Poll: Minimum Wage

[Godwynn]

The Senate today failed to pass a bill that would raise the minimum wage to $7.25 per hour. CNN.com

Meanwhile, Lou Dobbs said:

Raising the minimum wage to $7.50 would positively affect the lives of more than 8 million workers

- CNN.com

8 million workers is a little over 5% of the American workforce of 150 million. - World Factbook

 

[Veritass]

The Senate today failed to pass a bill that would raise the minimum wage to $7.25 per hour. CNN.com

Meanwhile, Lou Dobbs said:

- CNN.com

8 million workers is a little over 5% of the American workforce of 150 million. - World Factbook

Typical political grandstanding. For many such political goals, it is easy to point to the people that will be helped, and much more nebulous to point to the people who will be harmed. It is a simple matter to estimate the number of people working at between the current and proposed minimum wage, and say they will be helped. It is far trickier to identify who will be the people that get caused to be laid off because of this, or what is the cost to the average consumer for these changes. Even after the fact, it will probably be impossible to identify all of the unintended consequences of such a change.

If this would actually improve the economy overall, why not $10/hour, $20/hour?

 

[Godwynn]

If this would actually improve the economy overall, why not $10/hour, $20/hour?

Agreed, why not $150? Everyone can be rich! (Except those who lost their jobs ofcourse...)

To me a $5.15 to $7.25 or $7.50 is one hell of a jump. I think Washington has the highest minimum wage and I think it is $7.25/hour.

 

[JerichoHill]

If, you mean DC, then wow, it really sure has helped poverty in the District...

 

[Paradigne]

When I was starting out, it NEVER took more that 6 months to get above minimum wage. I doubt things have changed that much in 10 years. If you can prove you are worth keeping you will make more money.

 

[Panzeh]

Nobody around here(WV) even STARTS at minimum wage except for people in fast food, and you're not looking very hard if you cant start off with at least $8.00/hr, even in unskilled trades.

 

[downtown]

So if you make $6.50 per hour, and Ohio raises the minimum wage up to $6.50, what keeps you or your fellow employees at that job now?

Well, determining where I work is more complicated than just my wage. Will I have a long communte at a new job? Will I be able to do the work, can I find flexible hours, etc etc.

My job, even though the pay stinks, is nice, because its only a few min. from my house, and they give me time off if I have a gig. That's something that might keep me. My fellow employees make a little more than 6.50, since they've been there longer than I...so I dont know what they'd do.

What you're getting at though, is that I would want a raise. Yup. I wouldnt work for less than 7, and I imagine others making 6.50 would want a small raise too. However, not every hourly worker is going to want, or get a raise if there is a min wage hike, so we're not going to have widespread inflation. We could eat giving everybody a 30-50 cent raise, because our profit margin is large enough. I think companies could find a way to make it work. We're not talking a living wage here

 

[Mise]

No, they don't. You fail to see the point that I am trying to make, that economics makes. An employer will not pay someone more than the value of their labor. Quit trying to enforce your values on the wages of others. Such meddling only serves to harm the economies in the end.

I suppose you can explain Hotpoint's post about the continuing success of the UK economy after the implementation of a minimum wage?

I'm sure you will argue that the economic indicators would have looked even better if the minimum wage hadn't been implemented, but I hope you forgive me if I don't believe you. In all economic debates where real world statistics and indicators are considered, any effect that one change has is dwarfed by the myriad of other effects from constant sources.

 

[Veritass]

Well, determining where I work is more complicated than just my wage. Will I have a long commutte at a new job? Will I be able to do the work, can I find flexible hours, etc etc.

I agree completely. There are a lot of factors involved, and the same job is not the same to two different potential employees.

I wouldnt work for less than 7, and I imagine others making 6.50 would want a small raise too.

Yes, everyone's "optimal" salary is usually about 25% greater than their current one. I remember when I dreamed of making the money I can barely live on now.

 

[JerichoHill]

I suppose you can explain Hotpoint's post about the continuing success of the UK economy after the implementation of a minimum wage?

I'm sure you will argue that the economic indicators would have looked even better if the minimum wage hadn't been implemented, but I hope you forgive me if I don't believe you. In all economic debates where real world statistics and indicators are considered, any effect that one change has is dwarfed by the myriad of other effects from constant sources.

A few pages back, I stated that "the minimum wage does not appear to have any effects on unemployment in its current form". Therefore, its a bunk issue.

A minimum wage acts as a price floor. A price floor only distorts the economy when the market clearing price is lower than the floor. This is not the case at the moment. Therefore, there's no disagreement here.

Finally, please do not use spurious correlation. The minimum wage increase did not fuel English economic growth. The fact that the economy kept growing is testament to a confluence of a whole slew of economic factors that have nothing to do with the minimum wage.

The minimum wage, for the most part, is harmless political grandstanding. It cannot, in theory, help anyone, but it can hurt (though again, this is not the case today)

 

[.Shane.]

Finally, please do not use spurious correlation. The minimum wage increase did not fuel English economic growth. The fact that the economy kept growing is testament to a confluence of a whole slew of economic factors that have nothing to do with the minimum wage.

Its not spurious. It is a correlation, but that doesn't mean they're related. Correlation simply means they move in the same direction.

The humerous thing here is that had the economy declined, I'm sure that you'd of argued that the MW had something to do with it.

 

[Cuivienen]

Minimum wage should be twice what you can make on Welfare.

Interesting. "Double" might be too simplistic, but wouldn't that be a great way to encourage people to abandon welfare? "You can make three times as much money if you work for minimum wage!"

IDK how much money is actually given out on welfare. My guess is around $2 an hour.

 

[Paradigne]

Interesting. "Double" might be too simplistic, but wouldn't that be a great way to encourage people to abandon welfare? "You can make three times as much money if you work for minimum wage!"

IDK how much money is actually given out on welfare. My guess is around $2 an hour.

I have no idea on the dollar figure, but I do know they get food cheaper, housing cheaper (not the best housing mind you), free medical, etc. You know, things that take 3/4 of my paycheck...

 

[Perfection]

Its not spurious. It is a correlation, but that doesn't mean they're related. Correlation simply means they move in the same direction.

If it's not a spurious correlation then there must be a relationship.

 

[.Shane.]

Hardly. Spurious implies an intent to deceive. For instance, a spurious correlation would be to say that the decline in piracy causes global warmings as these events have a inverse correlation.

In an economic discussion its not spurious at all to say that there's a correlation between increasing minimum wage and an improving an economy, if demonstrable (ditto an inverse relationship). BUT, that doesn't prove they're related, it just invites reasonable discussion and investigation.

 

[JerichoHill]

Its not spurious. It is a correlation, but that doesn't mean they're related. Correlation simply means they move in the same direction.

The humerous thing here is that had the economy declined, I'm sure that you'd of argued that the MW had something to do with it.

Duh. I am an economist ... (ha!)

And it would silly for me to blame the downfall on an economy on a minimum wage hike. Thanks for putting words in my mouth. Please refrain from doing so in the future.

You used the correlation in your post to argue as if it was part of the causation.

That's like saying people drown more as they eat more ice cream. (get it?)

Also, to be fair, correlations need to be around .7 or above, according to most statistics book I've read, to have some sort of handle on causation. Any lower, and were' just looking at noise.

 

[Perfection]

Hardly. Spurious implies an intent to deceive.

Not really, spurious just means not genuine. Let's say you take 5 data points for two variables (x,y) and you find out that they seem to follow a linear relationship. It could be that through small sample size and random chance you came up with this apparent correlation, and after taking further points you find no true correlation. That would be an example of spurious correlation without intentful deception.

 

[.Shane.]

Duh. I am an economist ... (ha!)

We all know that, I got your junk mailer.

Granted I haven't looked at this thread w/ a fine-toothed comb, so if I missed this I apologize...

But, the idea that economists are unified in their view of the minimum wage as a negative is hardly true. Many economists find that its has a neutral effect or that it can have a positive effect.

What also I fail to see mentioned is: the whole "let the market take care of it" thing -- many economists recognize that the labor market is not a free market -- you aren't really free not to work, which gives employers an advantage -- a minimum wage puts the worker and employer on slightly more equal footing.

Lastly, the MW is not a purely economic issue. And people cannot be measured like you can, say, ingots of pig iron or some other commodity. To many variables to account for.

 

[JerichoHill]

I have no idea on the dollar figure, but I do know they get food cheaper, housing cheaper (not the best housing mind you), free medical, etc. You know, things that take 3/4 of my paycheck...

There is already an incentive called the earned income tax credit which supposedly will induce a person to get off welfare.

It doesnt work as well as one would hope

 

[.Shane.]

That's like saying people drown more as they eat more ice cream. (get it?)

I don't need to reply to threads w/ people who are rude and insulting.

Later.

Oh, and yes, I know you are an economist.