Thread: Increase Minimum Wage to $15

Originally Posted by M21Sniper

Utopia is a not a viable business model.

Sure it is. As long as you pay for my "standard of living."

Originally Posted by gunnut

Punker, all those historical lessons are very nice. Times have changed. Get with it.

Take some classes in economics. Open up your own business. Or even get a job. Instead of dreaming up of a utopia that doesn't exist as long as humans exist.

Here's a very simple example why increasing minimum wage increases poverty.

You have a small business that employs 6 people. Minimum wage is $5/hr. You pay your workers $10/hr. They make twice the minimum wage. They are doing OK.

I come along and say that's not enough. I pass a law that raises minimum wage to $15/hr. You run some numbers and realized that you can only keep 4 guys at $15/hr. You have to let 2 guys go.

The remaining 4 guys are making $15/hr now. Are they doing better than before? Sure they are. They make 50% more per hour now. But wait...they were making twice the minimum wage but are now making MINIMUM wage. Plus there are 2 guys who are unemployed.

Which is better? Having 6 guys making twice the minimum wage, - or - having 4 guys making minimum wage and 2 guys unemployed?

He doesn't understand this. You see, he is under the impression that the small business is raking in 400% profits so they can afford to keep everyone at $15/hour, plus pay the extra taxes, plus the medical coverage, plus other benefits, plus insurance, plus paid time off, etc. He seems to think the only actual cost for each employee is basic wages.

Of course none of that actually matters to him because what he really wants is a communist state. That's really what's being discussed.

Originally Posted by Wooglin

Of course none of that actually matters to him because what he really wants is a communist state. That's really what's being discussed.

Certainly!

Originally Posted by Punker

When you're responsible for producing the wealth of society, how can you end up being valued so low that you have to work twelve hours a day to support yourself? It just doesn't seem to follow any reasonable or sensible understanding of justice.

There are those that lead and there are those that follow. If you don't have the guts or skills to lead, then you have to follow, and that is a just result. I think equity is about the opportunity to succeed, whereas you take a socialist view that equity is about denying people the opportunity to succeed, but rather to be equal.

Originally Posted by Punker

Theorize all you want about the economy of Washington and Oregon. But before the minimum wage was increased by at least a dollar in both states, the unemployment was over 8% in Oregon. At the moment, it is at 5% and decreasing still, after the wage increases. Conclusion? There is no relation between unemployment and increasing the minimum wage, so long as it doesn't inhibit the employer class from getting a substantial amount of profits (which they can still get with $15 min. wage).

Wrong. Econometrics isn't theory, it's science. In your example, you're not controlling for a single other variable. As a simple example, on other variable to look at is the general economy - is that what's affecting the unemployment rate, or is it something else? By actually specifying a model and running the multivariate regressions, you can have data spit out on the other end that may or may not tell you something conclusive. In this case, it did - the living wages had an adverse impact on unemployment.

Originally Posted by Punker

Say that I interpreted the numbers wrong, if you'd like. But every number I use has had a correlating resource/reference to it so that anyone can check it up.

That's what I was saying about your bogus example - you interpret data wrong.

Originally Posted by Punker

Well, all of the profits listed on the BEA.gov site are restricted to one class of business: corporations; that is to say, publicly traded companies. Wall-street.com says: "People ask just how many publicly traded companies there are in the U. S. including otcbb and pink sheet companies. We estimate that there's about 15,000." [ http://www.wall-street.com/traded.html ] Okay, so about 15,000 businesses are publicly traded. About how much of the US economy is that? Well, according to the US Census Bureau, there are 4,996,828 businesses that have employees [ http://www.census.gov/epcd/susb/2003/us/US--.HTM ]. So, this means that one out of every 333rd business is publicly traded. Also, it's not quite that efficient to use a corporation's published profit as a statistic of how much profit they are making. After all, corporations and publicly traded business entities operate a different style of rewarding the investor: the use of dividends, that is, the profit paid to investors. So, while corporations listed profits of $1.2 trillion, they also paid dividends of 0.492 trillion, so total profit for all 15,000 corporate entities would be: $1.7851 trillion. And, if corporations make up just one out of three hundred businesses, that means, if all businesses earned the same profits as corporations, total business profit for the United States in 2005 was $589.083 trillion.

1. BEA stats don't use just publicly traded corporations. A quick of the data shows that the corporate income, which includes the government's income, is about 90% of US GDP. As an example of what a corporation is, one of my best friends is a 2-man business. He owns a corporation - in this case, it's a LLC (limited liability corporation).

2. Nice try to extrapolate, but once again, it doesn't pass the common sense test. US GDP last year was somewhere around $13 trillion. That's gross, not even profit. Your profit figure is nearly 50 times the gross earnings of the US.

Seriously, I highly recommend paying some capitalists money so you can learn how to use statistics and truly understand economic theory. Maybe it will light a fire underneath you and motivate you to join all us capitalists so that you can exploit your fellow human beings.

Originally Posted by shek

2. Nice try to extrapolate, but once again, it doesn't pass the common sense test. US GDP last year was somewhere around $13 trillion. That's gross, not even profit. Your profit figure is nearly 50 times the gross earnings of the US.

ROTFL! I didn't even notice that bit. Thanks for the laugh shek, you 'da man.

Originally Posted by Confed999

ROTFL! I didn't even notice that bit. Thanks for the laugh shek, you 'da man.

Nor I. Nice catch Shek.

You have to be part of the elite class to have such a keen eye. I can see that your pedigree is that of the proletariat. Please don't converse with me anymore

In fact, what I am doing speaking with Punker.

Originally Posted by Punker

Okay, I've tried to use statistics to demontrate that companies can and are turning in a 100% profit.

I still haven't seen a balance sheet for any major corporation showing a 100% profit. Hell, if things are so easy on corporations, why have Ford and GM (two of the larger corporations out there) been running into significant difficulties of late? The airlines? Your use of statistics is clearly flawed. Like Marx you attempt to selectively apply irrelevent information to prove your logic, however like Marx (and Lenin, Mao, Stalin, ect.) your logic fails when it runs into the real world.

In the year 1600, a farmer was required to only work ten hours a day to produce sustenance for himself, without the use of any advanced technology. ["A Treatise of Taxes & Contributions," by William Petty, chapter 10, paragraph 21.] The use of technology has allowed workers to produce at least two hundred times as much in our world as they could in the year 1600. This is a conservative estimate of the value that technology has given us in productive capability. However, the workforce today is employed for eight hours a day. If productive ability had really increased, then we would need to work less in order to satisfy the same wants of society.

You cannot possibly be considering that the economic status of people today is the same as farmers of the 17th century. Our poorest 3% possess material riches that the farmer of the 17th century couldn't even dream of, and they don't work anywhere near as hard as the said farmers (even assuming that the poorest 3% of American society is working 40 hour weeks, which it isn't, the degree of physical difficulty between 17th century farming and something like a job at McDonalds is several orders of magnitude.

But no, that's not happening. All of the surplus produced by the workers becomes the profit of the elite economic class.

And yet with $3000 dollars to live on over the course of a year, you still manage to gain access to a computer? How is that possible with the fruits of everyone's labor all going to the "elite economic class?"

This issue becomes extremely vexing when we consider that right after the industrial revolution is the period when the workers were employed in the hardest, most gruelling, and inhumane labors, for up to sixteen or twenty hours. It doesn't bother your conscience a little, that after civilization discovers a method to build more and produce more, that the only result is the massive and unbelievable poverty of the majority? No? This isn't... a conservative's issue?

During the begining of the Industrial Revolution, the vast majority of profit was further invested into industrial development. Steel, chemicals, timber, coal, textiles, and many other industries all needed huge expansion. That meant that very little was left for the workers. Now that the industrial economies are more mature, most productivity does go into consumption by the general population.

That's right. Corporations and governments of the world never have and never would lie. At least, not about truth.

So you are telling us that all of the corporations and governments (at least the western ones) can somehow keep this secret (100-400% profits) over a period measured in decades? Uh huh.

And, actually, capital is simply the result of applied labor. It is, in fact, labor in its complete form; it exists only because there was a worker to create it. So, if workers are in fact all completely responsible for maintaining society, why is it that this happens?

Leadership occurs from the top down. While it is true that capital requires labor, it is also true that labor requires capital. Businesses have to be out to make a profit, because if they aren't then there is no incentive (or means) to adapt to changing circumstances. No incentive for innovation (hmmm, kind of sounds like why communism has failed so consistently over the past 50 years).

When you're responsible for producing the wealth of society, how can you end up being valued so low that you have to work twelve hours a day to support yourself? It just doesn't seem to follow any reasonable or sensible understanding of justice.

And if you think that's an ancient reference, then take a look at any of the countries today where that is still happening: Vietnam, China, Indonesia, Burma, etc., etc..

A necessary precondition of industrialization. Industrializing nations have to use child labor or extreme brutality to keep their labor costs (and standard of living) low in order to entice the foriegn capital and expertise that they need to build industry. The alternative is remaining in agrarian poverty.

Whoa, whoa, whoa, whoa... My bogus examples? Are you saying that I forged those numbers? Are you saying that the U.S. Census Bureau is incapable of knowing how much workers are paid? Because it's not like there's a bureacracy where everyone's earned dollar gets funneled through. Of course they would have no idea how much income those companies get or how much they pay their workers. Say that I interpreted the numbers wrong, if you'd like. But every number I use has had a correlating resource/reference to it so that anyone can check it up.

We're saying that you don't have a clue on how to use those numbers. Your conclusions are delusional, and ignore certain truths... the foremost of which is that a companies operating costs are more than what it pays its workers!

And, if corporations make up just one out of three hundred businesses, that means, if all businesses earned the same profits as corporations, total business profit for the United States in 2005 was $589.083 trillion.

HAHA! This is pretty funny. You do know that those 15000 publicly traded companies make up a vast majority of the economy in the United States don't you?

People today are working the same amount of hours as people four hundred years ago, yet our productive capacity has increased by over 200 times. Where is all that extra produce going? After all, it's several hundred times what we've produced before however... we're still laboring the same amount? It's really quite simple, cut, and dry: businesses are making an unbelievable amount of wealth at the expense of the working class.

Point the first, we have an unimaginably vaster quantity of consumer goods available to us. Point the second, these goods are infinitely more complex than they were 200 years ago. Point the third, we have far fewer people actually creating things (less than 30% of our economy is manufacturing, and less than 3% is agriculture), and far more in cushy service jobs (whether flipping burgers at McDonalds or running a marketing campaign for Nike).

Hi Guys,

In labor as in all things, you get exactly what you pay for.

In my experience, the quickest way to make a man corrupt is to pay him to little or pay him to much AND I CANNOT STRESS THIS ENOUGH!!!

There is a world of difference between a $6.00 an hour employee and a $10.00 an hour employee.

I use seasonal and part time workers to get stuff done and I start every man at $10.00 an hour which is far above minimum wage and 10% to 15% over the local market. The result: higher profits.

Good men with good pay have constantly put me ahead of schedule and under budget. Well motivated, correctly compensated employees have given me a reputation for ethics, safety, accuracy and speed which is a handsome return indeed for a few dollars more per man per hour.

Minimum wage laborers are a disaster waiting to happen. If nothing else, they often times steal to make ends meet. At worst, they are not motivated enough to check crankcase oil, trailer tire pressure, materials quality, stay late if the job requires it, etc., etc.

Minimum wage means minimum motivation, minimum loyalty and minimum productivity.

Second rate pay has a tendancy to attract third rate men so I would never countenance anybody to pay minimum wage.

It is cheaper to pay a man at a level that motivates him, keeps him loyal and spurs him to better performance than it is to carry extra insurance to cover ****ups, provide security against pilferage, pay for lost productivity, pay skilled foremen to keep him in line, etc., etc.

Raising the minimum wage is a bad idea. Let the market run its course and those who cannot perform at or above minimum wage and those who insist on paying it can either adapt to changing economic conditions or become roadkill on the highway of life.

Hope Ya'll Have a Nice Weekend,

William

Originally Posted by Confed999

ROTFL! I didn't even notice that bit. Thanks for the laugh shek, you 'da man.

I 'm thinking that maybe Punker wasn't using a computer, which are the tools of capitalists, and that is why his extrapolations were so far off the mark. I could see that using an abacus could be difficult when you get into the billions.

Originally Posted by M21Sniper

Personally, i turn about a 350% profit(sorry guys, i'm the one).

But seriously, what's it to you?

The only thing stopping you or anyone else from opening your/their own business is a lack of guts combined with laziness.

You want to have the good things in life, open a business and work hard. Biitching will get you nowhere in this country.

Profit margins are also a function of how volatile a particular market/industry is as well as the risk premium. Well, I'm pretty sure that the repo business carries a high risk premium, thus driving up the profit margin (I wouldn't work minimum wage in a job where I carry a higher than average risk of death).

Originally Posted by Julie

Ditto that.

That's a surprise. Out in WA state, the cost margin on the fencing companies was about 100% above materials, so once you included labor, my guess is that it was 50-75%. However, that was in the summer during peak season, and I'm pretty sure that fencing slowed down considerable during the 6 months of rain.

Out here in northern VA, the pricing is about 75% above materials in the summer, and about 50% during the winter. I know that with the fence company I used, it was slightly below that, so he was only pulling about $1.50 profit per linear foot, or maybe around 8% profit.

Do your customers just not have a clue about pricing, or is there just too much demand and not enough supply of fencing companies that allows you to charge that much margin? I don't feel bad for customers - you pay what you are willing, and if that means more $$ for the supplier, then good for them. That's how price allocates scarce resources to those that really want something.

Originally Posted by Punker

I agree. At the same exact time that we enact the $15 minimum wage law, we should ban all importations that do not come from countries that have legal protections for their workers.

Now that you legislate against them exporting sans protections, their production stops, and they all lose their jobs. You've just created poverty. Good job!

Or, if you want to argue that they then increase protections, then their cost of production goes up, their lose their comparative advantage, and no one buys their exports anymore, their production stops, and they all lose their jobs. You've just created poverty. Great job!

Why do you think production has been shifting away from the developed countries?

My prescription for you in this case: take an international trade theory course.

Signed,
Evil Capitalist

Originally Posted by lwarmonger

I still haven't seen a balance sheet for any major corporation showing a 100% profit. Hell, if things are so easy on corporations, why have Ford and GM (two of the larger corporations out there) been running into significant difficulties of late? The airlines? Your use of statistics is clearly flawed. Like Marx you attempt to selectively apply irrelevent information to prove your logic, however like Marx (and Lenin, Mao, Stalin, ect.) your logic fails when it runs into the real world

Communism doesn't work in the real world for two main reasons. First, it is impossible to create a classless society. Someone has to be in charge. Second, no private property doesn't give workers or administrators a whole lot of incentives to be real ambitious. If the goods are flawed in design or nobody is in a hurry to get them out the door, a society can snowball downhill fairly rapidly. Why should they, they get the same piece of the pie and a roof over their heads no matter what they do. All the communist states got around this by implementing a police state. Bullets and fear were their motivation. And believe me, the average citizen in China or Vietnam would give anything to live in the standard that we call poverty.