Minimum Wage Dishonesty

[bobevenson]

Minimum Wage Dishonesty
By Walter Williams
American economist, commentator, and academic. He is the John M. Olin Distinguished Professor of Economics at George Mason University, as well as a syndicated columnist and author known for his libertarian views.
Published Jan. 13, 2016

"Michael Hiltzik, a columnist and Los Angeles Times reporter, wrote an article titled "Does a minimum wage raise hurt workers? Economists say: We don't know." Uncertain was his conclusion from a poll conducted by the Initiative on Global Markets, at the University of Chicago's Booth School of Business, of 42 nationally ranked economists on the question of whether raising the federal minimum wage to $15 over the next five years would reduce employment opportunities for low-wage workers.

The Senate Budget Committee's blog says, "Top Economists Are Backing Sen. Bernie Sanders on Establishing a $15 an Hour Minimum Wage." It lists the names of 210 economists who call for increasing the federal minimum wage. The petition starts off, "We, the undersigned professional economists, favor an increase in the federal minimum wage to $15 an hour as of 2020." The petition ends with this: "In short, raising the federal minimum to $15 an hour by 2020 will be an effective means of improving living standards for low-wage workers and their families and will help stabilize the economy. The costs to other groups in society will be modest and readily absorbed."

The people who are harmed by an increase in the minimum wage are low-skilled workers. Try this question to economists who argue against the unemployment effect of raising the minimum wage: Is it likely that an employer would find it in his interests to pay a worker $15 an hour when that worker has skills that enable him to produce only $5 worth of value an hour to the employer's output? Unlike my fellow economists who might argue to the contrary, I would say that most employers would view hiring such a worker as a losing economic proposition, but they might hire him at $5 an hour. Thus, one effect of the minimum wage law is that of discrimination against the employment of low-skilled workers.

In our society, the least skilled people are youths, who lack the skills, maturity and experience of adults. Black youths not only share these handicaps but have attended grossly inferior schools and live in unstable household environments. That means higher minimum wages will have the greatest unemployment effect on youths, particularly black youths.

A minimum wage not only discriminates against low-skilled workers but also is one of the most effective tools in the arsenal of racists. Our nation's first minimum wage came in the form of the Davis-Bacon Act of 1931, which sets minimum wages on federally financed or assisted construction projects. During the legislative debates, racist intents were obvious. Rep. John Cochran, D-Mo., said he had "received numerous complaints in recent months about Southern contractors employing low-paid colored mechanics getting work and bringing the employees from the South." Rep. Miles Allgood, D-Ala., complained: "That contractor has cheap colored labor that he transports, and he puts them in cabins, and it is labor of that sort that is in competition with white labor throughout the country." Rep. William Upshaw, D-Ga., complained of the "superabundance or large aggregation of Negro labor."

During South Africa's apartheid era, the secretary of its avowedly racist Building Workers' Union, Gert Beetge, said, "There is no job reservation left in the building industry, and in the circumstances, I support the rate for the job (minimum wage) as the second-best way of protecting our white artisans." The South African Economic and Wage Commission of 1925 reported that "while definite exclusion of the Natives from the more remunerative fields of employment by law has not been urged upon us, the same result would follow a certain use of the powers of the Wage Board under the Wage Act of 1925, or of other wage-fixing legislation. The method would be to fix a minimum rate for
an occupation or craft so high that no Native would be likely to be employed."

It is incompetence or dishonesty for my fellow economists to deny these two effects of minimum wages: discrimination against employment of low-skilled labor and the lowering of the cost of racial discrimination."

___________________________________________________________________________________________________

From
Bob Evenson
To
Walter Williams
Today at 11:14 AM

Prof. Williams, the last sentence of your column is disturbing beyond words: "Is it incompetence or dishonesty for my fellow economists to deny these two effects of minimum wage: discrimination against employment of low-skilled labor and the lowering of the cost of racial discrimination." It's like a mathematician denying that 1 + 1 = 2. On the one hand, it doesn't seem possible that a professional in any field could be that incompetent, but on the other hand, it doesn't seem possible that he could be that dishonest. Regards, Bob Evenson

[BigWhit]

the effects of raising the minimum wage so much would not be easily absorbed. Wages for everyone else would need to go up relative to the minimum wage. If I make 20 bucks an hour welding while a burger flipper makes 8 bucks and this law goes into effect giving burger boy 15 an hour I'm going to want 35+/hr. Why should I not get an equal raise if I went through the hassle of bettering myself and learning a trade with which I can support myself if a high school dropout with no ambition gets his pay doubled?

[Dalek Prime]

the effects of raising the minimum wage so much would not be easily absorbed. Wages for everyone else would need to go up relative to the minimum wage. If I make 20 bucks an hour welding while a burger flipper makes 8 bucks and this law goes into effect giving burger boy 15 an hour I'm going to want 35+/hr. Why should I not get an equal raise if I went through the hassle of bettering myself and learning a trade with which I can support myself if a high school dropout with no ambition gets his pay doubled?

Why not just ask for a raise if it's bugging you so much? Otherwise, why defend an economic system that's not benefitting you? Seriously, you want to defend capitalism, yet money follows capital, not your labour or skill, as the system has always worked. Socialists want to change that and help you, yet you despise both them and the very word socialism for some bizarre, indoctrinated reason. You have so much to learn, or should I say, unlearn.

Why shouldn't a burger-flipper make more? They work their asses off for the owners to make millions or billions. Don't you? And don't you often feel you deserve more? Jerk. Start thinking, instead of singing praises for a system that shits on most people who don't have consolidated wealth, including yourself. I, for one, will never understand why people defend a system that enriches the few as though they are the only deserving ones on the planet, at their and the majorities own expense. Holy fuck. It's absolutely stupid.

[bobevenson]

The trouble with you, pal, is that you think the world owes you and others like you a fucking living, but keep your fucking hands out of my pocket, OK?

[BigWhit]

If burger boy gets 15/hr I will be asking for a raise. And yes, money follows capital. This is why I get paid. I create more than twice as much capital as someone taking your order at a drive through and I should be paid accordingly.

Yes I want to get paid more, thats why I learned a trade and get paid more than minimum wage, moron. And most fast food joints are franchised which mean eaxh individual store is a small business. Yes McDonald's is a huge corporation that takes in billions of dollars but corporate doesn't set the wage for their workers, the business owners do.

I defend calitalism because it's the only system which allows individuals the opportunity to pull themselves from poverty and into the middle class. Hell, the middle class didn't even exist before free markets. And you want me to shun this economic system because you say it's taking advantage of me? That's laughable. If anything I'm taking advamtage of it.

If you want this kind of total economic control move to North Korea. There are no ruch elite to enslave you there.

[Philosophy Explorer]

It's known that the very rich spend less of their income, %-wise, than the middle class and even less than the poor who can't build up a savings. By raising the minimum wage will increase spending and help to bolster the economy.

In relationship to this, Medicaid needs a serious adjustment. I'm talking about how much money you're allowed to have in your bank account which is currently set at up to $2,000. Beyond that and Medicaid will withhold support and may even bill you for services beyond the time you exceeded the $2,000 amount (also note that the $2,000 amount has not been adjusted for inflation in over 20 years).

Raising the minimum wage won't have employers placing a greater value on their workers. BUT it would help businesses sell more as disposable income increases which would lead to more jobs.

PhilX

[Arising_uk]

The trouble with you, pal, is that you think the world owes you and others like you a fucking living, but keep your fucking hands out of my pocket, OK?

What job is it that you do bob, that is, how have you earnt your living?

[bobevenson]

The trouble with you, pal, is that you think the world owes you and others like you a fucking living, but keep your fucking hands out of my pocket, OK?

What job is it that you do bob, that is, how have you earnt your living?

Why don't you pester Walter Williams with your idiocy?

[bobevenson]

It's known that the very rich spend less of their income, %-wise, than the middle class and even less than the poor who can't build up a savings. By raising the minimum wage will increase spending and help to bolster the economy.

In relationship to this, Medicaid needs a serious adjustment. I'm talking about how much money you're allowed to have in your bank account which is currently set at up to $2,000. Beyond that and Medicaid will withhold support and may even bill you for services beyond the time you exceeded the $2,000 amount (also note that the $2,000 amount has not been adjusted for inflation in over 20 years).

Raising the minimum wage won't have employers placing a greater value on their workers. BUT it would help businesses sell more as disposable income increases which would lead to more jobs.

PhilX

Try reading Walter Williams' column again. Minimum wage causes unemployment, and there's no getting around that, it's like an immutable law of physics.

[henry quirk]

Suppose...

I own Quirk's Books, a tiny independent seller...money is tight...the law sez I can't establish the value of an employee's work...instead, I'm obligated to pay no less than X, no matter the job...now, I'd like to keep my three employees...each is at least competent, and each is sometimes great...thing is: X is going up to X plus 2 (or X2)...as I say, money is tight...even though I gotta pay more to each employee, sales are not going up...where do I get the money to pay X2?

I could increase prices...that, however, will probably reduce sales more...I can cut back on the work of my employees and pay them less overall...that, however, will hurt them and probably drive them to look for other employment...I can let a person go...that, however, means the two who remain will work more for the same pay...not thinkin' they'll be all that happy with that... could reduce my own income from the store, but I'm already bare bones now...I could stock less, be less varied than I am in what I offer, but that probably will hurt sales.

So, great and wise promoters of a minimum wage, solve my problem for me.

[Philosophy Explorer]

It's known that the very rich spend less of their income, %-wise, than the middle class and even less than the poor who can't build up a savings. By raising the minimum wage will increase spending and help to bolster the economy.

In relationship to this, Medicaid needs a serious adjustment. I'm talking about how much money you're allowed to have in your bank account which is currently set at up to $2,000. Beyond that and Medicaid will withhold support and may even bill you for services beyond the time you exceeded the $2,000 amount (also note that the $2,000 amount has not been adjusted for inflation in over 20 years).

Raising the minimum wage won't have employers placing a greater value on their workers. BUT it would help businesses sell more as disposable income increases which would lead to more jobs.

PhilX

Try reading Walter Williams' column again. Minimum wage causes unemployment, and there's no getting around that, it's like an immutable law of physics.

Any unemployment that may result would be offset with new jobs resulting from a higher disposable income leading to more spending and many economists say the economy overall would benefit. So you can take your God Walter Williams and shove him (the real problem is robotics).

PhilX

[Philosophy Explorer]

Suppose...

I own Quirk's Books, a tiny independent seller...money is tight...the law sez I can't establish the value of an employee's work...instead, I'm obligated to pay no less than X, no matter the job...now, I'd like to keep my three employees...each is at least competent, and each is sometimes great...thing is: X is going up to X plus 2 (or X2)...as I say, money is tight...even though I gotta pay more to each employee, sales are not going up...where do I get the money to pay X2?

I could increase prices...that, however, will probably reduce sales more...I can cut back on the work of my employees and pay them less overall...that, however, will hurt them and probably drive them to look for other employment...I can let a person go...that, however, means the two who remain will work more for the same pay...not thinkin' they'll be all that happy with that... could reduce my own income from the store, but I'm already bare bones now...I could stock less, be less varied than I am in what I offer, but that probably will hurt sales.

So, great and wise promoters of a minimum wage, solve my problem for me.

See my post just above.

PhilX

[henry quirk]

Phil,

You mean this: "Any unemployment that may result would be offset with new jobs resulting from a higher disposable income leading to more spending and many economists say the economy overall would benefit."?

Color me dumb, but I ain't seein' how that helps me with my Quirk's Books problem. See, X2 means I spend more while not making more. Also: just cuz Joe has more cash in his pocket doesn't mean he'll be more inclined to spend it in my store. For myself: when I get more cash, I tend to save it for rainy days. Certainly, I can't be the only one who does this.

[Arising_uk]

Why don't you pester Walter Williams with your idiocy?

He your employer? If not what is it you do or did you do to earn a living bob? As for someone who is unemployed you appear to have much to say about those who do and I wonder just how you came to be in the happy situation of not having to work.

[Philosophy Explorer]

Phil,

You mean this: "Any unemployment that may result would be offset with new jobs resulting from a higher disposable income leading to more spending and many economists say the economy overall would benefit."?

Color me dumb, but I ain't seein' how that helps me with my Quirk's Books problem. See, X2 means I spend more while not making more. Also: just cuz Joe has more cash in his pocket doesn't mean he'll be more inclined to spend it in my store. For myself: when I get more cash, I tend to save it for rainy days. Certainly, I can't be the only one who does this.

Since there doesn't seem to be much of a middle class in the US currently, then I'm talking about the poor folks who have a great tendency to spend the disposable income - I wasn't referring to you HQ - and the economists would back me up. So save up your money for rainy days as that would help increase lending.

PhilX