# Minimum Wage



## autisticdragonkin (Oct 13, 2015)

Why should the minimum wage exist? It causes unemployment which harms unskilled workers. If poor people are unable to live with their current incomes then the government should implement a basic income rather than institute a minimum wage


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## Kirby (Oct 13, 2015)

autisticdragonkin said:


> Why should the minimum wage exist? It causes unemployment which harms unskilled workers. If poor people are unable to live with their current incomes then the government should implement a basic income rather than institute a minimum wage



A minimum wage is needed to weigh and balance the value of jobs based on the skills required for that job. 

It wouldn't work in a capitalist system because simply raising the income of lesser skilled jobs to match the current "living wage" would ultimately just cause inflation and lower the value of the dollar, which would inadvertently then just make the living wage even higher. This problem would then eventually effect a constantly rising proportion of people who earn more than the "living wage" by lowering the value of their earnings, which then causes the "living wage" to increase again. Theoretically this would create a scenario where a large chunk of the population would be poor.


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## AN/ALR56 (Oct 13, 2015)

This would cause massive unemployment for workers because the ilegal immigrants will accept any wage to survive,thus creating a massive shitstorm because the workers will be replaced by masses of people who dont care about being explored.


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## autisticdragonkin (Oct 13, 2015)

Kirby said:


> A minimum wage is needed to weigh and balance the value of jobs based on the skills required for that job.


The equilibrium price of unskilled labor can do that better


Kirby said:


> It wouldn't work in a capitalist system because simply raising the income of lesser skilled jobs to match the current "living wage" would ultimately just cause inflation and lower the value of the dollar, which would inadvertently then just make the living wage even higher. This problem would then eventually effect a constantly rising proportion of people who earn more than the "living wage" by lowering the value of their earnings, which then causes the "living wage" to increase again. Theoretically this would create a scenario where a large chunk of the population would be poor.


Taxing the rich and then transferring the money to the poor wouldn't lead to inflation because it wouldn't increase money circulation rate nor would it increase money supply.


AN/ALR-56 said:


> This would cause massive unemployment for workers because the ilegal immigrants will accept any wage to survive,thus creating a massive shitstorm because the workers will be replaced by masses of people who dont care about being explored.


How would this cause unemployment? Illegal immigrants would not accept sub market prices for their labor.


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## AnOminous (Oct 13, 2015)

autisticdragonkin said:


> How would this cause unemployment? Illegal immigrants would not accept sub market prices for their labor.



Illegals will take whatever you give them and shut the fuck up.

Or be beaten, deported, and whatever else the criminal willing to hire illegals will do to them.


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## Adamska (Oct 13, 2015)

People could just move their company to China, Vietnam or another country due to lower wages as another method to get out of paying for labor as well.

I personally like the idea of a minimum wage that's tied to the rate of inflation or deflation rather than random leaps and jumps whenever the idea is fronted myself. That way the wages consistently match the dollar without artificially inflating it by being driven upward.


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## AN/ALR56 (Oct 13, 2015)

AnOminous said:


> Illegals will take whatever you give them and shut the fuck up.
> 
> Or be beaten, deported, and whatever else the criminal willing to hire illegals will do to them.


This is the most common form of slavery here,they just place massive debts in the illiterate worker and keeps him working for free to pay the debt,if he complains he is just threatened with deportation or violence.
This commonly used by construction companies in government contracts, but when they are discovered by the feds,strangely nothing happens but a small fine...


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## Dudeofteenage (Oct 13, 2015)

autisticdragonkin said:


> Why should the minimum wage exist? It causes unemployment



Most studies have shown it doesn't.


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## Strelok (Oct 14, 2015)

autisticdragonkin said:


> The equilibrium price of unskilled labor can do that better



All that does is result in a race to the bottom by workers willing to work for less and less while living in ramshackle tin huts and shitting in the streets, something that was endemic in the days when we used to think shooting unionized strikers was a fine and dandy thing to do.

It's the same reason we regulated the financial system, and passed anti-trust laws, because when left to their own devices, large businesses will do everything in their power to shit on both workers and consumers rights if it's in their self interest to do so. It's tragedy of the commons on an industrial scale.


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## autisticdragonkin (Oct 14, 2015)

AnOminous said:


> Illegals will take whatever you give them and shut the fuck up.
> 
> Or be beaten, deported, and whatever else the criminal willing to hire illegals will do to them.


There still is an illegal immigrant equilibrium wage even if a low one. No illegal immigrant will willingly work for free (slavery is nothing to do with equilibrium wage and a separate issue)


Dudeofteenage said:


> Most studies have shown it doesn't.





> High minimum wages, however, particularly in rigid labour markets, do appear to hit employment. France has the rich world’s highest wage floor, at more than 60% of the median for adults and a far bigger fraction of the typical wage for the young. This helps explain why France also has shockingly high rates of youth unemployment: 26% for 15- to 24-year-olds.


A basic income would help mitigate the costs of finding a new job


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## Sperglord Dante (Oct 14, 2015)

Guatemala's minimum wage is peanuts, most of the workforce in is in the informal market and even 'legit' businesses often pay less than minimun wage to laborers.

And yet our NEET problems are about as bad if not worse than France's!

I do like the idea of universal income but that's not gonna get widespread any time soon.


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## Holdek (Oct 14, 2015)

autisticdragonkin said:


> A basic income would help mitigate the costs of finding a new job


The very article you quoted has the subheading: "Moderate minimum wages do more good than harm."


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## Pickle Inspector (Oct 14, 2015)

autisticdragonkin said:


> Taxing the rich and then transferring the money to the poor wouldn't lead to inflation because it wouldn't increase money circulation rate nor would it increase money supply.


The rich have lots of resources to avoid taxes though plus there is the argument to keep taxes down in fear they'll move somewhere with lower taxes (Tax exiles).

Also there is the problem of in work poverty where the government basically has to top up an employees low wage.


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## Kenneth Erwin Engelhardt (Oct 14, 2015)

A lot of undocumented immigrants that work aren't "employees". They are "independent contractors" paid under the table.


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## AnOminous (Oct 14, 2015)

Thundersteam said:


> A lot of undocumented immigrants that work aren't "employees". They are "independent contractors" paid under the table.



The employer/employee relationship is defined by how the employer controls the actions of the employee.  Independent contractors are generally in charge of how they carry out their duties, otherwise they are not independent contractors.

If the employee caused damages as a result of their actions directed by the employer, the employer would be held civilly liable.

Both kinds of employment would be illegal, but if the undocumented person was truly an independent contractor, the person paying them would probably not be required to check their documents and do what an employer does.

An employer, however, would not cease being an employer with the legal obligation to do this (and to pay minimum wage) simply by calling the employee a contractor falsely.


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## Kenneth Erwin Engelhardt (Oct 14, 2015)

"An employer, however, would not cease being an employer with the legal obligation to do this (and to pay minimum wage) simply by calling the employee a contractor falsely."
In theory you're correct, in practice I'm sure this goes on a lot more than people realize. It's the underground economy and it probably accounts for a good portion of the jobs that undocumented people get.


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## Doc Cassidy (Oct 14, 2015)

Honestly, the only reason a person should make minimum wage is because they're a teenager, in college, or a dumbass.

If you decide to work for a living there are plenty of factory and oil jobs available, not to mention the countless jobs if you spend 6 months to a year in trade school.


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## Dudeofteenage (Oct 14, 2015)

Doc Cassidy said:


> Honestly, the only reason a person should make minimum wage is because they're a teenager, in college, or a dumbass.
> 
> If you decide to work for a living there are plenty of factory and oil jobs available, not to mention the countless jobs if you spend 6 months to a year in trade school.



The work we do is a product of a lot of factors, and our own personal motivation/education/general worth as a human being is only one of them. Jobs disappear due to macro-economic factors that are totally outside the control of any individual worker.

It really saddens me that this neo-moralism that sees a person's employment circumstances as a reflection of their individual moral fibre is so widely accepted, particularly among people who wouldn't regard themselves as moralists in any other sense.


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## JU 199 (Oct 20, 2015)

Dudeofteenage said:


> It really saddens me that this neo-moralism that sees a person's employment circumstances as a reflection of their individual moral fibre



It's usually about kicking down and easy answers to complicated problems

"That person is on minimum wage? Must be lazy, so it's his/her fault"

The accuser gets to feel better about themselves and can ignore larger economic issues. It's a win-win.


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## The Lizard Queen (Oct 21, 2015)

Bit of a rant in the spoiler button. Reader beware.



Spoiler



Raising the minimum wage at all for any reason is a terrible idea.

If you were to raise it up to 15 dollars an hour, what you would really
be doing is lessening the value of the dollar as a whole. What you
would end up with is creating a system where $15 now has the
purchasing power that $7.25 had before the raise.
The money would not retain its value, because the value of money is
not really based off of gold or an arbitrary number, it is based off
of the time, resources, and effort people spend to earn it.
Time is quite literally = money.

I will use gold as an example though. Gold is expensive because it is
rare. Rareness means that it takes a significant investment of time
and resources to mine it, you can't just find it laying around on
every street corner. If you were able to create gold and give a huge
lump of it to every single person in the country, gold would be worth
much less because it would no longer be rare.

Increasing the amount of paper money in the general population would have the
same effect. Money has value because not everyone has a lot of it, and
it costs time and resources to earn, but it has no more value than
what people ascribe to it. if $15 required the same amount of time and
resources that $7.25 did before, than $15 would become the new $7.25.

If you raised the minimum wage, in the short term the people who live
on those wages might have an easier living for a few months, but
eventually the system would balance out, and they would be asking for
$20 an hour for living because they can't survive on $15.

Also, by giving everyone more money, you actually hurt more people.
When the min wage goes up to 15 an hour, the guy who currently makes
16 an hour is not likely going to get a raise to compensate right off
the bat. Prices everywhere will go up because it costs more to hire
and train people, and Mr. $16 an hour will find he has a much higher
cost of living than he did before. People in his income bracket and
the middle class will suddenly find themselves worse off than before,
at least until the system evens out and $15 has the purchasing power
that $7.25 did before, and the guy who made $16 is now making $27, but
living the same as he did before the switch because now he is paying
$2.50 for a taco that used to cost $1.

In other words, raising the minimum wage is purely cosmetic. It hurts
as many as it helps in the short term, and does NOTHING in the long
term.



*TLDR version:*
The value of currency is based on goods produced and the effort and resources required to produce them (This is why Bitcoin can be a realistic currency, because it requires resources (energy and video cards) and labor (time) to produce, which creates its value). Changing the numbers on a paycheck does not actually change the amount of resources spent to produce those numbers, so after a while the currency will normalize so that a $15 min wage would have the same buying power that a $7.25 min wage has now.

But, talking about minimum wage changes is pointless to begin with. You can't fix the nature of humanity. Someone is always gonna be on top, someone is always gonn' get stepped on. Plus, there will always be lazy, stupid, and uneducated people living in a pile at the bottom of the ladder, and smart, lucky, and talented people at the top. Changing that would not only be impossible, but would likely stagnate society and impede progression.

But, the wonderful thing about the western world is we have a thriving middle class. The best we can hope for is to find ways to increase the middle class without trying to eliminate the lower classes, because eliminating them by wealth redistribution would just turn the middle class into the lower class, and make the already overbearing class problems worse.


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## Marvin (Oct 21, 2015)

The Lizard Queen said:


> But, the wonderful thing about the western world is we have a thriving middle class. The best we can hope for is to find ways to increase the middle class without trying to eliminate the lower classes, because eliminating them by wealth redistribution would just turn the middle class into the lower class, and make the already overbearing class problems worse.


Turning the middle class into the lower class is good if there's a net improvement in the quality of life for most people. There are quite a few countries in which being middle class is a lot worse than just being lower class in the US.


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## JU 199 (Oct 21, 2015)

The Lizard Queen said:


> But, the wonderful thing about the western world is we have a thriving middle class.



The middle class has been fraying in the west for a decade or so. Especially since 2008.


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## PeteyCoffee (Oct 21, 2015)

I hope they don't increase the minimum wage very much because currently in the United States many retarded, elderly, and disabled people get jobs and participate in society but with a high minimum wage it will no longer be economically feasible to employ them.

You don't hire a person who costs you more than they can bring in. For nonessential jobs (the type they tend to have), margins are already tight.


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## AP 297 (Oct 21, 2015)

I am going to actually disagree on this. 

One of the biggest problems in the world right now is that there has been consistent rounds of over production and consistent force to lower wages. Lowered wages reduces consumption, and is creating the scenario that we have now. Over the last 30 years we have had boom and bust cycles that have occurred every 8 years. I would not be surprised if we have another that happens next year. 

This is basically caused by something known as a Savings glut. Lowered wages and a wage system that is creating a "race to the bottom" for wages is creating a constant system of forcing countries to take on debt to support social services to compensate for the low wages(savings) that companies are able to achieve. 

You cannot have supply without demand. Low wages destroys demand. We have over produced and under compensated for it.


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## GS 281 (Oct 21, 2015)

Get rid of the minimum wage. Let the poor really feel a squeeze. Its about time we seen a REALLY pissed off populace. Enough pussyfooting around. Government and business has been doing just enough to hold off revolution for decades. Our problems are too layered, compounded and complex. Sometimes there needs to be a crisis, revolution and breakdown of the system before it can be redesigned in a way that conforms to the environment at large once more.


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## AP 297 (Oct 21, 2015)

yawning sneasel said:


> Get rid of the minimum wage. Let the poor really feel a squeeze. Its about time we seen a REALLY pissed off populace. Enough pussyfooting around government and business has been doing just enough to hold off revolution for decades. Our problems are too layered, compounded and complex. Sometimes there needs to be a crisis, revolution and breakdown of the system before it can be redesigned in a way that conforms to the environment at large once more.



Ya, I am really going to disagree with this. Revolutions are really overrated. Better a slow methodical approach rather than a catastrophe. 

Another problem with revolutions and unrest is that you wind up with booming black markets and suddenly no one can find toilet paper. I am not kidding on the last one. Toilet paper becomes scarce when countries start falling apart. Look at Venezuela - 

http://newsfeed.time.com/2013/05/17/bathroom-blues-venezuelas-toilet-paper-crisis/
http://www.usatoday.com/story/money/business/2013/05/16/venezuela-toilet-paper-chavez/2165405/
http://www.telegraph.co.uk/news/wor...tages-claim-lives-as-oil-price-collapses.html
http://www.theatlantic.com/business...t-paper-shortage-dont-laugh-seriously/275940/


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## PeteyCoffee (Oct 21, 2015)

@The Lizard Queen is right; the problem of lowly workers becoming unable to provide enough value to justify their employment is temporary; the market will readjust itself.

However, periods of great market readjustment or inflation (recessions) tend to be uncertain, tumultuous times. Everyone hurts, except the wealthiest people, who tend to come out of it even wealthier - having bought smaller companies which could not adjust fast enough, having bought stock when other people were selling, having hired desperate people for cheap, etc.

The wealthiest profit massively, of course, but the alternative is even worse. If no one buys that failing company, it ceases operating and everyone involved loses their job. If no one buys that stock for cheap, the price plummets to near zero and those who need out get pennies. If no one hires those desperate workers, they are out of work for the duration of the recession. In other words, if no one would or could profit off of bad times, the result would be a total economic collapse. Still, their necessary involvement has the consequence of an increasing wealth gap.

Theoretically, if a group of people became powerful enough, they could use government influence to repeatedly manufacture inflation (using money printing, government spending, economic mandates, etc.), let the economy recover, then do the exact same thing again. They become wealthier, as they become more powerful. Eventually, they own everyone.


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## The Giver (Oct 21, 2015)

Marvin said:


> Turning the middle class into the lower class is good if there's a net improvement in the quality of life for most people. There are quite a few countries in which being middle class is a lot worse than just being lower class in the US.



Regardless of whether the empirical claim that it would be possible to cause a net increase in well being by lower the average standard of the middle class and raising that of the lower class, I'm just not sure I'm comfortable with this kind of utilitarian reasoning. 

Consider the following scenario. A small subsection of the population is compelled (economically, politically, w/e) to do shoulder the vast majority of negative utility... a statistically small slave class, say. However, the negative utility of this slave class is outweighed by the positive utility conferred on the rest of the population, which constitutes the vast majority. Furthermore, let's say -- hypothetically -- that this set up leads to a net increase in quality of life over spreading out the negative utility across a wider section of the population. Is the slave caste system therefore morally correct, or good?

I'd hesitate to say it would be. In fact, I'd say it was radically immoral. But, you can't justify that conclusion with utilitarian reasoning alone. You'd need reference to something else... say basic human rights that hold regardless of any net increase/decrease in quality of life. Now, I guess I want to say that something like a minimum wage is likely such a right. Respect for the worth of labor should not, on my view, ever be allowed to fall below a certain value. If you put in a hard days work, I believe you have a right to some minimum amount of compensation for that labor. What an appropriate value might be, I won't speculate about, but it seems to me this right holds independent of maximizing overall quality of life.

Of course, overall quality of life should be a very important concern nevertheless. I just don't want to say that it is the ultimate principle on which to judge policy


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## Marvin (Oct 21, 2015)

The Giver said:


> Regardless of whether the empirical claim that it would be possible to cause a net increase in well being by lower the average standard of the middle class and raising that of the lower class, I'm just not sure I'm comfortable with this kind of utilitarian reasoning.
> 
> Consider the following scenario. A small subsection of the population is compelled (economically, politically, w/e) to do shoulder the vast majority of negative utility... a statistically small slave class, say. However, the negative utility of this slave class is outweighed by the positive utility conferred on the rest of the population, which constitutes the vast majority. Furthermore, let's say -- hypothetically -- that this set up leads to a net increase in quality of life over spreading out the negative utility across a wider section of the population. Is the slave caste system therefore morally correct, or good?
> 
> ...


The argument I was addressing seemed to say that using wealth distribution to eliminate the lower classes would just serve to turn the middle class into the new lower class. I don't think that's important because "lower class" and "middle class" are just relative terms without an important meaning of their own. If the existing middle class becomes the new lower class simply because there isn't someone below them, that doesn't really mean anything to me.


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## The Giver (Oct 22, 2015)

Marvin said:


> The argument I was addressing seemed to say that using wealth distribution to eliminate the lower classes would just serve to turn the middle class into the new lower class. I don't think that's important because "lower class" and "middle class" are just relative terms without an important meaning of their own. If the existing middle class becomes the new lower class simply because there isn't someone below them, that doesn't really mean anything to me.



Ah, my mistake. In that case I pretty much agree with you. The labels really aren't what is important


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## PeteyCoffee (Oct 22, 2015)

yawning sneasel said:


> Get rid of the minimum wage. Let the poor really feel a squeeze. Its about time we seen a REALLY pissed off populace. Enough pussyfooting around. Government and business has been doing just enough to hold off revolution for decades. Our problems are too layered, compounded and complex. Sometimes there needs to be a crisis, revolution and breakdown of the system before it can be redesigned in a way that conforms to the environment at large once more.


I suggest what I'm about to say is an absolute: if a revolution is more violent than the system it overthrows, the revolutionary system will be more violent (repressive) than the overthrown system.

For this reason, I prefer the republic over the old ways. The crises a bloating republican government will inevitably create or exacerbate on an almost yearly basis nonetheless rarely devolve into violence. Compare this to a noble system - crises occur far less often, but they usually end violently.

Then again, perhaps a government resistant to unrest isn't all it's cracked up to be... I think the traditional Chinese Bureaucracy was extremely resistant to unrest. Except once every couple hundred of years, there was a civil war. Of the 10 deadliest wars in history, 5 were Chinese Civil Wars. I hope this republic does not build pressure similarly. I hope the American Civil War was an unusual incident.


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## GS 281 (Oct 22, 2015)

PeteyCoffee said:


> I suggest what I'm about to say is an absolute: if a revolution is more violent than the system it overthrows, the revolutionary system will be more violent (repressive) than the overthrown system.



Could you explain what this is grounded in?


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## PeteyCoffee (Oct 22, 2015)

yawning sneasel said:


> Could you explain what this is grounded in?


It makes sense to me. An individual who used violence, at great personal risk, in order to help initiate a cause will use the same level of violence to further initiate or maintain the cause after the revolution, especially considering the personal risk is now gone.

It's unlikely that a person is going to change in a fundamental way over the course of a revolution, to be willing to risk one's life in order to violently initiate an agenda, and then suddenly not. Much less thousands of people involved in the revolution all changing fundamentally at the same time.

I cannot think of an example where a violent revolution produced a less violent successor state. Even in the USA, almost immediately after the revolution the American government started arresting journalists. This happened, and I consider the American Revolutionary War about the least violent a major war could possibly be. Many of the battles were pitched, as in both sides met and laid out the rules ahead of time as if it were softball match. In fact, not one of the 56 signers of the Proclamation of Independence died as a result of the war. Only one of the 56 signers had a son who died in the war.

Of course, the US situation improved fairly quickly as revolutionaries lost elections or retired.


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## GS 281 (Oct 22, 2015)

So, nothing? Well it doesn't make any logical sense to me so I think I am going to move on from this discussion.


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## AnOminous (Oct 22, 2015)

PeteyCoffee said:


> I cannot think of an example where a violent revolution produced a less violent successor state. Even in the USA, almost immediately after the revolution the American government started arresting journalists. This happened, and I consider the American Revolutionary War about the least violent a major war could possibly be.



Arresting journalists for various things has been endemic pretty much since the U.S. has existed, despite the fact that among the things this nation is known for, taking free speech protections more seriously than virtually every nation on the planet is one of its best features.

I'll note that the election after the Federalists went on their seditionist purge punished them savagely at the polls and put Thomas Jefferson in the White House.

Journalists who were arrested during this period were not only not silenced by doing this, they generally grew even more vehement, firing broadsides from behind bars and after being released.  That strategy massively backfired.


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## Flowers For Sonichu (Oct 22, 2015)

Minimum wages should be adjusted in accordance to housing prices.  I could rent a 3 bedroom house back in Michigan for ~$800 which is what I used to pay for a room windowless room that even @FramerGirl420 couldn't stand in when I lived in Brooklyn.  Corporations these days don't fucking understand basic economics in that if you pay your workers more, they spend more money and boost the economy so increases in revenue will offset the cost of labor.   Meanwhile, it's shown that "trickle down economics" that put massive wealth in the hands of few people fails to benefit industries that don't build yachts.

Henry Ford paid his workers twice as much as other factories were paying because they would be able to afford the cars that they make and it paid off handsomely for him.  When the automotive jobs went to other countries and the factories shut down, people weren't able to afford to buy a new car and they took shitty paying jobs compared to the union wages they had.  Because they had less money, they were no longer able to afford a new car or looked towards cheaper foreign models such as Toyota and Honda.  Meanwhile, the foreign car workers making a shit wage can't afford the cars they make and the end result is the Big 3 automakers went to shit.


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## AP 297 (Oct 22, 2015)

Flowers For Sonichu said:


> Minimum wages should be adjusted in accordance to housing prices.  I could rent a 3 bedroom house back in Michigan for ~$800 which is what I used to pay for a room windowless room that even @FramerGirl420 couldn't stand in when I lived in Brooklyn.  Corporations these days don't fucking understand basic economics in that if you pay your workers more, they spend more money and boost the economy so increases in revenue will offset the cost of labor.   Meanwhile, it's shown that "trickle down economics" that put massive wealth in the hands of few people fails to benefit industries that don't build yachts.
> 
> Henry Ford paid his workers twice as much as other factories were paying because they would be able to afford the cars that they make and it paid off handsomely for him.  When the automotive jobs went to other countries and the factories shut down, people weren't able to afford to buy a new car and they took shitty paying jobs compared to the union wages they had.  Because they had less money, they were no longer able to afford a new car or looked towards cheaper foreign models such as Toyota and Honda.  Meanwhile, the foreign car workers making a shit wage can't afford the cars they make and the end result is the Big 3 automakers went to shit.



I would even argue a huge component of the Housing Crisis was we had builder constructing huge houses to sell for $300,000 when most workers could barely afford $150,000 houses. The companies used contractors who worked for under minimum wage and in doing so produced an over supply of housing while continuing to contribute to the squeezing down of wages. We had constructed enough housing to supply over 3 extra years of housing and none of this housing was anything that most people could afford. We had significant oversupply and severe underdemand. When it was revealed that most people could not afford to buy these houses, a huge economic collapse occurred. 

While supply side economics have a place, I would argue after 4 decades of stagnant real wages and severe booms that have produced nothing of real value. Maybe it is time for some demand side economics. Maybe it is time for minimum wage hikes, and other policies to spur demand. Some believe that demand is infinite, but it really is not. Eventually you are limited in what you can afford.


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## Dudeofteenage (Oct 22, 2015)

The Lizard Queen said:


> I will use gold as an example though. Gold is expensive because it is
> rare. Rareness means that it takes a significant investment of time and resources to mine it, you can't just find it laying around on
> every street corner. If you were able to create gold and give a huge lump of it to every single person in the country, gold would be worth
> much less because it would no longer be rare.
> ...



What you have here is not just an argument against increasing the minimum wage, but an argument against all economic growth. If those people on the minimum wage quit their minimum wage jobs and started thriving businesses, there'd be more money in the system, and exactly the same mechanism would kick in.



SunLightStreak said:


> Ya, I am really going to disagree with this. Revolutions are really overrated. Better a slow methodical approach rather than a catastrophe.



I disagree, ironically, even though I am a fan of revolutions. But empowering the working class (eg through higher minimum wage) makes a revolution more likely, not less likely.


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## AP 297 (Oct 22, 2015)

Dudeofteenage said:


> I disagree, ironically, even though I am a fan of revolutions. But empowering the working class (eg through higher minimum wage) makes a revolution more likely, not less likely.



How does this happen? How does higher wages and people being able to afford things actually make revolutions more likely? If people are content, they have no reason to risk life and limb fighting the state military. 

In the US we have had stagnant real wages since 1973. The Minimum wage has not kept up, and very few people have gotten wage increases. Technology advances have led to the only real increase in standard of living, and lately it has not been enough. Meanwhile we have had the fed pump 29 trillion dollars(16 trillion of it under reported) since 2008 into the investment sector and it has produced nothing. It has not even produced significant inflation. 

http://www.huffingtonpost.com/l-randall-wray/bernankes-obfuscation-con_b_1147291.html
http://www.forbes.com/sites/traceyg...the-feds-16-trillion-bailouts-under-reported/

The reason is because wages are stagnant. We can joke about revolutions, but lets be honest here. No one is revolting in the US except in maybe wanting to elect Trump, Sanders, Carson or other non establishment candidates. Increased minimum wage does not make a near non event more likely. I humored one person by posting my reply about black markets and toilet paper to show how absurd wishing for a revolution is.


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## Flowers For Sonichu (Oct 22, 2015)

The Iranian Revolution and the Korean Civil war are two examples of revolutions happening during a time of economic prosperity for both countries


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## The Lizard Queen (Oct 22, 2015)

Dudeofteenage said:


> What you have here is not just an argument against increasing the minimum wage, but an argument against all economic growth. If those people on the minimum wage quit their minimum wage jobs and started thriving businesses, there'd be more money in the system, and exactly the same mechanism would kick in.



Only if their thriving business was printing money...
Successful businesses would actually increase the value of currency by giving it a greater buying power, since the real value has nothing to do with the number on the paper, but the buying power it represents.


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## Dudeofteenage (Oct 22, 2015)

SunLightStreak said:


> How does this happen? How does higher wages and people being able to afford things actually make revolutions more likely? If people are content, they have no reason to risk life and limb fighting the state military.



Empowerment and contentment are not necessarily the same things. Sometimes rising living standards makes people more ambitious and less willing to live with restrictions. Probably the paradigmatic example is the French Revolution which was preceded by an economic boom in _ancien regime_ France.



The Lizard Queen said:


> Only if their thriving business was printing money...
> Successful businesses would actually increase the value of currency by giving it a greater buying power, since the real value has nothing to do with the number on the paper, but the buying power it represents.



So how does that work? You've still got extra money going into the system, which means a greater amount of money chasing the same amount of goods.

I'm guessing you may mean that successful businesses indirectly stimulate the wider economy and indirectly lead to an increase of goods and services available, so inflation is minimised. Which may well be true, but it's quite possible for minimum wage increases to do the same thing, since low income people have more money available to spend, leading to an economic stimulus effect.

I know that the beneficiaries of the minimum wage haven't "earned" their extra money the same way successful business owners have, but the economic effect of a dollar (or whatever unit of currency) is the same whether or not it was earned by entitlement, honest hard work, or anything in between.


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## PeteyCoffee (Oct 22, 2015)

Dudeofteenage said:


> What you have here is not just an argument against increasing the minimum wage, but an argument against all economic growth. If those people on the minimum wage quit their minimum wage jobs and started thriving businesses, there'd be more money in the system, and exactly the same mechanism would kick in.


No, a new business creates wealth; assuming a business survives the free market without losing money, it has to be creating more wealth than it expends.

The value of money depends on the wealth it represents. Increasing the minimum wage does not create wealth, it simply redistributes it. More money being distributed to an area without more represented wealth in that area in order to justify it = temporary inflation, in order to correct the discrepancy.

Say the minimum wage was doubled. That would mean suddenly certain types of companies have about 30% increased expenses. Sure, market adjustments will soon take care of that and at that point expenses will be basically the same as before. However, many small to medium sized companies couldn't last 6 months losing money, much less the 3 to 4 years the complete market adjustment will probably take. (Hell, there are companies which couldn't take 3% increased expenses.)

In the meantime, companies fail, corporations buy them out. The dead competition means that after this recession corporations of the effected industries get by offering less wealth than they did before. The wealth gap is increased.


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## autisticdragonkin (Oct 22, 2015)

As one can see minimum wage moves the amount of people working from point E to point A.
the grey area represents economic loss from minimum wage
the pink area represents the profits of corporations with minimum wage
the orange and teal areas represent worker income with minimum wage

without a minimum wage the orange area and the lower grey area are worker income
the pink area the teal area and the higher grey area represent profits for corporations


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## PeteyCoffee (Oct 22, 2015)

Dudeofteenage said:


> So how does that work? You've still got extra money going into the system, which means a greater amount of money chasing the same amount of goods.


That is called a recession - more money being added to a system without more value being created, or without an equivalent increase in productivity.

In a time of prosperity, money becomes more distributed as a consequence of increased productivity. Usually it's because of either technological innovations or increased competition. Forcefully redistributing money does not produce the same effect. On the contrary, doing so reduces competition, as plenty of small to medium sized companies cannot survive any more money being taken away from them.

Edit: Also, inflation hurts the poor and the most generous organizations the most because they can least take the hit.

If increasing the money supply is the solution to a better economy, then we should transfer all production to printing dollar bills.


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## Dudeofteenage (Oct 27, 2015)

PeteyCoffee said:


> That is called a recession - more money being added to a system without more value being created, or without an equivalent increase in productivity.



You're mixing up your terms here. A recession is simply a prolonged period of negative economic growth. It can happen with or without more money being added to the system.

Using the definition you've extended here, the early 90s economic recession was not an economic recession because Bush Snr didn't print money.



PeteyCoffee said:


> In a time of prosperity, money becomes more distributed as a consequence of increased productivity. Usually it's because of either technological innovations or increased competition. Forcefully redistributing money does not produce the same effect.



Never said it did. However, conversely, increased productivity does not, contrary to libertarian economics, always lead to increased prosperity.



PeteyCoffee said:


> Edit: Also, inflation hurts the poor and the most generous organizations the most because they can least take the hit.



While hyper inflation is not characteristic of inflation, generally high levels of inflation hit the middle hardest, since the poorest sector of society's main asset is their wages, and wages can adjust for inflation while savings can't. The rich usually have most of their money in assets or investments and relatively slight liquid holdings, so, again, they're not vulnerable to inflation.

But this is missing the point - contrary to what you've written above, inflation is not exclusively caused by wealth distribution. Periods of high economic growth are usually accompanied by spikes of inflation regardless of whether or not that growth was state simulated or privately simulated. Redistribution, ironically, only creates inflation if it does its job, e.g. by creating economic growth.



PeteyCoffee said:


> If increasing the money supply is the solution to a better economy, then we should transfer all production to printing dollar bills.



Once again a caricature of Keynesian economics. Nobody would argue that simply printing money in and of itself will increase wealth. The argument is that printing money is a necessary evil for spending projects that will create sufficient economic growth to outweigh the inflationary effects of the printing. It's the same logic as a business borrowing money in order to expand, except that the state's method for increasing liquidity is different (although states often do borrow, and in fact generally prefer to do so).


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## AnOminous (Oct 27, 2015)

Dudeofteenage said:


> Once again a caricature of Keynesian economics. Nobody would argue that simply printing money in and of itself will increase wealth. The argument is that printing money is a necessary evil for spending projects that will create sufficient economic growth to outweigh the inflationary effects of the printing. It's the same logic as a business borrowing money in order to expand, except that the state's method for increasing liquidity is different (although states often do borrow, and in fact generally prefer to do so).



Printing new money is essentially a tax on existing money, as it siphons from the fixed pool of value, the existing money, into the new money, devaluing the existing money.  This effect isn't instantaneous, and when done responsibly, the growth created by doing so eventually offsets the loss of value.

It is generally, at the outset, politically painless to authorize this kind of indirect tax, which is where its pernicious features arise, as a government becomes inclined to do it again and again.  While most developed countries are never going to make the elementary mistake of actually kicking off hyperinflation by excessive money printing, reliance on the method is still potentially dangerous.

It also tends to alter the behavior of market participants.  It discourages saving and encourages borrowing, as both money saved and money to be paid back in the future are worth less.  This is why money printing is usually coupled with increased interest rates.  

This doesn't necessarily mean the practice is universally bad.  There are times it's actually preferable to encourage spending and borrowing.  It's just often, imprudently, done when that's exactly what you don't want to encourage.


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## chimpburgers (Oct 27, 2015)

Dudeofteenage said:


> You're mixing up your terms here. A recession is simply a prolonged period of negative economic growth. It can happen with or without more money being added to the system.
> 
> Using the definition you've extended here, the early 90s economic recession was not an economic recession because Bush Snr didn't print money.
> 
> ...


I would also add that this is why we also have monetary policy in place. I would also argue that part of the reason why the Great Depression occurred was because there wasn't enough in the money supply at the time. I don't think any economist would go around saying that printing money on its own creates wealth. Production is obviously really important.


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## Joan Nyan (Oct 28, 2015)

autisticdragonkin said:


> As one can see minimum wage moves the amount of people working from point E to point A.
> the grey area represents economic loss from minimum wage
> the pink area represents the profits of corporations with minimum wage
> the orange and teal areas represent worker income with minimum wage
> ...





autisticdragonkin said:


> As one can see


Can one? I guess I have to take your word for it because I've been staring at that graph for 5 minutes and can't make heads or tails of it.


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