ray

I don't agree with your phrase "miserably poor".

ray

The federal minimum wage is $7.25 per hour ... that's about $14,000 per year

All those who make less than the Federal government’s official poverty threshold. . . which for a family of four is $23,850.00. People working at minimum wage, even holding down several jobs. Seniors living on fixed incomes. Wage earners suddenly out of work. Millions of families everywhere from our cities to rural communities.

I think that someone could be said to be miserably poor if they are in a familiy or individual that suffers food insecurity, housing insecurity or medical insecurity (that is fear of a medical problem because of the financial implications).

That varies by region of the US.

.Food Insecurity
In 2012, the USDA estimated that 14.5% (or 17.6 million) of US households were food insecure—meaning that they had difficulty at some time during the year providing enough food for all their members due to a lack of resources. Rates of food insecurity were substantially higher than the national average for households with incomes near or below the Federal poverty line.

The point I'm making Ray is that where nations have guaranteed health care through national insurance, there is no health insecurity. Where minimum wages are higher there is far lower food insecurity or homelessness. And that as a way to eradicate homelessness, food insecurity and health insecurity ... the market place has not been good.

How's this for a campaign slogan: "Ask not what your country can do for you, but ask what you can do for yourself."

Lets ignore the fact that everyone working for minimum wage are investing 40 hours of their week, reasonably a full work week, trying to d as much for themselves and their family as possible.
but they end up poor and suffering the insecurities I've noted.
In order that the places that hire them can compete ....Mostly with each other...
These are largely service jobs that aren't being out sourced....
And in order for the owners of the business to continue to enjoy enormous profits.
So the cost of alleviating the poverty that the minimum wage creates falls to tax payers and in the US that means typically inefficient social programs...
raising the minimum wage to a livable number is a more efficient way to alleviate the insecurity and allows those who are at a minimum greater dignity.

But its always easier to blame the working poor for being the working poor.

I didn't blame the poor ... that's your dishonest political characterization of what I wrote.

Why do people have food insecurity if we have food stamps? Why do we have health insecurity if we have ACA? We have a tremendous amount of public housing. Why is their housing insecurity?

So since Canada has a minimum wage of about USD $9.15 to USD $10.25 and the U.S. has minimum wages of $7.25 to $9.32 you live in Paradise and we live in a Dickensian universe?

You care so much about the working poor that you are willing to risk their jobs for them.

ray

Why do people have food insecurity if we have food stamps? Why do we have health insecurity if we have ACA? We have a tremendous amount of public housing. Why is their housing insecurity?

You have them, because as a society you don't want people to have food insecurity...
But as I wrote:

So the cost of alleviating the poverty that the minimum wage creates falls to tax payers and in the US that means typically inefficient social programs...

ray

So since Canada has a minimum wage of about USD $9.15 to USD $10.25 and the U.S. has minimum wages of $7.25 to $9.32 you live in Paradise and we live in a Dickensian universe?

hell no.
About the only thing better in Canada is our health care system, and a lot cheaper access to public education. But these two things do alleviate some insecurity and allow greater social mobility.

ray

I didn't blame the poor ... that's your dishonest political characterization of what I wrote.

Here's what you wrote ....

How's this for a campaign slogan: "Ask not what your country can do for you, but ask what you can do for yourself."

it seems to me that it is blaming the victim language...
But maybe you could clarify what the bumper sticker says...
Perhaps its code I don't get.
We're talking about a living wage for those working 35 hours a week. Not hand outs to surfer dudes.

rickyp wrote:ray

Why do people have food insecurity if we have food stamps? Why do we have health insecurity if we have ACA? We have a tremendous amount of public housing. Why is their housing insecurity?

You have them, because as a society you don't want people to have food insecurity...
But as I wrote:

So the cost of alleviating the poverty that the minimum wage creates falls to tax payers and in the US that means typically inefficient social programs...

ray

So since Canada has a minimum wage of about USD $9.15 to USD $10.25 and the U.S. has minimum wages of $7.25 to $9.32 you live in Paradise and we live in a Dickensian universe?

hell no.
About the only thing better in Canada is our health care system, and a lot cheaper access to public education. But these two things do alleviate some insecurity and allow greater social mobility.

ray

I didn't blame the poor ... that's your dishonest political characterization of what I wrote.

Here's what you wrote ....

How's this for a campaign slogan: "Ask not what your country can do for you, but ask what you can do for yourself."

it seems to me that it is blaming the victim language...
But maybe you could clarify what the bumper sticker says...
Perhaps its code I don't get.
We're talking about a living wage for those working 35 hours a week. Not hand outs to surfer dudes.

What are you saying should be done to surfer dudes getting handouts then?

Ricky:

Here's what you wrote ....


How's this for a campaign slogan: "Ask not what your country can do for you, but ask what you can do for yourself."

it seems to me that it is blaming the victim language...
But maybe you could clarify what the bumper sticker says...
Perhaps its code I don't get.

I'm not blaming someone for being poor ... it's really hard and often a result of one's parents. Some are lucky to be born wealthier than others.

However, once you acknowledge that there is poverty and that some people are poor (often through no fault of their own) you have to figure out the best solution. The U.S. has had a war on poverty for 50 years. You are saying that we are losing. Obama has said that we have created a culture of dependency. When he says it is wisdom; but when I say it I'm blaming the poor. Why do the meaning of the words change when two different people say the same thing?

But I digress; the reality is that the state offers very limited solutions. Yes I agree that there should be minimums for food and health care. But after that it has to be up to the individual. After sympathizing and listening, I will tell any poor person I meet that their best answer is hard work, smarts, and maybe some luck. But if they spend their time listening to people like you who talk about the evils of capitalism, how unfair it all is, how it's the systems fault or the man's fault, and how the government should do something about it, how it's all Walmart's and McDonald's fault, they are pursuing a dead end. I've got a way out. You've got snake oil ...

Ray Jay wrote:Why do people have food insecurity if we have food stamps? Why do we have health insecurity if we have ACA? We have a tremendous amount of public housing. Why is their housing insecurity?

As a nation we've been tearing down public housing all over the country and NOT replacing it. Chicago is losing 65% of their housing units. 210,000 housing units were slated for demolition nationwide between 1995 and 2007. In NYC, one of the few places with a (barely) functioning PHA, has waiting lists that are over 10 YEARS long. No one can get a public housing unit unless you're already in public housing, because if you're displaced, you're at the top of the list for a spot, and we're removing units, not adding to them. The minimums you think people should have are being, and have been, continually undermined for the past 25 years. That's not even remotely debatable. You can debate if they've been undermined too much or not enough, but the safety net has shrunk dramatically.

Here's an article on public housing, focusing specifically on Chicago. http://harpers.org/archive/2012/05/the-last-tower/

But I also know that a blind increase in the minimum wage is not necessarily going to help the people who need the most help, and may in fact, hurt the most vulnerable, since it will make it harder for some people to get a job, and so much gov't assistance is now related to having that job. It's unfair to do income/poverty calculations on a family of 4, since these are often first jobs, or jobs that are held by people in the households of others, or are simply stepping stones to other things. If you make the stepping stone more dear, you'll have fewer of them, which is tragic.

It's a very, very complicated issue, with hosts of unintended consequences looming around every corner. I don't have a solution, and neither does anyone, it seems, but that does not change the fact that some large minority of the very poor are completely screwed.

There is a big difference between what an individual should do if they are poor and what public policy should be. I totally agree with RJ that if you're poor that you should not tolerate excuses for your plight. Read some Ayn Rand if you're poor...but from a public policy standpoint telling the poor to have better character is not an effective solution. If everyone who was poor did everything right as far as work choices, educational choices, choices regarding having kids, etc. would that change the fundamental realities that our economy requires a certain level of unemployment to function without significant inflation and that there are only so many jobs around? Most likely, if one poor person makes decisions that get them out of being poor another person takes their place. Maybe that is not entirely true, but there are significant external factors that are going to make sure there always a certain number of people struggling to get by. And the increasing economic inequality is certainly one of those external factors.

Anyway, as you guys have said, almost any policy we come up with has unintended consequences. You try to help people and they become dependent. Not hoping to solve the problem but just help is all that is is possible and I would focus on these:

(1) Ensure educational opportunities. Education costs are going through the roof but the poor need to have access to education (from kindergarten through college)
(2) Ensure that corporations are not artificially lowering wages due to their unequal bargaining power;
(3) Rethink our philosophy about punishing crime. Putting large numbers of the poor in prison for non-violent crimes means that when they get out they will not be able to find a job.

geo

But I also know that a blind increase in the minimum wage is not necessarily going to help the people who need the most help, and may in fact, hurt the most vulnerable, since it will make it harder for some people to get a job, and so much gov't assistance is now related to having that job

There is no hard evidence that minimum wage increases decrease employment, with the exception of very short term effects for part time teens. (That was presented by ray)
And think logically...
If a business can get along with 8 people now, why would they hire 9? They wouldn't. They don't They aren't employing excess staff just because of a low minimum wage.
Businesses are not currently hiring more people than they require to do work, regardless of the wage level. They hire what they need to produce the goods or services that they want to sell.
By the logic of higher wages cutting jobs ... if the minimum wage were lowered every business would hire more people.
They wouldn't. They have the work force they need. But most would pay less if they could..

Ray

But if they spend their time listening to people like you who talk about the evils of capitalism, how unfair it all is, how it's the systems fault or the man's fault, and how the government should do something about it, how it's all Walmart's and McDonald's fault, they are pursuing a dead end. I've got a way out. You've got snake oil ...

every nation that has done a better job of reducing poverty, is capitalist. They just happen to have more universal social services, more respect for labour in their employment laws, and higher minimum wages.
I'm all for capitalism. In fact one of the things about capitalism is that businesses find efficiencies. Government isn't particularly good at that.
Which is why I'd rather not have inefficient costly programs like food stamps or public housing.
What government is good at is making laws and standards and enforcing them. Like minimum wage.
Consider that all the tax money that goes into food stamps et al, would be lowered if fewer people required them. And fewer people would require them if working 35 hours a week wasn't working poverty but working that provides the essentials.
That is a way off assistance.
As long as you buy the canard that business can't compete with each other by paying a decent minimum , then your tax dollars and others will be frittered away supporting people on minimum wage with food security and more...
Why, if enough of the working poor no longer needed assistance maybe those tax dollars could be used for more productive uses like infrastructure or even tax rebates....

Ricky:

There is no hard evidence that minimum wage increases decrease employment, with the exception of very short term effects for part time teens. (That was presented by ray)
And think logically...
If a business can get along with 8 people now, why would they hire 9? They wouldn't. They don't They aren't employing excess staff just because of a low minimum wage.
Businesses are not currently hiring more people than they require to do work, regardless of the wage level. They hire what they need to produce the goods or services that they want to sell.
By the logic of higher wages cutting jobs ... if the minimum wage were lowered every business would hire more people.
They wouldn't. They have the work force they need. But most would pay less if they could..

Small businesses are much more dynamic than that. You have to factor in the cost of labor saving technological improvements and marginal revenue for increasing hours.

Freeman:

I totally agree with RJ that if you're poor that you should not tolerate excuses for your plight. Read some Ayn Rand if you're poor...but from a public policy standpoint telling the poor to have better character is not an effective solution.

I understand that dichotomy. I submit that poorer people read the newspaper and watch television and soak it in when our national leaders and media talk about the evils of big corporations and that government should do more for them and it is all other people's fault. Don't we all hear from our politicians that we should be taxed less and get more?

Ray Jay wrote:Small businesses are much more dynamic than that.

Some are very dynamic. Some are not at all. It's not something one can easily generalise about (well, one can, but one would be oversimplifying greatly).

I understand that dichotomy. I submit that poorer people read the newspaper and watch television and soak it in when our national leaders and media talk about the evils of big corporations and that government should do more for them and it is all other people's fault. Don't we all hear from our politicians that we should be taxed less and get more?

I think we hear that from the people too. The politicians are just saying it because it's a popular line to take. Certainly the 'taxed less' bit. Oddly, increasing the minimum wage is unlikely to increase tax rates - it may well mean more revenue for government and less spending.

ray

Small businesses are much more dynamic than that. You have to factor in the cost of labor saving technological improvements and marginal revenue for increasing hours

Small businesses are indeed dynamic. And the owners of them make business decisions every day that incorporate a myriad of factors.
But not one of them involves deliiberately hiring more employees than are required to do the work, just because they get them cheap.
An increase in the cost of labor that occurs after a minimum wage hike also occurs as only one factor in the business too. It might cause a business to consider getting by with less labor but all those other dynamic factors also occur. Including technological improvements...
However those considerations aren't just triggered by a minimum wage hike. In a dynamic business they are factors that the business owner considers every day. A hike in minimum wage would just be one factor and in most businesses in the service sector and retail sector currently making use of minimum wage the most, already baked into most of their business practice.
There are also dynamic decisions to be made by government every day. And one is, if I (gov) spend all kinds of money on social benefits for working people who, after a full week's work, still can't feed their families or pay rent or buy health insurance.... Why?
Who is being subsidized here?
Why spend money inefficiently by government to alleviate the misery caused because many businesses will only pay a minimum wage if forced to do so .... (Most would pay even less if they could) .
You can call food stamps, and medicaid and public housing welfare ... but its also corporate welfare in that a minimum wage would eliminate the need for much of the public welfare. And force businesses to deal with the genuine cost of labor and not a subsidized cost.

Since you are keeping an open mind, you should check out: Minimum Wages" by MIT Press.

http://mitpress.mit.edu/books/minimum-wages

Based on their comprehensive reading of the evidence, Neumark and Wascher argue that minimum wages do not achieve the main goals set forth by their supporters. They reduce employment opportunities for less-skilled workers and tend to reduce their earnings; they are not an effective means of reducing poverty; and they appear to have adverse longer-term effects on wages and earnings, in part by reducing the acquisition of human capital. The authors argue that policymakers should instead look for other tools to raise the wages of low-skill workers and to provide poor families with an acceptable standard of living.

Here's a scholarly article: http://www.people.vcu.edu/~lrazzolini/GR2010.pdf

Using data drawn from the March Current Population Survey, we find that state and federal
minimum wage increases between 2003 and 2007 had no effect on state poverty rates. When we
then simulate the effects of a proposed federal minimum wage increase from $7.25 to $9.50 per
hour, we find that such an increase will be even more poorly targeted to the working poor than
was the last federal increase from $5.15 to $7.25 per hour. Assuming no negative employment
effects, only 11.3% of workers who will gain live in poor households, compared to 15.8% from
the last increase. When we allow for negative employment effects, we find that the working
poor face a disproportionate share of the job losses. Our results suggest that raising the federal
minimum wage continues to be an inadequate way to help the working poor.

And here's something interesting from the BLS: http://www.bls.gov/cps/minwage2013.pdf

Minimum wage workers tend to be young. Although
workers under age 25 represented only about one-fifth
of hourly paid workers, they made up about half of those
paid the federal minimum wage or less.

David Neumark is an opponent of raising the minimum wage. The evidence indicates that raising the minimum wage reduces poverty.https://dl.dropboxusercontent.com/u/150 ... ncomes.pdf

Raising the minimum wage does not cause unemployment
http://www.cepr.net/documents/publicati ... 013-02.pdf

Here is an article discussing this.
http://m.washingtonpost.com/blogs/wonkb ... s-poverty/

It's kind of hard to read this technical economic literature, I did look through the one you cited, but the consensus among the studies that have been done (while there are those that argue differently) appears to be that raising the minimum wage helps to reduce poverty and does not reduce employment levels.

Using data drawn from the March Current Population Survey, we find that state and federal
minimum wage increases between 2003 and 2007 had no effect on state poverty rates

Ray, one of the really nutty things about these analysis on minimum wage increases is that the minimum wage only increases every 3 or 4 years.
There is an immediate effect for people getting that increase... They catch up to the losses in their income buying power that inflation has eaten away fr the last 3 or 4 years...
What other expense can businesses that use minimum wage count on to be anti inflationary ? None. But because minimum wage has to be legislated every 3 or 4 years, they can count on their labor costs - at least for their min wage employees , .

Until the min wage is set to rise automatically with inflation .... the working poor who are paid minimum wage are always losing out as the months pass.

rickyp wrote:ray

Small businesses are much more dynamic than that. You have to factor in the cost of labor saving technological improvements and marginal revenue for increasing hours

Small businesses are indeed dynamic. And the owners of them make business decisions every day that incorporate a myriad of factors.
But not one of them involves deliiberately hiring more employees than are required to do the work, just because they get them cheap.

Of course one might hire a new employee because of cost. For instance, one thing business people worry about is redundancy. You want redundancy in your business system, because what happens if Joe gets hit by a bus? Who can do his job? But redundancy can be expensive, and if your people are expensive, you're likely to sacrifice redundancy because of the cost (which actually puts your entire business at risk, but people do it all the time.)

Or you're working 8 guys with some overtime, maybe you can hire a 9th and drop the overtime, but training can be really expensive to bring someone up to speed. If that new guy is cheap, a training wage, you might do it. If he's making the same as your employees, you might not.

Expectations of growth is often a chicken and egg problem in a lot of service industries, if your next person can be brought in cheap, you might do it in anticipation of being able to keep at least some of their time busy as you grow.

There are very few assembly-line type small businesses, where you're making widgets and you need 10 workers, not 9, not 11, to run that line, most small businesses are much more elastic than what you describe. At least in the USA, but I expect everywhere.