Confirms what we knew raising the minimum wage would do. For some reason people are surprised. Republicans have already started saying stupid things.
The CBO now estimates that "the $10.10 option would reduce total employment by about 500,000 workers." I would love to see evidence that I am not alone on this point in the form of links to previous Hubski comments along the lines of "confirming what we knew."Confirms what we knew raising the minimum wage would do.
Wait, what? I have been muted/ignored — twice — while arguing that an arbitrary minimum salary has negative effects.
Correct me if I'm wrong -- we knew it would a) reduce total employment and b) help the poorest percentage of the population in the short term. Right? We still know this as far as I know, only apparently it took a CBO report for Republicans to realize it? I still want to see what happens with this, and I was privately hoping that we would wait long enough with federal minimum wage reform to see what the results on unemployment were. EDIT: intervention is probably not a good thing in the long run for our economy -- actually it's not, period, but if we're going to have a minimum wage it's ridiculous for it to be unindexed to inflation, because it provides companies essentially with an excuse to pay their workers below living wage. So that's probably a positive change. Maybe. EDIT2: I believe that 500k number was intentionally found using very harsh estimates.
In my view a reduction in employment after hiking minimum wage is the most likely outcome (though it's hard to say by how much), based on the common sense principle that when stuff costs more, people buy less of it. It seems clear to me that the ones who are hurt are likely to be poorer than those who benefit. Also, those who are hurt lose a lot: their entire salary, an opportunity to improve their skills, a consistent work history, networking opportunities. Those who win only gain a percentage of their salary, and may be expected to work harder or work fewer hours or accept fewer fringe benefits in compensation.we knew it would a) reduce total employment
I have not seen evidence of anyone on Hubski expressing this view. Mostly I see calls for a "living wage" with no clear statement of what that means. In my opinion it is bold to say we "know" anything more than obvious facts like "A change to minimum wage law will affect workers." There are data and theories and predictions and estimates, but little universal agreement.and b) help the poorest percentage of the population in the short term
I disagree here. I think it can help some workers (those who will get a higher wage — if we make the rather baseless assumption that employers will not make compensating adjustments outside of salary). It will also hurt some, those who are let go because employers choose not to pay more for labor, and those who would have been hired with the old minimum but now are not hired.I still want to see what happens
That chart illustrates a good point, which was also demonstrated in the paper kleinbl00 shared. When minimum wage is low compared to average incomes, an increase in minimum wage does not cause much harm. But that is also when it does not do much good either.if we're going to have a minimum wage it's ridiculous for it to be unindexed to inflation
Either it is a net benefit or a net harm. If it is a benefit, then it makes sense to take measures to prevent dilution of the benefit by inflation. If it is harmful, it should be eliminated; we should not depend on inflation to gradually reduce the damage.I believe that 500k number was intentionally found using very harsh estimates.
If you could tell me why you believe that it would help me decide if I should believe it too.
Why are you assuming 'we' is hubski? 'We' is economists. hubski's all over the map on this. Economics is very clear on the costs and benefits (in the short term, again) of fixing the price of labor. Sure. It's a question of percentages, because the minimum wage is here to stay, which brings me to my next point -- Spoken like a true economist; that is, one who doesn't care about elections. The last bit was from something I read on r/economics quite a while ago. Can't find it. Doesn't change the facts; a minimum wage increase has significant employment effects, whatever the exact numbers are.That chart illustrates a good point, which was also demonstrated in the paper kleinbl00 shared. When minimum wage is low compared to average incomes, an increase in minimum wage does not cause much harm.
Either it is a net benefit or a net harm. If it is a benefit, then it makes sense to take measures to prevent dilution of the benefit by inflation. If it is harmful, it should be eliminated; we should not depend on inflation to gradually reduce the damage.
Why are you assuming 'we' is hubski? 'We' is economists.
Because I am not an economist. Economics may be clear on the subject — I think it is — but economists are a capricious lot.one who doesn't care about elections
Obviously this is important, unfortunately. Supporting minimum wage, like opposing immigration, is an easy win in the polls even if one knows that both positions are almost certainly harmful to one's constituents.Doesn't change the facts
I understood you to mean that the numbers were massaged to increase the out-of-work number to half a million, is that right? I was surprised to see a dot-gov source publish findings against minimum wage at all, and respect the fact that they express a wide range of uncertainty, describing "a two-thirds chance that the effect would be in the range between a very slight reduction in employment and a reduction in employment of 1.0 million workers."
Then let's settle on 'we' being 'people who are familiar with the right economic ideas'. Precisely. I can't envision a future scenario in which the minimum wage would be summarily abolished. I'm sure there is one, but it strikes me as outside the realm of foreseeable possibility. As for the latter, yes, that's what I meant. I understood the source I can't find to mean that the actual increase in unemployment would probably be less than 500k (though it certainly could be up to a million within the margin of error the CBO reported). By doesn't change the facts I meant: "the $10.10 number will still obviously hurt employment to some degree."Obviously this is important, unfortunately. Supporting minimum wage, like opposing immigration, is an easy win in the polls even if one knows that both positions are almost certainly harmful to one's constituents.
Suddenly the Republicans care about the working class. There are probably reasons the minimum wage is a dangerous idea, but those aren't the reasons. Get yourself together Boehner.