Minimum wage: $15 NOW!; or 15... eventually
 

Today the Mayor, Ed Murray, signed into law a bill passed unanimously by the city council yesterday that raises the minimum wage in the City of Seattle to $15 / hour.

This is a big deal, it is estimated that 100,000 people in Seattle make less than $15/hour. There was tremendous political exertion by all parties starting at the beginning of the year to make this happen. There are lots of details, like when, how fast, what's included, etc etc, which I'll cover tomorrow.

Meanwhile I gave a link to several good news stories on the subject, here's one that I found particularly helpful in conveying the tone of the months-long debate.

I hope it works out a well as they hope it will.

It won't. Econ 101. It's been proven thousands of times all over the world that you can't vote yourself prosperity. The supply curve still operates the same, around the world, no matter what a city council may believe.

Every time someone makes an argument for this, ask yourself, why not $20? Why not $25? Ask yourself, how did central planning work in the old USSR? How has it worked since it was ended in China?

I ask myself as an employee, am I generating enough revenue to justify my salary? Because there is nothing else this comes down to, and if employees are not generating that, there are three choices: either you're fired, your hours are cut back, or the business closes. There literally are no other choices.

So, what's employment in Seattle today? Lower than the national average. That's a good starting point for this kind of project. Historically, higher minimum wages result in a rise in unemployment. That's what is expected from the supply curve. Let's see what happens in five years. I expect it to be up about 2-3 points and I expect city tax revenues will be down. Good luck to the poor, who will be the first and the worst affected by this. If I turn out to be wrong I will happily admit it.

I thought that employee productivity is up in the US and company profits were also up. But wages are not also rising because unemployment is so high, companies don't have to increase wages to retain their employees. The teeming masses of unemployed waiting to get their foot in the door is enough to keep workers from leaving a low paying job.

So how do you convince companies who are sitting on piles of cash to share that cash with the workers? Either through new jobs or higher wages? Companies will always hold on to profits and not share them if they can get away with it.

Reminds me of how the Republicans have long chanted that small businesses are the job creators, but that's a fallacy. It's consumers who are the job creators. If demand goes up, businesses have to hire to meet that demand. They don't hire more and pay more just because they are good guys. If they have a huge profit, they are going to keep that profit if they can. They only create new jobs if they can't meet current demand. They have no choice but to hire. And they will never give a raise unless they are afraid they will lose their employees. And they aren't afraid right now because there are so many willing to jump in and fill the spot of the current employees.

A minimum wage takes some of the power from the companies and gives it to the workers.

Some small businesses may be on such shaky ground that they have to do layoffs, but I bet most will be fine. And the large ones will have no problem.

There will be a small increase in inflation because of this. Probably seen in the apartment rental market the most. (Because that's local and a finite resource.)

The real problem isn't that minimum wage needs to be raised, that won't do anything to address disproportionate wealth.

CEOs make from 10 to 422 times the median worker's pay
http://www.payscale.com/data-package...come/full-list

It's essentially a Ponzi scheme, the current idea that executives can make as much money as they can while paying employees as little as they can. Just like growing corn over and over on the same plot of ground without replenishing the soil will lead to a dust bowl.

I still maintain this is a backlash from Dr. Spock's scheduled feeding myth rather than nursing on demand.

http://www.huffingtonpost.com/2014/0...n_4748066.html

Winner Winner chicken dinner

great NYT piece
http://opinionator.blogs.nytimes.com...e-the-pay-gap/

If you were aiming for CEO salaries with minimum wage increases, you have just shot your friend in the face. This affects small business and government just as much as big business.

Let us know how the prices of hamburgers react to that $15/hr minimum wage...get those sperm-covered $1 McChickens while you can...

If you want real money you need a bullshit job.

Let's say I own and run 'Quirk's Books' (my business, my property).

If I wanna pay a buck an hour, can't see how that's any one's concern (exceptin' for me and the person who takes the buck per hour job).

If I wanna pay 50 bucks an hour can't see how that's any one's concern (exceptin' for me and the person who takes the 50 bucks per hour job).

As the owner: seems to me I ought to be the one determining the value of any job I need done.

If I value poorly, then I'll have no employees (or, what I have will be for shit).

If I over-value, then my business suffers by way of my misuse of cash.

If I'm wise, then I pay what my lil economy can bear.

If I'm unwise then -- one way or another -- I go out of business.

Not seein' the need for mandated wages.

The great strength of humans over other animals is that we share our wisdom, and try not to let the unwisdom of some take down the efforts of others. Enron, for example: yes, their unwisdom did eventually put them out of business, as the system says must happen. It also, however took down thousands upon thousands of innocent individuals who never made any of the unwise decisions that killed their employer.

The system as you describe it does work, but is unnecessarily brutal. If the lessons of the past are lost, your system is a valid backup. But we are stronger as a whole when we take what we've learned in the past and use it to mildly regulate the unwise individuals who crop up in the present.

I agree with HQ but for slightly different reasons. Raising the minimum wage won't change income disparity as long as Quirk's books wants to make X* his employee's minimum wage. As one goes up so will the other.

If a certain group of people want all the marbles then the number of possible marble games drops to *ahem* 1%.

:D

A guy who makes 365 times what his 50k/yr employee makes doesn't buy 365 times more groceries, cars, beds, shoes, and so forth. He stockpiles money and doesn't stimulate the economy.

If he could be contented with making 20 times his 50k/yr employee then he could hire 340 more employees or double the pay of 680 his 25k/yr employees and they for certain would spend the shit out of that money and that would help the economy.

Ultimately you can't legislate for morality or against greed, if you could no one would try to find loopholes.

But pulling a Dick Cheney is another choice.;)

If there were standards, like* "income over $500k" or "businesses with more than 30 employees" it wouldn't screw the little guy.

* to be determined by experts later

Leads to a return to feudalism. And that's OK. Feudalism lead to the French Revolution.