If a fast food worker is entitled to $15 an hour, what are THESE people entitled to?

The argument in favor of raising the minimum wage has nothing to do with fast food workers specifically. It has to do with the following idea: anyone who works full-time should be making enough money to support themselves. It also has to do with modern economic realities, specifically the fact that it is not just entry-level jobs that pay minimum wage anymore. Furthermore, many positions that are considered to be entry-level jobs are effectively not because the people above are not moving up or out.

And this is where the fast food workers come in: many have been working what others consider an entry-level position for years while trying to make ends meet. They have not been offered promotions. They have not been able to find jobs that pay better, and frequently have to take second or third jobs just to reach subsistence levels of income (which may still be below the poverty line). Given how starkly at odds this is with American ideals—that whole “work hard and you will succeed” thing, sometimes called the American Dream—people understandably want something to change.

Raising the minimum wage seems to many the obvious solution. And in response to arguments about inflation, the common response is “the whole reason we’re in this mess is because inflation already happened and wages weren’t increased to compensate for it.” You might disagree. I’m sure plenty of people will come in and give us their armchair economic analysis about why they don’t think this will work. But anyone who just throws around inflammatory rhetoric without responding to the actual arguments is being a dishonest interlocutor. So there’s the argument. Have at it.

As a side note, I always find it interesting to see how fixated people get on the fact that it’s fast food workers asking for a living wage. The intense need some people feel to make sure “those people” know their place is highly revealing. We are talking about human beings here. And yet, it seems there are plenty of people who are ready to argue that they somehow do not deserve to be able to meet their basic needs. They’re not even asking for free stuff. They are asking for the ability to make a living by trading their labor for money. You know—capitalism.

@ibstubro I think it’s very well established that the amount of inflation a rise in the minimum wage would cause is incredibly small.

Companies that don’t pay their employees a living wage are essentially externalizing their costs for their human resources onto everyone else. If you have an employee working for you full time, then you have a moral obligation to pay them enough to live on: i.e. enough to have food, shelter, clothing a means of transportation, and healthcare. Those are very basic. If you’re not meeting those needs of your employees and are expecting the government to pick up the slack via welfare, foodstamps, medicaid, etc then your company is essentially leeching money from the public to pad your profits, using the employee as a vehicle for the theft. Furthermore, if your company engages in these practices, it allows you to have a competitive advantage in the marketplace over other companies who pay their employees responsibly. This forces good companies to engage in these practices just to remain competitive. It’s a race to the bottom. This is why having the government level the playing field allows for better free market economics to do their job.

Also relevant.

Great answers @gorillapaws and @SavoirFaire .
I hope ya get lots of answers to this question @ibstubro .will make for interesting reading, I am surprised one of our right wing friends haven’t chimed in with OMG it will be the end of the free world as we know it.
And as one put it if these workers depend on Government help to meek out a living after working 40+ hours a week,who is really mooching off the Government the worker who can’t live off the wage he/she makes, or the corporation that wont pay them a living wage?

It’s not about entitlement. It’s about being able to live. I’m in Australia and our minimum wage is 16.40$. It’s about not having legions of people on the streets, children starving, and general food insecurity. It’s about trying to steer your country into a more liveable place for all. Simple.

Let’s do the arithmetic. Suppose a fast food worker now makes $10 per hour, so we are talking about a $5 raise. Let’s estimate that the worker can handle 20 orders per hour, which would mean an extra 25 cents per order. Compared to what a person spends in a day, this is pretty negligible. Nobody would notice the difference.

The point of increasing the minimum wage is to begin to correct the shift that has happened across previous decades. Before women were fully accepted into the workforce, a working class man’s wage could support a whole family, because it had to. The West had great economic success when women started working more, because it mobilised so much of the population for productivity. But now only the wealthy can afford to have a family where the mother stays at home with the kids. In effect wages have halved, because it now takes two wages to support a family at the same level of comfort. Meanwhile the rich have cashed in on the increased productivity without paying the same proportional wages, and the wealth gap has become a yawning chasm. Increasing the minimum wage would go some way towards restoring the wealth balance that allowed the economic growth of past decades.

Additionally, increasing the minimum wage should stimulate the economy. More people with more to spend increases turnover, business revenue, and therefore tax revenue. And they will spend the money rather than saving it, because at that end of the wage scale they’re missing out on necessities to survive. Give them the money to meet their needs, and they will spend it to do so. It’s not like $15/hr can support a serious savings plan anyway.

It isn’t always inflationary because employers don’t always offset artificially elevated labor costs by raising prices on their goods. According to the data, it is a more common practice for employers to layoff off their employees and put the extra workloads on those that are still employed. At the same time they just stop hiring new employees or take advantage of those willing to do an internship. So while prices may remain unchanged, there will be much more unemployment and a decline in job opportunities. Those few workers who do get to keep their job and enjoy the new minimum wage, will be working much harder for it due to the increase in workloads as an offset from those who were laid off.

As technology progresses, the minimum wage will just be another law to incentivize employers to replace employees with robotics. This is already being done in some parts of Asia and Europe.

Employees are not entitled to any minimum wage. The entire law is unconstitutional and anti-capitalistic. Just another example of government destroying personal choice. Employers have constitutionally protected property rights and wages should be negotiated between the employer and employee. If they don’t like the wage, then renegotiate or leave and find employment elsewhere.

This may sound silly, but one thing I don’t like about raising the minimum wage is that it will devalue many people’s salaries. For instance, my job I had before I left to be a stay at home mom was 14$ an hour. That felt nice and respectable for a job that required a bachelors degree and several years of experience. Once the minimum wage was raised, my job would become a minimum wage job, making the same as the lowest level pages at the library. About half of the jobs at my old place of employment would suddenly become minimum wage jobs. I’ve seen first hand what happens when a wage gets devalued.

When Border’s first opened up, they paid their clerks 6$ per hour. The minimum wage was below 4$ per hour, so you had people earning almost double minimum wage. You could get a higher caliber of employees for that and expect more knowledge about books and experience in sales. You had very wise old booksellers who seemed like the smartest people in the world.

Unfortunately, Borders continued paying their starting workers 6$ per hour as the minimum wage went up. There were more qualified people that chose different jobs other than the bookstore because they didn’t pay enough. The bookstore employees became less qualified to be those wise old bookstore clerks everyone loved.

Finally, Borders became a minimum wage job and only raised the pay when minimum wage went up. No longer did you see the great Borders booksellers everyone raved about when the store opened. You had clerks that had the same book knowledge as Walmart employees.

I don’t think it’s a coincidence Borders tanked around this time.
—

When people talk about inflation and minimum wage, they have to also put the fact that you’d have to raise other people’s wages above minimum wage in order to keep the job valued. Especially when you raise it so dramatically. You can’t expect the person who makes 15$ an hour right now to be satisfied with a 15$ per hour job when the minimum wage goes up. You’ll have to raise those salaries too if you want the same quality of worker to do the job.

And THAT“S where the inflation will take place.

@grac3alot “According to the data, it is a more common practice for employers to layoff off their employees and put the extra workloads on those that are still employed. At the same time they just stop hiring new employees or take advantage of those willing to do an internship. So while prices may remain unchanged, there will be much more unemployment and a decline in job opportunities. Those few workers who do get to keep their job and enjoy the new minimum wage, will be working much harder for it due to the increase in workloads as an offset from those who were laid off.”

You’ve been misinformed. Do you have a link to your data? According to Dr. Arindrajit Dube the research has shown that:

“In all, we have by now replicated these findings in 4 papers using 5 datasets and 6 different ways of accounting for comparability of areas. These are summarized in Table 2. For high impact groups such as restaurant workers and teens, we find that a 10% increase in minimum wage raises average wages or earnings by 1.5% to 2%. Employment changes are usually close to zero, never more negative than -0.5%, and sometimes positive in sign. In all cases, there is clear evidence that minimum wage increases raise total pay going to low-wage workers after factoring in both wage and employment changes.”
source

I think someone removed my account? I can no longer log into the other one.

Anyway, no, it is you who is misinformed. The information you quoted is not peer-reviewed.

My evidence is peer-reviewed.

Over three subsequent years, we find that binding minimum wage increases had significant, negative effects on the employment and income growth of targeted workers. Lost income reflects contributions from employment declines, increased probabilities of working without pay (i.e., an “internship” effect), and lost wage growth associated with reductions in experience accumulation. [snip] Over the late 2000s, the average effective minimum wage rose by 30 percent across the United States. We estimate that these minimum wage increases reduced the national employment-to-population ratio by 0.7 percentage point. source1

Another one here source2

And one more here source3

Evidence provided by Paul Krugman, Nobel laureate.

@grac3al0t Dr. Dube is one of the leading researchers on the economics of minimum wage. He has published many peer-reviewed papers and refers to that research in his sworn testimony I quoted. So yes the quote itself wasn’t peer reviewed, but it’s summarizing research that is peer reviewed, which itself is listed at the end.

Furthermore the research you link to has been shown to have a flawed methodology for establishing controls. You can see this discussed here: “Neumark, Salas, and Wascher construct a “matched panel estimator” loosely based on synthetic controls. We provide a detailed discussion and critique of this estimator in Appendix B, section B2. In brief, this estimator is without an econometric foundation, as it uses residuals from an OLS panel regression to estimate synthetic control weights. In addition, the set of donors they use to construct synthetic control often themselves receive treatment, violating a key requirement of the synthetic control method.”

If it is OK for the State to set a minimum price for labor, then why not also set a maximum as well?

@LostInParadise

Opinion pages on the New York Times is not evidence even when you’re a nobel laureate. He got his nobel prize for New trade theory which was peer-reviewed and withstanded all the criticism from his professional peers, but that is just for that finding. Here, though, none of his “evidence” is published in any peer-reviewed journal regarding minimum wage. That is why it is an op-ed. An opinion piece. Means nothing if it isn’t peer-reviewed.

@gorillapaws

Same answer above applies to Dr. Dube. That isn’t how it works. When you do a study, even when you quote peer-reviewed work, you have to have your professional peers review it. If it doesn’t go under such scrutiny, it is just biased propaganda trying to this credit the already approved peer-review work.

The research I linked to has already been approved by the peer-review organization and found to have a legitimate methodology. What you’re linking to is another .edu (a non-peer-reviewed) publication. It is just another biased piece of propaganda.

NBER s the standard and largest economic peer-review organization in America. What some Op-ed or professors at a .edu have to say means nothing. Either it is peer-reviewed or its biased propaganda.

So like I said, you’re extremely misinformed.

Still not accepting anyones link but your own I see @grac3al0t nice, so what is the answer oh I know lets cut it back to $3 an hour, and boy that will put so many people to work,who cares if they can’t even afford to live under a bridge with that wage,at least the wealthy are still raking in huge profits.(these minimum wage increases reduced the national employment-to-population ratio by 0.7 percentage point.)<That a huge number to you??
On my universal health care question you thought 14% was very small? Interesting.
Your links seem so out of touch with the real world and real people , no matter how much you scream PEER REVIEWED.

The answer is to stop the government from interfering with market dynamics which causes a whole shit load of unintended consequences some of which you just named. This is isn’t a market inefficiency, it is a government one and it should start with the Federal Reserve.

@grac3al0t “Either it is peer-reviewed or its biased propaganda.”

Sorry but that’s a false dilemma fallacy. The link I referenced was a working paper, considered grey literature. According to this 9–17% of published economic sciences papers contained citations to grey literature. There are many reasons why a paper isn’t peer-reviewed, including the fact that it’s still under review. Papers don’t magically transform from being propaganda to legit once it passes peer review… the text remains the same.

If the articles you’re citing are using bad methodology, then a critique of it doesn’t need to be peer-reviewed to be true. Critique the methodology of the critique, but you can’t outright dismiss a rebuttal simply because it’s not peer-reviewed. It’s not like the paper I cited was written by a gang of clowns. The authors are credible, published professors.

I told you bud, I’m not accepting work that isn’t peer-reviewed and published on a legitimate peer-review organization. I don’t except such evidence. Their degrees and historic accomplishments does not make their point any more valid if they’re not being reviewed by professionals.

Therefore, when you quote me anything that does not meet these high standards, you’re going to be dismissed. Hence, I believe it is you who are misinformed and don’t actually have legitimate evidence.

My sources are peer-reviewed and published in such organizations.

The NBER is the nation’s leading nonprofit economic research organization. Twenty-four Nobel Prize winners in Economics and thirteen past chairs of the President’s Council of Economic Advisers have been researchers at the NBER. The more than 1,300 professors of economics and business now teaching at colleges and universities in North America who are NBER researchers are the leading scholars in their fields. These Bureau associates concentrate on four types of empirical research: developing new statistical measurements, estimating quantitative models of economic behavior, assessing the economic effects of public policies, and projecting the effects of alternative policy proposals.

The NBER is governed by a Board of Directors with representatives from the leading U.S. research universities and major national economics organizations. Other prominent economists from business, trade unions, and academe also sit on the Bureau’s Board.

So when you quote me some rebuttal from a professor of a particular University, it really means nothing. Either he gets reviewed by professionals and gets approval for his criticism or its just another biased propaganda piece.

I’m gone for the weekend, I’ll be back on monday, That is if someone doesn’t delete my account again.

@grac3al0t Well here’s a link to one of his earlier published works. And this one is in the process of being published by the Journal of Labor Economics.

@josie “If it is OK for the State to set a minimum price for labor, then why not also set a maximum as well?”

As stated earlier, a company who doesn’t provide a living wage to full-time employees is externalizing their labor costs onto the taxpayer. In effect, our tax dollars make it possible for their businesses to run, but they’re not reimbursing us for those costs. Minimum wages protect the taxpayer from this expense by forcing companies to provide a living wage so their employees aren’t receiving government payouts.

There is no reason to cap income with a maximum wage restriction because this doesn’t produce costs to the taxpayer.

Additionally, the constitution stipulates that the government should “promote the general welfare of the people.” (I’m sorry @grac3al0t, the Constitution isn’t a peer reviewed journal, so you’re free to disregard it). Improving the standard of living for the working poor would radically improve the economy for everyone, not to mention reducing the costs for the government.

@keobooks Low end workers’ wages may also proportionally increase if the minimum wage increases. As @trailsillustrated mentioned, the minimum wage in Australia is $16.40/h. After finishing my degree, my graduate job paid around $26/h. I’m not sure enough of the economics to say if broader increases would occur in the US, but I’m horrified at what the workers there are paid. You were proud to be earning $14/h, but during my studies I worked for $17.50/h plus penalties with my only qualification being a first aid certificate. Sure, our cost of living is higher, but anyone working a 40hr week on minimum wage can get by without too much difficulty.

So, everyone in the US should be paid a Federally Mandated Minimum Wage that would allow them to live in Manhattan, NY?

Seriously.
I’m not being provacative.

@ibstubro I’m not following your logic. The cheapest 1 bedroom studio closets are like 2k per month in Manhattan. I’m well above the poverty line and I don’t think I could afford to live there.

Yes there has to be a set minimum, if there wasn’t employers would abuse it big time ,because if they could get away with paying someone 5cents and hour they would.and you all know it even our fright wing friend who wont except any link that isn’t (GASP) peer reviewed.
Raising it will have some short term consequences ,employers will retaliate ,by letting some workers on the bottom go, and getting the remaining workers to work more to fill the gap, but then when they wake up to the overtime bill, and tired employees are not very productive, things get back to normal and the right finds something else to bitch about.

If your rent should be no more than ⅓ of your income, @gorillapaws, then the minimum wage in NYC should be around $40 an hour.

Locally, the best unskilled jobs in my area still haven’t reached $20 an hour.

It’s ludicrous to believe a federally mandated minimum wage solves anything.

So whats the answer @ibstubro , a state set minimum wage? You know very well if no set minimum companies will abuse that big time.
There really has to be set minimum.
The right scream the Government is to BIG, then stop making the people on the bottom depend on the Government so much,which in the real world I think it’s the companies themselves that are depending on the Government, by getting the Government to subsidize their income with foodstamps and such lets the companies keep paying these workers a wage they can’t live on.

I honestly don’t know the answer, @SQUEEKY2, and don’t pretend to.

I tend to think that the government should stay out of it. It’s just increasing the overpopulation of the urban areas. Maybe there could be incentives for people to re-locate to areas where they can afford to live on the wages they are able to make.

It seems to me that it’s more like…“Raising it will have some short term consequences ,employers will retaliate ,by letting some workers on the bottom go, and getting the remaining workers to work more to fill the gap, but then when they wake up to the overtime bill, and tired employees are not very productive, things get back to normal” and the cry to raise minimum wage begins again.

Raising minimum wage is not without consequence. The employers raise the cost of goods and services to pay the increased wages, which eventually cancels out the wage increase.

Then who is to blame, the workers that want a living wage?
Or Corporations that want to maintain profits for share holders at all costs?

How would you feel after working a 40+ hour week, and still have to ask the Government for help just to put food on the table?

I’m not ‘blaming’ anyone.

Where I live, the current minimum wage is high enough for me to get along on. I know that’s not true of everybody, and I’m not arguing that. But I’m making the argument that raising the minimum wage is effectively lowering the wages of everyone else, as it will increase the cost of living for everyone.

Maybe the President’s higher education proposal has merit. Again, I don’t know. I’m pretty sure what we are doing isn’t working well, however.

@ibstubro “So, everyone in the US should be paid a Federally Mandated Minimum Wage that would allow them to live in Manhattan, NY?”

A lot of the people who work in NYC don’t live in NYC—thus the importance of the George Washington Bridge. And this helps us see why not everyone needs to be making $40/hour minimum. But the people of Harlingen, TX can’t commute to New York, Boston, or San Francisco every day. So while they may have one of the lowest costs of living in the United States, they’re also stuck with having roughly 33% of their population below the poverty line. Nor are they alone. If the current problem is sufficiently widespread, then, the solution may need to go beyond state or municipal solutions.

I have asked this before why when a top person gets a raise, people just shrug, but when the bottom want one , everyone cries the sky is falling.
In the past twenty some years the idiots at the top, have seen their income go up something like 400%
But the working slob and the minimum wage earners barely scratched a 4% increase.
And yet it’s so bad if the lower slobs get any kind of an increase.
WHY??

@ibstubro First I don’t think anyone here is arguing that the federal minimum wage should be set for the cost of living in NYC. That’s a straw man. Second, you’re simply wrong about inflation. From the video I linked above, a $7.19 cent meal at McDonalds would only increase by $0.04 to cover the cost of raising the minimum wage to $10.10. In the big picture of inflation that’s very negligible. In many industries that pay over minimum wage there would be no price increase, so the effect on the overall inflationary effect on the economy is close to 0%.

However, with fewer working poor getting subsidies, the aggregate cost to the taxpayer would be pretty significant. Not to mention with more money in their pockets, the working poor would be able to buy more stuff, which increases the demand for goods and services in the economy. This should have a significant boost on the economy.

WOW excellently said @gorillapaws why don’t our fright wing friends get that??
They just run around and scream the sky is falling, down with the Government,and with the lower income earners, with this increase will need the Government less, but the Rep/cons still run around screaming it will be the death of us all type thing.

@gorillapaws “As stated earlier, a company who doesn’t provide a living wage to full-time employees is externalizing their labor costs onto the taxpayer. In effect, our tax dollars make it possible for their businesses to run, but they’re not reimbursing us for those costs. Minimum wages protect the taxpayer from this expense by forcing companies to provide a living wage so their employees aren’t receiving government payouts.”
Oddly, the party who screams the loudest against taxation is the one that favors the policies that lead to passing business expenses on to the taxpayers.

@ibstubro “Where I live, the current minimum wage is high enough for me to get along on.”
Precisely so. Now look at the population distribution of the US. I think it safe to say that merely living in the Midwest puts you in a minority since nearly ⅔ of Americans live someplace quite unlike where you are. But the fact that, aside from housing, cities don’t cost terribly much more to live in than the country (a bit more, but nothing like 20,000% more) plus have a large number of customers to pass the cost to means that prices rise only slightly. Now, a 1% price hike with 50% more money being dumped into the economy due to increased spending as a result of finally having money to spend seems to me to be a good thing, thus I see it as an investment.
Of course, the fact that Costco is outperforming Walmart also lends a little credence to the argument while the fact that, according to The Economist Australian Big Macs are $4.32 (or AU$5.76) compared to $4.79 here, and that Seattle hasn’t imploded yet all prove it in more practical terms than a few business ledgers.

Another point to be made is that according to classical Keynesian economics, product demand declines when incomes are skewed to favor the wealthy, which leads to recessions. Simply put, wealthy people spend a smaller proportion of their income on basic goods. There is, for example, only so much that a plutocrat can spend on food. Raising the minimum wage has the effect of transferring money from the more wealthy to the less wealthy and acts as an economic stimulus, which benefits everyone. It is not a zero sum game. Redistributing the slices of the current pie leads to increases in the size of the pie.

@LostInParadise You know that, I know that, Nick Hannauer knows that, but there are some who insist that the only way for the poor to get out of poverty is to give all the money, including returns on investments and increased profits, to the aristocracy, while also cutting all government assistance.

Thanks for the reference.

Nice article @jerv and so very true, but is it (GASP) peer reviewed?
If it isn’t our favourite fright winger miss grac3al0t will just dismiss it as left wing propaganda
don’t tell her but I agree with her to a point, she said businesses will retaliate by letting workers go and working the remaining ones more, and I think that is true,BUT unlike our fright winger I think that is a short term consequence, businesses will wake up when they get the overtime bill, and realize tired employees are not very productive,then things will get back to normal,and your economy will do better, because one the lower income earners wont need Government help,and two they will have more money to put back into the economy,but the right still refuse to see this,and I keep wondering why????

Personally, my views on money are more inline with Bill Gates, Warren Buffet,Nick Hannauer, and Elon Musk. The way I see it, self-made multi-billionaires know a few things about money, more than simple heirs like the Koch Brothers.

@jerv I think you’re actually onto something there. People that inherit wealth are all about preserving it, clinging to it, maybe out of fear that they know they aren’t capable of starting from nothing and becoming filthy rich. Whereas you take a guy like Musk, steal all of his wealth and I’m reasonably confident he would be able to earn it all back.