Monday, June 26, 2006

Five-fifteen foolishness

Let's pretend for a moment that the minimum wage really shouldn't be increased. Imagine that there's actually some truth to the fatuous argument that the minimum wage deserves to be low so that the prices of goods don't go up. In this hypothetical fantasy, the prices of a national conglomerate's products teeter precariously on whether or not some dockworker in Peoria gets a 50-cent hourly raise.

Assuming that principle is true, why don't we just not pay anyone anything? That way, stuff would be super-duper cheap! At least as cheap as a jab at Dubya's intelligence. Such cost-cutting would allow corporations to save money and thus be able to hire more workers, so that they could work for nothing as well! Who could resist such a logical extension? It's flawless.

But goods made by equally underpaid workers smacks of communism! And aren't most of the things we purchase already made for 10 cents a day by three-year-olds in Sweatshopistan? Kinda pulls the rug from underneath that one, doesn't it?

Seriously. Who can argue that the minimum wage should stay where it is, especially after all this time? I'll tell you this: it isn't anybody trying to make it on such a dismal wage.


T. said...

I had an argument with someone over the minimum wage just yesterday and began talking about Barbara Ehrenreich's study in "Nickled and Dimed". No matter what I said, they remained unconvinced; they were positive that the price of goods would rise with a payraise.

Never mind that I've seen really no significant change in prices at the fast food restaurants in the city--despite the fact they're paying their employees almost twice the pre-K wages.

BeerMan said...

bottom line:

wages just like goods are controlled by the laws of supply and demand.

The market will set wages just as it sets the price of goods.

The price of a good is determined by profit maximization, not costs. The viability of a good is influenced by costs.

If people dont get remuneration, they will not work. So, you need to pay them to work. Guess what? That is the smallest amount for which they are willing to work.

The secret to high wages it not a law. It is in a healthy economy and in competition for the labour resources so that the workers have options.

Minimum wage decreases the number of companies that can support their workers. It destroys jobs and it obliterates competition in the labour makets.

Big governemt is not the way.

Socialism (which is really what a minimum wage amounts to) is really not the way.

We tryed socialism. Remember Marx? Your pal? Socialism failed.

Michael said...

Um, we tried straight capitalism too...that didn't work so well either, between the various economic panics, recessions, and depressions. In addition, today's "marketplace" isn't exactly a level playing field or much of a market (anyone who believes, for instance, that insider trading isn't a major part of how business is done is, to paraphrase Warren Buffet, "the sucker in the market."

Simple notions about supply and demand might make for an adequate middle school comprehension of basic economics, but the modern world is a bit more complicated. You'd be hard pressed to locate anything beyond a lemonade stand to validate your point of view, Beerman. But hey, if that's your model, go for it: I like lemonade.

As for the minimun wage, I think Congressional pay SHOULD BE the minimum wage. Let them set it at whatever level they want...and then live on it, provided they don't have outside sources of income, like ol' Tex Sensenbrenner.

Robert Taylor said...

Listen, Ian, don't listen to Beerman (obviously the name tells you a little about his intelligence). It's pretty clear when it comes to this debate. If congress can raise their own wages, they can raise everyone elses. That the bottom line.

Cajun Tiger said...

Before I even start this debate, I'll agree to disagree b/c we won't see eye to eye on it.

However the point that has been brought up about Congressional pay raises is dead on. It is ridiculous for them to make as much as they make and continue to vote for their own pay raise. Who wouldn't vote to give themself a pay raise if given the opportunity...that whole idea that they give themselves raises needs to be revisited.

Ian McGibboney said...

I agree that the Congressional pay raise is an absurd model. Perhaps we should vote for that during election cycles, based on how we (as people) gauge their performance...seeing as how how they're our employees and all.

And while I'm not advocating a communistic parity in incomes, we definitely have to do something about the spiraling gap between rich and poor that's causing the middle class to crumble away. Even a capitalist society cannot sustain itself when wealth is as concentrated as it's getting.