NEW YORK (CNNMoney.com) -- On Friday, the federal minimum wage rises for the third year in a row, sparking the perennial argument among economists: Will it help workers at the bottom of the ladder, or will it kill their jobs?
The U.S. minimum wage goes to $7.25 an hour, from $6.55, according to the U.S.
Department of Labor. Most states have their own minimum wage, and employers are required to pay whichever is higher. That means minimum wage workers will get a raise in 29 states. In the remaining 21 states and Washington, D.C., they'll see no change.
For the record, MA has a minimum wage of $8/hour, WA has the highest at $8.55/hour (from the map shown here). The wage hike is being touted as some sort of stimulus-like apparatus; with the apparent thinking being that min-wage droves are now going to have an extra $28/week to cram into the economy...
Can we stop pretending that this actually makes a difference? Really? So Chippy McDopehead makes an extra $25 a week at his McJob. Are we deluding ourselves into thinking that this is going to make any difference in the local economy, let alone the national economy? Who's even at the minimum wage, really? Within a month or so if you haven't progressed in your employment beyond minimum wage, there's generally a reason.
And let's carry it to the extreme: Make the minimum wage $20/hour. That's $40K a year; that should be plenty for everyone to live on, right? Sure, as long as you don't mind paying $15 for a gallon of milk and $250 for dinner out. There's a reason some jobs only pay minimum wage - there's no skill or danger involved that warrants such a high rate of pay. Businesses that want their employees to stick around more than six months or provide more than the bare minimum pay more.
This is one case where the free market kicks the .gov's ass six ways to Sunday...
That is all.
12 comments:
If the theory was actually right, we could forever solve both our economic woes and the problems with poverty overnight.
Just make the minimum wage a million dollars a year.
Everyone would be rich, everyone would have plenty of money to pump into the economy and fall our troubles would be over.
and fall our troubles would be over.
I don't know where that spurious "f" came from. Supposed to say "and all our troubles would be over."
The times when I worked for minimum wage it was with small businesses who were struggling to keep business volume up to keep up with the overhead.
I'd imagine in places where this law makes a difference a few guys would get a raise while a few guys would get a pink slip.
Great work!
Or they fire everyone and hire illegals at $5/hour...
Jay there is no reason to bring illegals into this debate. The issue is totally unrelated. Why can't you stay on topic? Next thing you know is the minimum wage hike is going to prevent quality firearms from being manufactured because companies can't afford janitorial services anymore. Heck, we all know if WalMart would just pay healthcare for everyone and Exxon would fork out their grotesque profits to everyone, then all of our world would be bunnies and unicorns. But no...you have to muddy the waters by trying to show how many of these issues are interrelated.
Sorry about that. I feel in a very sarcastic mood this morning.
S'okay. We appreciate fine sarcasm here @ MArooned...
BTW Tam put up a great post on this a while back:
http://booksbikesboomsticks.blogspot.com/2006/02/politics-bill-gates-pizza.html
points out a good point, if you're making minimum wage work harder and get promoted, or find another job. I only worked for the minimum for about two summers. After that I either found a new job or got promoted to higher pay.
I had a (commie) friend of mine mention she'd been working at the same place for 4 years at minimum. I asked her if she thinks she'd be making the same if she'd spent those years bagging groceries or flipping burgers.
Of course not, she CHOSE to work for minimum because she didn't really need the money (Mom and Dad were putting her through school) and she liked the job better than other unskilled labor.
If you're working for minimum you're only giving the minimum work. The problem isn't the .gov or your "greedy" boss, but YOU!
That extra couple of bucks a week is going to pay for Chippy McDopeyhead's two packs of smokes and an extra gallon of gas.
The Obama Administration! Funding BIG TOBACCO and BIG OIL since 2009!
I really have to wonder if our Glorious President and his Administration of Lackeys is actively attempting to do every damned thing possible to wreck and destroy the American economy.
I am starting to have a hard time believing anyone could be this idiotically incompetent.
When the unbacked currencies collapse from excessive government interference and loss of public confidence, I'd propose starting a new currency based on the unskilled, non-dangerous, moderately strenuous work-hour. It'd be issued by the International Bank of Me. Everyone can generate Work-Hours, every day of their life, and the Work-Hours of an Ethiopian are directly comparable to the Work-Hours of an American.
There is no minimum wage: a Work-Hour is the minimum wage.
Still, some people's labor is more valuable than others. They are skilled, or willing to do dangerous work, or they can physically do more in an hour than others, or the product of their labor is particularly valuable or prized, or few people are willing to do a necessary job so a premium must be offered. So, for a real hour of their labor, the person they do it for must exchange multiple Work-Hours. Thus, a skilled programmer could demand 10 Work-hours per real hour... when he is doing his particularly specialized skill. If nobody needs any wizardly programming, possibly because of a complete collapse of the system of unbacked currencies, he could always work for one Work-Hour per hour shoveling manure.
If you issue too many IOU Work-Hours from the International Bank of Me, and you don't have a stock of owed Work-Hours from the International Banks of Tirno or JayG... those that you owe could recoup the loss by requiring labor at their discretion. If they don't need your particular skill, they could require your labor as a lawn-mower, or you could exchange a commodity at the exchange rate of, say, X grams of gold per Work-Hour or Y grams of steel bar-stock per work-Hour.
Why not? This is what the modern currency is trying to emulate, and politicians are trying to game as if the they could fundamentally alter the nature of Value by altering the numerical values of the means of exchange. I propose merely backing the currency on something the politicians can't alter: the fundamental value of a hour of time, diligently worked.
Gosh, I'm really feeling old now; I remember when I was dreaming of making the big dollar rate union construction was paying laborers... $3.75 per hour. I remember earning $1.00 per hour from three different employers... and it wasn't during the era when $1.00 was "a lot of money."
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