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Obamanomics' Fatal Flaw: Minimum Wage-Hiking States Are Seeing Slower Job Growth
Who could have seen this coming? While facts are awkward things - especially in the face of populist policies - the data shows that retail trade employment growth since the start of the year is notably slower for 'minimum-wage-hiking' states than 'non-minimum-wage-hiking' states.
As ValueWalk's Roger Thomas explains,
Seventeen states increased their minimum wages in 2014. Most of the changes happened early in the year.
...
It’s still quite early on evaluating how large the adverse employment effects will be, but it looks like the effects are starting to show up in the retail trade employment numbers. As a note on why retail trade, the effects would likely show up in retail trade before they show up in other industries because retail trade employs a large proportion of the minimum wage workers.
Here’s the early evidence.
The figure shows the growth in retail trade by state since the start of the calendar year according to whether or not a state imposed new higher minimum wage rates.
On the left hand side are states that left things as is, meaning these states did not impose any new minimum wage rates.
On the right had side are states that imposed new minimum wage rates.
The figure that matters here is the difference in the average employment growth rate. In states that left business as is, employment growth in the retail trade industry is up 0.72%.
In contrast, states that imposed higher minimum wage rates saw retail trade employment growth of only 0.43%.
Although it’s still too early to say the results are statistically valid, one could likely assume further analysis will find that some or most of the difference is due to higher minimum wage rates.
* * *
It seems Obamanomics has a problem... but when did factual reality ever stop policy-makers and politicians in the past?
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Minimum wage hikes are going to be the kick start to full robot automation.
Slower job growth is the goal.
Less jobs = more welfare recipients.
Know of a couple people with advanced degrees colecting Social security disability. Their jobs outsourced overseas.
The government's new form of permanent unemployment insurance.
Maybe I should file for that and work off the record.
Well, modern life is quite depressing?
Especially when you fall behind no matter how hard you work.
Either SSDI or become a banker?
pods
Moar Robots!
That was the whole fucking point. More robots, more production, less human labour, MORE LEISURE TIME!!! We got the fucking robots! Where's the fucking extra leisure time????
You wanna work 80 hours per week? Go ahead, knock yourself out. But don't come whinging to me when your next-door neighbour is unemployed. Perhaps if you got him to do half your work, your wife will remember that she has got a husband and the kids will be yours and she won't leave you.
Retail trade growth? So more folkz is workin' minimum wage in virgina than ny since jan1 2014. #success bitchez, keep those minimum wage hikes blocked nad soon everyone can be working for nothin'
How's about minimum wages for banksters! Imagine how menny jobs we could create with that!
Oh, hang one, I forgot. Bankster wages are set by the freeeeeeee markits and they are worth every penny because they take on the huge risk that they may have to get bailed out but luckily they managed to manage that risk becoz they are such geniuses.
Besides, banksters lend money to the community so the community can buy land so they can borrow more money backed by that land so they can create biznesses that create jawwwwwwwwwbs!!! Oh, hang on, that was my point. Perhaps we need moar of them. And if we reduce the price of banksters, we can hire moar of them to lend more money to push up the price of land to justify the bizness loans that create moar jobs. Think about it! This shit could go exponential!!!
=moar votes.
Obamanomics and Socialism have changed the meaning of the Land of Opportunity. It is no longer a land of opportunity for the industrious to better themselves through hard work and ambition; it is the land of opportunity for the takers.
Shades of David Lee’s poem” Lazy”?
Lazy
By David Lee
Laziest man ever was Floyd Scott
it wasn't nothing that boy
would ever do for anybody
when he's 5 years old
arredy too late his mama one day
sez Floyd come take this trash out
to the barrel but he just lain there
in the living room on the furniture
so she sez you taking this trash out
like I told you?
he never answered she sed
you want to take this trash out
to the barrel or do you want a whipping?
he sez finally how many licks?
she sed 3 with a flyswatter
he didn't say nothing for a minute
she thought he's coming to get it
the he sed do I have to
come out there or will you come
give it to me in here? ...
... he was 24 years old when he
went and got in the car to drive
down to the grocery store a block away
to get him a can of beer
had this terrible itch that was a tragedy
he stretched up scratch his ast
hit the curb and rolled the car
on flat ground right over
Doctor sed he couldn't find
nothing wrong with the x-ray
but his back wasn't strong enough
for him to walk on it after that
insurance bought him 4 different wheelchairs
all too hard for him to use
til they got one with a electric motor on it
he sed he was satisfied
never walked a hundred steps in a row after that
some days he sed it was too hard and not worth the effort
to even get out of bed to it
so he got a television set in his bedroom
to help him get by on social security
that same year 4 kinds of welfare
and the Assemblyofgod brought his supper
on all days with an R in them
county paid for him a private nurse
because he sed it was a soft spot
in that pavement caused his accident
of their negligence and behavior
he was gone sue the county
and the down for a million dollars
if they didn't take care of him til he got well
they thought it'd be cheaper to buy him a nurse
for however long it took
after 3 years she found a way to get married to him
and still have the county pay her for being a nurse's helper
bought them a trailerhouse they put in
right next to his daddy's house
where he didn't have to pay no rent
after that she give up her other patients
and kept the county money for watching him
it was enough to get by on they sed
she's almost as lazy as he was
I heard moss grown in her toilets
they put a deep freezer out on the front porch
to hold the TV dinners she fixed
on all days without a R
both of them got so fat they had to have two couches
in the living room to set and watch TV on
so lazy a dog couldn't live with them
it'd of starved to death waiting
to one of them to come feed it
"Less jobs = more welfare recipients" = more young gals standing around on street corners.....hmmmmm........
Well, don't stop there. They gave up a what??? percent payrise and in return got an increase in retail of 0.29%?
Let's all go and get the cheapest minimum wage jobs we can! We'll all get richer, if only we were poorer!
Ummm, or did those retail sales go to someone else?
What happened to the price of land in those different states?
What about student loans? (Although I think we can agree that lower student loans would be a good thing).
The good news is there are jobs. The bad news is you can't be paid to do them. Decisions, decisions.
Absolutely.
They have never done that in the history of the world, why now?
a wage is a price
Wage is a word, like love. Love is a word.
As I said once before: If I pay someone enough money to wash my car, then they can go and buy a sausage. But if I pay a lot of money for a sausage, that sausage will NOT go out and buy another sausage.
A Wage is a special type of price.
I sure as hell hope so!!! NO ONE SHOULD WORK FOR 7.25!!!!
I'm going to sit back crack a cold one and wet a line. Government pays more if I sit on my ass and collect!! In 1964 minimum wage workers made about 20 dollars an hr adjusted 5 Silver quarters or 1.25 an hr. What the hell happened? Weres that America dream and all that stuff? Someone's got thier hand in the cookie jar and it's at he expense of the lower paid workers who are the back bone of this Country. If your going to step on the throat of the poor and keep it there, we're going to find ways to let you carry the burden, oh oh gotta run line tight, gotta a big one on the line for dinner!
Duh... liar in chief is a complete moron.'
Eliminate all socialist welfare programs, set maximum wage for all non-technical, non-managerial, non-bureaucratic jobs at about $6.00 per hour, and watch job growth EXPLODE!
Utopia is within our grasp.
Watch job growth explode ... just like in China! Slave labor everywhere.
huh? Making things more expensive leads to fewer purchases, which leads to slower job growth? What kind of propaganda is THIS!
you say raise minimum wage
i say automation and outsource
"Yessir, Mr Tyler(s) that Big Mac comes to $22.95. Plus tax.
"Sorry, no, we have to charge for water."
In the end there will be just one machine building 7 billion everythings per hour, and only one man needed to operate / maintain the machine ('cos it mostly repairs and rebuilds itself). There will be warehouses full all over the world but no-one will be able to afford to buy anything because 6 999 999 999 people will have no jobs and the one guy with a job will be working 80 hours per week on the minimum wage.
And his boss will be telling him, "I have to cut your wages! I can only pay you what the market can afford!!! If you don't want the job then I'll give it to someone who does."
The boss will then have part of the machine destroy everything that the other part of the machine produces in order to keep prices high and "Because I can't afford to just give stuff away. Business is tight, you know. I need to decrease supply so I can maintain high prices. I'm not a fucking communist!"
The boss will survive by borrowing money from the bank, based on the high valuations of the stuff that doesn't get sold at prices nobody can afford.
WAKE THE FUCK UP!!!!! Wages are supposed to be high. Everything is supposed to be automated. If we have soooooo much automation then why do the remaining workers have to work so hard????????
They must not have raised the minimum enough. The need to double it and then break some windows. /s
Well, it has been a slow hurricane season, but Ferguson, MO seems to be on the right track.
get to fuckin work mr schumer you putz schmuck
As long as ObaMao's Free Shit Army and Wall St Banksters are kept happy that's all that matters.
Yes....job growth is "slower"....but those workers are actually be able to pay their fucking bills.
You Austrian folks need to accept that the hyper inflation scenario is HAPPENING, slower than some predicited....but it is happening. And that is why WORKERS are demanding more MONEY due to the FED'S treasonous actions. Fuck the CPI; its a bullshit number. When fast food WORKERS are going ON STRIKE, despite not BEING IN A UNION, RISKING THEIR "JOBS", that will tell you more than you need to fucking know about the state of the USD and the cost of living in America as well as the state of job opportunity in America. JOLTS is still way too high, despite some improvement, since 2008. It's not like these folks, mostly brown, can just get up and leave and go apply for a job at Goldman Sachs. They are STUCK at their jobs because the ECONOMY IS STILL DEPRESSED.
People act like the USD is this honest, pure currency printed by the most righteous governemnt in the history of forever. It's not. It's printed by a PRIVATE CORPORATION for PRIVATE CORPORATIONS like TBTF banks who then use money collected by the GOVERNMENT as COLLATERAL for speculative gambling.
The issue of the cost of living is SO much bigger than the minimum wage. It's the collective dissonance of the actual problems going on the America that folks, including this site, continue to ignore because THEY can pay their fucking bills and the majority of us are struggling or simply CAN'T.
Unless the economy of the US grows, aggregate living standards must stagnate or decline. Given that the living standards of some percentage of the populace are growing rather rapidly, and given that some other percentage maintains their existing living standards through borrowing, I think we have a problem - unless, of course, we can figure out how to capture some of the wealth from outside the US.
Grow, steal, or lower expectations; I don't see a fourth option.
Progress is satisfying humans needs more efficiently - i.e. at a lower cost.
Since its inception, government has skimmed increasingly more of the benefit of that progress for itself and its ilk.
Government and its cronies have been the main beneficiaries of the agricultural, industrial, and information ages, periods of time with massive increases of efficiency.
Efficiencies mostly stolen by government.
So, without these inefficiencies, economic output, and living standards, would continue to grow? Is there a limit to "progress" through increasing efficiency? I think it's hard to argue that efficiency based growth isn't limited; a corollary would be to claim that that an existing economy could be infinitely shrunk in geographic size through efficiency gains, that the entire economy of the United States, for example, could be contained in a very efficient city the size of Dubuque. That would be stupid.
I don't really understand your point. Perhaps you believe that without existing government inefficiencies, we are far from any real limits on growth?
Who let the trolls out?
Woof.
Woof woof woof.
Government's net action is to steal from others and use that to destroy.
There is a whole big universe out there. The minds of too many people are still clinging to their arboreal lives.
yeah, deflated, errr lower prices are bad all around. WTFU
Shizz you have it right: its all about the inflation. The root cause is inflation. All this complete garbage aboutt 0.43 vs 0.72 percent is just stupid. (What is this a Human Events article?) Inflation is killing us all, its just killing thosea at the bottom of the economic ladder a lot faster. A lot faster. Sooner or later, it will eat up the rest of the bottom 99%.
you're barking up the wrong tree
the partial reason cost of living so high is due to monetary policy ($$s flowing into commodities and other assets ...re housing)
all to keep the status quo for upper quintile
The Federal Reserve IS monetary policy. The US government controls none of it.
Shizzmoney, we have to get more people working, regardless of the wages. More production means more affordable living (more stuff per hour worked.) Less production means less affordable living. The numbers on the paycheck don't really matter. What matters is production.
Producing anything? Like producing ditches? Like producing lots of small rocks from big rocks?
edit: If you really want to get people working, I think forcing them to do it would get you the best bang for your buck. It wouldn't be "free" because you would have to feed and house them, but they're being fed and housed already, so no net loss.
Or you know, you could allow them to work at a wage that less wealthy potential employers could afford...
I think your only trouble is that you're thinking too small, although see my post above on eliminating welfare and setting a maximum wage; it's a start.
CaptOveur:
I could put a whole team of architects, engineers and tradesmen to work right now but the damn bastards insist on being paid! I've only got fifty dollars in my wallet right now! If they weren't so greedy then they could all have jawwwwwwwwwwwwwwwwbs!!!!
Or more to the point, if the employer had richer customers then the employer wouldn't be so poor now, would he??? Rich customers??? Where do they come from??? Ask a Chinaman. He tells me they live in a foreign country.
And, as I've said here before, go to Google and find Peter Schiff's "15 for 15" video where he asserted that DOUBLING (at the time, from $7.50 to $15 per hour) the minimum wage for Walmart workers would result in a 15% increase in Walmart prices. If your customers receive a 100% pay rise, are they really going to be upset about a 15% price increase?????? Peter Shiff's numbers, not mine. Don't believe Schiff's numbers? Work out your own.
Okay, real world: What happens when you raise minimum wages? The jobs go overseas or wherever the cheaper wages are. If the jobs go overseas, where are the workers and more importantly, WHERE ARE THE CUSTOMERS??????? You're happy with Chinese workers on two dollars per hour? Then you're going to have Chinese customers on two dollars per hour. You want competitive US workers? Go ahead, pay them two dollars per hour. Now how much can they afford to buy from your store? Take Peter Schiff's numbers backwards: Workers took a 50% pay cut so you could have prices 15% cheaper. Winning? Pay your workers zero. How much is your product now? How's that mortgage / rent going?
Isn't $2/hr $2/hr more than they could afford before?
You're obviously not going to be able to understand this, as you've evidenced that you're a confused, self-contradictory flamer.
But here we go: Minimum Wage causes *increase of the cost of living broadly*. Money printing is part of the problem, sure. But most people on ZH should be savvy enough to know by now that money-printing is only one dimension of inflation. It's not a 1:1 equation of dollar-printed:proportional increase in cost of living. It isn't. If it was, QE should have sent cost of living through the roof (I realize some things are inflating, but is it money-printing that has caused it or is micro-economic conditions like scarcety?).
Cost-push inflation is real, and people like you ARE TO BLAME. I'll say it again: the specific delusion you have just spewed out is exactly the kind of useful-idiotism that pro-inflationists want to see. Basic economics acknowledges that minimum wage is primarily a DEFLATIONARY FLOOR. The implication of inherent inflationary pressure caused by this policy is so obvious, only the lowest decile of proglodyte can't see it.
So, you're against "inflation." Great! Me too! But your solutions ARE THE CAUSE, so 'fuck outta here as we say in Brooklyn.
No. by itself, increasing the minimum wage causes zero inflation. Zero. Go back and read the definitiion of inflation. one segment of the population gets a littlemore money to use, another segment gets a little less. No inflation, zero.
Except for the fact that "inflation" is merely a measure of how much things cost.
Let's see: do businesses ever increase the price they sell goods/services for because it costs them more to do business? Yes. All. Of. The. Time. It's called C.O.G.S., and if you were even a little literate about this topic you'd know that.
Now, if it costs me more to do business, I'm supposed to just let my margins go to shit? Lose all of my investors/ access to capital markets/ credit worthiness? No.
There's even a common vernacular for this phenomenon: "pass the costs to the consumer." This is how business is done. Exceptions include "total return" scenarios wherein a business can survive the "race to the bottom" because they/their owners/their investors get special tax or credit perks from the Government that make it all worthwhile.
Don't believe me? Go vote for Hope & Change. But for your own good, don't go in to business in any capacity.
Who are your customers and, apart from the prices you charge, what determines how much they can afford to buy from you?
Apart from the prices you charge, what else determines what proportion of the population is a potential customer of yours?
Those are excellent questions, and if there were an absolute answer, we'd see a lot more universal success in business.
Generally, the answers to those questions are highly dependent on what we might call "positioning": How high are the barriers to entry for competitors? How many people am I competing with? How are new regulations impacting those competitors? Do they have special access to buffers from impact of new regulations due to personal/private connections with Regulators via "lobbying" or nepotism? How long have I been in business? What is my current standing with repeat customers and how likely are they to keep dealing with me as I increase prices?
That list could go on for days. In short, it's all highly relative and ultimately there is enormous implied risk of getting it wrong. Failure is possible. Maybe you have no pricing power, and new regulations are just going to be the end of your business. That's a fairly likely outcome as well- one that, for me personally, brings up questions about the wisdom of having a Pricer-in-Chief in our "elected" over-Lords.
Perhaps I should re-phrase the question just for you. Why don't you build a business in China, Ethiopia, Bangladesh or Mexico? The wages are so low over there that, after dealing with US wages for so long, you should make a shitload. Now, are you going to sell to the locals or to people who live in other countries? Why?
Actually, I shall rephrase the question a third time:
IF minimum wage workers took a 50% pay cut, WOULD YOU BE WILLING TO DROP YOUR PRICES BY 50%?
IF NOT THEN WHY NOT???
"You Austrian folks need to accept that the hyper inflation scenario is HAPPENING"
Martin Armstrong: "FOR THE RECORD – the 7% number for unemployment is the official number – it is by no means REAL. The real number is in the area of 12% now and will rise to test the 25% level. Here is our old forecast from 2009.
wp.com/armstrongeconomics.com/wp-content/uploads/2013/01/unemployment.jpg
Armstrong headline today:
74% of all Municipals want to raise Taxes – Hello DEFLATION!Kondratieff Winter is the time of deflation, not inflation.
Bring back chattel slavery for "economic growth". It did wonders in early America and it may just be the spark this sluggish economy needs to undercut and surprise the Chinese -- they won't see it comin'.
Louis CK on slavery:
http://www.youtube.com/watch?v=UVTXFsHYLKA
Very confronting.... and sad
With chattel slavery, the slaves received barely enough to live on and their owners benefited greatly for doing little work.
With government slavery, the slaves keep barely enough to live on and their government masters benefit greatly for doing little work.
Both systems work for a select group: those at the top.
shocking...
For fuck's sake, flipping burgers is a job for kids, not adults.
This is what happens when you exempt kids from the expectation of having any pre-post graduate work experience and you flood the country with third world peasants.
"...and you flood the country with third world peasants on orders of your Zionist Masters."
Flippin burgers, bagging groceries, standing behind a cash register.
These are not the jobs one takes to obtain insurance/401-k/decent wages.
These jobs are for kids while they're at home. To help buy their 1st car, to learn how to be punctual and productive in a service job.
It is NOT a supporter of anyone trying to pay a mortgage or raise a fuckin family.
General Electric moved its RESEARCH AND DEVELOPMENT division to Beijing, and all the very high paid jobs with it. Bank Of America laid off Americans and replaced them with H1 visa holders from India at 1/2 the wage. The list goes on and on. Tell me where people ARE SUPPOSED TO WORK?
Obama's job czar?
GE CEO jeff immelt
They're not really. They're supposed to remain dependents of the government and remember to vote for bigger and more powerful government on election day. In the meantime the new, imported helot class will hopefully keep prices of consumer non-durables low enough to prevent a crisis.
"It is NOT a supporter of anyone trying to pay a mortgage or raise a fuckin family."
I kinda disagree here. If the cost of government was reasonable and not hidden through price and wage distortions, you should be able to live modestly and raise a family on about any full time job. The problem is that the total federal, state, and local government costs $6.3T. By very rough numbers that works out to $30 per hour worked in the private economy. One third of that back to the workers would make a huge diffence in standard of living.
Screw federal minimum wage. It should all be done on a state level.
Screw the minimum wage. It should not be done at all at any level.
I feexed it!!
It doesn't matter what you pay your workers. We got high unemployment and a lot of idle talent. I make what you make. I pay my workers half what you pay yours. What's your next move? Guess what my next move is? Where does it end? How's your debt? How's your mortgage? How's your prices?
probably the most stupid article Ive seen on ZH. WOOOOW %0.43 vs 0.72%. Earth shaking! How long did idiots have to fiddle wth the data to come out with a selection of states to show what they wanted to show? Please.
The conclusion is based on a very superficial 'analysis' of the data. 17 states increased the minimum wage, but aren't all represented in the graph. Why was the time window used chosen? The article makes comparisons between states that have very different economies supporting them (New Jersey v. Wyoming). The article also focuses on rate of change, but doesn't give the context of what the rate was in prior periods.
Very humble of the author to admit the results aren't "statistically valid", whatever that means. Statistically significant maybe? What level of significance is being used? What intervening variables were considered? What explanatory power does the wage hike variable have compared to others?
My incarcerated business partners retarded gay niece failed her intro to stats class at Brown and could do better than this.
So this is Obamanomics... read Fed's... fatal flaw... Been trying to put my finger on it. It is, after all, very subtle...
Was going to add to this, but what's the point? How many of us here don't know the drill? To pass this man of as a socialist is an insult to socialism... don't get me wrong, I am all in favor of such insults... but this guy, and his handler's, are world class, elitist, let's kill off the majority of the world's population (read cattle, or worse) while we live like gods fascists...
Or worse...
Guess I did add to it...
I don't see how this an actual problem anyway, they'll just send out the minions to the media and proclaim min wage hikes are resulting in upbeat job growth.
The New world order is the third world environment for the 99%. Be prepared.
The new world order: shut down and move all the factories, and high wage jobs to China and India, blow up the real estate market with bad loans, the fix it with runaway inflation... then blame all the victims for the problems, while the crooked bankers drive to their 100 million dollar homes in the Hamptons in their bentleys and ferarris.
That can't be...
The Fed's devaluation policy should continue.
That second chart must be the most fucked up looking graph I've ever seen haha oh and the economy sucks.
Maybe the problem isn't how much the minimum wage is, but rather the kind and quality of work being offered. You can pay me $25 an hour to be a Wal-Mart associate or a McDonalds team member, but my life will continue to be shit and fundamentally devoid of meaning, even if I can finally buy that PlayStation I have always wanted. I don't shop at/spend my money at the aforementioned businesses and their ilk because I am opposed to the idea of spending what little money I have on cheap plastic shit made in China by wage slaves and chemically engineered food-like products. Maybe instead of paying people more to perpetuate a system that is anti-human, we need to transition away from these growth- and consumption-based economic model that exploit workers and provide us "consumers" with poisonous garbage, to something more in line with the reality of our dwindling resources and limited intelligence. All these systems (economic, financial, capitalist) are just man-made constructs. They are ideas some socio/psychopath came up with to make us all slaves. There are still a few smart people out there who aren't hell bent on fucking over every other human being on the planet to their benefit. We can come up with something better. But of course, that will never happen, so why am I even bothering to write this, and why did you read all the way to the end?
It's because you're right. You're 100% right.
the entire economic argument for and against wage hikes are one side says it inhibits job growth and the other side says it encourages economic activity.
it definitely affects the management of employees in the companies that employ large numbers of minimum wage employees. there aren't many. most low wage paying companies already pay more than minimum wage so the actual effect of a rise in minimum wage has a minimal effect. obama's increase in federal emplyees minimum wage to $10/hr is symbolic as all federal employees already get paid more than that, for instance. none of my kids friends ranging from high school to mid twenties works for minimum wage in unskilled positions.
these charts are a mess and attempt to correlate something that may correlate but have way too many other factors than a minimum wage increase for such a simplistic comparison to show something meaningful.
Classic case of using a carefully selected data sample to make a point that fits the author's point.
This is such a small SSS and it isn't even a statistically significant difference if you use a basic chi-square or t-test. Since most Americans are mathematically challenged and can't even handle concepts like percentages or fractions, that doesn't matter.
Yeah, its a joke isn't it? 29 basis points a wild differnce? Not even significat against noise. And "growth in retail trade" what the hell does that men, Walmart sells 100 more towels made in China, for a nice 3 cent profit each?
Minimum wage outlaws work for those who cannot make minimum wage or above.
How does raisin minimum wage help those who cannot get a job with the older lower minimum wage?
1. First, let me say that SOME RETARDS ARE UNEMPLOYABLE AT ANY COST. TURNING THEM INTO LOW PRODUCTIVITY SLAVES WHILE WILLING, ABLE-BODIED PEOPLE ARE UNEMPLOYED SOLVES NOTHING. I have seen this first hand. At one tenth of the minimum wage (govt chipped in a bit to top it up), the retards were still sacked for low productivity. Waddya gonna do? Pay 'em less? SOONER OR LATER YOUR FIXED COSTS SWAMP THE WAGES AND THE RETARDS ARE UNEMPLOYABLE AT ANY COST!!!
2. Working your guts out and getting nothing in return because you are a retard is NOT better than getting nothing because you are a retard. I appreciate the benefits of work for retards as a means of socializing, a method of showing them the real world and a method of giving them confidence and increasing their feelings of self-worth. But if you work your guts out for 50 hours per week and your meagre wage can't even pay half of your bills, who is kidding who?
No way can I believe that you are a real accountant. Oh, hang on, did you used to work for Arthur Anderson?
http://www.youtube.com/watch?v=LLr5oWfoWRY
Problem: Your costs go up by 15% but YOUR CUSTOMER'S WAGES GO UP BY 100%.
Shit, oh noeeees. How ever will you survive?
"Bad news Enron, I have to charge you 15% more."
"Dammit! We doubled our revenues last year - there is no way we could afford that extra 15%!
????
Re "How does raisin minimum wage help those who cannot get a job with the older lower minimum wage?" :
1. Minimum wage is only a portion of total costs and so a percentage minimum wage increase is greater than the percentage cost / price increase needed to cover the wage increase.
2. Debt dilution (both for the producer and the customer)
The solution to the riddle lies in here:
1. One capitalist's WORKERS are other capitalists' CUSTOMERS. But I guess accountants don't notice that little entry because it isn't on the books, is it?
2. Geographic Wage Arbitrage. If Chinamen get paid fuck-all and produce so much, then why aren't they rich? From where does China get all its customers?
3. When are you going to start screaming about the unsustainably high price on real estate? Or is that a "good" thing because it allows a company to borrow more money? Shouldn't real estate prices bear some resemblance to people's ability to service the loan? If the repayments on the cheapest house in the cheapest suburb are $400 per week and the minimum wage is $500 per week, what is the real cost of the actual worker? When will anyone say, "We cannot afford to have the price of real estate go up by 100 dollars per week because I can not afford to pay my workers an extra 100 bucks per week"? Oh no, real estate prices are set by the freeeeeeeeeeeee markits, aren't they? Yeah sure. I hear the Sydney Harbour Bridge is quite cheap at this time of year.
Let's raise minimum wage to $1000.00 an hour and we will all be rich... and we can ride unicorns to work.
And why not? You won't know if you don't give it a go.
Worst case: Everyone else demands proportionately higher wages / prices and you're back where you started (errr, except everyone is now in the top tax bracket).
Oh, but hang on, now all debt is diluted to two tenths of fuck-all. Don't worry. The banks'll sort that out real quick. You don't think the banks will stop lending to idiots, do you?
Errr, no, I'm wrong about everything. All jobs disappear to the other side of the world where the workers are now, relatively speaking, one hundred times cheaper than they were a minute ago and now the other side of the world are desperate to sell as much crap as possible to the richest customers in the world. Errr, whoops, where did all the customers go?
Or should we drop the minimum wage to zero? Then you can drop your prices to ... how much is your rent / mortgage again? Oh, by the way, where did all the customers go?
At first I thought it was a graph of the current size of the public (green) and private (red) sector. GO GREEN! (or go somewhere else, which, as an employer, is exactly what I'm going to do. I run a little surf camp/yoga/blues-guitar-and-ukelele-clinic thingy and my people are happy if they get laid, decent grub and a few barrels. It'd be a shame all around to let it all go.)
Wage and price controls are the result of failed economic policy. Soon, class warfare will define that not only should people be paid a minimum of $20/hour (plus free healthcare, food stamps and subsidized housing), but people can't be paid more than $50/hour. The migration to the communist ideal where everyone get's paid the same, has the same, looks the same, thinks the same (Harrison Bergeron).
You're looking under the wrong rock.
DEBT AND THE PRICE OF REAL ESTATE ABSOLUTELY SWAMPS EVERYTHING ELSE. Anyone who has been paying attention since 2000 should be well aware of this. Give the workers any pay rise you care to mention. The entirety of that payrise will end up being buried in higher real estate prices. What do companies do when they earn "too much" money? They deliberately bury it into higher land prices. Oh sure, that company needs to buy that over-priced land in the middle of town to put their offices because? Because, ummmm, because in 20 years they can sell it for a higher price and in the mean time they can borrow more money based on its valuations! Sure, and the minimum wage workers can give up a 2% pay rise so the company can bid that land up to $16M instead of $15M.
What is the first step to becoming competitive with the rest of the world without working your guts out for nothing? Eliminate debt and crash the price of real estate.
Over the space of a few years, the price of real estate QUADRUPLED and no-one uttered a word. How can a new business compete with an established business when the new business has to buy over-priced real estate?
But mention a 3% payrise for the weakest, most defenceless of our workers and suddenly everyone screams that the world is going to implode. BULLSHIT! When real estate prices go up, those workers have to give up buying other stuff. Retailers go broke. Bullish? Dyslexic and forgot the not-so-silent 'T'.
Another pro-slavery, anti-worker article on ZeroHedge. ZH, please tell your neoliberal Friedmanite contributor that minimum wage has no relation to growth among industrialized nations.
http://www.oecd.org/indonesia/economicassessmentofindonesia2008improving...
America hasn't "hiked" the minimum wage in decades. Short of re-introducing slavery and completely freeing corporations like McDonalds from the burden of wages, I don't know what else this rotten system can do to become productive. The problem isn't the minimum wage of working people, it's plunder at the top.
All will be well and everyone will be happy at zero pay for work ! :-)
how come we are not talking about the Fed Press release like everyone else is....what word is going to change....I need to know..my bot is already to go...dove or hawk...let the games begin
You know, I understand from a life long love of history, which led me to read all forms of history books from an early age, that in the Old South before the Civil War, slaves we not only fully employed, but highly valuable and sought after. So much so that the free negros of the north were under threat of kidnap and transport to the South for sale as slaves. The profit for this act was very well worth the trouble. "12 Years a Slave" was very much true.
My point is, that this fettish for lower and lower wages, is simply driving towards a full employment, at stravation wages, economy.
The minmum wage has sunk year after year due to inflation and few real cost of living adjustments to the minimum wage. I think, if the whole employment and consumption/demand picture is looked at, this constant drum banging for the much loved "lowest minimum wage possible" would be proven to be bullship economics. But if you simply want to take the most narrow minded political talking points approach, then tell everyone that even a modest rise in wages for those at the bottom is a job killer.
In fact, mostly, it is justification for the race to the bottom.
a race to the bottom driven by capital going to Asia to chase lower and lower rates for labour
something some 19th Labour and Socialist leaders in some countries understood, and made them restrict the flow of "national" capital
200 million Chinese alone joined the globalized economy at their rates. Indian (for example IT graduates) are doing their part, too
Walmart is a fine example of how you can exchange local with cheap global, and this with subsidies
if the US really had a serious socialist "intelligentsia", it would not be the way it is
in Europe, we are behind the curve, always catching up, of course. only the SME model is the one that contains, in part, this process of globalization - or should I say: homogenization of labour expectations
and all this without mentioning robots
Labor, competing to lower its cost to capital, is the real competition that globalism is looking for.
We (not me, though) will have robot slaves, a drastically reduced global population, a dramatically right-sized underclass, and a one-world government ensuring the highest standard of living for the remaining global-middle-class.
Provided there's the energy to build the machine.
Liberalism, completely unfettered, has a very ugly side, nearly as ugly as socialism and conservativism, when unfettered
the reaction to unfettered, predatory liberalism can be violent: conservativism becomes extreme nationalism, preempts socialist criticism, and becomes National-Socialism, in short... NAZI, at least last time in Germany. With slighty less socialist influence and the ideals of corporativism (in a different, medieval-origined sense) it becomes Fascism, as it did in Italy, Poland, Spain, Portugal, Austria, etc. etc.
three main political directions, with two of them sometimes reacting together to the one corrently dominant one
I think we have a scale problem. I don't think there's a theoretical, "correct" balance of these three forces (I'm interested in reading your fleshed-out model on this, btw) that can be deployed at a global level. In fact, I think a nation state the size of the US is already passed the point of humane central governance.
the scale of the system is not relevant for the political reaction, except for the effects on wealth concentration
the political system and it's elasticity to stress is more relevant. Liberalism, after all, promises a tide that rises all boats
see what Putin does, at least officially: oligarchs have to help pushing the national barge, ... or else
imagine a Senate Committee quizzing US Tycoons: "and what have you done, lately, for your Motherland?" In ancient Athens, the 300 richest families had to pay for one warship's building and maintenance costs each, for example. The second highest class had to maintain a warhorse and make sure it was manned (the knights), an expense equivalent to the labour of 10 free labourer, or a modern tank. All those "visible" levies were necessary because the first class somehow always found a way to shift taxation away from it's shoulder's (nothing new under the sun), a pattern that was older then Athens, and similar in Persia
Labour vs Land vs Capital, the real political fight is always based on this, with corruption dragging down against efficiency pushing up
whenever they were efficient, Athens or Venice hired mercenaries. Rome captured millions of slaves and the Nile, the equivalent of offshoring and finding plentiful energy. At that point, Augustus had to increase the pace of colony building so that the Roman (middle class) had something to do, instead of clogging the free food dole
I'll have to write it down for you
Nationalism is imperative to a nation’s survival and identify.
America lost her culture when she lost her sense of national unity due to ethnic replacement; as a result she lost her battle for survival.
It is not surprising, therefore, that the Jews were the push behind America’s 1965 Immigration Act that opened America to a flood of Third World immigration to make America nationally “safe” for Jewish political predominance.
For it is only cultures, says Dr. Kevin MacDonald, with a strong sense of national identity where Christianity and/or ethnic origins formed a part, that “tended to exclude Jews, at least implicitly. An important aspect of Jewish intellectual and political activity in post-Enlightenment societies has been opposition to national cultures throughout Europe and other Western societies.”
Wilhelm Marr, a journalist who coined the world “anti-Semitism” and who himself became known as the first “anti-Semite,” saw the same happen in Germany in the 1800s. He wrote in 1879 that anti-Semitism … was actually motivated by "the struggle of nations and their response to the very real Judaization of society, that is, to a battle for survival....” (p. 10 The Victory of Judaism over Germanism: Viewed from a Nonreligious Point of View).
Professor MacDonald wrote on January 6, 2010:
Marr describes his writing as “as ‘scream of pain’ coming from the oppressed.” Marr sees Germans as having already lost the battle with Jewry: “Judaism has triumphed on a worldwide historical, basis. I shall bring the news of a lost battle and of the victory of the enemy and all of that I shall do without offering excuses for the defeated army.”
Marr considered it a fair fight whereby the Jews used their abilities to obtain power in Germany and other Western societies: “By the 19th century the amazing toughness and endurance of the Semites had made them the leading power within occidental society. As a result, and that particularly in Germany, Jewry has not been assimilated into Germanism, but Germanism has been absorbed into Judaism” (p. 11). …
If the world needs a picture of the future should Jews prevail in their worldwide quest for world Communism, one need only a photo of Lev Davidovich Bronstein (Leon Trotsky), head of the mass-murdering Jewish Bolsheviks in the former Soviet Russia.
As for America's Christian heritage under Jewish political control: On July 17, 2012, Zionist Knesset member Michael Ben-Ari publicly destroyed a copy of the New Testament, saying: "This book and those who sent it belong in the garbage can of history."
What Ghordius has just outlined is the Communist definition of conservatism.
I somewhat agree with your statement, particularly if you exchange communist with socialist
conservativism is critizized from two directions, socialism and liberalism, but socialists spent more time and effort to think about it on an intellectual plane
for the high-minded "pure" socialist, the conservative is too religious, too nationalist, too much in love with war, often too racist
for the high-minded "pure" liberal, the conservative is too authoritarian and has something against progress, change, liberty
conservativism has many faces: one of inertia, of "don't fix it if not broken", one of religion, one of race/tribe/nation, one of shared history, one of collective wisdom, what the Romans called Mos Maiorum, etc. etc.
conservativism is the original human political "school of thought", and the least intellectual of the three. it's rooted in space and time and culture and polity. it's also the easiest to poke fun at it, and yet often the one that has the most collective wisdom
as a disclaimer, I see myself as a centrist. I find all three schools valid, and I find all three dangerous if pursued to excesses. this makes me a sympathizer of the radical, and makes the radical see me as it's worst enemy
The U.S. is so fat we could use some starvation wages.
One big difference : the slave holders did have to house and feed their slaves, not so today. These resposabilities are diverted to society. Et etcetera.
It would be a wider margin if you exclude the growth of marijuana shops in Washington.
Go Green!
The last place I would invest would be New York.
The War on Sanity courtesy of the Golfer-in-Chief.
Looks like someone drew these charts with an Etch-a-Sketch.
Look, it doesn't take some psychedelic charts to figure this out. It's not rocket science (although government retards want the masses to think it is); you artificially raise the cost of doing business, businesses start cutting back and/or raising prices where they can. Never understood what's so hard about that concept. Unless you believe businesses exist for altruistic purposes.
A nation that has a stable currency does not need to raise its “minimum wage.” Forcibly raising the minimum wage is just a way of debasing the currency through inflation.
It is also the government’s way of putting small businesses out of business to favor its big corporate lobbyists.
Worse yet, raising the minimum wage is the ultimate cruelty to people on fixed incomes with no or artificially-low cost of living adjustments, such as Social Security recipients. The purchasing power of the earlier money they contributed to SS is devastated – creating extreme hardship and poverty amidst a nation of plenty.
Why is this sleight of hand so difficult for Americans to understand?
It was none other than Barack Obama in April 2006, as a young Democratic senator from Illinois speaking at the inauguration of the Hamilton Project, who promised his “friend Bob” (Rubin) more NAFTA-type agreements and cuts in entitlements, such as Social Security.
In his speech to the Goldman Sachs-sponsored think tank, Obama said: “The forces of globalization have changed the rules of the game… The coming baby boomer retirement will only add to the challenges.”
Raising the minimum wage in the present economy also is a huge welfare step to force businesses to pay people who aren’t worth the price a high minimum wage. It's equating kids and other people with extremely low skills and no ambition high wages with people who are skilled and working hard.
Socialism has never worked and that is why. The global elite are forcing Americans down the road to global serfdom.
It’s also the object of this government plus the media to incentivize these low-skilled people to vote Democrat; by doing so, they are giving away the value of the currency. The Republicans appear to have no objections.
Socialist parasites believe businesses exist for them to feed off.
They're called "CEO"s, "Board of Directors", and "Banksters".
Yes, ignore the CEO's with 6 and 7 figure salaries moving all their operations/jobs overseas and let's instead blame minimum wage workers. Terrible article, ZH.
I beg to differ, but I see this as two totally differentt issues. While I see what you are commenting about as a major problem and a real issue for America the minimum wage debate is a animal of a different color. This article does raise the point that a higher wage effects the number of jobs created.
While I'm strongly against raising the minimum wage because it will make America less competitive and slow job growth, I concede the debate is destined to continue until it is raised. I hereby state without a doubt, the minimum wage will go up! Polls show a majority of Americans support this idea.
It is my feeling that many people believe the myth this will put more money into the consumers pocket and create economic growth. They fail to recognize it will also spark inflation while reducing opportunity. New twist and wrinkles are being added by the White House and supporters of this increase every week. Things like expanding the number of workers eligible for overtime pay is another attempt to push this along. Unfortunately much of the impact and pain will directly fall upon small business the real creator of jobs. More on this subject in the article below.
http://brucewilds.blogspot.com/2014/03/the-minimum-wage-will-go-up-right...
Yeah, a doubling of the minimum wage might lead to a 15% price rise.
http://www.youtube.com/watch?v=LLr5oWfoWRY
No way could we afford that. But real estate prices can quadruple and we'll all be rich!!!
Yes there is bloody sarcasm in there. Why is it so hard to see? I use Schiff's own video against him and no-one gets it. For the hundredth time - you can also look at his video in reverse. Are you really so much better off because the Walmart workers took a 50% pay cut so you can buy stuff 15% cheaper?
Again: The wage problem is just a smoke screen for the real estate / debt problem. Cheapest house in cheapest suburb went from less than 50% of minimum wage to 100% of minimum wage. You don't complain about your customers having less purchasing power due to their increased mortgages? The extra ten bucks you give your workers doesn't match the extra 20 bucks he puts into his mortgage. Fucking pay attention to real estate prices. They are not a free market. Mortgage bonds, CDOs, CDSs, synthetic CDOs, bailouts, Linda Green, ratings agencies, Too Big To Fail, EMPTY FORECLOSED HOMES KEPT OFF MARKET TO KEEP PROPERTY PRICES HIGH!!!!! But no, let's just blame the weak and the defenceless because no matter how hard they work and how much they produce, they're still not worth it! They operate machines that let one man do the job of fifty but they're still only worth half a wage, if that. Less if there's someone out there desperate enough to do it cheaper.
Solution is simple: expell all socialists, union & entitlement parasites, and latin invaders; end income taxes & entitlement programs; regulate population size & growth so that supply of labor regulates price of labor.
... and ban the capitalists from selling to socialists. Let the capitalists only ever sell to each other ... all the while saying, "There is no better way". I know you agree with me.
Gleefully accept to get rid of you bloodsuckers.
Personally, I think we need a little of everything - capitalism, actually I'll take a lot of capitalism but also a little bit of communism, socialism. Hell, we even need a tiny bit of dictatorship. No? Well how do you stop people voting themselves more benefits without a dictatorship? Oh, that's right, with a lot of anarchy. Fair enough. Let's all be anarchists. If only we were all anarchists then the biggest bully would be limited to being just one person.
http://dilbert.com/strips/comic/1989-10-20/
- i.e. it ain't gonna happen, or it won't happen the way you want it to happen.
The whole "capitalism v communism / socialism" paradigm is a smoke screen. The answer lies somewhere else that just happens to intersect the "capitalism - communism" plane at certain points. We should be looking else where.