Comments on: Supply and Demand (And Other Economic Arguments Against the Minimum Wage)

By: CameronDaniels

CameronDaniels — Sat, 06 Nov 2010 16:06:51 +0000

RubberBaron does make a good point here, but it is not entirely clear that a lower minimum wage would subsidize the older economy. I think an important assumption you are making is the educational potential of these lower-skilled workers.

To move to the “newer” economy, as you put it, we would need an effective educational system to allow these low-skilled workers to move upwards. I am not entirely sure that we are able to provide that service, or that it is the duty of the government itself to provide that service. This creates a weird dichotomy: the United States wants to allow these low-skilled workers to gain valuable skills and push its economy in a positive direction (don’t want to encourage low skills with high minimum wage) but also we don’t want to punish low-skilled workers for simply being born into poor conditions (to just allow them to fall through the cracks). That’s why (author’s editorial opinion, only) the minimum wage should be allowed for the states because the individual values and educational profiles of different states are so disparate (not to mention cost of livings problems).

By: ninja training

ninja training — Sun, 28 Mar 2010 22:34:43 +0000

The Ninja Trainer says, “Thank you”.

By: Carnival of Pecuniary Delights No. 24: Friends Edition | Pecuniarities

Carnival of Pecuniary Delights No. 24: Friends Edition | Pecuniarities — Thu, 17 Sep 2009 13:03:26 +0000

[...] Don’t Quit Your Day Job… presents The Minimum Wage Mistake. [...]

By: PKamp3

PKamp3 — Sun, 28 Jun 2009 18:23:15 +0000

Hey RubberBaron, thanks for commenting! Since, most likely, no one will defend the negative income tax I’ll play devil’s advocate for a minute.

I assume that the working poor get more respect than the non-working poor. My contention is there are large amounts of people willing to work for less than minimum wage now. Currently, they are receiving aid in the form of food stamps, medicaid, welfare, and a patchwork of other programs.

The argument from Friedman went like this: by setting this esoteric ‘guaranteed minimum wage’, you move people off these hard to administrate programs, (if you believe that government administration is a waste…) and replace it with just one system, the country would be better off than we are today, in terms of reduced administrative costs. We could eliminate programs like minimum wage and its kin.

I sympathize with your plight, and it’s curious that Milton Friedman is one of the economists associated with the NIT movement. However, it makes sense because currently we are subsidizing people to *NOT* work with all of these programs. The pertinent question of a negative income tax is: Will it work better than the complex system we have now, and encourage people to work? Here’s some further reading on the subject: http://www.irp.wisc.edu/publications/dps/pdfs/dp126003.pdf

By: RubberBaron

RubberBaron — Sun, 28 Jun 2009 14:23:16 +0000

And with a reduced minimum wage comes a greater demand for lower paid people. The lower paid tend to work in consumer service industries: burger bars, hotels, cleaning services etc. With negative income tax it means that higher rate tax payers are effectively subsidizing burger bars and hotels. Where’s the sense in that?

Why should I, in an industry where wages tend to be higher, be hit for subsidizing the old economy?