(02-08-2019 10:09 AM)RiceLad15 Wrote:  I need to find the study, but I’ve feel like I’ve seen evidence based studies that suggest that increasing minimum wages does not actually lead to a net decrease in jobs.

Well, you can contrive a "study" to produce any result you want, but that one seems so counterintuitive as to be absurdly illogical.

I've seen some such studies, but all that I've seen were obviously and badly flawed.

In February 2014, CBO estimated that an increase to $10.10/hour would put 500,000 to 1,000,000 out of work. $15 would presumably put more out of work. Maybe we would be better off ordering our Big Macs from a kiosk. But those 500,000-1,000,000 wouldn't be.

And I haven't seen a formal study, but the anecdotal evidence coming out of Seattle certainly suggests jobs would be lost in significant numbers.

(02-08-2019 10:09 AM)RiceLad15 Wrote:  

(02-08-2019 09:33 AM)georgewebb Wrote:  

(02-08-2019 09:06 AM)RiceLad15 Wrote:  

(02-07-2019 11:10 PM)Owl 69/70/75 Wrote:  

(02-07-2019 10:51 PM)OptimisticOwl Wrote:  The plan also calls for taking care of those unable or unwilling to work.

I'm not opposed to taking some care of those unable or unwilling to work. A subsistence level guaranteed basic income does that. You just won't live very well on that. People who work should live better than people who don't work. They'll get the message.

I can't remember what your opinion is on increasing minimum wage - it helps achieve that goal by increasing the standard of living of those willing to get a job (any job).

No, it increases the standard of living only for those who are lucky enough to land one of the reduced number of jobs. It decreases the standard of living of everyone else. Put another way: it hurts the poorest people the most.

I need to find the study, but I’ve feel like I’ve seen evidence based studies that suggest that increasing minimum wages does not actually lead to a net decrease in jobs.

Good idea. Let's increase the minimum wage to $100/hour and eliminate poverty altogether. Everybody's rich. Of course, that would not affect prices or employment at all. Studies say so.

When you raise the bottom, you raise the whole pyramid, and the bottom remains the bottom.

In your company, some people are above you and some below you in the salary structure. If the ones below you are elevated to your level, are you content to stay there? If the janitor makes the same wage as you do, are you satisfied?

No, of course not. You didn't go to Rice to make the same as a janitor.

So the upward pressure on wages will move through the whole pyramid, from bottom to top, in every business. and with the increased overhead will come a need to price their goods/services more dearly, to cover increased costs.

This is the type of stuff business owners and operators know, and paycheck cashers don't.

(02-08-2019 10:26 AM)OptimisticOwl Wrote:  Good idea. Let's increase the minimum wage to $100/hour and eliminate poverty altogether. Everybody's rich. Of course, that would not affect prices or employment at all. Studies say so.
When you raise the bottom, you raise the whole pyramid, and the bottom remains the bottom.
In your company, some people are above you and some below you in the salary structure. If the ones below you are elevated to your level, are you content to stay there? If the janitor makes the same wage as you do, are you satisfied?
No, of course not. You didn't go to Rice to make the same as a janitor.
So the upward pressure on wages will move through the whole pyramid, from bottom to top, in every business. and with the increased overhead will come a need to price their goods/services more dearly, to cover increased costs.
This is the type of stuff business owners and operators know, and paycheck cashers don't.

And academics fall very much into the paycheck cashers category.

(02-08-2019 10:09 AM)RiceLad15 Wrote:  

(02-08-2019 09:33 AM)georgewebb Wrote:  

(02-08-2019 09:06 AM)RiceLad15 Wrote:  

(02-07-2019 11:10 PM)Owl 69/70/75 Wrote:  

(02-07-2019 10:51 PM)OptimisticOwl Wrote:  The plan also calls for taking care of those unable or unwilling to work.

I'm not opposed to taking some care of those unable or unwilling to work. A subsistence level guaranteed basic income does that. You just won't live very well on that. People who work should live better than people who don't work. They'll get the message.

I can't remember what your opinion is on increasing minimum wage - it helps achieve that goal by increasing the standard of living of those willing to get a job (any job).

No, it increases the standard of living only for those who are lucky enough to land one of the reduced number of jobs. It decreases the standard of living of everyone else. Put another way: it hurts the poorest people the most.

I need to find the study, but I’ve feel like I’ve seen evidence based studies that suggest that increasing minimum wages does not actually lead to a net decrease in jobs.

There are a metric ton of studies that show, in the short term, that the labor market acts much like every other fing market in the context of the principles of econ 101.

I guess the labor market is super duper magical special to be able to avoid any of the the principles of 101. Amazing. Who won Nobel prize on that? I mean, for such a huge exception to show complete inelasticity in a fungible good/service is pretty fing amazing. Even more so when the labor market, at the core, is the single market in existence since all other goods/services are a first derivative at the very least of that market.

That is short term.

I was going to follow up with long term, but Owl#s already addressed that in his response in item 1).

Quote:This is the type of stuff business owners and operators know, and paycheck cashers don't.

I think the existence of this sub-thread bears that out majestically.

Edited to add: I *know* we in the mudpit of the political forum have tilled this field before. This specific topic. Kind of deja vu all over again.

I used an extreme case to show that raising the MW has effects, far more wide-reaching that a bigger take home pay.

It seems to be a tenet of liberal thought that the wealthy, in this case business owners and operators, can and will absorb all sorts of extra costs without reacting.

I worked a MW job in the 60's, for $1.25/hour. I would guess that people working that job today would make $10-12/hr, but their standard of living would be about the same as those who worked it 50 years ago.

I agree OO, the liberal bent in this nation seems to believe that the labor market is a market that is fundamentally and magically immune to the basic concepts of econ 101.

(02-08-2019 11:11 AM)tanqtonic Wrote:  I agree OO, the liberal bent in this nation seems to believe that the labor market is a market that is fundamentally and magically immune to the basic concepts of econ 101.

And Numbers is correct that labor is basically the cost of everything.

(02-08-2019 10:20 AM)Owl 69/70/75 Wrote:  

(02-08-2019 10:09 AM)RiceLad15 Wrote:  I need to find the study, but I’ve feel like I’ve seen evidence based studies that suggest that increasing minimum wages does not actually lead to a net decrease in jobs.

Well, you can contrive a "study" to produce any result you want, but that one seems so counterintuitive as to be absurdly illogical.

I've seen some such studies, but all that I've seen were obviously and badly flawed.

In February 2014, CBO estimated that an increase to $10.10/hour would put 500,000 to 1,000,000 out of work. $15 would presumably put more out of work. Maybe we would be better off ordering our Big Macs from a kiosk. But those 500,000-1,000,000 wouldn't be.

And I haven't seen a formal study, but the anecdotal evidence coming out of Seattle certainly suggests jobs would be lost in significant numbers.

UW just published two studies. One found that the minimum wage increased costs of childcare because of the increase in labor costs, and the other found that there was no significant price increases in food costs at supermarkets.

https://www.washington.edu/news/2019/02/...ordinance/

Another study found "that the increase added about $10 per week on average to the earnings of low-income workers through 2016, even while reducing weekly hours slightly. But more experienced workers made $19 more per week, the research found, partly by making up for lost hours in Seattle at second jobs worked outside city limits.
In addition, employee turnover decreased, which the authors believe suggests that employers tried harder to retain their most productive staff members as wages went up."

https://www.cnn.com/2018/10/23/economy/s...index.html --> actual paper https://www.nber.org/papers/w25182?utm_c...rce=ntwg17

This article digs into another paper that studied 137 minimum wage increases, and the results suggest that those increases do reduce the number of jobs paying below minimum wage, but offset that by increasing jobs paying above minimum wage.

https://www.washingtonpost.com/news/wonk...d6ef58885c

The reason I talk about looking at studies is that, logically, the argument that increasing the minimum wage causes job loss makes sense assuming we operate in a perfect system with all rationale actors. But we know that we don't, so we should assume that things may not fall in line with academic thinking 100% of the time.

https://www.youtube.com/watch?v=C94bL5g-CJA

(02-08-2019 11:02 AM)OptimisticOwl Wrote:  I used an extreme case to show that raising the MW has effects, far more wide-reaching that a bigger take home pay.

It seems to be a tenet of liberal thought that the wealthy, in this case business owners and operators, can and will absorb all sorts of extra costs without reacting.

I worked a MW job in the 60's, for $1.25/hour. I would guess that people working that job today would make $10-12/hr, but their standard of living would be about the same as those who worked it 50 years ago.

But it isn't that easy. If it was true that all minimum wage increases kill jobs, then why do we have a net increase of jobs with a minimum wage in the first place? Why then, did we not have a mass exodus of jobs when the federal minimum wage was increased multiple times?

I would probably disagree with your last statement. If you standardize that to costs of living (food, housing, transportation, etc.) those have all outpaced the minimum wage significantly. $12 per hour gets you $24,000 per year before taxes, and $1.25 gets you $2,500.

The median home price in 1965 was around $21,000 and in 2018 around $320,000. That's 8.4 years of salary in 1965 and 13.3 years in 2018. But the thing is, the federal minimum wage in 2018 was $7.25 per hour, or $14,500 per year. So you would need 22.1 years of salary to buy that house - almost three times more than that MW job in 1965. So maybe you're a bit off on that last statement.

(02-08-2019 11:38 AM)RiceLad15 Wrote:  

(02-08-2019 10:20 AM)Owl 69/70/75 Wrote:  

(02-08-2019 10:09 AM)RiceLad15 Wrote:  I need to find the study, but I’ve feel like I’ve seen evidence based studies that suggest that increasing minimum wages does not actually lead to a net decrease in jobs.

Well, you can contrive a "study" to produce any result you want, but that one seems so counterintuitive as to be absurdly illogical.

I've seen some such studies, but all that I've seen were obviously and badly flawed.

In February 2014, CBO estimated that an increase to $10.10/hour would put 500,000 to 1,000,000 out of work. $15 would presumably put more out of work. Maybe we would be better off ordering our Big Macs from a kiosk. But those 500,000-1,000,000 wouldn't be.

And I haven't seen a formal study, but the anecdotal evidence coming out of Seattle certainly suggests jobs would be lost in significant numbers.

UW just published two studies. One found that the minimum wage increased costs of childcare because of the increase in labor costs, and the other found that there was no significant price increases in food costs at supermarkets.

https://www.washington.edu/news/2019/02/...ordinance/

Another study found "that the increase added about $10 per week on average to the earnings of low-income workers through 2016, even while reducing weekly hours slightly. But more experienced workers made $19 more per week, the research found, partly by making up for lost hours in Seattle at second jobs worked outside city limits.
In addition, employee turnover decreased, which the authors believe suggests that employers tried harder to retain their most productive staff members as wages went up."

https://www.cnn.com/2018/10/23/economy/s...index.html --> actual paper https://www.nber.org/papers/w25182?utm_c...rce=ntwg17

This article digs into another paper that studied 137 minimum wage increases, and the results suggest that those increases do reduce the number of jobs paying below minimum wage, but offset that by increasing jobs paying above minimum wage.

https://www.washingtonpost.com/news/wonk...d6ef58885c

The reason I talk about looking at studies is that, logically, the argument that increasing the minimum wage causes job loss makes sense assuming we operate in a perfect system with all rationale actors. But we know that we don't, so we should assume that things may not fall in line with academic thinking 100% of the time.

So coupling two of your studies together just reiterates the long term effect. Zero.

Wages go up -- cost of goods and services in the long run goes up. Minimum wage goes up -- *some* of the employees are retained at a higher wage.

Funny they now have to expend that increased wage with increased overall costs. This isnt news for the long term equilibrium. So wow, awesome --- increase minimum wages with a long term effect of near zero for the employees that are retained. What an awesome ideal of social progress.

But, in the short term, there are three distinct side effects. Net employment at those levels goes down. Your own study Cliff's notes noted that.

The three effects are:
a) businesses that cannot pass along the cost of higher employment go out of business --- Seattle restaurants in a nutshell.

b) businesses that can pass along the entire or partial cost either reduce profits --- a net job loser due to reduced consumption by the evil employers; or plaster the increases onto the consumer -- again the same effect.

Look at the average cost of a sit down meal in Seattle pre- and post- 15 dollar mania. And, for those that pass the cost along actually suffer reduced patronage.

c) businesses that can replace tasking with technology -- do so. I am negotiating a multi-point, multi-million dollar automated ordering system for a client. Net effect is to reduce his rising employment costs in the Bay Area (mandated mind you) by 20%. They are reducing overall employment by 15% headcount wise with almost all of it at the lower level. The impetus is the new levels make it feasible, and it is a long term necessity to keep some sort of constancy on that portion of labor costs.

But hell, what a great ******* win for minimum wage I guess.

Your paean to the minimum wage being this awesome panacea is simply dirt clod stupid, to be blunt. But please keep singing the awesome praises of how this 'raises people all over'. Real world wise that is an idiotic position to take.

Apologies about the bluntness.

(02-08-2019 11:55 AM)RiceLad15 Wrote:  

(02-08-2019 11:02 AM)OptimisticOwl Wrote:  I used an extreme case to show that raising the MW has effects, far more wide-reaching that a bigger take home pay.

It seems to be a tenet of liberal thought that the wealthy, in this case business owners and operators, can and will absorb all sorts of extra costs without reacting.

I worked a MW job in the 60's, for $1.25/hour. I would guess that people working that job today would make $10-12/hr, but their standard of living would be about the same as those who worked it 50 years ago.

But it isn't that easy. If it was true that all minimum wage increases kill jobs, then why do we have a net increase of jobs with a minimum wage in the first place?

Net increases in population have a little to do with that when you think about it.

Quote:Why then, did we not have a mass exodus of jobs when the federal minimum wage was increased multiple times?

In the long term the minimum wage has zero effect. Everything stabilizes with a ratchet upwards. Nominally speaking everyone wins. Relatively speaking no one gains.

It is the short term effects that are pernicious. For example, the guy whom is replacing 15% of his head count with technology readily admits that he constantly 'upgrades' employees to better positions from the lowest level. Minimum wage jobs are fundamentally training grounds.

Now, instead of a 6 head count at the front, he is reducing to 3. There are now, by definition, 50% fewer people who stand the chance of being upgraded to, say, manager of straw counting (which may disappear because of other California policies).

So the left sings Hosannas over the lives they have 'uplifted' -- all the while the training grounds for further advancement for *lots* more people is being curtailed.

Idiotic.

(02-08-2019 12:09 PM)tanqtonic Wrote:  

(02-08-2019 11:55 AM)RiceLad15 Wrote:  

(02-08-2019 11:02 AM)OptimisticOwl Wrote:  I used an extreme case to show that raising the MW has effects, far more wide-reaching that a bigger take home pay.

It seems to be a tenet of liberal thought that the wealthy, in this case business owners and operators, can and will absorb all sorts of extra costs without reacting.

I worked a MW job in the 60's, for $1.25/hour. I would guess that people working that job today would make $10-12/hr, but their standard of living would be about the same as those who worked it 50 years ago.

But it isn't that easy. If it was true that all minimum wage increases kill jobs, then why do we have a net increase of jobs with a minimum wage in the first place?

Net increases in population have a little to do with that when you think about it.

Quote:Why then, did we not have a mass exodus of jobs when the federal minimum wage was increased multiple times?

In the long term the minimum wage has zero effect. Everything stabilizes with a ratchet upwards. Nominally speaking everyone wins. Relatively speaking no one gains.

It is the short term effects that are pernicious. For example, the guy whom is replacing 15% of his head count with technology readily admits that he constantly 'upgrades' employees to better positions from the lowest level. Minimum wage jobs are fundamentally training grounds.

Now, instead of a 6 head count at the front, he is reducing to 3. There are now, by definition, 50% fewer people who stand the chance of being upgraded to, say, manager of straw counting (which may disappear because of other California policies).

So the left sings Hosannas over the lives they have 'uplifted' -- all the while the training grounds for further advancement for *lots* more people is being curtailed.

Idiotic.

So in the long term the minimum wage increases have a net zero effect. So in order to keep that net zero effect that is caused by inflation, shouldn't we continue to increase the federal minimum wage?

Without that, the net effect would be negative, as cost of living climbs and wages stagnate...

(02-08-2019 12:45 PM)RiceLad15 Wrote:  

(02-08-2019 12:09 PM)tanqtonic Wrote:  

(02-08-2019 11:55 AM)RiceLad15 Wrote:  

(02-08-2019 11:02 AM)OptimisticOwl Wrote:  I used an extreme case to show that raising the MW has effects, far more wide-reaching that a bigger take home pay.

It seems to be a tenet of liberal thought that the wealthy, in this case business owners and operators, can and will absorb all sorts of extra costs without reacting.

I worked a MW job in the 60's, for $1.25/hour. I would guess that people working that job today would make $10-12/hr, but their standard of living would be about the same as those who worked it 50 years ago.

But it isn't that easy. If it was true that all minimum wage increases kill jobs, then why do we have a net increase of jobs with a minimum wage in the first place?

Net increases in population have a little to do with that when you think about it.

Quote:Why then, did we not have a mass exodus of jobs when the federal minimum wage was increased multiple times?

In the long term the minimum wage has zero effect. Everything stabilizes with a ratchet upwards. Nominally speaking everyone wins. Relatively speaking no one gains.

It is the short term effects that are pernicious. For example, the guy whom is replacing 15% of his head count with technology readily admits that he constantly 'upgrades' employees to better positions from the lowest level. Minimum wage jobs are fundamentally training grounds.

Now, instead of a 6 head count at the front, he is reducing to 3. There are now, by definition, 50% fewer people who stand the chance of being upgraded to, say, manager of straw counting (which may disappear because of other California policies).

So the left sings Hosannas over the lives they have 'uplifted' -- all the while the training grounds for further advancement for *lots* more people is being curtailed.

Idiotic.

So in the long term the minimum wage increases have a net zero effect. So in order to keep that net zero effect that is caused by inflation, shouldn't we continue to increase the federal minimum wage?

Without that, the net effect would be negative, as cost of living climbs and wages stagnate...

The minimum wage workers in 1947, 1962, 1975, 1991, 2001, 2014, et al, made differing amounts, but it did not change their standard of living very much, if any.

It is a kind of chicken and egg question as to whether the increases helped them to keep up with inflation or if the increases were contributors to inflation. I suspect it was a bit of both - more of the former at the time of increases, more of the latter a few years later.

In 1964, I could get a minimum wage of $1.25 and a BBQ sandwich for $.50. Now, the proportions are still about the same. My co-workers in 1964 did not live in the nicest housing. Ditto for MW workers today. If you want to improve the lives of MW workers, don't give them raises - give them opportunities for other jobs. Nothing will raise income and living standards like competition for labor. Stifling the incentive for people with money to put it to work in new businesses is stifling opportunities for workers. That's why 70% tax rates and wealth taxes are bad - not because they hurt the wealthy, but because they hurt the poor.

Have you bothered to consider what might be a root driver of inflation in youur incisive analysis?

Here is a simple scenario to ponder. Labor is a root cost of every economic activity. What effect does a x% rise in the cost of labor do to resulting goods and service prices? Finally when the definition of inflation is the nominal increase of a "list" of goods and services, what does that change in price of goods and services do to the defined inflation rate.

Cmon man. Put your thinking cap on.

Edited to add: my original comment should have been no net *relative* change. Big nominal change.

My issue is this, and this simple example spells it out:

Assume a one product economy: cheeseburgers. In it the cheeseburger maker earns $10/hr for his endeavors. Lets assume the equilibrium price of cheeseburgers to the community is $2.

What the liberals promote is the concept of raise the minimum wage = $15, price of cheeseburgers = $2. The liberal train of thought is that somehow magically no other item or sector is affected, and the poorest of the poor are 50 per cent better than before. But this also ties in to the wonderful ideal of the progressive mindset that the price of everything should be regulated, and strict government control should be implemented.

In fact, to some extent, prior to 1980, this was somewhat efficient. The Keynsian ideal of price controls was rooted in a large amount of the national infrastructure: ITC controlled the cost of trucking an train shipments, not regulated -- controlled. The transportation department controlled the cost of air traffic -- not just regulated -- controlled. They had price controls on the price of every single airline ticket in the United States. Not only that, 'perks' that airlines offered were strictly regulated to dampen any effect to 'sidestep' the cost of the ticket.

In addition, controls on the top end of wealth were imposed by 65-90 per cent effective marginal income taxes. Hell, even under the Nixon administration explicit price controls were adopted across whole swaths of economic activity. And, additionally, private ownership of gold was effectively outlawed from 1932 to 1975. In this 'command and control' piece of hell, the liberal dream of effectuating the $10 to $15 minimum translating to the minimum wage holders achieving a 50% better slice of the pie was more easily obtained.

The adoption by Reagan in the 1980's of the Chicago view fundamentally changed that paradigm.

Now, the reality of the situation is that the change in minimum wage to $15 dollars will sure as shinola mean that cheeseburgers will cost $3 in the long term.

But the drive to raise the minimum wage is a simple vestige of the progressive bent to collectivism and the progressive bent to a form of economic facism where the longing is to control all the other levers and the minimum wage hike means a real transfer of wealth.

But progressives are either amazingly resistant or amazingly oblivious to the concepts that Chicago-school thought (and implementation) mean. And, the individualism that is a fundamental cornerstone of the Chicago-school thought is absolutely anathema to the very deep liberal/progressive roots in collectivism.

(02-08-2019 01:41 PM)OptimisticOwl Wrote:  

(02-08-2019 12:45 PM)RiceLad15 Wrote:  

(02-08-2019 12:09 PM)tanqtonic Wrote:  

(02-08-2019 11:55 AM)RiceLad15 Wrote:  

(02-08-2019 11:02 AM)OptimisticOwl Wrote:  I used an extreme case to show that raising the MW has effects, far more wide-reaching that a bigger take home pay.

It seems to be a tenet of liberal thought that the wealthy, in this case business owners and operators, can and will absorb all sorts of extra costs without reacting.

I worked a MW job in the 60's, for $1.25/hour. I would guess that people working that job today would make $10-12/hr, but their standard of living would be about the same as those who worked it 50 years ago.

But it isn't that easy. If it was true that all minimum wage increases kill jobs, then why do we have a net increase of jobs with a minimum wage in the first place?

Net increases in population have a little to do with that when you think about it.

Quote:Why then, did we not have a mass exodus of jobs when the federal minimum wage was increased multiple times?

In the long term the minimum wage has zero effect. Everything stabilizes with a ratchet upwards. Nominally speaking everyone wins. Relatively speaking no one gains.

It is the short term effects that are pernicious. For example, the guy whom is replacing 15% of his head count with technology readily admits that he constantly 'upgrades' employees to better positions from the lowest level. Minimum wage jobs are fundamentally training grounds.

Now, instead of a 6 head count at the front, he is reducing to 3. There are now, by definition, 50% fewer people who stand the chance of being upgraded to, say, manager of straw counting (which may disappear because of other California policies).

So the left sings Hosannas over the lives they have 'uplifted' -- all the while the training grounds for further advancement for *lots* more people is being curtailed.

Idiotic.

So in the long term the minimum wage increases have a net zero effect. So in order to keep that net zero effect that is caused by inflation, shouldn't we continue to increase the federal minimum wage?

Without that, the net effect would be negative, as cost of living climbs and wages stagnate...

The minimum wage workers in 1947, 1962, 1975, 1991, 2001, 2014, et al, made differing amounts, but it did not change their standard of living very much, if any.

It is a kind of chicken and egg question as to whether the increases helped them to keep up with inflation or if the increases were contributors to inflation. I suspect it was a bit of both - more of the former at the time of increases, more of the latter a few years later.

In 1964, I could get a minimum wage of $1.25 and a BBQ sandwich for $.50. Now, the proportions are still about the same. My co-workers in 1964 did not live in the nicest housing. Ditto for MW workers today. If you want to improve the lives of MW workers, don't give them raises - give them opportunities for other jobs. Nothing will raise income and living standards like competition for labor. Stifling the incentive for people with money to put it to work in new businesses is stifling opportunities for workers. That's why 70% tax rates and wealth taxes are bad - not because they hurt the wealthy, but because they hurt the poor.

I need to eat at the BBQ places you're eating at! I can't find a $3.50 BBQ sandwich anywhere but McDonald's (heck, the McRib might even be more expensive than that). If we're talking BBQ sandwich buying power, instead of house buying power, about 1 hr of MW work = 1 bbq sandwich.

Is it that you're against raising the minimum wage at all? Or that you don't agree with the drastic increase in the minimum wage that some suggest?

I agree that the best way to help others is by increasing opportunity - that's why I think a federal job guarantee is a good idea, and some of the Green New Deal initiatives are great. Similar to the alphabet soup of admins in the 30s/40s, investing significant bucks into our own country would both provide more, technical/skilled jobs for people who are stuck in minimum wage jobs, as well as updating our crumbling infrastructure. Yet all I hear is derision about every part of the green new deal, it seems...

(02-08-2019 01:44 PM)tanqtonic Wrote:  Have you bothered to consider what might be a root driver of inflation in youur incisive analysis?

Here is a simple scenario to ponder. Labor is a root cost of every economic activity. What effect does a x% rise in the cost of labor do to resulting goods and service prices? Finally when the definition of inflation is the nominal increase of a "list" of goods and services, what does that change in price of goods and services do to the defined inflation rate.

Cmon man. Put your thinking cap on.

Edited to add: my original comment should have been no net *relative* change. Big nominal change.

Wait, so if we never enacted a minimum wage, we never would have seen inflation????

C'mon man, put your thinking cap on, because that is literally what you're suggesting.

Labor costs obviously have an effect on prices, and an increase in labor costs will lead to increase in prices. But there are so many other aspects of monetary policy that affect inflation, that it's strange you only focus on minimum wage. There are other factors, other than labor, that cause costs to rise, and demand for goods does too. Couple that in with policies enacted by various legislatures and a central bank, and by god, you've got a lot of reasons why inflation has occurred in the US.

(02-08-2019 03:09 PM)RiceLad15 Wrote:  

(02-08-2019 01:44 PM)tanqtonic Wrote:  Have you bothered to consider what might be a root driver of inflation in youur incisive analysis?

Here is a simple scenario to ponder. Labor is a root cost of every economic activity. What effect does a x% rise in the cost of labor do to resulting goods and service prices? Finally when the definition of inflation is the nominal increase of a "list" of goods and services, what does that change in price of goods and services do to the defined inflation rate.

Cmon man. Put your thinking cap on.

Edited to add: my original comment should have been no net *relative* change. Big nominal change.

Wait, so if we never enacted a minimum wage, we never would have seen inflation????

C'mon man, put your thinking cap on, because that is literally what you're suggesting.

Labor costs obviously have an effect on prices, and an increase in labor costs will lead to increase in prices. But there are so many other aspects of monetary policy that affect inflation, that it's strange you only focus on minimum wage. There are other factors, other than labor, that cause costs to rise, and demand for goods does too. Couple that in with policies enacted by various legislatures and a central bank, and by god, you've got a lot of reasons why inflation has occurred in the US.

I am sure we would have seen inflation of some sort. Please dont put words in my mouth. Central bank policies can very definitely do so at the very least. Tight money policies vs loose money policies.

Is it your assertion that minimum wage is not a driver of an inflation? I mean, if you say not, then is labor not a factor in any nominal price increases at all?

Take a look at the base contribution of labor to GDP. It is massive. If you arbitrarily raise it to some level, then yes, it will be one of the root drivers of inflation.

Correspondingly, if in a free market the minimum wage falls, it would be correspondingly very much a contributing factor to deflationary pressure.

Please dont write the word 'all' into the description as you seemingly wish to do above.

Getting back to your comment, do you realize that the minimum wage itself, when raised, is very much a contributing factor to inflation? Or, does lad world have the weird economic law that a non-relativistic increase in wages has zero effect on inflationary pressures?

I would say absolutely and undoubtedly that the increase in the MW in the Seattle area has fundamentally added to the local cost of living there. I would be absolutely hard-pressed to argue the counter that it had zero effect.

I know you desperately want to live in the land of unicorns, elves, and chocolate sunflowers where a governmental drawn line on a cost has zero economic effect except to give relative wealth to one class. But governmental price controls never work in that intended manner. And yes, there is zero difference between a minimum wage and any other price control enacted by any government ever. Yet the progressives seem bound and determined to charge that holy grail time after time after time after time after time.....

One saving grace is at least they cant assert a racism charge into the mix.

(02-08-2019 03:02 PM)RiceLad15 Wrote:  I agree that the best way to help others is by increasing opportunity - that's why I think a federal job guarantee is a good idea, and some of the Green New Deal initiatives are great. Similar to the alphabet soup of admins in the 30s/40s, investing significant bucks into our own country would both provide more, technical/skilled jobs for people who are stuck in minimum wage jobs, as well as updating our crumbling infrastructure. Yet all I hear is derision about every part of the green new deal, it seems...

And there you have the difference between you and I.

I think the jobs should come from private industry, motivated by capitalism. You want them to come from government, a la the USSR.

You think the "investment" should come from government via tax money, I think the investment should come from private enterprise, investing in their own future.

What is it about capitalism that you guys are afraid of?

Yes, I deride most of this GND as unworkable pie in the sky. I have pointed out some of the difficulties in doing it. Maybe you should explain the ease with which we will revamp every building in America in 12 years or unionize every job. Maybe you can explain where all the infrastructure for the proposed rail system will come from without polluting even more.

This would be a difficult 100 year plan for a police state. Lenin tried it. A 12 year plan?

You once again demonstrate that liberals only care about the shining ideal, not the nitty gritty of how to get it done.

yes, I agree, utopia would be nice.

So, when you or your priestess can explain HOW, to achieve utopia, come on back.