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comment by mk
mk  ·  3915 days ago  ·  link  ·    ·  parent  ·  post: Some thoughts on minimum wage

Thanks for playing.

    Assumes facts not in evidence. Suppose Bob, Carol, Ted and Alice all work for Google. They all make eleventy seven gajillion dollars a year. The minimum wage is eleven dollars a year. Neither Bob, nor Carol, nor Ted nor Alice are experiencing wealth distribution.

Well, it would come from Google Inc. if they had a minimum wage workforce, but they don't. It's a targeted redistribution that only hits those employers with a minimum wage workforce. It's a type of legislated redistribution, but not a universally applied one. Maybe that's an arguable upshot of minimum wage? It's a tax that doesn't fall on high-skill labor employers (place-making).

I agree that it is partially about lifestyle protectionism, but that's not exclusive to redistribution. It can be about both. A Federal minimum wage of $10.10 does approach or equate to a living wage in a number of places, but even where it doesn't it could reduce the overall need for other subsidies, and the proposal is to adjust for inflation, so it won't erode (as fast).

Costco is a nice corporation. IMO the minimum wage is in part an attempt to force other companies to be as just as Costco since it doesn't seem that the workforce is rational or mobile or organized enough to make it untenable for employers to do so. Predatory corporations can't employ kids anymore and they have to provide safety equipment. No doubt some places did so before they were compelled, but that doesn't mean that compelling the rest was unnecessary.

But what of a living wage? Is that what an employer should provide?





kleinbl00  ·  3915 days ago  ·  link  ·  

    It's a targeted redistribution that only hits those employers with a minimum wage workforce.

Right - as opposed to employers with a living wage workforce, which is not the same. Most of the minimum wage employers - fast food, retail - will simply ditch jobs if their margins are too low. McDonald's has had automated order and checkout in the works for 20 years now - they aren't pulling the trigger because they don't have to. Best Buy has vending machines at lots of airports. Grocery stores are most likely to invest in self-check in regions that are most heavily unionized. "Minimum wage workforce" is code for teens, illegals and the indigent.

    It's a tax that doesn't fall on high-skill labor employers (place-making).

A wage is not a tax. A tax is not a wage. Employ someone on an 01 visa and you will pay a tax to the government for hiring them instead of an able-bodied American Pay someone $4 over what you're required to pay them and the government doesn't benefit at all - the same money comes to them from you or them.

    I agree that it is partially about lifestyle protectionism, but that's not exclusive to redistribution.

But you haven't made the argument.

    A Federal minimum wage of $10.10 does approach or equate to a living wage in a number of places...

Quite. Red states, mostly. Goes a long way towards explaining approval ratings, considering.

Problem is, it isn't a living wage everywhere. That's why Republicans generally argue against it - it isn't enough to do anybody any good, but it's too much to expect those poor, downtrodden "small business owners" to shoulder.

    IMO the minimum wage is in part an attempt to force other companies to be as just as Costco since it doesn't seem that the workforce is rational or mobile or organized enough to make it untenable for employers to do so.

IMO the minimum wage is like Obamacare - a not-quite-good-enough solution to a problem that desperately needs something better.

    Predatory corporations can't employ kids anymore and they have to provide safety equipment.

Yeah, but that shit dates back to Upton Sinclair. What have they done for us lately?

    But what of a living wage? Is that what an employer should provide?

There are plenty of employers that do. In'n'Out provides a living wage. Dick's Drive In in Seattle. Costco. There are others. These are generally privately-held corporations that aren't beholden to stockholders, who recognize that employee retention is often just as valuable as overhead reduction to long-term profit.

Know what would be interesting? If the Amazon warehouses unionized. I'll betcha Amazon would fold within a year of it. Because by your reasoning ("minimum wage is a tax"), zero-margin Internet goods are a penalty.

mk  ·  3914 days ago  ·  link  ·  

    "Minimum wage workforce" is code for teens, illegals and the indigent.

This may be true. However, it has become less so in the last several years, correct? No doubt automation might relieve some minimum wage pressures, but I'm not sure that McDonald's has standard wages as they are franchised, and I wonder how many franchise owners would benefit so much so that making them available would be worthwhile, along with the repairs, etc. Also, people might prefer to order their burger from a person rather than having to push 'customize' > 'no pickles', etc... I'm just saying that there are other hurdles that might be keeping that specter at bay, at least in some industries.

    A wage is not a tax. A tax is not a wage.

True, but a legislated minimum wage does force employers to pay employees more when they might have paid less. That is the government legislating with the intention to take money from one set of folk and put into the hands of another. Also, it does increase the payroll tax on employers. But I am not arguing that it's for the government's benefit. I'm saying that it's a means to alter the distribution of money. I was using the term 'tax' loosely in the above comment. It's government-directed employer to worker monetary distribution.

    Problem is, it isn't a living wage everywhere.

    IMO the minimum wage is like Obamacare - a not-quite-good-enough solution to a problem that desperately needs something better.

I can agree with this. Some might argue that's why the Fed should set the floor, and the States take it from there, but I do agree that it is not a solution to a problem, more a way to alleviate some symptoms.

    These are generally privately-held corporations that aren't beholden to stockholders, who recognize that employee retention is often just as valuable as overhead reduction to long-term profit.

What I wonder, is if this highlights something that can be improved upon from another angle. Is it necessary and good to have shitty corporations in addition to the good ones? Is there a magic ratio? A constant one? What changes the ratio if it does change, and is that sustainable?

    Know what would be interesting? If the Amazon warehouses unionized. I'll betcha Amazon would fold within a year of it. Because by your reasoning ("minimum wage is a tax"), zero-margin Internet goods are a penalty.

Ha. It's funny. I made a similar argument about Amazon to wasoxygen in a previous post, and never finished it, and it was a question that he asked me that spurred me to write this one. I think I need to revisit that discussion and see if my reasoning takes me full circle.

kleinbl00  ·  3914 days ago  ·  link  ·  

For clarity - I'm a big booster of a livable minimum wage. It solves all sorts of pernicious social ills. It is also bare-faced wealth redistribution, which I'm also a big booster of. I'm mostly here as an annoying gadfly to pick apart your arguments. We actually disagree about very, very little.

So in that vein:

    This may be true. However, it has become less so in the last several years, correct?

Quite. The rise in fast food strikes/minimum wage protests is in direct correlation to the rise in structural underemployment due to the aftermath of the 2008 recession. I read in The Week today that since 2000, minimum wage workers under 18 have dropped from 27% in 2000 to 17% in 2012, while those with "some college" are now in a majority. We're back in the space where we instituted a minimum wage to get rid of the wetbacks.

    No doubt automation might relieve some minimum wage pressures, but I'm not sure that McDonald's has standard wages as they are franchised, and I wonder how many franchise owners would benefit so much so that making them available would be worthwhile, along with the repairs, etc.

Franchises function on standardization. You charge what we say you charge for a burger, you make it our way, and if you want to maintain your right to use our logos and brand identity, you pay $2500 for a Blizzard machine.

If McDonald's decided that their interests were better served by BurgerBot, every franchise would have one. They don't - McDonald's response to Super Size Me demonstrates that they're intensely aware of their public image and will sell salads at a loss even when nobody buys them. However, they've also managed to create a bifurcated culture where there are long-term employees and itinerants. It's just not as simple as either of us are making it out to be.

    True, but a legislated minimum wage does force employers to pay employees more when they might have paid less.

Yeah, but it's not a tax. This is an important distinction. The government can also mandate that McDonald's can only serve beef that's been inspected by the USDA - that's also not a tax, despite the fact that it redistributes wealth from McDonald's to USDA-compliant beef processors.

    Also, it does increase the payroll tax on employers.

And increases the tax burden paid by employees. Yeah - a minimum wage is a form of wealth redistribution. It still ain't a tax, and shouldn't be thought of as one.

    Is it necessary and good to have shitty corporations in addition to the good ones?

HELL NO. We draw a line as to what corporate behavior is permissible and dissolve corporations that cross the line. What you're asking is if we need corporations just this side of "too shitty to live." Nope.com.

    Ha. It's funny. I made a similar argument about Amazon to wasoxygen in a previous post, and never finished it, and it was a question that he asked me that spurred me to write this one.

Here, let me finish it for you.

IF: Amazon has gained tremendous marketshare through cut-throat behavior and abusive labor practices

AND: They destroy a competitor that does not employ cut-throat behavior and abusive labor practices

THEN: The greater marketplace suffers despite any savings to the consumer because Amazon has made it that much harder for an honest business to remain in the marketplace.

It's social darwinism, pure and simple: survival of the fittest leads to the biggest, nastiest shark in the tank and nothing else. Even Adam Smith believed in protectionism.

mk  ·  3911 days ago  ·  link  ·  

    HELL NO. We draw a line as to what corporate behavior is permissible and dissolve corporations that cross the line. What you're asking is if we need corporations just this side of "too shitty to live." Nope.com.

Although I agree with the sentiment, I do wonder at which point does the medicine become worse than the disease? That is not to say that I don't think that some of Amazon's practices shouldn't be curtailed, but for every effort made, something is lost. Sometimes the cost is more bureaucracy for good corporations that don't need it, sometimes it the creation of infrastructure that devolves into legacy and then drag, and worse, sometimes it is an opportunity for special interests to weave their wishes into new legislation.

One nice thing about a minimum wage is the simplicity of it.

That being said, I'm not sure that shark is the proper term, or at least, I don't think the shark is the worst enemy. The leach is the worst. It's one thing to watch companies beat up on each other using their own resources, but when they are using the public's resources to fight each other, that's when it's really bad. Wallmart is a big leach. Amazon will make the transformation, but it's not as far along yet.

kleinbl00  ·  3911 days ago  ·  link  ·  

    I do wonder at which point does the medicine become worse than the disease?

Question of the century, ladies and gentlemen.

John Lewis Gaddis made the point in "The Cold War: A New History" that the 20th Century was nothing more than Capitalism squaring off against Socialism and the two extremes grinding each other to nubs while the successful, thriving societies tended to pick something on the spectrum in between.

blackbootz  ·  3913 days ago  ·  link  ·  

    And increases the tax burden paid by employees. Yeah - a minimum wage is a form of wealth redistribution. It still ain't a tax, and shouldn't be thought of as one.

Why shouldn't it be thought of as one? The government is (legitimately) coercing an individual or group of individuals to spend more money than they would normally. I hear heads on talk radio refer to all sorts of government coercion as tax, not that I should take my cues from willy-nilly.

kleinbl00  ·  3913 days ago  ·  link  ·  

BECAUSE THAT MONEY IS NOT GOING TO THE GOVERNMENT.

A tax is remuneration to the government. Period. Full stop. Should I hire "an Alien of Extraordinary Ability" I will pay more to the government than I will had I hired a citizen. That is a tax. Should I buy gas in Los Angeles County instead of Riverside County I will pay more to the government. That is a tax. Should the government require me to pay someone a dollar more than I want to, however, that is NOT a tax BECAUSE THE MONEY DOES NOT GO TO THE GOVERNMENT.

Demagogques use the word "tax" incorrectly because they have successfully made "tax" a bad word, so they might as well apply it to everything.

blackbootz  ·  3913 days ago  ·  link  ·  

facepalm. Duh.