Comments on: The Price Floor of Labor http://www.coxesroost.net/journal/2006/11/10/the-price-floor-of-labor Asking the Stupid Questions since 1971 Fri, 21 Nov 2008 06:40:53 +0000 http://wordpress.org/?v=2.6.3 By: Patrick Trombly http://www.coxesroost.net/journal/2006/11/10/the-price-floor-of-labor#comment-22865 Patrick Trombly Fri, 26 Jan 2007 19:42:54 +0000 http://www.coxesroost.net/journal/2006/11/10/the-price-floor-of-labor#comment-22865 I don't understand why we can't elect representatives who think or pretend that the government can repeal laws of economics. It's like trying to repeal laws of physics. They'll raise the minimum from $5 to $7 over two years when unemployment is 4.4%, an ever-declining percentage of the population earns the minimum, McDonald's and Starbucks both pay higher than $7 to start, and most people making the minimum today will get a 30% raise in the first year, and then if rampant unemployment doesn't happen they'll say that raising the minimum "worked." If you set an economically meaningful price floor, it will put and/or keep people out of work, and while the present increase won't be economically meaningful in most instances, there's always someone on the margin and it will be meaningful to them. Democrats contend that we think that people "just don't deserve to make more." It's kind of like arguing that if someone jumps off the Tobin Bridge, she "deserves" to fall to her death. I don't say that she does - I just say she surely will fall to her death. The Democrats seem to think that she won't if the Legislature first repeals the law of gravity... I don’t understand why we can’t elect representatives who think or pretend that the government can repeal laws of economics. It’s like trying to repeal laws of physics. They’ll raise the minimum from $5 to $7 over two years when unemployment is 4.4%, an ever-declining percentage of the population earns the minimum, McDonald’s and Starbucks both pay higher than $7 to start, and most people making the minimum today will get a 30% raise in the first year, and then if rampant unemployment doesn’t happen they’ll say that raising the minimum “worked.” If you set an economically meaningful price floor, it will put and/or keep people out of work, and while the present increase won’t be economically meaningful in most instances, there’s always someone on the margin and it will be meaningful to them.

Democrats contend that we think that people “just don’t deserve to make more.” It’s kind of like arguing that if someone jumps off the Tobin Bridge, she “deserves” to fall to her death. I don’t say that she does - I just say she surely will fall to her death. The Democrats seem to think that she won’t if the Legislature first repeals the law of gravity…

]]> By: David Nesting http://www.coxesroost.net/journal/2006/11/10/the-price-floor-of-labor#comment-19576 David Nesting Sun, 12 Nov 2006 00:22:20 +0000 http://www.coxesroost.net/journal/2006/11/10/the-price-floor-of-labor#comment-19576 What benefit does the US get out of having a homogenous minimum wage among all of its states? You might argue that ensuring a minimum quality of living is a legitimate goal of our federal government, but can a federal minimum wage achieve that? Is that even a goal? Or is it about "getting something done" and pleasing your voters who don't even realize they have <a href="http://fastolfe.net/2006/11/07/levels-of-government" rel="nofollow">governments</a> at their state or locality level? Each state has a unique marketplace, and some states are much poorer than others. A single minimum wage will consequently affect some states very differently than others. Are these effects considered? Many states have minimum wages that exceed those set by the federal government. Many do not. Have we asked those that don't why they don't? Minimum wage is one of those issues that isn't very popular to criticize, so people aren't too keen to ask hard questions like this. What benefit does the US get out of having a homogenous minimum wage among all of its states? You might argue that ensuring a minimum quality of living is a legitimate goal of our federal government, but can a federal minimum wage achieve that? Is that even a goal?

Or is it about “getting something done” and pleasing your voters who don’t even realize they have governments at their state or locality level?

Each state has a unique marketplace, and some states are much poorer than others. A single minimum wage will consequently affect some states very differently than others. Are these effects considered? Many states have minimum wages that exceed those set by the federal government. Many do not. Have we asked those that don’t why they don’t?

Minimum wage is one of those issues that isn’t very popular to criticize, so people aren’t too keen to ask hard questions like this.

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