do know that a close friend of mine who lived in Europe (Germany in his case) liked many things about it, but ultimately chose to move back to the U.S. My friend said – and I think he might be onto something – that one key difference between the two countries was that U.S. Society emphasized the freedom to rise OR fall as far as luck or work or talent or lack thereof could take you. German society, on the other hand, emphasized a sort of “golden mean” (or, if you wanted to be more negative about it, mediocrity). The aim in Germany was to help everyone who fell too low, but also to push down anyone who rose too high. The idea of pushing down someone who is financially successful through extremely high taxes is anathema to many people in the U.S. – not necessarily just conservatives either.
Alexander
While various welfare programs are already indexed in some ways, they are still being relentlessly attacked by conservatives both directly (Republicans who want to defund programs) and indirectly (playing with numbers to show that the actual index is lower than it really is). Should the min. wage be indexed such pressures would increase even more and ultimately may destroy the program. Naming a set min. wage every so often is simply the easiest political action at this point and can achieve the desired goal (though Obama’s 10.1$ fall below the living wage in many states and for many family sizes).
badbadbadBAD!
Human population is growing and human consumption is growing. Setting a deflation target would force people to consume less then what they’d prefer to consume given reasonable inflation. That means mass unemployment, sub-standard living conditions and starvation. Not a very good thing.
Please note that there are people that want deflation. They are the ones who keep calling for a return to the gold standard (hard money translates into real deflation during an economic crisis) or keep claiming that hyper-inflation is around the corner. Why are they doing that? Because the very rich would only benefit from a deflation since their assets would have even greater value. Whereas people in debt, or with very low assets or employees (i.e. people who rely on companies to go into short term debt in order to expand a business and thus provide work) will all suffer.
Look outside. The current deep recession is accompanied by either below-target inflation (US) or real deflation (EU). As you can see it translates into massive unemployment because both businesses and consumers are afraid to go into short term debt to make economical investments (for a family it may be buying a car or a house, for a business it’s investing in better equipment or expanding to a new location) that allow economic growth. Deflation is a horror best avoided.
What are you talking about?
US inflation correlates perfectly with US GDP growth. The only reason that inflation isn’t becoming negative in the past decades is because we’ve learned how to control inflation to a degree so that it doesn’t turn into a deflation during a recession. Nevertheless, if you look at the charts you’ll see that inflation is either negative or close to zero during each recession, except for the late 70s-early 80s oil crisis which was an anomaly.
On the contrary, inflation erodes accumulated wealth and accumulated debt, thus acting as a vehicle of equality of sorts. Our current inequality has nothing to do with inflation targets, and every analysis (including by people who want more inequality) shows that our inflation targets are bad for the very rich and good for employees.
You do realize, don’t you, that making comments like that exposes you as a partisan hack, rather than someone interested in serious discourse?
That’s an Ayn Rand reference. Since all government action (per her) is backed by force, men with guns, all regulation is the equivalent of a government employee pointing a gun at you. Really.
Giliell #139:
I don’t get why people seem to think I’m against increasing the minimum wage: I’m not. I’ve never said anything of the sort: if anything, I’ve argued that you aren’t doing enough because the current, semi-periodic raises should be replaced with a continuous track to inflation. Fix wages and the problem that forces periodic fixes to wages.
Slithey tove #140 (not quoted) and Jason Dick #141:
I understand both of you talking about very similar (if not identical) issue,s but I have to disagree. There is a fascinating paper published by the Bank for International Settlements from a conference they held about 10 years ago on deflation and low-inflation economies. Well,what do they say regarding wages rigidity?
“Indeed, recent wage setting behaviour in Asian economies experiencing persistent deflation has exhibited more downward wage flexibility as the deflation environment became more familiar. This all goes to suggest that such notions of downward wage inflexibility that were formed during the Great Inflation may in fact be regime-dependent. It is possible that once a low inflation or moderate deflation environment were to become more familiar, the past psychological aversion to downward nominal, rather than real, movements would become less of a constraint.” [PDF pg 10]
It seems deflation by itself may not be that problematic—just like inflation, only unexpected (sudden?) changes in the monetary regime precipitate unwanted economic behavior. It seems only logical to me that if there is bad inflation (like the “stagflation” of the 1970s) determined by more complex factors than just the rate set by banks, then there can also be good deflation (also determined by something more complex than the rate). So of course, the real danger isn’t that deflation is inherently bad but that:
You really do sound convinced that inflation-targeting and interest based monetary policy is the only effective, proven system. But me? I see your fears and think “Replace the current interest-based policy with a stimulus-based one like the Works Projects Administration? Oh not that, please! Save us from historically validated, effective systems, whose secondary social effects are also beneficial! </sarcasm>”
While fiscal stimulus is undoubtedly a good idea, the problem is that it’s difficult to pursue in practice. You would need to have automatic systems that engage in fiscal policy for it to have any chance of success, because the overwhelming political bias in nearly every nation is to do the exact opposite: to cut spending when the economy tanks.
Inflation targeting is a good idea not because it’s the best possible policy, but because it’s policy that is well-implemented most of the time.
As for deflation becoming normalized and reducing downward nominal wage rigidity, well, the problem with that idea is that it’s proven that it takes decades of high unemployment, at the very least, before that is likely to no longer be an issue. I’m just not willing to consign millions of people to decades of unemployment to implement a worthless policy.
BIS is always in favor of reducing inflation, no matter the rationale. I’m not sure I’d cite them for any intellectual content.
MichaelE @109,
Thank you for the correction, and sorry for the misinformation! It appears to be a popular myth (which Wikipedia has bought into) that assisted suicide is legal in Denmark. A big chunk of the population approves of it, and a fair number of Danish doctors are willing to say (anonymously) that they’ve actually helped with it—but you’re right, it’s unambiguously illegal there. Apparently it’s never become a politicized issue like it has in, say, the Netherlands.
A. Noyd @75,
Traditional masculine norms are certainly a factor. Multiple US/Australian studies have shown that more stoic and success-focused men are at higher risk for suicide. Traditional masculinity makes it hard to get psychological help, from loved ones or from our healthcare system.
Jason Dick @76,
AFAIK, this isn’t exactly true. American LGBT people, particularly male ones, have a higher rate of reported suicide attempts than their straight cis counterparts, as well as a higher rate of diagnosed depression. But they don’t actually complete suicide attempts at a higher rate. (Or so say the relatively few studies that have been conducted on that. There was a study in Denmark that had different results; gay men with registered partnerships lived longer than straight men, but also committed suicide more often.)
This parallels the “gender paradox” in suicide, found in many countries including the US: Females are much more likely to attempt suicide, to end up in the hospital as a result, and to be diagnosed with related disorders like depression—but males are much more likely to actually die by suicide.
So it seems like straight cis males are the odd ones out here; they report less depression and less self-harm than women and/or LGBT people, but kill themselves more often.
(In the US, you’re also much more likely to die by suicide if you’re of white or Asian descent, middle-aged or older, and single or divorced. That particular risk doesn’t seem to have a lot to do with marginalized group membership–in fact, membership in many ethnic minorities is protective, possibly because they have strong moral norms against suicide.)
Yeah, see.. this is the problem. Its like the whole MvDonald’s things. Someone ran numbers and concluded that a mere 50 cent increase in the cost of a burger would let them “double”, due to volume of sales, the amount paid to *every employee* including the CEO. Only… That isn’t what actually happens – what does happen is that they would raise the cost $1, triple the salary of the CEO, increase the amount paid out to stock holders/board members, then, maybe, increase the pay of the lowest person working for them by all of 10%.
Now, I would call this dishonest. So, sadly, would most liberals in general, who all tend to “presume” that companies have their own best interests in mind (and that they are capable of recognizing that people able to buy their products are in their best interest), and the naivete shown is **purely** based on the disconnect between what is rational, logical, sound, and forward thinking, vs. what the damn corporations actually do.
In short.. we can’t help but, no matter how jaded, look at the magic trick, and for a moment, how ever brief, hope that the guy pulling cards out of thin air is actually performing real magic – even while knowing that, in reality, he just used slight of hand to steal our wallet. This may be naive, and delusional, but without holding to the hope that people will, if given enough opportunity, act sensibly, to improve the world, we likely all be out there doing what the CEOs are doing – selling people things they don’t need, which don’t work as well as they could, for more money that people can afford, while raking in more money that anyone rightly deserves, even if their salary wasn’t a the biggest con job since the invention of religion.
Of course is doesn’t surprise anyone that companies will pull this crap. No more than it surprises any of us that some halfwit will defend the practice, on the claim that the companies in question are losing “profit” due to what minimum wage earners are being paid, which might be a few million dollars, and not, say, the one asshole in the company being **personally** paid a few million dollars, all by himself.
Its damned easy to run a company at a loss. There are idiots that do so all the time right here in the town I live in. Heck, my own cousin was doing so, right up until he bankrupted his company. All that is requires is that you take every single dime you can manage, to line your own pockets, and then blame the other employees for being “too expensive” to keep on, and keep paying. Who, other than you accountant, and lawyers, will know the difference?
scienceavenger #145
It was always interesting to me, the libertarian mantra about “force” and “men with guns” concerning governmental regulation. However, it really makes sense because the government and their proxy “men with guns” are really the meddlesome kids in their power fantasies.
They would be able to cheat whomever, use whomever, rob whomever, steal whatever, amass a vast wealth on the broken backs of the lesser, stupid poor, all without consequence – if it weren’t for those “men with guns”.
These “guns”, this “force” is so often chanted about by libertarians because these are the only things stopping them from not only “fucking you and getting mine” more easily – but keeping it without any accountability.
anteprepro
Not only are you lying, you’re trying to smear me in this thread with made up ad hominum attacks from another thread because you can’t wrap your head around my arguments and come up with a coherent refutation. Dispicable.
I just thought it was funny. It wasn’t a serious argument, even though it is true that Clinton has made $400,000 for an hour speech. If you can wrap your head around why someone thinks her time is that valuable, even though she’s produced nothing of any value in the private sector, then maybe you can start to see my reasoning.
It is a staple of libertarian philosophy, not exclusive to Rand. And it is undoutedly true. Ask Eric Gardener. Or simply name for me a government requirement of its citizens which is not backed by force.
Interesting. You’re asking me how workers benefit from the existence of a job?
The idea that any job, no matter how invaluable, should require an employer to pay a “living wage” is incredibly offensive to me, and it should be to you, and it should be to any low-skilled worker trying to make a better life for themselves.
You are saying that low-skilled workers have no value, or more precisely have only that value that the government assigns them. You are saying that they can steal from a restaurant owner who, for example, has used their intelligence and creativity to create a menu and an atmosphere and a brand that they hope people will voluntarily choose to frequent and risked their livelihood to turn that abstract concept into a reality. And it is stealing – for the government to force that restaurant owner to pay a dishwasher one penny above the value of their labor is to steal from the restaurant owner.
If that dishwasher cannot live on the value of their labor, they have a choice. They can choose to increase their value or they can choose not to, but what they should not have a choice to do is to tell the restaurant owner – at the point of a gun – that they must give them more than they are worth. To mandate this transaction is to steal the earned money of the owner and put it, unearned, into the pocket of the dishwasher. To value the dishwasher for their lack of skills above the owner for their mastery of them. To tell the dishwasher they do not have to succeed while punishing the owner for doing exactly that.
This is just part of the moral bankrupcy of progressive economics, which continues on despite the failure of the “war on poverty” or many other such wars. But if you’re still not convinced, take a look at this organizaton – http://www.doe.org/ – the next time you wonder how low skilled workers benefit from a job, any job.
@ Gilliell #133
This is something I wish I’d thought to point out to TW before. The amount of people legitimately claiming benefits here in the UK despite having a job is staggering, and it’s due entirely to the fact that the minimum wage is not a living wage. By paying them a living wage we remove the need to pay them benefits, thus cutting government spending, thus (in theory) lowering taxes… though in reality, probably just allowing taxes to be spent on other things.
Surely TW should be in favour of this? We’re making them less dependent, after all!
@ Tony! #135
No problem :)
It ably argues against TW’s point that the living wage would be impractical because it varies from place to place… they’ve thought of that. The government is unlikely to vary it in as much detail as that calculator does; purely for bureaucratic reasons the regions would have to be much broader. But they can vary the minimum wage across regions to better reflect the calculated living wage.
@ scienceavenger #145
Yeah, I’m aware of the… theory? I was attempting to point out the illogic of his premise, but frankly by that point I was so irate I’d lost all coherence.
I mean, I get where they’re coming from. All government action kind of is backed by force. Taking the minimum wage as an example; this law is demonstrably advantageous to society as a whole. Some amoral, sociopathic fuckwits would rather not follow this law, in order to gather things for themselves instead. Those people must be forced to follow the law for the betterment of society as a whole, and we do that by threatening them with fines and incarceration. If they refuse to pay the fines or go to jail then eventually, after enough escalation, some people with guns will show up, overpower them, and take them to jail by main force. Fine, that’s force; I’m willing to concede that.
Where Randians err is in assuming that because something is backed by force it is necessarily invalid or immoral. It doesn’t occur to them that the one trying to buck the law might be the immoral one. Some laws are arbitrary and stupid, but many of them have perfectly solid moral foundations, and are designed to stop sociopaths taking advantage of the rest of society.
@ Tom Weiss #152
1- I’ll say it again: it’s not a lie, or a smear, or a misrepresentation when you actually fucking said it. I was there, I read the thread, I saw the comment. Christ, I’ll even quote the fucking thing! Here it is, in all it’s rape-tastic glory; comment #66 from the “It could be worse” thread:
[Additions in square brackets mine].
You then went on to vigorously, if ineffectually, defend this statement; claiming multiple times that this doesn’t constitute rape, despite having it clearly explained to you why it does, and that the hypothetical boss would be perfectly morally justified in their actions. You slimy fuck.
2- Learn what ad hominem means. I am so sick of people misusing this. Anteprepro pointed out your previous comments as evidence of your general lack of morality and ethics in an attempt to inform others that your behavior and views displayed in this thread were not at all surprising; they in no way attempted to equate that lack of moral character with the validity of your current arguments. Ad hominem is not some catch all term for “anything said about me which I dislike”.
3- Learn to spell “despicable”.
4- Fuck you.
Tom Weiss, no links, no read. Grow up. Your evidenceless word has been refuted as ignorance and deliberate idiotology. Show evidence your idiotology works, or shut the fuck up. And try for evidence not bought and paid for by the Koch brothers.
*SNICKER* Thanks for proving out points, not yours. YOU LOSE LOSER.
Oh, just to show you how stupid TW is, current unemployed, 8.3 million.
Job creation 224,000 in April.
What about the 8.1 million left?
Jason Dick #147:
Telling me something is “difficult” will not discourage me. Remember, “we do this not because it is easy, but because it is hard.”
This argument implies that inflation is inherently socially-neutral. Given that inflation reduces the real purchasing power of nominal wages, I will require significant convincing of such neutrality.
numerobis #148:
Fascinating, if true. Looking at their website and wikipedia page, it appears the BIS is directed by a group of central banks, none of whom have shown any interest in long term deflationary strategies. Trying to search for anything to back up your sources seems to have led down a twisty rabbit-hole maze of conspiratorial blogs, so without further information I’m forced to conclude that your statement is about as much value as saying the Bilderbergs ordered the FDIC to sell the gold in Fort Knox to the martians.
Funny how in the end libertarians like Tom Weiss always have to show of the moral bankruptcy of their religion: paying someone a living wage is “offensive”, and is even “stealing” from the Holy Job Creators. Congratulations Tom, again and again you show how despicable, inhuman and unempathetic your ideology is. We don’t even need to make you look bad, your own words are perfectly capable of achieving that.
Also, how much you might whine about smears, the scenario you sketched in the previous thread is rape, plain and simple. You can stomp your little feet as much as you want, that doesn’t change reality.
Really, isn’t it about time Tom was given the heave-ho? He doesn’t know anything about the topics he spouts of about, most specifically about economics, and now he is even into rape apologia? Discussion is impossible with a brainwashed ideologue like him.
Also, it will surprise no one that the non-profit Doe foundation revered by Tom Weiss is the typical libertarian wet dream.
http://nypost.com/2009/06/29/the-dough-fund/
tl;dr: the big boss of the foundation pays himself 400k each year, and throws a nice 200k to his wife and a slightly smaller amount to his son. He also lives in a house paid for by the foundation (147k in rent).
But paying the riffraff a living wage is of course obscene.
Sometimes I think people like Trom really want to go back to a feudal system. He certainly is first in line to get the job licking the boots of the new nobility.
We can wrap our heads around your arguments (such as they are) perfectly well – they are extremely simplistic, after all. We just find them pathetically unconvincing because of the vast number of significant issues we have repeatedly brought up in our objections, and which you have entirely ignored.
Ah, but in TW’s head, the one and only cause of unemployment is “government interference”, so if we get rid of that, then we would have full employment. The various other factors causing unemployment which people who actually know anything about economics are aware of don’t exist, and the fact that the sort of employment we would have in TW’s world doesn’t actually pay most of its workers enough to survive on is a trifling inconvenience, which people can easily mitigate by choosing to eat less.
In Tom Weiss’s libertarian world, underpaid dish washers can survive by licking the dirty plates before popping them in the sink.
Fucking scum bag.
Alexander@157:
First off, fuck you.
Secondly, here’s my main source for the claim:
http://krugman.blogs.nytimes.com/2015/04/08/bb-and-the-permahawks/
http://krugman.blogs.nytimes.com/2014/07/12/liquidationism-in-the-21st-century/
Raising rates reduces inflation — or puts you in deflation if, as we currently are, inflation is low. The BIS is in effect advocating for reducing the inflation rate.
If you don’t believe Krugman’s reporting on the BIS mantra of higher interest rates, here’s some independent sources. See the BIS saying we have to raise rates now to tame inflation, in 2011:
http://www.bloomberg.com/news/articles/2011-06-26/bis-says-central-banks-need-to-start-increasing-rates-to-contain-inflation
See the BIS saying we have to raise rates now to prevent civil unrest, in 2015:
http://www.telegraph.co.uk/finance/economics/11479425/Low-rates-will-trigger-civil-unrest-as-central-banks-lose-control-BIS.html
They have an agenda: to raise interest rates. Why? I’m not sure. I am sure what the effect of increased interest rates is though: in the short term, the rich get richer while the poor get poorer. That’s because the rich have money, so now they get a return when they park it at the bank. The poor don’t have money, so they pay more in interest on their loans and they lose their jobs when the rich decide to park money at the bank rather than invest in the real economy. In the long term, it’s more complicated, but given that BIS doesn’t have a consistent reason for claiming we need higher rates — we just need higher rates no matter the justification — I don’t see why we’d take them to be credible.
I am fine with the ad hominem accusation from Tom Weiss. I do in fact want people to just disregard what Tom Weiss is currently saying because of who he is. Because Tom Weiss has proven themselves to either be horrible, incompetent, or both, such that simply pointing out that Tom Weiss is such a Tom Weiss should be all the discussion that we need on whatever bullshit Tom wants to spew into any given thread. It is not like he has any new arguments or even addressed previous arguments. He is just constantly regurgitating the same already refuted shit, but he imagines he has successfully defended it, because he has his head so far up his ass that he could give himself cardiac surgery with his teeth. Dismissing the bullshit after he repeats it for the 9000th time, and doing so while also pointing out some of the other odious things he is more reluctant to have us be aware of, seems perfectly fair to me. Sometimes “fallacies” aren’t fallacious (see: fallacy fallacy). Pointing out that we have already had these arguments with this dishonest hack, and that he is also a profoundly horrible, stupid human being in other debates as well, seems perfectly legitimate. A warning to those who think that investing time into arguing with Tom Weiss will actually be anything more satisfying and effective than trying to wrestle a pile of mud.
Tom Weiss: thank you – I suppose – for spelling out so clearly who and what you are. A sociopath in his own write (and seriously, that rape apologia quoted verbatim from the other thread? Now that’s obscenity).
springa73, 142
Why do libertarians always try to treat money/gold/capital as if it were an inherently valuable part of themselves and any attempt to reduce economic inequality to provide for a functional, humane society with decent infrastructure is as horrible as, if not more horrible than, the physical and mental handicapping in Harrison Bergeron? I really cannot comprehend this belief that the assumed to be inherent, and often arbitrarily assigned, value of inanimate objects somehow becomes a part of the inherent value of the possessor and that taking some of it away to make life less shitty for others is akin to cutting off their limb or performing a lobotomy. I was raised catholic by a gun nut that is a bit of a gold bug and teabagger, but I still cannot wrap my head around this shit.
@Tom Weiss, 152
How does one better their life if they are spending every available penny on simply staying alive and still falling short of that aim?
Does bettering your life generally not involve some form of education, or training?
Do education or training generally not require some form of disposable income or, at the very least, free time?
How does one with no disposable income, and who has to work multiple jobs in order to meet the most basic requirements of living therefore better their life?
If you want people to better their lives, why would you oppose their having the tools to do so? Why would you find the very concept of it offensive?
Tom Weiss, #152
I can’t believe I missed this!
People who work full-time to make it possible for rich people to have mansions and cars and jets shouldn’t be paid enough to cover the basic needs of life comfortably?
You do realize that all these rich employers NEED those people right? Otherwise they won’t have their nice shiny things at all. They absolutely need them. So it is terribly cruel of them to have those people making their nice luxurious things possible but then paying them shitty wages. Not in your libertarian rich asshole’s world maybe. But in the real world it is.
And of course Tom Weiss would find it offensive that employers should be expected to provide a living wage. Tom Weiss thinks regulation and restriction on transactions is literally evil (his words). Tom Weiss cares far more about businesses than actual people. Tom Weiss does not care that people starve and sees eating as a Free Choice. Tom Weiss has supported people being forced to provide sex in order to work, to be paid with sex for their work, to be paid with nothing at all, or to be paid $1 per hour. Tom Weiss still insists that the minimum wage is evil, despite actual evidence that he is talking out of his ass.
Tom Weiss doesn’t care that people live, and is offended at the idea that companies be forced to give wages at all. I am just surprised that the idea of a “living wage” does not cause Tom Weiss to spontaneously combust with gibbertarian fury.
Giibertarianism is a lot like religion. An ideology not grounded in reality. And one that doesn’t work in real life.
Much of the third world is run on Loonytarian principles. Government regulations are few and negotiable with an exchange of money. The result is control by heavily intermarried oligarchies, monopolies, and stagnant societies going nowhere.
One would think religionists like Weiss would move to one of the Loonytarian Utopias. Out of 220 countries there must be a few. There is. Somalia is the leader. The government is laissez faire, regulations are few, and you can get as rich as you want. The leading occupations are warlord and pirate.
And here is the other thread that Tom Weiss has been active in. He has a talent for worming around all over the place:
http://freethoughtblogs.com/pharyngula/2015/07/18/the-ear-of-david-brooks/#comments
Enjoy (?)
Why Nations Fail. The title of a popular book a few years ago. The authors are economists who used data to look at why some nations succeed and some fail.
You need three things.
1. A strong central government.
2. Rule of law, a level playing field.
3. Taxes of at least 10% of GDP.
This is determined not by ideology but by experiment.
And it doesn’t look like Loonytarianism at all.
I’M really wondering how the hypothetical dishwasher is supposed to increase his “market value” when they are washing dishes 20 hours a day (I suppose that laws that limit work hours a day are evil, too) because they need to eat…
Why can’t the employer stay late and wash the dishes him/herself? Or will that be interfering with their personal home and family life? We can’t have that happening to people can we?
Yeah, about that “need to eat” thing… Tom Weiss, from the “It could be worse” thread (comment #65):
So it’s cool, our hypothetical dishwasher can just choose to eat less (or not at all) for as long as it takes them to find a better job, of which there are always an unlimited number available, with no pesky things like training, relocation or travel expenses to stand in the way…
Well, Giliell, he can choose not to eat. Because according to Tom Weiss, you can choose if to eat or not. If you do not eat, you do not need the money to pay for food. Then you can work on increasing your market value and after you have done that, you can find better work and get the food. See? Logic! I will immediately conwey to anyone with financial problems.
Or my heavily handicapped coleague, with mentaly and bodily handicapped child – if they stop eating, he will have money for other things (like requalification courses) and he can increase his market value by stopping being handicapped and being so damn whiny and dependent on laws that requires companies to employ handicapped people. An you know, that is true oppression, and authoritarianism, and communism, and many other bad-isms, to have regulations in place that prevent employers willy-nilly fire handicapped people.
The sad thing about above written two paragraphs is, that they are not parody of Tom Weiss’s positions, but accurate summarisations of his blatherings in last week.
Thing about a dishwasher “increasing market value”: Tom Weiss was in full support of a college professor being paid zero dollars. There are very few things you can do to “increase market value” more than having a degree that qualifies you to be a college professor. And yet apparently it is perfectly for even that to have absolutely zero market value. So people get fucked over by their “free choice”. Too bad, so sad, the free market is infallible so it is all your fault. It is your fault if you are a dishwasher. It is your fault if your degree and student loan debt doesn’t help you out of a job as a dishwasher. It is your fault if you have one of the biggest degrees out there and still are seeing job openings that pay LESS than the dishwasher job. All your fault because the market is never wrong. And the solution is to just make new free choices and hope that you luck your way into being an executive or business owner or something some day.
Oh please, don’t play coy with me, I know exactly what you were doing. It’s that great Republican tradition of the half-argument, perfected by Ann Coulter, where you pop off something snarky in a not-so-subtle implication of hypocrisy aimed at your interlocutors, while studiously avoiding actually making and supporting the argument. It’s scare quotes, long version.
As for Hillary’s per-speech pay, the market has spoken, and it has determined that her speeches are worth that much. That you, personally can’t wrap your head around that fact is immaterial. And you call yourself a free-marketeer.
As for seeing your reasoning, no, there is no reasoning that goes from discussing a minimum wage increase to wondering about Hillary’s speaking fees. It’s partisan, issue-distracting hackery, and nothing else.
Not only are you lying, you’re trying to smear me in this thread with made up ad hominum attacks from another thread because you can’t wrap your head around my arguments and come up with a coherent refutation. Dispicable.
It is you who are lying, and it is you who are hiding from arguments and ideas you can’t handle. The cited dialogues prove this, and you know it.
The idea that any job, no matter how invaluable, should require an employer to pay a “living wage” is incredibly offensive to me, and it should be to you, and it should be to any low-skilled worker trying to make a better life for themselves.
Why would anyone be offended at the idea of requiring employers to pay workers a wage they could live on? That certainly would not be bad for any of the people who sell goods to the workers — more money for the workers means they can buy more stuff and thus create more jobs within their own neighborhoods.
But we all know that’s not what really “offends” assholes like Weiss — they couldn’t possibly care less about workers. The only thing that offends people like him is that real life and real people don’t accept his simple, brittle, useless worldview.
If that dishwasher cannot live on the value of their labor, they have a choice. They can choose to increase their value or they can choose not to, but what they should not have a choice to do is to tell the restaurant owner – at the point of a gun – that they must give them more than they are worth.
How the fuck does a dishwasher “choose to increase his value” when his employer has the power to choose how much to pay him? This bullshit about “choice” just shows that libertarians think in nothing but meaningless airy abstractions and have absolutely ZERO common sense. Not to mention heaps of wild paranoid fantasies about dishwashers robbing their bosses at gunpoint.
You are saying that low-skilled workers have no value, or more precisely have only that value that the government assigns them.
First, those are two very different things; the latter is not a “more precise” version of the former. Second, why is it bad for government to “assign value” to workers, but perfectly okay for greedy selfish unelected CEOs to do the same thing? And third, once again we see a libertarian equating a policy intended to benefit workers with “saying that low-skilled workers have no value.” This is yet another crystal-clear example of the pathological dishonesty and denialist looking-glass logic that underlies nearly all libertarian discourse. Like most backward religions, libertarianism is nothing but a scam. Tom Weiss is just one more liar in a long succession, reading from the same tired old script the Koch brothers wrote for him and his lazy gullible chums decades ago.
If the employers don’t like government telling them to pay a living wage to dishwashers, they have a choice. They can wash the dishes themselves or choose to serve food to their guests in dirty dishes.
Assume a spherical cow…
You assume a perfect meritocracy, which we are not … remotely. This is knowable and backed by significant data. The odds are VERY high that your hypothetical owner did not earn his position from the ground up, but started at a significant advantage (say coming from a white, crime free, well-off family) compared to your dishwasher, who likely started off without those advantages. Kids born of poor parents do NOT succeed at the same rate of kids born of rich parents, given equal efforts and merit. You should know this.
Instead of being offended at the notion of a minimum wage, you should be offended at the gross unrealism of the assumptions you are making.
All modern Libertarians do. And that, in a nutshell, is the problem with Libertarianism. If we lived in a perfect meritocracy, then I would agree with a large portion (or certainly a larger portion) of what they are saying. The problem is that we demonstrably don’t. They wish to simply ignore this fact and pretend we do, and fuck all those people who happen to start lower down the ladder than they do. I wish to make changes until we actually have a meritocracy. That’s the ultimate goal.
Depends on what you mean by “merit” – a lot of what we call merit is actually just dumb luck. I didn’t earn my IQ, or my access to a decent education, or my talent for a particular form of abstract thought that just happened to be a ticket to a well-paid, high-status career that barely existed when I was born…
@181 The real irony of libertarianism is that it nearly mandates newborns being taken from their families and being raised in a (government?) boarding school, where they all get the same education, skills, and other important attributes, thus creating a meritocritous beginning, at least as far as we are able. But just watch them scream over any such notion, even something much less intrusive, such as significant inheritance taxes.
The perfect libertarian meritocracy:
When a poor person is not rewarded for not working harder, it is because they are unskilled.
When a poor person is not rewarded for getting more skills, it is because they are lazy and/or got the wrong skillset.
When a poor person cannot get more skills because they cannot afford it, it is their Free Choice.
When a rich person is rewarded for birth and simply having money, it is okay, because their parents were high merit and it is still deserved.
When a rich person rewards themselves at the expense of the poor people, it is fine, because they are the ones making the financial risk and it is their right and there is no reason why poor people should expect to eat.
It is the perfect meritocracy where getting hired is about connections and getting promotions is about how many wheels you grease. It is the perfect meritocracy where people are regularly promoted until they final reach a position where they are incompetent. It is the perfect meritocracy where you are automatically paid significantly more for being in certain fields, even if other fields are more important for society, require more skill, and/or requires more time and effort.
And of course, the perfect meritocracy leads to a society run by bitter, ineffectual, anti-intellectual politicians. Because, of course.
numerobis:
Re-reading my message that did come out a lot harsher than I intended; I really should have added a “</sarcasm>” or something to indicate a not-entirely-serious tone. Mea culpa.
[As an aside: Reviewing my browser history I had searched “bis bank papers”, “bis bank conferences”, and “bis bank history”. The first two searches’ first page was nothing but links to the BIS’s own site, so they were of no use to me. For “history”, the first page of results I get are (in order): the bank’s own about page, their Wikipedia entry, two conspiratorial blog entries (skimmed but both quickly veered into tinfoil hat territory), a conspiratorial book on Amazon, an article from the Telegraph about their WWII finance escapades, another “global currency” conspiracy site, the NY Federal Reserve’s page, Brittanica.com’s entry, and some law paper. Nothing on the reputable sites showed a policy position regarding inflation, and the ones that did want to talk about that sort of thing didn’t seem reputable.]
Now, in so far as the BIS bank is concerned:
#162:
Consider: 2% inflation (per year) means that which costs $1 today will cost $1.02 in a year; 10% raises costs to $1.10 and 100% to $2. Interest rates must rise as inflation rises: if I am charging you less interest than the inflation rate, the money I give you will have more purchasing power than what I get back. Contrariwise, 2% deflation means that things costing $1 today cost $0.98 next year … so interest is no longer required to stave off the loss of future purchasing power.
Long term deflation is like getting an automatic pay raise every year, even as the dollar amount remains static. Giving that sort of automatic, effortless lift to the minimum wage is so perfectly suited to my politics, can you really blame me for overlooking the source which seems to lend support to such an impossible dream?
Long term deflation is like getting an automatic pay raise every year…
That’s assuming that a) you’re not one of the people losing your job in this deflationary (as in, recessionary) climate, and b) your own wages aren’t being deflated along with everything else. And if both of those assumptions are true, then you’re a lot luckier than all those other shmoes who have to lower their prices for whatever reason.
Problem with deflation: Inflation is related to increasing money supply. More money, less value for individual unit of money. Deflate by having less money. More value for each unit. Sounds like a win until you remember two factors:
1. The population is increasing. More people with less money is not a winning combination.
2. The rich are getting a larger share of the money supply every year because a key aspect of our economy is the ability to use money to make more money.
Tightening the money supply will only exacerbate the issue of the rich having a disproportionate level of control of the money supply. (Though considering that the money supply starts with banks and trickle down is bullshit, inflationary schemes aren’t much better)
(Though considering that the money supply starts with banks and trickle down is bullshit, inflationary schemes aren’t much better)
They are better if they’re coupled with real efforts to redistribute wealth to the poor, by such means as government spending (infrastructure, defense, etc.), educational assistance, publicly-funded research and innovation, and significant assistance to poor communities.
Deflationary policies benefit the rich — and ONLY the rich — by increasing the value of the money they control, and by denying money to smaller potential competitors. Yes, they also tend to choke off growth of big as well as small businesses; but that’s something the big business owners can weather far better than small business owners.
Another thing about the libertarian “force” and “men with guns” shit: even if we were to go down that rabbit hole philosophically everything comes down to force. Government or no government. In a world of two people or whole societies. In the sense libertarians talk about “force” it’s force all the way down.
If I walk into the house of Tom Weiss and make a sandwich from his fridge and plop down on his couch and choose to never leave. What is he to do about it? What is anyone on earth to do about it? Whether there is a government or not, police or not, warlords or kings or gods – what is anyone to do about it? Anyone can do anything, and literally the only way you can stop someone from doing something they are resolved to do is to stop them physically somehow.
So, it is simply the nature of things that force or threat of force is always at play when it comes to curbing unfair, or harmful, or vile, or violent, or any behavior at all. Tom Weiss and those who think like Tom Weiss find it reprehensible that the people create and pay a government to provide this “force” for them, what is their alternative? One vs One? Who can kill who first, who can beat up who better? Which Warlord amasses the biggest army?
What the fuck do they actually want? They claim not to want Somalia and Warlords, but that is what their ideology means. So what are they actually talkin —- Oh, that’s right, their ideology is inconsistent and they are too stupid to realize it. I forgot.
Nerd 156
“Anyone who is willing to work and is serious about it will certainly find a job. Only you must not go to the man who tells you this, for he has no job to offer and doesn’t know anyone who knows of a vacancy. This is exactly the reason why he gives you such generous advice, out of brotherly love, and to demonstrate how little he knows the world.”
Thumper
Not just don’t, can’t. Even starting from a total blank slate (let alone actual existing situations) there is no conceivable way to define, let alone implement, an actual meritocracy that actually works in anything resembling our reality. (In no small part because of the fundamental difficulty in defining what is or isn’t intrinsically meritorious).
Nerd of Redhead #156:
To be a bit pedantic, the 8.3 million number overestimates the problem a little bit, and the 224,000 number underestimates it.
Some of those people who are out of work are just between jobs and will start another job within a few months. Sometimes that’s voluntary, sometimes it isn’t. But there’s continual churn in the job market. A more realistic number for the “excess unemployed” is around 7 million or so.
At the same time, most of the 224,000 number is made up of new people entering the workforce, so that the number of people unemployed was not reduced by 224,000 in April.
A really good way of looking at this is by looking at the employment rate among prime-age workers:
https://research.stlouisfed.org/fred2/series/LREM25TTUSA156N
Using this limited age range reduces the impact of demographic factors (such as the Baby Boomers entering retirement). We see that right before the depression started, the employment ratio was about 80%. It then got as low as 75% but has since recovered to 76.7%. So roughly 1/3rd of the people put out of work have made it back into the workforce. And at the current rate, it will take decades for the rest to be brought back in to the workforce.
Citation needed.
I didn’t do anything particularly rigorous to get that number. I used this graph and sort of guestimated the remaining shortfall:
https://research.stlouisfed.org/fred2/series/PAYEMS/
You could do something more rigorous, of course, but I doubt you’d get a number lower than 6 million or higher than 7.5 million using any sort of serious analysis.
Another somewhat more useful estimate on this topic comes from the Job Openings and Labor Turnover Summary:
http://www.calculatedriskblog.com/2015/07/bls-jobs-openings-increased-to-54.html
Raven
And Tom Weiss is a presuppositionalist, a William Lane Craig in a cheap tuxedo.
Yeah, Tom Weiss is wrong and annoying. The message has been transmitted, and I agree with it…but it’s time to lighten up and stop repeating it.
Jason Dick, I’m only a scientist with a math minor. I can’t add up your figures from the presented data. You need a further explanation.
Here is a super, super-rough way to estimate the excess unemployment at present. First, use the employment-population ratio for prime-age workers:
https://research.stlouisfed.org/fred2/series/LREM25TTUSA156N
It’s not unreasonable to consider the peak in 2007 at 79.9% to be a “full employment” figure. This is a bit conservative, though, as we know that the economy actually wasn’t doing all that great at the time. But it works for a rough estimate.
The current employment-population ratio is 76.7%.
The question then becomes: how much is that 3.2% difference? For that, you can use the total size of the work force:
https://research.stlouisfed.org/fred2/series/PAYEMS
This doesn’t include farm workers, but it’s good enough for a rough estimate. The current size of the workforce is about 142 million. So the slack in the workforce is (79.9 – 76.7) / 76.7 * 142 million = 5.92 million. This is probably a bit of an underestimate, as stated above (the non-farm workforce isn’t quite the entire workforce, and 2007 probably wasn’t maximum employment that our economy is capable of).
Sorry Jason Dick, my simple math, says with 141 M jobs, and a 7% unemployment rate, the total labor force is 152 M, making 11 M unemployed, not the 8.3 M listed by the BLS. So there is some obvious juggling of the nubmers going on.
So again, show where you obtain each number, its source, and why the corrected values are better than the BLS metrics as of a few months ago.
I detect some anomalies you your calculations, starting with peak employment in 2007, and not correcting for the increase in people seeking employment in the 8 years since then.
Jason Dick, I traced back the St. Louis Fed reports to philosophies by Milton Friedman, the man who made Chile a basket case, before it was revived by revolution and more sane economics. Don’t bother, your numbers won’t likely make sense.
MattP, #165
Well, I’m not a libertarian, and neither is the friend who I was talking about. I used to have libertarian leanings, though, and it is definitely true that libertarians, and quite a few non-libertarians as well, think of a person’s property as an extension of that person’s identity. From that perspective, to take a person’s wealth or property without their consent is indeed a form of violence akin to cutting off a limb. I think that it’s psychological – people really do sometimes come to see their houses, land, cars, cash, even less tangible things like investments as almost part of themselves, above and beyond their utilitarian value.
Oh, I agree. And the selfish liberturds don’t want to share those assets, to the degree of reasonable taxes, with those who are less fortunate. And they show their overweening selfishness and arrogance when they call it anything other than paying normal taxes for a rational society.
springa73:
The entertaining thing I have noticed with several internet libertarians I have encountered is that this scenario is an understatement. Or you have it in reverse. What do I mean? I mean that libertarians don’t think of a person’s property as an extension of themselves, they view their body/self as a subset of their property. For other people, we are concerned with the body first and foremost, with health, with biological needs, with prevention of violence, with limiting physical restrictions, and so on. For libertarians, the focus is always on property. On wealth and property rights. The body just happens to be part of your property rights, but there is no more concern for your physical being than there is for the same sacrosanct status of your Ferrari, your living room, or your bank vault. It really is incredibly telling, but it is consistent and blatantly obvious a lot of the times. Just look at how they use the words “violence” and “coercion”, or the ever-present “men with guns”, so that they broaden these into contexts where they can treat financial regulation as akin to actual, physical harm. And yet spend a disproportionate amount of time concerned about only the new, financially relevant forms of “violence” and “coercion” that they have invented. I sometimes wonder if the only reason they even oppose traditional “violence” and “coercion” and “men with guns” is by accident of analogies used to rant about government.
anteprepro @202
Ever notice how many Libertarians are forced birth advocates (anti-abortion) and/or rape apologists? Women’s right to control what happens to their bodies definitely is less important a man’s property rights.
Yes, the market has spoken. But why? I agree that her time is that valuable. Why? Few, if any people on earth are paid as much as she for a hour-long speech, so she has incredible value. Why?
Because the US, government has the power to dole out favors to resulting in millions or billions of dollars for friendly businesses. The “green energy” sector has been a huge beneficiary of Washington subsidies during the recent past even though they do next to nothing to combat climate change. Wall Street benefits from legislation like Dodd-Frank, which helps raise the regulatory burden and costs for their competitors. Boeing benefits immesely from the Ex-Im bank and will go to great lengths to see it re-authorized. And those are just off the top of my head. The bottom line is this: when government grows stronger, when there are more throttling regulations, more barriers to entry, the only people who benefit are big businesses. The people paying $400,000 to hear what is likely to be a relatively bland speech devoid of specificity or brilliance are making an investment, hoping that a President Clinton will hand them a favor or two and they will make a return on their investment.
You’re wrong, once again. For libertarians the body is inviolate, it is the beginning and the end. There is no higher purpose on earth, as there is no afterlife, than for a person to live solely for themselves. There are no property rights unless your right to your own body is absolute. Libertarians believe this – but progressives don’t (unless you’re talking about abortion).
You’re not concerned with the prevention of violence or limiting physical restrictions – you would initiate more violence and more physical restrictions. You want to violate my body for your sake. You want to force me to work to meet your biological needs. And then you want me to pretend that I don’t see the gun you’re holding, that what I’m being forced to do is somehow just and moral. And if I refuse, if I say that I don’t wish to participate, you’ll show me just how quickly you initiate violence.
More outright lies. Is it possible for progressives to have a political argument without slandering, lying, silencing or distorting their opponents positions? Can you not simply deal with our ideas?
And speaking of silencing, you’ve succeeded with me for a while, this is exhausting. Resume normal echo chamber operations.
My own personal, anecdotal experience says otherwise. I’ve met at least two Libertarians that were anti-abortion. Interestingly, both claimed that abortion was unwarranted use of force on another person, akin to murdering an adult.
You’ll be sorely missed.
@Tom Weiss #20
We did. Multiple times.
You seem to be frustrated by the thought, that we do not comprehend the finer points of your phapposophy. We do.
And from that understanding stems our conclusion, that you are asocial, anti-social, overall shitty human being and possibly sociopathic and therefore not safe to be around.
Please, pretty pleeeeeeease, stick to the flounce. I do not understand why PZ has not banned you, but I feel sure in saying that you will not be missed by anyone. We learned nothing from you, we only learned a lot about you and all of it is repugnant.
Yes, we expect you to pay your fucking taxes. Welcome to civilisation. If you don’t like the terms, you’re entirely free to go and live somewhere else (such as Somalia, or a cave in the middle of nowhere), so, by your own standards, you are simply making a choice to stay here. You’re not actually being coerced, because you can always walk away and look for a better deal somewhere else, just like the sub-minumum-wage dishwasher or the secretary blowing her boss to keep her job.
You don’t want to be free, you just want to be a free-loader.
Tom Weiss:
“Next to nothing” is “something”. And that “next to nothing” is better than what we’d get in a free market whose sole motive was profit. So it’s kind of funny that you think that is somehow an indictment of green energy and not an indictment of the baseline non-committal attitude of the rest of industry.
You have no ideas that are backed by history, economics, politics, and good logic. All you have is a series of illogical slogans, an incoherent theology, and nothing but obnoxious ways of arguing. In short, you have nothing to present.
Don’t come back until you can show the thirty years of liberturd economics in a first world country in the last century. That is what allows you even to be heard. Without that, you are simply an obnoxious noise.
Tom Weiss
You know, when contradicting somebody who says “LIbertarians conflate body and property”, this is really not a good response. Because lower numbers on your paycheck are not equal to cutting out a ound of your flesh. BTW, everybody here is also perfectly willing to work for your biological needs. Even though you’re a complete asshole. Even though you don’t think that people should have food, clothing, shelter and medical care, we are still willing to provide all those things for you. And chances are high that one day you will need that assistance. I hope you remember this conversation then. Or maybe the government could hand you right now a bill for all the services you received so far like education.
The libertarian mindset is inherently immoral because it weighs a person’s expectation to comfortably support themselves and their family against “the value of their labor”. There is something scary about that idea and that phrase… that a class of rich people looks at the underprivileged masses and decides what their worth is despite the fact that these people are putting in the majority of their waking hours to do work for them that they don’t want to do themselves. People shouldn’t be paid just according to their value to you but also according to the requirements of basic living. People aren’t resources.
Dunc, #207
Ouch.
Hit it out of the park there. Prepare to have that point ignored or misconstrued though.
More outright lies.
…which you don’t even try to refute using even ONE citation of fact or history. All of our arguments stand because you’ve offered nothing of substance to counter them.
Can you not simply deal with our ideas?
Your ideas have been proven worthless, at best, in the real world. That’s all the “dealing” your ideas deserve. Now fuck off to bed and stop pretending your ideological bubble-verse is anywhere near as real or relevant as the real world we have to actually live in.
You’re not concerned with the prevention of violence or limiting physical restrictions – you would initiate more violence and more physical restrictions. You want to violate my body for your sake. You want to force me to work to meet your biological needs.
This is nothing but pure delusional raving that has absolutely no connection to any real-world event. Tom Weiss is up way past his bedtime, and he’s getting as cranky as any child who hasn’t been put to bed on time.
Raging Bee #186
You seem to be laboring under the impression that growth and inflation are linked; one going up or down necessitates the other doing so as well. This paper published by the Federal Reserve Bank of Minneapolis questions just such a link between deflation and economic contractions. They conclude that “A broad historical look finds many more periods of deflation with reasonable growth than with depression, and many more periods of depression with inflation than with deflation. Overall, the data show virtually no link between deflation and depression.”
Recall my comment in #146: “It seems only logical to me that if there is bad inflation (like the “stagflation” of the 1970s) determined by more complex factors than just the rate set by banks, then there can also be good deflation (also determined by something more complex than the rate).” This idea of a “more complex” causation also ties immediately into:
anteprepro #187:
Not as much as you might think. According to Wikipedia, almost half of the globe lives in a nation with births are below the net replacement rate. In addition, those seem to be concentrated in the developed, “Western” world (Canada, USA, Australia, China, Japan, and much of Europe). Unless this trend changes, we will need to understand economic policies that do not assume endless, exponential growth, and be prepared to adopt them. It would be terrible if the changing population negates the assumptions our current system requires, render our current tools impotent, and find zero theory on how to understand or affect the new environment. Questioning output growth as a core economic assumption, no matter how undesirable it may be today, will surely help us when the population growth ceases.
lol So, since you can’t like, stop eating, I had an idea – Since Mr. Weiss seems to think we all can “choose” things for ourselves, and that government is bad, then logically:
1. Its no more reasonable to presume that a corporation should be allowed to force you to leave at gun point, than a government, nor deny you employment based on a denial of your own choices.
2. The CDC, and other organizations should have no say in what you choose to do.
3. Clothes are the second (or maybe third, if you include rent, but you could always just, in the short term, live under a bridge or something, right), biggest expense that anyone, including poor people have to spend money on.
Therefor, I suggest all workers be allowed to just dispense with clothes. We can take down all those stupid, government mandated, rules about that, and signs saying, “No shirt, no shoes, no service”. Well, unless the customers can be somehow forced, possibly at gunpoint, to leave. Nah.. That would be just as totally unreasonable to a “true libertarian”, who is concerned about individual rights, and people “forcing” you to conform to arbitrary laws, or personal requirements to give up their hard earned money, right? lol
Hmm. What else can we dispense with, while we are at it? I mean, I suppose we could go back 200 years ago, and stop buying soup, and making people get hair cuts, or trim their beards, right? It may not be the state “forcing” those things one people, well, except maybe the soup part, in food services, but.. obviously a corporation shouldn’t have the right to use “its” force to mandate such things either, right? What else?
I mean, since we are trying to follow this twit’s (and the rest of his cult’s) logic…
@ #191
Uh… No, the 8.3 million probably “underestimates” the problem.
See, it would be complicated to try to work out who is really unemployed, based on actual data, so we use “people who are unemployment”. Now, while its true that there may be some percentage of tax dodgers, being paid under the table, who wouldn’t be “counted”, the only ***real*** statistics we have on who is, and isn’t employed would have to come from how many people are “listed” in IRS rolls as a) employed, and b) paying into taxes. This, as long as it took less than a week or so to find a new job, would including “people between jobs”.
But, here is the thing – you claim that “people between jobs” are “not unemployed”. Which shows, very clearly, that you don’t actually give a frack about who “is” unemployed, since you are using what exactly as a definition? People that are not on unemployment? Well, not everyone that loses a job either wants to be, or is qualified to be, on unemployment. In fact, in my state, quitting your job, for any reason, disqualifies you to seek it. Why, I have no damn idea, except that, apparently, some, probably libertarian, decided that intentionally dumping a shitty, or possibly abusive, job, to pursue other avenues of employment makes you.. I don’t know, probably lazy or something, and thus not deserving – though.. why someone fired because they are incompetent at it should get help where the competent person, who quit, doesn’t… But, we have already established that there is no logic to this BS. Alternatively, there are those who time ran out on. Those that stopped looking, after, in some cases, months, of trying. And, yeah, those who may have a job lined up, or presume they do, and just haven’t started yet.
Now.. I really cannot comprehend, unless your a politician, or an ass, or both, why any of the last three “disqualify you” as, “not having a job, and thus being, at this moment, not employed”. Yet, we have geniuses like yourself showing up to inform us that, yes, indeed, there are less than 8.3 million unemployed people in the country, because some arbitrary definition, which excludes twice the number of people “officially” considered to be unemployed, might be “inaccurate”, according to your entirely delusional, and arbitrary, definitions.
But, from a political standpoint, its genius – you can exclude a huge percentage of the population as, “not qualifying, so I can ignore them as a problem”, and pat yourself on the back, while you are at it, because you can turn around and claim, “If they are not on are arbitrary list, then, sort of like rapists and drug pushers, from Mexico (al la Trump), everyone **not** on the list must be lazy people, who don’t want a job, illegals, or criminals, who are being paid under the table, or, ‘people who are merely between jobs'”. By golly, you are practically a saint, and an advocate for law and justice, for excluding such horrible people from the ranks of those “deserving” to be called “unemployed”.
That it also lets CEOs and politicians claim that the situation is “better” than it is, in theory, because the “official” numbers are, according to them, all terribly wrong, instead of, and this is just totally silly…. **WORSE**.
You seem to be laboring under the impression that growth and inflation are linked; one going up or down necessitates the other doing so as well.
I’m assuming no such thing. I am merely saying that deflation is most beneficial to people who are not themselves stuck in the deflationary spiral. Does anything in that paper you cite refute that?
Speaking of which, I had a look at that paper, and I’m finding grounds for suspicion. For example, there’s this sentence, which appears very early in the paper:
That experience has led to theories in which deflation leads to depression.
I’m not aware of anyone saying this — everyone I’ve heard from says depression leads to deflation, not vice versa. So right away it looks like the paper is disputing a nonexistent argument.
Is Japan’s recent slowdown from a historically high average growth primarily due to its very low inflation rates? We doubt it.
I don’t remember anyone saying Japan’s slowdown was CAUSED by its low inflation rate. Normally an economy’s growth stops, for whatever reason, and THEN inflation slows or stops as a result, not a cause, of the halt in growth.
So right there I see two instances where your paper seems to be misrepresenting other people’s arguments. That raises serious questions about its honesty, and leaves me disinclined to read on.
Yes, well, in libertard world, apparently, things like a lack of water are “caused” by people dying of thirst, not the other way around. lol
In the real world, they both effect one another. Heightened unemployment puts downward pressure on inflation, and falling inflation or deflation put downward pressure on employment.
So if you get an external shock, and are in a situation where the central bank can’t keep inflation from falling (even slowly), then you end up with a long period of heightened unemployment. This happens both because the falling or negative inflation is itself harmful, and because the rising wages that are a signal of a strong recovery puts positive pressure on inflation.