Has anyone suggested that there is? Why should there be a law that says you must overpay people, which is what you call for? That's quite an assumption. I have worked for dozens of business, and consulted with over a hundred others in my career. I find that many business owners are penny-wise and pound foolish (particularly immigrants who come from backgrounds of privation and work in a culture of entitlement). Outright greedy people are rare, and even more rarely do they stay in business long. Or, they are just outright criminals. The heart of economics and all market activity, are individuals exchanging property between each other so that each may derive some greater value from the transaction than they otherwise had. Morality and immorality doesn't really enter into, except at a subjective level where, for instance, the transaction may involve alcohol or prostitution or gambling. So, what gives you the divine right to interfere with the transactions and impose your subjective moral values on people make between each other if everyone does so peacefully? Poor you. Calling everyone greedy that doesn't share your particular moral values, and then whining and whinging when someone calls you out. And, you've said it yourself, you want capitalism to have quasi-religious moral basis and use police powers to interfere with peaceful people, rather than just let them make their own decisions. According to you, such motivations should be illegal. So, they are expressly not "fine." Not that you care about the consequences, which is the prohibition of jobs for people who can't overcome the cost of hiring them. They can just remain dependent on others or be homeless, eh? It mainly happens to young black men, and they only matter for votes, not whether they have much hope for a stable life.
Are you asking whether society should aspire to work as hard as possible for a little bit of wealth or whether it should instead work as efficiently as possible to produce wealth enough for the world? Well obviously, society should work efficiently. Work shouldn't be an end unto itself. -Meta
Eventually, no one will be able to work harder than the robots. All that will be necessary to live will be some raw resources and a few machines. At which point we'll all have a serious question we'll need to answer (if we haven't answered it already) Do we want a system in which only the private owners of these machines and the raw resources can live, or do we set it up so that the benefits of these machines and the raw natural resources flows down to everyone? -Meta
In bold above, you believe that the hundreds of thousands/millions of workers in the past five years, who work for Google, Apple, Microsoft, GE, Exxon Mobil, General Motors, ATT, HP, etc. etc. etc., all of which are not in your 10% group, did not experience any economic gains?? And, greatly increasing tax revenues, to take from 'personal' savings and wealth, and given to government, will somehow boost the root economy? This is crazy! If government spending could solve any problem at all, since government does not care about deficit spending, why doesn't government just spend another $1-$2 trillion each year in debt money? The answer is government cannot solve the problems you talk about...
Many of them are in the top 10%, which in case you did not know starts at about $150,000 a year, which is a little above the average high tech worker salary. I did not make that up, it was widely reported by publications like the Wall Street Journal, Economist, and many others. And all that is not nearly enough to offset the millions of other workers who lost their jobs and had to settle for jobs that pay far less than they used to make. It is pretty simple really. If people are hiding their money in their mattresses the economy will run out of money and grind to a halt. The stock market is a giant mattress, people put vast amounts of money in it and very little trickles out. If it wasn't for the government's deficit spending and the Fed flooding the markets with money the economy would never have recovered what little it has. What I see is a real need to encourage people to take their money out of the equity markets and put it where the rest of the economy can use it. The easiest way to do that would be to raise taxes on equity market profits and lower taxes on business and personal income. The taxes someone would pay would not change at all and possibly be lower if they changed their investment strategy to take advantage of the tax code changes. What economic model do you think would solve this problem? How would you encourage money away from the equity markets and into the rest of the economy?
Only a few people are in the 10% so don't try to change facts. There are a 'few' in the corporations I mentioned that become wealthy but most are workers who earn well according to their education and skills. Hundreds of thousands of workers are definitely benefiting from this economy. Yes many are not but without education and skills and communication skills, etc. they won't do much better even as the economy improves. There are equity markets throughout the world, people and business and governments investing with each other, and you wish to stop this?? I would not encourage taking money out of the equity markets. One thing this would destroy billions/trillions in wealth...
This is inaccurate. The money isn't "in" the market. When you buy a share of stock from a seller, he gives you the stock and you give him money. The money is simply transferred from one person (the buyer of the stock) to another (the seller of the stock). It doesn't disappear into any mattress.
Paying a living wage for all jobs that are essential to this society is not overpaying. People work in order to survive. An essential job should pay a living wage. If the job is not essential to society, then that job does not exist. I remember when if you went into retail, the service sector here, and worked for a small local owned clothing store, hardware store, auto parts store, the local owners paid their employees enough to live on. A living wage. So we did this for a long time, and the owners still prospered as did their workers. Now, we call this low skilled work, so walmart can pay a non living wage and have taxpayers subsidize the wages so the family can be billionaires. And that is how neoliberalism of the GOP and since Clinton, the dems, have changed our economy. So paying all who work demands a living wage.. And the only way we can get that today is by federal law to force it. For now employers think they are entitled to the taxpayers subsidizing their wages so they do not have to pay people enough to live on.
The comments in BOLD above are misinformed. There is no such thing as a living wage? Business owners 40-50 years ago paid their workers $1.50/hour. You can't stereotype that owners prospered. Taxpayers do not subsidize wages. Business pays wages commensurate with whatever the labor market demands. If you were a retail business owner, and you needed 100 workers, and you decided to pay them well above the labor market rate at $18/hour...but your competitor has the same number of workers but is paying the supply and demand market rate of $12/hour, how can you possibly compete and stay in business? Conversely, owning the same business, and you need 100 workers, and you think you can low ball wages to $8/hour, the ONLY way you can hire your 100 workers is if those workers agree to work for $8/hour. If they demand $10/hour then you can't hire any workers and you are out of business. This should tell you that it is the workers who determine the wages...not the businesses. Why can Walmart pay one million workers $10/hour...because there are two million people competing for these jobs! Competition means lower wages. Once again, it is not Walmart who decides the wages. In your finite wisdom world, of course all retail businesses tomorrow could pay their workers $20/hour...but what would happen? Well, many will layoff workers and seek cheaper labor elsewhere. Some will close the doors. And you create inflation which means once the dust settles those who 'were' earning minimum wage will again be earning minimum wage in a higher cost of living economy...zero gain and lots of loss!!
Meta777 said... That is where we are heading. And robotics makes what we consume and providing much of the services, takes away the ability of the masses to earn money in order to buy what the robotics made and provide. This was discussed back in the 1920s and 30s. The solution they came up with was the people would be paid on behalf of the work done for them, by the machines. This would give all the income to buy what the machines were making. But this implode capitalism, for robotics will inevitable do away with capitalism, as we will have evolved economically out of it. So Capitalism filled a gap that was needed until we moved into some form of socialism. So we best get a better attitude towards socialism, for it is all that will work. Capitalism will die off. It will be a quaint entry in the history of humanity at some point, and they will marvel at how it lasted for so long, being that it is not an intelligent model to use to allow a people to thrive.
Wealth disparity is largely caused by government policies. SS/Medicare are forced Ponzi schemes that take a significant amount of most Americans income, while promoting less personal investing. If we had mandated private accounts, wealth disparity would be nothing like we have today. Most Americans would acquire and pass more wealth.
Of course there is a living wage. If min wage was adjusted up for inflation from what it was in 1968 plus gains in productivity, it would be a living wage today. In 1968 with that min wage, you could actually rent an apartment here, which would have been 1/4 of your monthly income. It helps when you were alive back then, working for a min wage in 1968 to remember what reality was. I was there. LOL. I rented a one bedroom apartment for 1/4 of my income. Gas was 24 cents a gallon here. Groceries could be bought for 7 or 8 bucks a week. The locally owned stores here paid above minimum wage, and those people had a disposable income after essentials were paid. There business model was not based on nonliving wages, for those owners knew their employees had to earn enough to live on. LOL. And that is what has changed. Today, many employers could not care less. I didn't know anyone who worked 40 hours a week back in the 50s and 60s and didn't earn a living wage. And that was with just the man working. I know, hard to believe we didn't always exploit working people, by paying them less than it takes to live on, a living wage, but that is the way it was where I live. I did the same thing when I was in business. I paid living wages, while non of my competitors here did. Which meant just that I kept less of the income pie my employees were creating for myself. And I was in business for almost 50 years before I retired a few years ago. If you cannot pay living wages, you do not need to be in business, and we do not need a business that does not pay living wages.
So what do you believe a 'living wage' might be? $18/hour? $25/hour? And whatever 'living wage' you decide is based on what qualifications; uneducated and unskilled? College graduate? If you're talking about increasing the current $7.25/hour minimum wage to $18/hour, then what will you do with all other wages in the workforce? Obviously they too must be increased at the same rate. Or do you believe everyone should earn the same wage? So...once you increase the minimum wage by 200-250%, then you increase all other wages by the same rates, and you have created horrific inflation, when the dust settles, those earning $18/hour will again be earning minimum wage and complaining they need a living wage in order to survive. BTW; back in the 50's and 60's, how did that cost of living compare to today? How much credit card debt did people have? How many drove new cars? How many owned 2500 square foot homes? How many were paying $150-$200/month for cable TV and $50/month for Internet, and $100-$150/month for cell phones? How many were paying $100 per seat to attend baseball, basketball or football games?
To me a living wage is enough to live independently without the need for charity or government assistance. In some places it could be as high as $18-25 an hour. In many others it can be substantially less. Here's the thing. The minimum wage peaked in real terms in 1968. If it had kept pace with inflation it would now be about $22 an hour. Because the minimum wage has not risen with inflation the entire wage curve has been slowly depressed over the last 50 years. Wages have not kept up with inflation because the wage floor of minimum wage, from which the entire wage structure arises, has been able to be kept artificially low through the massive expansion of government expenditures for low wage support programs like subsidized housing and health care and the earned income tax credit and the growth of food banks and charity for poor workers. So yeah, raising the minimum wage will raise the entire wage curve but even $15-18 and hour would not be enough to bring the wage curve back to where it was in the 50s and 60s.
If the money just moves from one trading account to another it never leaves the market and that is how the money moves, it stays in the big comfy equity mattress. It is only when someone withdraws money from their trading account and spends it on goods or services that it leaves the market. Less than 0.0001% of the money traded in the markets leaves on any given day. Economic studies have suggested that an increase in market withdrawals of 0.00005% can increase demand for goods and services in the larger economy by 0.2-1% depending on how it is spent. A small change in the tax code could do that, something fair and simple like taxing capital gains as ordinary income.
These are just political comments which have little meaning in reality? For example your "If it had kept pace with inflation it would now be about $22 an hour" and IF all wages kept pace with inflation since 1968 what would they be today? The point is, no matter how you politically twist things, people who perform at a minimum level will always be in that minimum wage. The minimum wage has little to do with how much others earn? If you're earning $35/hour, and it's time for your annual wage review, do you actually think they will base your increase on the minimum wage? IMO wages don't parallel inflation because they are two separate entities. Inflation is an economic outcome while the cost of labor is primarily defined by the supply and demand of labor. This means there is no reason whatsoever for the two to parallel each other. People need to reduce their spending in line with their potential income and stop having entitlements about 'how they should be living'. People who earn $15/hour MUST define their lives around $15/hour...period. Will it be a great life...depends on the person and how they deal with it...
Actually, I think the new point is that people shouldn't wait for money to trickle down from the rich. Instead, the rich should be allowed to accumulate as much wealth as they want with no restrictions. As for everyone else, if you want more...work more. If you have a job, get an extra job. Still not earning enough? Get 3, 4, 5 jobs. However many it takes. Can't find any jobs? Well you're probably not looking hard enough. Try moving to a different state. Still can't find any? Then improve your value by furthering your education, or better yet,...create your own job! Not enough money or start up resources for either of those options? Then take out a loan or two or three. If the rich can do it, so can you! But you're already in crippling debt and no one will loan any more to you? Then you probably should stop spending more than you take in. You can't spend any less than you already do? That's silly, of course you can. Move out of your expensive apartment, sell your car and ride a bike to work, and that way you wont have to spend any money on gas getting to your 5 jobs.....plus, you'll be in great shape! Eat out less, cook more, and cut back on luxury foods like steaks, fish, fruits, and vegetables. If a starving kid in Africa can live in a mud hut for pennies a day, then so can you! And if its still not quite working out for you after that, then sorry, but its your own fault for doing drugs and having sex out of wedlock. -Atem
Your position is the one that is politically based because it has no standing in the economics that studies real world economies as they actually function, not as some long ago crackpot with only a minimum of actual data proposed that the entire economy must function. Certainly there are other factors at work concerning real wage increases, the most important being productivity growth. Increased productivity allows increases in wages without detriment to prices or profits. Increased productivity can also keep wages ahead of more general inflation. Numerous studies of actual real world economic conditions in many nations and economies have indicated a strong correlation between inflation, productivity growth, the minimum wage and the entire wage curve. The entire wage curve, all wages along it, and the calculations workers and owners make to determine an acceptable wage all starts with the minimum wage. To put it simply, the wage curve will not rise as fast as productivity increases when the minimum wage is kept below the rate of productivity growth. With inflation the entire wage curve is depressed over time. The US is the poster child for this scenario. Over the past forty years productivity growth has averaged around 3% a year while wages have declined in real terms. Over the last ten years all the economic benefits of productivity increases have gone to the top 10%. Based on productivity growth alone the economy can certainly support a higher wage curve. Based on productivity growth alone the minimum wage should be somewhere around $28 an hour since productivity growth over the last 50 years has outpaced inflation.
Your opinion of how prosperity works is tainted with liberalism. In a fairly regulated economy, price and wages will find equilibrium. Motivation to produce is a huge factor. Liberal policies only consider wages and equality by government edict. Our country does not have a problem with evil employers, it has a problem with improper government intrusions. We do not produce like we did before because the government is allowing China to flood our markets with products not produced under our same regulations. A fair market would have all products produced under fair regulation. The invisible hand will take care of the price/wage issue. It is simple logic, the more government the more corruption. We have far too much improper government and not enough proper government.
So instead of our current wage curve which goes from $7.25/hour to perhaps $60/hour, you believe the US economy, and businesses, can simply increase this to $28/hour to perhaps $200/hour? You believe in this scenario that the US would gain a competitive advantage in the global marketplace? What level of inflation do you believe this will cause? How many jobs will be lost in this scenario? How many companies will close the doors and/or relocate offshore? You believe that minimum wage workers, those with the lowest skills and lowest education and qualifications should be earning about $58,240/year plus benefits? There is no possible way on Earth to justify a $28/hour minimum wage...
The problem is that a "fairly regulated economy" doesn't give a (*)(*)(*)(*) about people who, because of age, infirmity, illness, mental condition or just temporary market conditions, do not have market value that provides a basic level of subsistence. It doesn't care if they starve to death or bleed to death because they couldn't afford health insurance. It is only interested in profit. it doesn't care if our skies and waters and beaches are polluted or that our resources are mismanaged or that the unprotected are abused. It just cares about profit. That is why we need government intrusion into a "fairly regulated economy."
