Problem I have with the living wage idea

[B0S0X87]

Say I make $10 an hour. It's not a lot of money, but I can get a quick bagel and coffee at the corner store for $3.50 which pays it's workers only $6 an hour. Now, say the minimum wage is raised to $10 an hour. My buying power decreases because the corner store has to raise its prices in order to pay its workers. Also, even though the worker's who previously made $6 an hour have their wages increased, their buying power remains the same as the prices rise with wages.

Am I missing something here? I don't like the fact that people have to work two jobs to pay for the bare necessities, but I can't see how raising the minimum wage is going to help.

[LuminousX]

1. Back up a second...

and consider what that means to the current minimum wage.

Should we allow a $2.00 minimum wage because it means you'll be able to pay $.75 for coffee and a bagel?

I'm not saying you are saying this but I'm just hyperbolizing for a moment - is it okay to support clothing manufacturers who use slave labor because it means cheaper clothes?

Okay, after that bit of moralizing, I believe most 'Living Wage' resolutions and legislation omit certain types of jobs. I could be wrong.

[B0S0X87]

4. Of course the minimum wage shouldn't be $2

But I don't see the benefit in raising it by more than 50%.

[KittyWampus]

21. Rising Tide Lifts All Boats. Guy Now Making More Toasting Your Bagel

can spend more at YOUR place of work.

Some locales in American have done living wages on state level.

The economy didn't collpase.

[B0S0X87]

26. good point

I didn't think about that.

[leftyandproud]

27. Lets raise it to $30 and EVERYONE will be rich!

</sarcasm off>


actually the economy would collapse and tax revenue would fall around 90% within a month..but at least we care about the workers right?

Seriously...Your economic arguments are correct. Forcing above-market wages will increase costs and unemployment. It is a simple law of economics. I have no problem with indexing the current min wage to inflation, but doing anything drastic like doubling it would really devastate our economy. "Fair" or not, some jobs simply aren't worth $10.00 an hour...and legislating it into law will do nothing but eliminate positions for low skilled workers.

[greendog]

36. Absolutely right!

Some humans simply aren't worth it. Maybe we should call them what they are, "sub-humans".

Sub-human wages for sub-humans. Welcome to the NewDemocratic Party!

[Cicero]

43. That's not what leftyandproud meant and you know it

Can you honestly tell me that every job in America is worth paying $10.00 per hour?

Later,

[greendog]

46. If it's not worth a living wage...

...it's not worth doing.

Can you honestly tell me that ANYONE is worth less than what it takes for them to subsist on?

[Cicero]

55. No one is talking about what a PERSON is worth

...what we're talking about is what any one particular JOB is worth, and some jobs are worth more than others, based on what the market, as expressed by employers AND employees, is willing to pay. A person's intrinsic worth is not determined by what job he has, and the fact that you cannot seem to see the difference is very sad, I think.

My very first job was as a temp employee for a couple of weeks while in college at a company that made band saw blades. I worked the sanders and grinders that were used to polish the blades at the point where they were welded together. Sometimes I had to work with blades that were 20, 30, 40 feet long. And they all had very sharp teeth and I got some minor cuts along the way. I was paid $0.25 above minimum wage, which at the time was $4.50 an hour, I think.

Are you going to say that that job was "not worth doing" because I could not have subsisted on those wages?

Later,

On edit: spelling

[greendog]

56. You're right!

No one is talking about what a PERSON is worth. And THAT is what's sad.

At the baseline, what an employer is purchasing is a PERSON, a human being. At the baseline, the employer should expect to pay the cost of maintaining that PERSON as a human being.

That same employer expects to pay the cost of purchasing and maintaining his machinery, his buildings, and his inventory. What's so hard about applying those same expectations to the cost of his employees. Why should the PERSONS that work for him be expected to subsidize his perceived need for cheap labor by working for less than the baseline cost of their existence?

As for your temporary band saw blade polishing job...I'm sorry you don't think your time was worth more than that. A few months ago I was offered an unskilled temp job grinding metal that paid 18 bucks an hour. The work was for a government contract and was covered by the Davis-Bacon Act. "I" don't think your temp job was worth less than the one I was offered.

Many union factory workers have relatively unskilled jobs that pay living wages. The union movement organized around the worth of PERSONS as human beings and that is what created the American middle class. It's sad that there are people today who've forgotten the sacrifices made by those women and men. It's sad that people think in terms of the worth of a "job" divorced from the human who performs it.

Finally, the notion that "the market" creates low wage jobs is nonsense. "Management" creates low wage jobs. They make the conscious choice to devalue human beings...not because the market requires it, but simply because they want to.

Look at the difference between Sam's Club and Costco. Same business. Same "market". Costco CHOSE to create living wage jobs. Sam's CHOSE to create the type of shit jobs you seem to be an advocate for. Same jobs - two different companies. Can you say that the jobs at Sam's are worth less than the jobs at Costco? Can you say Sam's gains anything by treating their employees as less than human? (Costco seems to be the more successful of the two)

The only benefit derived from the creation of shit jobs accrues to the elite. It's a power play. The intentional creation of an underclass keeps the rest of us in our place.

[thinkingwoman]

57. an employer is absolutely NOT purchasing a person

That's slavery. And it's illegal, immoral, and wrong.

An employer is purchasing a certain amount of work done for a set amount of time.

To use your equipment example--if an employer buys used equipment at a much lower price, he gets what he pays for. Likewise, if an employer purchases work from an employee at a rock bottom price, he gets what he pays for.

Your blanket statement that "management" creates low wage jobs demonstrates a lack of basic economic understanding of this entire topic.

It's true that HUGE corporations pay their top level management outrageous salaries while paying the little guy crap. But small businesses, which make up the majority of businesses in this nation, don't have that luxury and don't make those choices. It's ok to compare Sam's Club and Costco...but comparing either to the Mom and Pop shop down the street is ludicrous.

A high minimum wage will kill the Mom and Pop shop and leave only the Sam's Club. That would be an improvement?

[greendog]

60. an employer absolutely "is" purchasing a person...

...if that "certain amount of work done for a set amount of time" has to be done by a person. "Work" doesn't do itself...what's so hard to understand about that?

Our hypothetical "person" isn't free to do anything else while she/he is employed. Our hypothetical "person" does use up a certain amount of energy performing her/his job, and in many cases has no energy left for other employment. In some cases employers forbid outside employment for this reason.

And exactly how would a higher minimum wage kill the "mom and pops". The minimum wage (relatively speaking) was higher in the '60's and '70's and the "mom and pops" did ok. As a matter of fact, a higher minimum might help them compete with the big corps for good employees.

I grew up in a "mom and pop" business family. Dad took care of his employees with decent wages and benefits. He paid better than some of his larger competitors because it was the right thing to do. He stayed in business for more than 25 years and did ok. He didn't get rich but he raised 6 kids and has a comfortable retirement.

I stand by my statement that "management" creates low wage jobs. The old pre-union mill jobs paid shit wages and offered lousy working conditions because they could get away with it. Once they were forced to take decent care of their employees they found a way to do it profitably. Society didn't collapse. The benefits and wages garnered by the unions trickled down to the employees of the smaller businesses.

The creation of a minimum wage didn't kill the smaller businesses either. And raising the minimum wage through the years didn't harm business...in fact, by spreading the profit around a more vibrant economy was created.

[thinkingwoman]

75. So your Dad was a slave owner?

He purchased people for 25 years but he paid them better than competitors so that made it ok?

Your insistance on such inflammatory language cheapens some very real and important points you make. That's a shame.

Your argument contains a lot of generalizations however, and they weaken it.

For example, let's look at the minimum wage of the 60s and 70s paragraph:

"The minimum wage (relatively speaking) was higher in the '60's and '70's and the "mom and pops" did ok. As a matter of fact, a higher minimum might help them compete with the big corps for good employees."

You're right about the buying power of wages inthe 60s and 70s being more than now. But then your next sentence makes no sense. Why is a higher minimum needed to help them compete? What's to stop a Mom and Pop from simply paying a higher wage and competing regardless of what the minimum is set at?

I lurk on a lot of these minimum wage conversation threads and the one thing I keep noticing is that a lot of posters repeat the same opinions without a lot of real world experience or discussion. One of the questions I rarely see asked is this:

Why are so many small businesses struggling so much more now? And why do these businesses find themselves unable to pay higher wages or offer benefits?

Sometimes I see posts that claim that small business owners are simply greedy bastards keeping profit for themselves. But that isn't reflected in my local business community. I see businesses that did fine for 20, 30, and 40 years suddenly struggling to find and keep employees and pay them anything at all.

I think these conversations, and your posts, have pieces of the truth. But this neat little "employers are bad" explanations don't get us to the whole truth.

Something is happening to this nation's economy...something that cannot be remedied by demanding a higher minimum wage and claiming that it won't hurt business. The only people not hurting right now are the CEOs and shareholders of the fortune 500s.

Employees and small business employers need to find common ground and start understanding each other and working together or we're all going to go under together.

Sorry for the sermon. I'll be closing the doors of my more than a century old business for the final time before the end of the month. It survived the great depression and it survived the 70s and 80s but it won't survive this endless relentless recession.

[Econslave]

77. business sense

Its not a huge surprise that most people here use generalizations to talk about complex business concepts. Unless you've worked actually running a business, you often don't know just what drives a business.

As for why small businesses are running into trouble. I see it as 3 factors

1) steadily increasing technology has made too many products "commodity products" where the profit margins are extremely low and you basically have to differentiate on brand loyality and service.

2) with the exception of "luxury" goods, people are looking at the cost much more closely, and sometimes taking lower quality to keep the prices down. Small business usually produces higher end goods, and unless they have brand loyality lose business to the lower price companies.

3) The improvement of transport and communication technologies have shortened and spread out supply chains, allowing businesses to move into new markets, often displacing small businesses that previously had no competition.

The fact that education has not kept up with technology hasn't helped. Many career paths require special training and entry level positions can be difficult to find, which means the few people in those fields can demand higher salaries and get snatched up by big businesses which again hurts the competitiveness of small business which often needs the expertise just to keep up with the sheer economic power of the corporations.

And yet, we keep adding more regulation on small businesses which already are struggling. Perhaps we need to reduce the regulations which only seem to make small businesses increasingly less competitive.

[thinkingwoman]

88. Yes! Thank you!

Finally an answer that furthers the discussion.

I completely agree with all 3 points and think they are a good portion of the problem. I'd also be interested in hearing what types of regulations you think should be reduced.

Another point that your post touches on is education not keeping up with technology. I think that's true, but I also think there's more to it. I think education is failing even further to prepare students to do even the most basic office and small business production work.

I would continually receive job inquiries from people who could not even create a resume. I always insisted on a resume as a test of basic competence of writing, presentation and layout (since I owned a publishing company). You wouldn't believe the stuff I got.

I don't know where to start to fix that. But now that my business is closing, I would like to do at least some work to remedy the situation by helping raise awareness or provide training or something.

[Just Me]

93. Part of the system failure: advancing big corps - hurting small businesses

The big corporations can fund huge lobbying campaigns essentially controlling the laws pertaining to regulations and tax breaks. They sponsor regulations which concentrate power/wealth in big business while leaving the most burdensome laws in place for entreprenuers and small businesses making success VERY, VERY DIFFICULT.

Big corporations are responsible for both killing off competition (in the form of small businesses) and suppressing the possibility of a living wage.

It's the corporate America way.

[greendog]

78. You can't purchase "work,"...

... as I said before, it doesn't do itself. You need a "person" to do the work. If you want to call it "wage slavery" you'll get no objection from me.

If every business is subject to the same "living wage", competitors don't have the option of lowering their prices by paying sub-living wages. Everyone starts at the same place.

Some people, like myself, prefer to work in a small business setting. There's usually more variety to the job and more opportunity to learn. It's just more interesting...but a low starting wage is a deterrent. If I was guaranteed (by law) a living wage I'd literally have the option to seek work at any business in town.

While the larger businesses might be able to offer a little more money, the smaller businesses could be competitive in other ways. I'm sure there are plenty of workers who'd gladly leave their factory or cubicle job for one in a small business. I think small business would benefit from this as well.

Small businesses ARE struggling...it's because our elected representatives are giving all the breaks to their corporate contributors. These corporations receive huge tax breaks and subsidies that give them an unfair advantage over small business.

Your intuition is correct, something IS happening in our economy.I'll suggest a few books that have helped me understand it.

"When Corporations Rule The World" and "The Post-Corporate World" by David C. Korten and "Wealth And Democracy" by Kevin Phillips.

As for me being "inflamatory"....whenever I see liberals spouting "cheap labor" propaganda I tend to react in the most provocative way I can. It's my way of honoring the women and men of the early labor movement. Our middle class wasn't built on pleasant discussions. It came about through confrontation.

I'm sorry to hear about your business. These are tough times, we're all feeling it. The only option we have is to educate ourselves and fight back.

[Econslave]

80. "wage slavery"

using the term "wage slavery" isn't quite correct.

The reality is that becoming an employee of a company is in a way a contract.

You - offer your skills and time to the company
The company - offers you money in exchange for that time and skill

You aren't selling yourself, but you are selling your skills, with the understanding htat you will "work" a certain amount of time in exchange for the funds.

And perhaps unlike you I have always worked in a "small business" environment, and I have to say that small businesses actually usually offer a higher starting wage than a big business. Also they are often more generous with bonuses and benefits if they can be. Some aren't because of the costs of doing business. (especially in regards to company health insurance with is now too expensive to provide for many small businesses)

You did say one thing I completely disagree with. Greendog you stated:
> If I was guaranteed (by law) a living wage I'd literally have the option to seek work at any business in town.

This doesn't work. if you were guaranteed a living wage by law then any business in town that was left would demand from you that you be worth the living wage or they wouldn't hire you. Right now you do have hte option to seek work at any business in town, and if your skills match a need they have, they might offer you a position, at the wages they feel match your value to the company. If that value is distorted because a law puts a floor on the wage they can offer, they are going to be much less likely to hire inexperienced workers, as they will want value.

[greendog]

82. I think the term "wage slavery"...

...works just fine. Unless a person is independently wealthy they don't have any choice but to participate in the economy either through employment or starting some kind of small business.

A "contract" describes the relationship between a business and it's customers but isn't an accurate description of employment. An employee can't offer her/his time or skills separate from her/his person. Their physical presence is necessary. The relationship is only voluntary to the degree that the employee has the option to seek the same relationship elsewhere. In that way employment is coerced, hence the term "wage slavery".

As for small business paying higher wages...around here I haven't noticed that, at least as far as blue collar skilled and semi-skilled work goes. Everyone knows that the highest wages are paid by the big plywood mill. Everyone also knows that all those guys hate their jobs and, if they could afford to, they'd be happier if they worked elsewhere.

And as I said in my post above "If I was guaranteed (by law) a living wage I'd literally have the option to seek work at any business in town.

That's true.

There wouldn't be a business in town that would have the option of finding someone at a lower wage. Experienced workers would increase in value and employers would have the choice of training new workers at a living wage or bidding up the price of experienced workers.

Your suggestion that higher wages force businesses to close mystifies me. Higher wages creates demand for the products and services offered by business. Lower wages reduce that demand. As other posters have said, there is a history of wages being increased either by government regulation or by union contract without closing businesses or creating unemployment.

[thinkingwoman]

89. Thanks

I appreciate the reading suggestions and will happily read them. I need to fill some time. ;-)

I did not mean to spout "cheap labor" propaganda. I'm not against a living wage actually, just wondering how to define and quantify it.

But I still think you can purchase work, and not the person. I think it's a matter of perspective, which gets understandably blurred when some idiot corporation fires people for smoking in their own homes.

In my business I had full and part time employees, but I also purchased content from sub-contractors. In each of those circumstances, if you asked the people I wrote the checks to, they would agree that I purchased their work, not them.

You're right about the discussion needing to be unpleasant to promote progress. I guess I would say the unpleasantness needs to involve words like greed and robber baron rather than slavery. But hey, maybe that's just me.

Thanks for the thoughful response.

[Lindacooks]

61. Nope, raising the minimum wage has NEVER hurt business

"The overall conclusion of this analysis is that since 1997, employment growth (all nonfarm employment and retail employment) in states with a higher minimum wage than the federal minimum has performed at least as favorably as in states where the $5.15 federal minimum prevails. That is, state minimum wages higher than the federal minimum wages have not adversely affect employment growth over the past few years. This conclusion holds for both the expansion phase of the economy – the years 1998 through 2000 – as well as the years of recession and extraordinarily slow growth since then (2001 through 2003).

In fact, when considered in the aggregate, taking all states together in two groups, employment outcomes have generally been more favorable in the higher minimum wage states than in all other states. Consider these examples:

1. Total employment in the higher minimum wage states increased by 6.2 percent from January 1998 to January 2004, 50 percent greater than the combined job growth of 4.1 percent for the other states where the federal minimum wage prevailed; and

2. Retail employment grew by 6.1 percent in the minimum wage states versus 1.9 percent in the other states."

<snip>

http://www.fiscalpolicy.org/press_040421.stm

[sendero]

90. I'll agree with you ....

.... partially. Your example is of situations where the minimum wage was raised a relatively small amount. If you raise it 50% at one time, I promise it will have deleterious effects on the economy.

I am a liberal. I wish there was some easy answer to guarantee every working (and disabled for that matter) person some minimum income with which a life of reasonable dignity can be lived.

What I don't want is to kill the goose that lays the golden egg. You can do some things to help such folks, but you cannot simply legislate a good economy with a high minimum wage. It is, in fact, a tightrope walk.

[mhr]

92. Wrong - Every Serious Study Of Living Wages Has Shown Just The

Opposite.

A simple Google search will uncover these studies.

[Poppyseedman]

2. The problem I have with the living wage is

who defines what is "living"

The same $10.00 hr in Sioux City ,South Dakota would be like $4.50 hr in NYC.

"Living Wage Laws" should be a local issue, if it is thought one is needed.

We just passed one where I live, it will be interesting to see how it effects the economy.

Minimum wage $6.15 an hr indexed to inflation yearly

[Lindacooks]

62. That's easy to fix

Every state, in fact, every county, has a povery level based in income. The living wage should lift a family above that level.

"Despite a record stock market and strong economic growth, poverty remains high in the United States. One out of five children live below the offical poverty line in the richest nation on earth. The population of Americaâs working poor has grown because the wage floor has failed to keep pace with the cost of living over the last three decades. The federal minimum wage, which in 1968 stood at 86% of the wage necessary to lift a worker and his or her family to the official poverty line for a family of four, today represents less than 64% of that "living wage." The federal minimum wage, presently $5.15 an hour, would need to be raised to $8.20 an hour simply to meet the federal poverty level. In many higher-cost regions, a true living wage is substantially higher (up to $18 per hour).

The dominant voice of American business has predicted economic doom and mass layoffs in their consistent opposition to minimum wage increases. While none of these forecasts have come to pass when the minimum wage was increased in the past, the business lobby nonetheless remains a powerful obstacle to raising the wage floor to a decent level."

<snip>

http://www.responsiblewealth.org/living_wage/

[Igel]

64. How big a family?

I mean, are we talking the employee + 1 kid? employee + spouse + 3 kids? employee + spouse + 3 kids + elderly parents?

One very relevant unstated figure in the poverty statistics is family size. $30k/yr can be poverty, if you have enough kids.

[Lindacooks]

73. That's figured into the equation too.

I know that the food shelf organization in my county has a sliding scale of how much money you need to make to qualify, based on the number of people in your family.

[Igel]

96. I had in mind "living wage". If the living wage = "enough to

lift a family out of poverty", doesn't that mean there is a sliding scale of "living wages"? So if I have a wife and one kid and get a job set at "living wage" I'm making more than the single guy on my right and less than the guy with a wife and 4 kids on my left.

I'm not sure a union or employer would go for that. The union would be confused for a while, and employers would all want single workers.

Or the living wage is set for the family with one wage earner and 8 kids, and while he's barely out of poverty I'm buying my 4-bedroom house.

[lazarus]

3. that's because

you're thinking microeconomics, not macroeconomics.

Prices do not go up when the minimum wage goes up. Just doesn't happen. The economy doesn't go downhill, inflation doesn't increase, none of the bad evil things Republicans say will happen actually happen.

[B0S0X87]

10. Could you explain how that works?

I'm not an economist- it just seems like common sense that the store owner would raise prices in order to compensate for increasing wages.

[Salviati]

14. here are my thoughts:

Because the price you pay for goods, p, is related to the cost of production, c, only by the fact that p > c. Otherwise the consumer will be charged as much as they are willing to pay for that particular good or service. E.g. the music industry.

Increasing c through increasing the minimum wage isn't nessicarly going to increase p unless c becomes larger than (or very close to) p, particularly since you've mostly just increased the wages of those making below the living wage.

P can be influanced by this a bit due to inflation though, if there is more disposible money going around, then people may be willing to pay more for things, because they are able to...

[hughee99]

70. If p is the price you pay for goods, and c is the cost of production...

then if c goes up, p will have to increase, or you will see profit margins go down. Is this not correct? In addition to c going up (because of the minimum wage) wouldn't it also go up because of the cost of "raw materials"?

A man running a bagel shop pays his newest employees $6 and hour. The minimum wage goes up to $10/hour. The new employees get a $4 raise. The veteran employees either get a $4 raise, or they get screwed to some degree. So all employees get a $4 raise. The place the man buys his ingredients from also has raised employee wages by $4, and to maintain the same profit margin, they've raised the cost of the ingredients they sell. Now the man is paying more for employees and more for ingredients (leaving out the increases that he may see in his electricity bill/delivery charges for raw materials and other overhead related expenses), so to maintain his profit margins, he must raise prices. Since he may sell 100 bagels per employee, he would now have to increase prices by
($4 + the costs of the ingredients per bagel)/100 to maintain the same profit margin. Either he is willing to reduce the profit margin or he is not. Smaller companies that don't have investors to answer to may be willing to do this if the business is sufficiently profitable to allow for this. For larger companies that have a drop in profit margins, the result is usually a drop in stock price. To get the profit margin back up (in the face of this not being a "temporary" situation), many times they tend to lay people off and demand more "production" out of those who are still around.

Is this not how things work? Where did I go wrong?

[lazarus]

16. A slight bit

but the percentage of the increase in price is usually less than the percentage in increase of wages.

For instance, I worked in a pizzeria when wage went up in the early 90s. We increased our prices (cleverly, a couple of months ahead of time, so we looked good when EVERYBODY else hiked their prices at the same time). But we only increased them a small amount, as we only had to cover for the wage increase of 5-10 people.

Granted, this doesn't apply to large scale increases. If we suddenly paid everyone 1,000 dollars an hour, yeah, pizzas would cost a lot of money, but a small increase to keep up with inflation isn't going to cause inflation to promptly hike up again.

To be honest, it's been about 8,345 years since I took Econ, so I've forgotten most of why. Hopefully someone currently involved will come along and save my ass. :hi:

[stevebreeze]

32. for one thing wages comprise a surprisingly small portion

of the cost of fast food items. If you doubled the min wage, you might only increase the cost of your bagel 10% or so. Of course the bagel person would now ALSO be able to buy a bagel on occasion, so the economy would actually increase faster with a higher min wage. Of course it would be fazed in over time so as to not shock the economy.

All the bad things that low wage proponents say will happen can happen if and only if you move in extreme fashion.

[Cicero]

44. If you double the minumum wage...

...or arbitarily set it to some high amount, like $10, then employers will want more "bang for their buck", so to speak. It will close the doors for many entry-level workers.

Later,

[Lindacooks]

63. Nope, that isn't right

"When people are paid enough to support their families, they no longer need to rely on public assistance in the form of housing subsidies, medical assistance, food stamps, and welfare. In effect, taxpayers are subsidizing employers who don't pay living wages.

When people are paid enough to support their families, they pay more taxes and buy more goods and services in the local economy, stimulating growth of neighborhood economies.

The vast majority of economic research concludes that there is little or no disemployment effect associated with wage increases, and the benefits far outweigh any negative consequences."

http://www.responsiblewealth.org/

[Dean_Convert]

5. Minimum Wage prevents Wage Slavery

What you need to do is increase your own income, not try to suppress the incomes of others. Have you given any thought to expanding your education or enhancing your job skills? Perhaps a change in career is in order.

[B0S0X87]

9. That was hypothetical

I'm not the person in my first post. I'm a student. When I graduate from college I'm sure I'll find a job that pays well enough to cover a 22 year old's basic expenses (so long as the job market doesn't completely destroy itself).

[cornermouse]

11. Reality check.

People making minimum wages cannot afford to go back to school and if you don't have the prerequisites (education and/or prior experience) you aren't going to get that better job.

[DrWeird]

6. Gee, it seem to work years ago...

Back when the minimum wage was far higher, taking inflation into account.

[bryant69]

7. There's an original thought.

Doing nothing is the correct answer. Great.

Bryant
Check it out --> http://politicalcomment.blogspot.com

[cornermouse]

8. In the past, when minimum wage went up, the money

that workers earning more also went up at least some. We used to have wages high enough to enable mothers to stay home. It seems to me that there has been a steady erosion of spending power and wages for quite some time now.

[KittyWampus]

22. CEO Salaries Have SOARED In Proportion To Wage Earners In Same

companies.

In the 50's CEO's only made X times the amount of what the lower guys on the ladders made.

Now CEO's make 10X the amount.

Paul Krugman mentioned this in a column a while back.

He posited the notion that CEO salaries went astronomical because of the massive increase in salaries sports figures were getting.

It's also a question of ethics, btw.

[AP]

24. Expense stock options & limited deductiblity of exec bonuses would also...

...free up a lot of room to encourage corps to shift money to employee wages rather than executive pay without having to raise prices.

[cascadiance]

29. Heck not just the 50's, try the 80's

It's a well established number that around 1980, CEO's and execs tended to make 40 times the average worker salary. In recent years this has been anywhere from 350 times to over 400 times as much. That is your 10x figure and it has only happened in the last 20 years.

That's also a perfect argument to make when someone says that wages are purely determined by supply and demand. If they say that, you then ask him how to explain these statistics. Ask them if CEO's were 10 times worse than those of today, with everything else being equal, or if workers (even though the American workforce is the most productive in the world recently) are 10 times worse today than they were then. It's something that they will have a difficult time arguing with, and you can get many to yield to the notion that the system is rigged to help those in control of the boards and executive ranks salaries.

[Igel]

66. I've thought about that for a while.

Our income's about 50k/yr (sometimes more). One kid, want more.

If I kept us to the standards I lived with in 1970 ... tv, economy car, canning own food, never eating out, no fancy food that wasn't made from scratch ... we'd be able to save lots and lots o' money.

I have no idea how to compare livestyles between now and then. Nodoby would want to live like my family did. By today's standards, my parents were poor, by 1970 standards they did reasonably well (both were steelworkers, and most families in the neighborhood did well on with just one steelworker's salary).

[leyton]

12. What you say makes sense...

and it's too bad everyone here is jumping all over you for the mere suggestion.

I'm no economist, but I think it would lead to a minor rise in inflation. However, perhaps it wouldn't be major: the people at the bottom have increased wages, but a lot of people who already make well above minimum wage would not be making any more money and their companies would not be raising their prices. I think it's a tradeoff, and you have to find the point where the net gain (benefits minus costs) is maximized. Whether or not that's at the current minimum wage or at a different one, who knows? :)

[B0S0X87]

13. Thanks Leyton

I'm new here, and while I really like DU in general, it is distressing that people will gang up on anyone who makes a slightly un-left wing post.

[leyton]

15. Welcome to DU

Well, it happens from time to time, and not much can be done about it, unfortunately.

Congrats on the World Series, though.

[B0S0X87]

18. Yeah, lol

The Sox winning it all somewhat numbed the pain of what transpired just a few weeks later.

[Worst Username Ever]

17. I agree, I find it distressing as well.

When no one seems to know the actual answer to your questions, the general retort is to reject the question or poster without actually answering it. I don't know the answer to your questions, but I have wondered about it in the past as well, and had hoped that perhaps a economically inclined DUer may be able to come up with an honest answer. I would be interested in hearing it.

Regardless of the ethics involved with raising the minimum, it would make sense that an increase in cost to a company would, indeed, be followed by an attempt to make up those costs by raising prices (or laying off workers). This would, in turn, lower the buying power of the average consumer. The question is, would the rise in cost of products (all products, from toilet paper to construction materials to food), be significant enough to neutralize the positive effects of a rise in minimum wage. I have no idea.

[no name no slogan]

68. A little inflation is a GOOD thing

Alan Greenspan has had this economy so tight-assed since 1987 that inflation is a non-issue. In fact, he has said, repeatedly, that he puts on the interest rate brakes whenever there's the slightest sign of wage inflation. He is the most worker-unfriendly Fed chairman we've ever had, bar none.

Instead of an increase in workers' wages, we've been rewarded with record-low interest rates and access to "easy" credit, instead. So, instead of being able to BUY things with our wages, we now have to BORROW from creditors to buy the things we could once afford with a paycheck.

This policy has been a disaster for working people. Personal bankruptcies are at record levels. Saving rates are at record lows. A family lifestyle that was once possible with one paycheck now takes two (or sometimes three or four) paychecks to afford.

Real wages have not gone up since the early 70s. If the minimum wage of the early 70s kept pace with inflation, it would now be around $11. Instead, it is half that-- and yet most of our Democratic leaders WILL NOT address this issue.

It's a sad day when the economic policies of Richard Nixon circa 1972 are more liberal than those of Democratic presidential candidates.

[dogman]

19. Historically it hasn't worked that way.

In spite of dire predictions by the GOP. Prices are more than a function of wages. Wages are cited by anti-worker lobbyists but price is a function of demand also. They can not go beyond a cerain level, or you might settle for just a cup of coffee. Take Krispy Kreme, maybe they would not be able to pay their CEO $760/hour.

[JerseygirlCT]

74. I agree

to some extent, the market will regulate b/c of demand. If doughnuts are priced too high, they won't sell. So the doughnut-making-and-selling people will find a way to make and sell cheaper doughnuts.

And, yes, wouldn't it be nice if there were some slow-down in bloated top execs salaries?

How many millions do you need, really?

[mzmolly]

20. Oh lord, this again?

:eyes:

Free Republic would appreciate this line of thought.

[AP]

23. At some point, it'll come out of CEO salaries. You can't raise the cost of

the bagel so much that people won't buy it.

Obviously, if everyone gets a decent wage, there will be room for increasing prices.

But the real room for paying people more money will come out of CEO salaries, which are at a record high. I don't know the ratio, but CEO salaries used to be something like 100:1 compared to average salary and now they're 10,000:1 or something ridiculous like that. There's obviously a lot of room there to have good profit margins while still paying decent wages.

I think if you raise minimum wage, you'd probably also need to do some other things with the tax code to encoruage corporations to pay more out in employee compensation (and less in executive compensation).

Expensing stock options would obviously be one smart thing to force corps to do, and also limiting the deductibility of bonuses that exceed some threshold (like % of net profit, or something like that -- in the same way that individuals can only take deductions for medical expenses up to a limit)).

[Vinca]

25. I was pondering this very question yesterday and,

sorry to say, I don't have an answer. What is abundantly clear is this. We need those bagel shleppers, delivery people, housekeepers, dishwashers and other unskilled workers every bit as much as we need lawyers, neurosurgeons and $50 an hour plumbers. Society couldn't function without them. The minimum wage - whatever it might be - should raise them at least a hair above the poverty line. People shouldn't work full time and take home a wage that keeps them in poverty.

[David Zephyr]

28. The "bagel" in your hypothetical here didn't slide by me.

You are posting here at the DU that you don't support the idea of a living wage?

You are posting with a hypothetical that suggests exploiting those less fortunate than you and you use a "bagel" in your example?

I think that you are only trying to cause trouble here and that you really don't care one bit about the minimum wage.

Really!

[B0S0X87]

40. Jesus Fucking Christ

I didn't say I didn't support the notion of a living wage, but the notion of prices rising was a problem that, to me, seemed likely to happen if the idea was installed.

And how, pray, does my hypothetical example exploit those less fortunate than me. I was simply saying that I didn't see how it would help them.

My original post was not "freeper propoganda" at all. It was common sense. I said this was a problem that troubled ME, and if you disagree (as you do) feel free to prove me wrong. If I find your points make sense, I will say so, as I did after cryingshame's rebuttal.

It really pisses me off that you can't ask a simple question on DU without being flamed. I became a democrat after years and years of questioning. I questioned every person, policy and action, liberal or conservative, Republican or Democrat. I have decided that the Democratic Party's ideas and beliefs are probably best for America, but that DOES NOT mean that I BLINDLY support every action put forth by the left wing of this party. If you want people to blindly support you and you refuse to give any reason beyond "we're right, you're wrong," then you, sir, are no better than the Christian Right.

[David Zephyr]

48. B0S0X87

I did not refer to your post as "freeper propoganda" in my response above.

[Desert Liberal]

30. Well, $10/hr would be really decent around here.

I would be happy with a minimum wage of $7.25 an hour. That way, people who do more specialized things who are making only that amount now would get a bump of $1.50-2.00 an hour. For those of us who barely scrape by, that would be hand up. With even a $1.00 an hour increase, I would have about $160 extra dollars a month (probably $125 after tax). Instead of barely being able to pay my bills, I could save back some of that cash every month and supplement a Pell grant to go back to school.
People who make only $5.15 now would be able to get out of abject poverty. And $7.25 is not so much. Nothing like $10 which is way out of the ball park.

[Synnical]

31. Freeper nonsense

At ten bucks an hour there is no way I can afford $3.50 for a bagel and coffee. It's more like $3.50 a WEEK in my home for bagels and coffee. I can't even afford to pay my rent, my car payment, and my car insurance. Not to mention electricity. Been there, done that - and that was back when I could float checks. And I don't even have kids to support.

You nit.

[Synnical]

33. Not to mention

Major corporations (like McDonald's) get Federal Subsidies for employing immigrant workers.

Who they can fire after three or six months (I forget which) and then re-hire more immigrant workers and get the subsidy again.

[earth mom]

34. Far too many people are now part of the working poor

because wages are stagnant and miserly. The * installation turns their back on it because they are too busy cozying up with big and small businesses who benefit from low paid employees. :puke:

Prices continue to go up regardless whether an employer pays his employees more. These days the worker is cut out of the equation more and more while stuck working for slave wages while the employer never suffers in the profits department.

Employees too often are a dime a dozen to their employers and very easily replaced with someone else for the same or less money. A workers only protection are unions or laws passed for a living wage, if these laws manage to get passed at all.

This issue is without a doubt one of the most ignored serious problems this country is facing. The middle class is fast disappearing.

Read the book "Nickled and Dimed"-it's quite the eye opener as to the direction far too many jobs are going these days. Far too many people are getting screwed by this crap big time.

[Synnical]

38. Half way thru "Nickeled and Dimed" - And NOT Getting By

Written with compassion and understanding. It also has some funny anecdotes. Good book.

[Lydia Leftcoast]

35. When Oregon raised its minimum wage, the price of the

lunch specials in my neighborhood restaurants went from $5.95 to $6.95.

For the type of person who eats lunch out regularly, that was hardly noticeable, an extra $20 a month. A person who can't afford an extra $20 a month for lunch probably would be brown bagging it anyway.

[leftofthedial]

37. equilibrium

[dcn112]

39. Ok I've had it

I've been reading these forums for a while, but this will be my first post. There are some people here that I have a hard time believing are democrats. I too value dissent but I tend to think of the minimum wage as one issue that democrats are united on.

Here we go..

1. We have the minimum wage because some employers will pay the lowest possible wage. Even if this mean that you can't survive, they don't care. This has been proven countless times and is part of the reason why we have the New Deal.

2. Of course if you raised the minimum wage to something like $15 an hour you would cause problems. However for the states that have raised the minimum wage by a few dollars they did not see any rise in unemployment. In fact, in some cases there was a decrease. How? You also have to remember that when you raise the minimum wage you increase demand, because people that make low wages will spend everything that they make.

The real question is this: Are we going to pay people that work 40 hours a week a decent wage or not? Are we going to tell people that can’t afford rent that we’re concerned with bagel prices? We can make this economy work for more people. Repealing the Bush tax cuts for the wealthy and raising the minimum wage by 2 or 3 dollars would be an excellent start.

Thanks to everyone here that has stood their ground and supported Dean. I was about to walk away because of the DLC.

[PassingFair]

41. A Big, Fat, Juicy WELCOME to you dcn112!!!

Have you seen the pictures from Dean's little soiree tonight? Thank you for standing YOUR ground. We've got our work cut out for us.

[nothingshocksmeanymore]

42. Great post! Most communities that have passed living wage laws

such as Santa Monica, Ca have upscale businesses anyway...

Funny..Repubs don't want living wages, don't want social programs, don't support rent control but will also chase the homeless off the streets..about the only place some can survive inside that model is in prison which both parties are happy to waste money and lives filling.

[David Zephyr]

45. Excellent post, dcn112.

And a big welcome to the DU! We need you! :hi:

[TheOriginalAmerican]

51. This argument was against living wage, not minimum wage.

I agree that we don't want wage slavery. Too many employers would turn it into that. Even one employer is too many.

However, the living wage itself doesn't work. You just admitted that.

You do increase demand for a little while by raising minimum wage. The problem is that these companies want to make up for the money that they are losing. Therefore, they raise their prices. Inflation leaves the person in poverty right back where they started.

I think that minimum wage should be raised with inflation, but not for other reasons. I think raising minimum wage causes inflation.

It's not that I'm a freeper. I'm a Democrat. I do support social programs. It's just that I'm thinking that the living wage will not logically work. I don't think that raising the minimum wage works. How many times did Clinton have to do it?

[Sugarbleus]

54. Bring back REGULATIONS

That is the sole problem with today's economy. How much money does one CEO/millionaire need to be satisfied???????

Bring back the caps on how much can be charged for services and other necessities, tax investments, put caps on interest rates for loans and credit etc., tax the wealthy, make special deals with businesses that agree to fair labor practices, the whole nine yards. That way a person earning a smaller wage could, feasibly, RENT a g.damned apartment without help from the state!

It's a g.damned free for all out there in terms of what can be charged(or not taxed) for goods and services! It's highway robbery!
*banks
*Credit Cards
*Interest rates on housing loans and other things
*Utility rates
*Communications/Telephone et al
*Investments
BREAK UP THE MONOPOLIES

[TheOriginalAmerican]

71. The problems I see with that.

A CEO is in their business to make money. It's not to provide jobs or even to please the customer. It's to make money.

If you put regulations on how much a person has to pay and at the same time force a living wage, then unemployment will definately go up.

I also agree that a person shouldn't need to have the state's help to rent an apartment, but this isn't an easy fix problem. That's because at this point, you really are coming close to reaching the Socialist point. There's nothing wrong with Socialism, except for that it doesn't work. Even these Social Democracies allow companies to make their money.

We need to start empowering these people. I really would like to see a program where poor people got job training for something high in demand so they could have a living wage.

[DaveinMD]

81. there is a race to the bottom

and government needs to step in to stop it. That means minimum wage. That means child labor protection. That means we should pass laws mandated health care coverage. That means worker safety provisions.

[David Zephyr]

47. Take a Bagel & Coffee Break and Read Up on the Haymarket Martyrs.

Reading your initial comments and the originating post in this thread, I could not help but reflect on the sacrifices made by America's great Labor Heroes. I am forever in debt to those men and women who courageously gave their very lives or spent their best years locked away in prison because they dared fight for something as basic as an eight hour work day, child labor laws, safe working conditions, equal pay for equal work and so much more.

I am certain that there were voices who thought the eight hour day would be "inflationary", don't you?

And yet, Albert Parsons, August Spies, Louis Lingg, Adolph Fischer and George Engel gave their lives fighting for an eight hour day. How many Americans even know their names? Very few, sad to say.

When any man or woman works forty hours a week at any job then they should be able to have a roof over their head where they can call home, groceries in the refrigerator, health care and enough money for some modicum of pleasure, never mind savings.

What's inflationary?

Perhaps this stupid $300 Billion war that has driven up the national debt forcing still more government borrowing.

Maybe the ever climbing petroleum prices that impact every commodity sold in the United States.

But I would never, ever blame a worker at the bottom of this nation's scandalous wage-slavery index for causing my bagel and coffee to cost more.

[B0S0X87]

49. the bagel and coffee was an example

It could expand to other, more important, expenses like housing and utilities.

I would be willing to pay more if it would help those making minimum wage, but if prices rise along with their wages, I don't see how it could help them.

[TheOriginalAmerican]

50. I agree.

I used to be for the living wage, but I have finally admitted to myself that it would never work.

I also find it disturbing that a person has to work two jobs in order to make it. I would like to see a program that helps train people for better jobs. Those programs do exist with a very low cost in some areas. If a person can manage to get the time, I would encourage them to do it. The problem is getting the time to work and take those classes for the time being. It sucks.

[fnottr]

52. Sorry about all the flames you're getting

But I do think you bring up a valid concern, we're doing no one a favor if we increase their wages only to have their costs of living increase by a comparable amount. Here's the way I see it though.

Cooperations are going to try to make as much money as they possibly can....it's just what they do. Most large businesses take in more profits than they need to in order to remain solvent...hence the outrageous salaries of executives. Now prices are held in check by competition. If one bagel store is charging too much for bagels, the customers are going buy bagels somewhere else.

This same sort of competition doesn't exist in the job market. A worker at the bagel store can't simply quit and get a job at a better paying store any time they want. Thus Wal-Mart can pay people $7.00 an hour in towns where Costco pays people $12.00 an hour for the same job and still find plenty of people to work for it. On the other hand, Wal-Mart couldn't sell for $12.00 what Costco sells for $7.00 and hope to stay in business.

Because of this, I believe if the minimum wage was raised a dollar or two, prices would remain about the same. I believe some enterprising cooperation would be willing to cut into it's profit margins and keep it's prices low, in hopes of attracting more customers. Since wages are only one of many factors that go into the cost of anything, a 20-25% increase in the minimum wage will not result in a 20-25% increase in the cost of production.

[rman]

53. so how do top CEO wages figure into your logic?

-

[DiscoStew]

76. no doubt...

multi millions for one person, but less than $10 per hour for the people actually doing the work?? Hmmm.... something does not compute...

[dogman]

58. I answered you once that it's historical, apparently you haven't

done much research. Try and follow this.
http://www.nationalhomeless.org/ulwwhitepaper.html
Snip>
White Paper

Universal Living Wage Effect on Business and Taxpayers

Living wages are good for business. When workers make more money, they also have more money to spend. In fact, minimum wage workers have spent almost 100% of past wage increases directly into the economy.<1> Increased personal income inevitably promotes commerce and stimulates local and nationwide economies. By protecting and stabilizing the very foundation of enterprises, the employees themselves, we can equally protect and stabilize businesses everywhere. <Snip

[Econslave]

59. Living wage sounds nice, works terribly.

I'm new here, so please don't kill me for speaking heresy.

I did study economics in college. (BA Economics UC Berkeley) so I guess I can make a complete fool of myself on this topic.

First, the people who point out that labor is only part of the cost of a good are correct. In fact a huge part of why the auto unions succeeded was that back when they formed labor was such a small part of the cost of the goods that management felt secure in accepting their demands. They fought them of course in an attempt to keep their profits up, but in the end they went along.

Second, top CEO's are getting paid way too much for the amount of work that they do, and this is made worse because of the tricks with stock options and grants they use to increase their pay. In truth most aren't being paid more than $1-2 million in base salary, but with the way their bonus and stock option payments are structured they can make millions as long as they keep the stock price going up. (which means keeping profits high and costs down, or engaging in funny accounting like Enron did - this is a definite economic moral hazard, but I haven't heard any good suggestions for ending it other than forcing businesses to cost the options)

ok.. that's the basics
Now on the "minimum wage". Try to think about most of hte people you know who are working at these kinds of jobs. Now I'll admit that some are probably trying to survive on it, but most of the people I know making minimum wage are high school/college students earning extra money; retirees who decided to get a job to help them get out of the house and be active; military working security jobs in their off duty time; those who took a second job to help pay for extra luxuries. Of these 4 groups, probably only the high school and college students would be greatly helped by an increase, HOWEVER, they also might be the first ones to lose their jobs because all businesses have a simple equation for hiring.

A business will hire you if the amount they are going to pay you is less than the amount of money you'll make for them. and they have to consider all the costs in addition to your base salary.
This includes:
social security copay (businesses play 6.2% of your pay to SS)
Worker Comp
Employement taxes
Cost of the administration (HR)
Cost of any other benefits (lower prices for employees, health insurance)

Businesses pay this no matter what the "minimum" wage is, so raising it will raise a businesses cost sometimes dramatically. This is especially true of small businesses which often don't have a huge profit margin, and not a lot of cash built up to help survive downturns.

Now, do I lke that some people work 2 jobs. Not really. Do I like the fact that in many families both parents work. No (although some I've known, both parents worked because of a desire to purchase more luxuries).

The solution. I don't know, except perhaps for doing better in education and training so that people can offer more to a company and therefore be offered higher paying positions.

[no name no slogan]

65. Simple: raise minimum to livable wage, cap CEO salaries

Many industrialized nations have laws that cap CEO pay to 100x that of the lowest-paid worker. And despite the complaints of the rabid right, they STILL have functioning economies.

All it really comes down to is values: do we value those who work 40+ hours a week enough to pay them a living wage or not? Do we want them to be able to afford the necessities of life, or do we want to subsidize them through more welfare handouts (paid for by working people's taxes) because corporate bigwigs want shiny new yachts every year?

It's really that simple. You don't need an economics degree from a high-falutin' college to figure that out. :)

[qwghlmian]

67. Please name one out of "many" such industrialized countries

that has laws that cap private companies' CEO pay to a multiple of the salary of the lowest paid worker. Some Germany lawmakers have bandied about such an idea, but nothing came of it.

[no name no slogan]

69. Japan, for example

Japan has a cap on CEO salaries, and get this: when their companies underperform, the CEOs actually get paid LESS money, instead of MORE, like they do here!

Sure, you can say that Japan is a poor example given the last decade, but their stagnation more to do with crony capitalism than CEO wages

[qwghlmian]

72. I looked around - could not find any documentation

on Japan having laws that cap CEO salaries. Never heard of it before. Care to post a URL?

[Econslave]

79. not that simple

Actually, its not that simple

There are 2 problems here

first - most actual CEO salaries are only $1-2 million, which at 100X means you could go down to a minimum wage of $10K per year (definitely below poverty line). Its the bonuses related to stock performance that create the huge salaries, and the stock options, none of which are considered "salary" by the boards of directors.

Perhaps the corporate boards shouldn't be the ones to set up CEO contracts, since most of members of corporate boards are also CEO's themselves and there is an element of self interest in driving up higher salaries.

The claim that CEO's make is that without hte high salary you can't get the best personnel. (partly true, but I expect that most CEO's would work for less if that was the only choice - but then again, I once thought the same way about most professional athletes)

second - you cannot force a company to pay someone more than their productivity. And you need to include all the benefit costs in any calculation of "wages". If someone working for company A is only going to bring in $7.50 per hour to that company, its going to want to pay less than that so that it can continue to make money, otherwise why employ that person. Demanding that everyone be paid a "minimum wage" without increasing their skill or training accomplishes nothing more than eliminating jobs where the new costs exceed the maximum value of the worker.

the best example I can give recently is Home Depot and now the Albertson's Grocery stores near me. They now have do it yourself cashiers rather than paying people to do the job. It is their way of reducing their costs. Right now most of the local Albertsons only have 4 self cashiers and 6-10 stations where an employee can work. Raise wages enough and they might go with 10 self cashiers and just eliminate those jobs.

[no name no slogan]

99. Let me clarify: salary == total compensation

Everybody knows most CEOs don't make their money in salaries-- they make it with stock options, deferred comp packages, and other ways that keep their taxable earnings low. Why? Because the tax system is set up to take more in taxes from those of us who earn a wage, rather than from those who live off their 'investments'.

You're also making the assumption that higher wages == less jobs. That's not necesarily so. Higher wages for workers means more $$$ in their pockets. Working- and middle-class people are more likely to spend whatever $$$ they get (unlike the rich who "invest" it or save it), therefore buying more goods and services, which creates MORE jobs to keep up with increased demand.

Higher wages for workers may mean some initial inflation, but with an economy in danger of deflation a little inflation is hardly going to cause any problems. In fact, a little inflation will actually help out the working class, as their wages will go up, for a change. Eventually this will lead to greater spending, and greater demand.

[rman]

91. people you know making minimum wage / raising businesses costs

The people you know making minimum wage are not a cross section.
There are some 60 million working poor in the US - those are not "high school/college students earning extra money".

Cost by itself is hardly relevant - it is only relevant relative to 'buying power'.
Large corporations in particular would have no financial problem by paying higher minimum wages - it's just that they'd make less profit (they'd still make profit).

I seems the RW thinks it is horrible that corporations would make less profit, but that it is ok for workers to be downright poor. This while the argument for making ever bigger profits is that it will benefit everyone - it should be obvious this does not pan out. Several decades of "trickle down" economics has done the exact opposite, it has concentrated ever more economic power in the hands of ever fewer people, and pushed ever more people below the poverty line.

Your solution wrt education isn't really a solution. Surely there's plenty of room for improvement in education, and it should be improved. But in itself it would not solve the minimum wage problem. The fact is that corporation do want - even need - workers to do certain jobs, jobs for which these corporations want to pay no more then a low minimum wage.
If all workers would have "more to offer" to corporations (thus warranting higher wages), then there'd be no workers to do certain jobs that corporations *need* to have done in order to operate their business, jobs for which corporations do not want to pay more then a low minimum wage.

One of the biggest costs for business both large and small is health-care. Health-care is hugely expensive and inefficient because it is commercial - it is in fact very efficient in generating huge profits for big pharma, but very inefficient in providing a sufficient level of health-care for a very large number of workers. This is also to the detriment of corporations - what good is a worker who is in poor health?
If health-care would be efficient in providing a decent level of health-care and not used as a means to generate profits for big pharma, then it would be a lot less costly so that it would not be such a financial burden for small businesses. Then small businesses to would be able to pay a living minimum wage.

[dogman]

97. Who are these people?

Check it out.
http://www.epinet.org/content.cfm/issuebriefs_ib149
<snip>The majority of affected workers are women (60.6%). Just 31.8% of the affected workers are teens, age 16 to 19, with fully 68.2% being adults. Close to half (45.3%) of the affected workers are employed full time, and another third (34%) work between 20 and 34 hours per week.

[Bouncy Ball]

83. You have to think about more than your purchasing power.

You have to think about the interconnectedness of it ALL. How EVERYTHING improves.

People will have more spending money. Which means consumer spending will be UP. Which means most businesses will be able to afford to leave their prices the same.

It also means more people will have money to put in the bank, in savings, which also helps the economy.

And so on and so forth.

That rising tide lifting all boats thing. It really does work.

[qwghlmian]

84. Using your logic,

let's pay everybody $100/hr - think of the hugely prosperous society that will result!

[Bouncy Ball]

85. Way to make an inappropriate extrapolation.

A living wage is NOT $ 5.15 an hour.

[qwghlmian]

86. It is an appropriate

extrapolation from your post, I didn't see anything about any limits in it.

[Bouncy Ball]

87. My fault for assuming most thinking people

would not think I meant "hey let's pay everyone $100 an hour!!" but obviously there are people like you who must need everything spelled out.

:eyes:

[dogman]

100. Using your logic,

reduce the pay of everybody to $1/hr-why $100?

[Jeff in Cincinnati]

94. You're already paying a Living Wage...

you just don't know it yet.

That person making $5 an hour is getting earned income credit, food stamps and housing subsidies (and lots of it, if he or she has kids). The fact is that a low-wage worker with one child get about $7,000 in direct and indirect assistance from the taxpayers every year. And that doesn't count the salaries of the legions of state and local bureaucrats who administer the programs.

So somebody working fulltime gets $2-3 per hour in federal subsidies. Wouldn't it make more sense to eliminate the subsidies (and lower everybody's taxes proptionately) and require owners to pay higher wages. Certainly we could have exeptions for small businesses (especially those that employ family members). But anybody who says we "can't afford" a living wage clearly hasn't done the math.

[no name no slogan]

95. Thanks Jeff-- that's EXACTLY why a living wage law makes sense

Just look at what Wal-Mart was doing with its employees who were paid the minimum wage-- they pushed them off to county social service agencies for their basic needs, like food and medical care. Because Wal-Mart would not pay a living wage, the citizens of the county had to make up the slack with their tax money.

Working people DO get a livable wage, one way or another. Either they get paid a livable wage by their employers, or we taxpayers have to pick up the slack (most major corporations don't pay taxes, btw).

[Jeff in Cincinnati]

98. Let me add...

Small and medium-sized businesses should receive hefty payroll tax breaks so that paying higher wages doesn't cripple their cash flow. And we need to seriously reform corporate taxation so that large companies (like Wal-Mart) aren't being given a competitive advantage over the Mom-and-Pops.