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| 04-16-2012, 06:56 AM | #16 |
| 04-16-2012, 07:09 AM | #17 |
 Originally posted by Parallax  I would agree but for the fact that employers aren't going to absorb that cost. The employees are consumers as well. Employers, particularly small businesses will find a way to get by with fewer employee hours. Between that and the resultant price increases nobody is going to be much better off if the wage increases are drastic. I don't have any employees. I am able to handle it myself, but if I had an eight dollar an hour employee and the government said that tomorrow I had to start paying him 12, I would probably cut the hours back. Perhaps not enough to offset the full amount, I would likely make up the rest with price increases; but the net paycheck increase wouldn't be anywhere near the 50% that the hourly increase would suggest. In a multiple employee situation, it would likely result in somebody losing their job completely. Apply all that globally and you would end up with Bush era unemployment and Carter era inflation. There's no such thing as a free lunch. The only way to have a job at less than the minimum wage would be to open up your own business. The annual earnings for someone working full time with an hourly wage of $19-20 exceeds the median wage so at least half of all Americans would see their employer reevaluating how necessary their services are in order to remain compliant with the law. | |
| 04-16-2012, 07:20 AM | #18 |
| Originally posted by mikemike That might be so for someone like you who runs a bicycle boutique but there are a lot of business models out there which are totally dependent upon minimum wage workers - fast food, pizza places, car washes, etc. - these types of places would need to increase prices at least percent-for-percent to try to survive. The locations which serve low wage communities would certainly go under. | |
| 04-16-2012, 07:22 AM | #19 |
| Originally posted by mikemike That might be so for someone like you who runs a bicycle boutique but there are a lot of business models out there which are totally dependent upon minimum wage workers I don't have any workers because there isn't enough work that I need or can afford any, even at minimum wage Remember my Green Acres comment? My battle here is the location and local attitude. People walk in and look at a bottom of the line $300.00 bike and say "What makes these bikes so danged expensive? Ah kin go up tuh that there Walmart place and git one fer $89.00." Then there's the remaining 10% that want something decent, but figure it just has to be better if it's imported from someplace exotic, like Sioux Falls, or Rapid city, or comes from the internet. Last edited by Parallax; 04-16-2012 at 09:06 AM. | |
| 04-16-2012, 07:25 AM | #20 |
| Originally posted by seacapt You do realize Mosler and Mitchell are prime capitalists and support the "theory" (which it is not) I stated....... Quote: Mosler spent his early life in Manchester, Connecticut and was initially employed in Hartford before moving to New York City to work on Wall Street. In 1982, he began a hedge fund, which by the 1990s was largely turned over to his partners. Later, he relocated to the U.S. Virgin Islands to participate in a government-sponsored economic growth initiative.[1] Academically, he is known for his writings on Modern Monetary Theory, an economic theory that describes the way fiat money is created and utilized in modern economies. Quote: Rodger Malcolm Mitchell, MBA is a "turnaround specialist," who saves troubled companies. He looks at each company with fresh eyes. He ignores corporate common knowledge. He finds the realities of each company's situation. He's learned: When the obvious answers don't work, the real answers will be counterintuitive.  Quote: Faith is belief without evidence; science is belief from evidence. What historical data indicates high deficits are beneficial and do not cause recessions, depressions, inflations or tax increases, crowd out lending funds or have any other negative economic effect? Quote: Did the recession surprise you? In 1998, during the height of an economic boom, Rodger Malcolm Mitchell predicted the recession of 2001, explaining when it would occur and what events would cause it. Mr. Mitchell predicted the series of Greenspan interest rate cuts and their failure to stimulate the economy. In 2007, Mr. Mitchell again predicted a recession, detailing the causes and the solutions. In FREE MONEY, Mr. Mitchell shows you how to predict our economy. He also describes solutions to Medicare, universal health care and Social Security. Test your knowledge. How many of these questions can you answer? Is the federal deficit too high? Do large federal deficits cause inflations, stagflations or recessions? Does the Fed have the power to prevent or cure stagflations? Will you or your grandchildren have to pay the federal debt? Do low interest rates stimulate our economy? Does taxpayers' money pay for federal stimulus spending? Would elimination of FICA cause Social Security and Medicare insolvency? Is owning money different from owning debt? Should business pay its fair share of taxes? Could a very large tax cut cause federal government bankruptcy? Are there affordable solutions -- without tax increases -- to street crime, universal health care, Medicare, Social Security, poverty, military and educational needs, and a deteriorating ecosystem and infrastructure? Surprisingly, the answers to 1-10 all are "No." The answer to 11 is "Yes." | |
| 04-16-2012, 08:56 AM | #21 |
| Originally posted by Parallax Boutique? Originally posted by jeffkrol Err what about when everyone's wages are up , wouldn't it just be a zero sum game.. they (slave wage job creators) protest too much.. besides the invisible hand will sort it all out....... | |
| 04-16-2012, 09:06 AM | #22 |
| Originally posted by mikemike Hehe, sorry if you take offense to that I was just referring to it being a specialized shop for something where you are carrying products that are probably several steps in quality and price above the more generic shops like wal-mart or general sporting goods stores like Dick's or Sports Authority and providing services which they cannot. | |
| 04-16-2012, 11:02 AM | #23 |
| Originally posted by mikemike Most of the people working at minimum wage jobs are working at jobs which cannot be offshored, such as flipping burgers, but there are lots of people working at under $20/hour who are competing successfully in a global labor market. These people might be the parents of, live in the same neighborhoods as, or patronize the businesses which employ the minimum wage workers. Increasing minimum wage punishes these people by sending their jobs offshore and has a destructive cascade effect on their communities. ........................ Again "Creative destruction" will sort it all out.. seems your not much of a capitalist...... Quote: “Raising the minimum wage is good economics and good politics,” said David Madland, Director of the American Worker Project at the Center for American Progress Action Fund, at a June 7 event co-sponsored by the Center for American Progress and the National Employment Law Project. Madland explained that new cutting-edge economic studies demonstrate the economic benefits of increasing the minimum wage. “Raising the minimum wage does not kill jobs—even during periods of high unemployment,” he said, but instead encourages spending, investment, and economic growth. Helen Neuborne, director of the Quality Employment Unit of the Ford Foundation, followed Madland’s remarks and underscored the important role a minimum wage increase could play in changing the lives of American workers. “Most minimum wage earners are adults, and 60 percent of them are women,” she said. “And they have families to support.” Raising the minimum wage would help workers cope during the next few years of America’s economic recovery from the Great Recession. Keep believing the lies THEY want you to believe..... Raising the Minimum Wage, Rebuilding the Economy IN an MMT sense all it would take is 1)cut all payroll taxes and raise minimum wage a bit. 2)subsidize wages at say. .25/dollar earned until a salary cap of $20/hour.. (no the Fed wouldn't have to "bill" you for it though you refuse to understand this) (probably would have to be a sliding scale to avoid "fudging" at teh cutoff and would have to be on a monthly basis.....) | |
| 04-16-2012, 11:37 AM | #24 |
| Originally posted by jeffkrol IN an MMT sense all it would take is 1)cut all payroll taxes and raise minimum wage a bit. 2)subsidize wages at say. .25/dollar earned until a salary cap of $20/hour.. (no the Fed wouldn't have to "bill" you for it though you refuse to understand this) (probably would have to be a sliding scale to avoid "fudging" at teh cutoff and would have to be on a monthly basis.....) Originally posted by jeffkrol GALBRAITH: Well, as you know, for many years now a great many of us have been saying that the government should be in the business of creating more jobs directly or indirectly with an expansionary program. And we have been blocked on that avenue, basically. At the moment, the debate has been dominated by debt and deficit worriers, one might even say hysterics. What I propose, therefore, is a measure that would not involve increasing federal budget expenditures and would in fact modestly reduce the deficit. And that proposal is to raise the minimum wage and to raise it very substantially. JAY: How much would you raise it? GALBRAITH: Oh, I would say $12 an hour from the present, you know, and change. So a very substantial amount, enough to make a material difference in the lives of a large part, of a substantial part of the working population, and therefore to change their household balance sheets to give them a substantial increase in purchasing power. That's the idea behind this suggestion. What you seem to want would be a wage guarantee of some sort like having the government just automatically depositing $3000/month into the bank accounts of every american over the age of 16 and reducing the minimum wage to $3/hour. That is totally different than what Galbraith is advocating. Changing people's relationship between work and money like this might sounds good when you put it through static analysis, but the economy is a dynamic system and it would have far reaching effects on how we americans look at the fiat currency and how foreigners look at the US dollar. There are huge risks that a paradigm shift will result in very severe negative consequences IMHO. | |
| 04-16-2012, 11:55 AM | #25 |
| Originally posted by mikemike If you reread the BS Dr. Galbraith was spewing in your own quote, that is not what he is suggesting (although he is pretty close to a chartalist). The tab for increasing the minimum wage by $12/hour would be picked up by the employers not the government in any way shape or form. What you seem to want would be a wage guarantee of some sort like having the government just automatically depositing $3000/month into the bank accounts of every american over the age of 16 and reducing the minimum wage to $3/hour. That is totally different than what Galbraith is advocating. Changing people's relationship between work and money like this might sounds good when you put it through static analysis, but the economy is a dynamic system and it would have far reaching effects on how we americans look at the fiat currency and how foreigners look at the US dollar. There are huge risks that a paradigm shift will result in very severe negative consequences IMHO. don't know where you get the $3/hr min wage from .. But lets tack left a bit.. consider it "soc sec" for workers... Worker gets $8/hr wages from an employer.. Fed sends check for $2/hr for every hour worked at that rate.. his effective wage is now $10/hr... Play the "tax game" all you want w/ the money but this doesn't "burden" the employer.. Rewards "workers" (isn't that what it is ALL about or do we just really want a country of wage slaves). Fed can afford it because of the VERY NATURE of it's currency system. States get added tax revenue (more money per employee , more money spent. They can even "save" Heck throw a larger "savers credit")..... Win win ONCE you get off flat earth................. BS is in the eye of the beholder.. looks like we may need another generation to get off flat earth.. This one apparently can't use observation and fact... eh... YOU just REFUSE to see that the Fed doen't have to "pay for" anything...... which we haven't done anyways for 2 generations........ | |
| 04-16-2012, 12:39 PM | #26 |
| Originally posted by jeffkrol Yes part of that is my own ideas.. don't know where you get the $3/hr min wage from .. What you are basically asking for is an expansion of the EITC which does almost exactly what you want (subsidizing 25-45% of their earned wages) for people who earn up to $20,000/year and goes all the way up to the low $40Ks but at a lower percentage. Any kind of program like this would probably be administered through the tax filing system as that is just a lot easier for the government to administer. How does this help anyone who is currently unemployed? The EITC isn't enough to entice many people to work for minimum wage. How does this help anyone who is basically unemployable for any reason? They will still be left out in the cold. On the other hand the $36000/year income guarantee helps the unemployed and unemployable people out, it would possibly reduce the amount employees would accept in exchange for their labor. In reality you would be able to just eliminate the minimum wage since the minimum people would accept would then be based on the cost of them working (i.e. transportation, daycare, work clothes, etc.) so you would see many fewer people actually working outside the home since it just wouldn't be worthwhile for them. So that would be a much different society than we have now. | |
| 04-16-2012, 04:03 PM | #27 |
| Originally posted by mikemike What you are basically asking for is an expansion of the EITC which does almost exactly what you want (subsidizing 25-45% of their earned wages) for people who earn up to $20,000/year and goes all the way up to the low $40Ks but at a lower percentage. Originally posted by mikemike Any kind of program like this would probably be administered through the tax filing system as that is just a lot easier for the government to administer. How does this help anyone who is currently unemployed? The EITC isn't enough to entice many people to work for minimum wage. How does this help anyone who is basically unemployable for any reason? They will still be left out in the cold. On the other hand the $36000/year income guarantee helps the unemployed and unemployable people out, it would possibly reduce the amount employees would accept in exchange for their labor. In reality you would be able to just eliminate the minimum wage since the minimum people would accept would then be based on the cost of them working (i.e. transportation, daycare, work clothes, etc.) so you would see many fewer people actually working outside the home since it just wouldn't be worthwhile for them. So that would be a much different society than we have now. see. and yes ..see thinking outside the box.. for fun: IMF struggling with facts that confront its ideology | Bill Mitchell – billy blog Quote: They are clearly realising that their economic model is deeply flawed and has failed to predict or explain what has been going on over the last five years. That tension has led to research which starts to get to the nub of the problem – in this case that large build-ups of debt in the private domestic sector (especially households) is unsustainable and leads to “significantly larger contractions in economic activity” when the bust comes. They also acknowledge that sustained fiscal support is required to allow the process of private deleveraging to occur in a growth environment. But then their ideological blinkers prevent them from seeing the obvious – that sustained fiscal deficits are typically required and that in fiat monetary systems this is entirely appropriate when . Which then leads to the next conclusion that they cannot bring themselves to make – the Eurozone is a deeply flawed monetary system that prevents such fiscal support and should not be considered an example of what happens in fiat monetary systems. Some progress though! Quote: In the US, for example, the Congress is soon to debate and vote on a serious reduction in income support for the already beleaguered unemployed. There is a tendency to think about this from the perspective of a commitment to social democracy as being immoral, iniquitous, and a violation of the human rights of the disadvantaged. While I have great sympathy with all of those emphases, there is an easier attack that can be mounted on cutting unemployment benefits in the US or elsewhere. Such a strategy only serves to further undermine the spending capacity of the private sector at a time when the principal problem is a deficiency of aggregate spending. A simple understanding of macroeconomics leads to the conclusion that our pathological meanness to the unemployed is just bad economics. | |
| 04-16-2012, 04:13 PM | #28 |
| Quote: Simon Johnson then notes that the Republicans in the US Congress want to “cut back dramatically on these benefits, asserting that this will push people back to work and speed the recovery”. In this context, he asks the question: Does this make sense, or is it bad economics, as well as being mean-spirited? He concludes, categorically, that these proposals are not only mean-spirited, but also plainly and simply, bad economics. Noting that the US “has lost more jobs than in any other recession in the last 70 years” (some 8 million jobs) and that the scale of idle labour in the US is well above the official unemployment rate (a rough rule of thumb is to double the official estimate), Simon Johnson says that: However you want to count it, the financial crisis of 2008 brought on a jobs disaster Further, the “disaster is still with us” and unlike previous recessions “the share of long-term unemployed in total unemployed” has risen dramatically (now close to 45 per cent). Simon Johnson attempts to justify the structure of unemployment income support in the US by arguing that the federal government “has the strongest ability to borrow at low interest rates”, while “most states are much more strapped for cash”. He might have actually said, which would have been closer to the truth, that the federal government can never be involuntarily strapped for cash. He implicitly acknowledges that when he says that we should: … not be deceived by claims that the federal government is “broke,” in the sense that it cannot afford to provide additional support to states and people at this level. This is a myth, pure and simple. Any financial constraints that the US government experiences are purely voluntary and not intrinsic to the monetary system that it is at the head of. He then makes the case that the unemployed are hardly to blame for the parlous current situation that they find themselves in. One of the underlying narratives relating to the unemployment benefit discussion is whether the individual is responsible for his/her own joblessness. Note Johnson’s phrase – “laid off through no fault of their own. He notes that the “jobs crisis was caused by recklessness in the financial sector, made possible by irresponsible deregulation … and resulting in enormous unconditional bailout protection for the bankers at the heart of the disaster”. With the mainstream economists trying to reconstruct this crisis as a sovereign debt problem, the roots of the crisis – in terms of private-sector extravagance – are being obscured. It is quite clear that the unemployed can do little to improve their individual circumstances. It is a fallacy of composition to think if all the unemployed tried harder to get a job that they could all succeed. The unemployed cannot search for jobs that are not there. A particular individual might be able to improve their chances of gaining a job, but in macro terms, that will only serve to shuffle the jobless queue. The overall problem is a deficiency of jobs which is a demand rather than a supply issue. In that vein, he says that: Let’s be generous for a moment and simply state that mistakes were made – on an enormous, macroeconomic scale with gut-wrenching consequences for families around the country. Why would anyone now seek to punish these people when they seek work but cannot get it? He notes that the extended unemployment benefit in the US puts a worker on around “70 percent of the poverty level for a family of four”. Interestingly, even if you choose not to adopt a caring approach to the unemployed as an exercise in humanity, the logic of depriving them of adequate income support a time when there is a severe deficiency of jobs, doesn’t even have a in terms of cold economics. Simon Johnson notes that cutting unemployment income support in this type of labour market “you will push more individuals and families onto the streets and into shelters” with the consequence that costly ” fall-back services” will be required. The cost of the services are ” much higher than providing unemployment benefits”. These costs extend to the damage to overall spending that these cuts would cause. He says: How does it help any economic recovery when the people who lose jobs cannot even afford to buy basic goods and services – enough to keep their family afloat? We worked out long ago (during the Great Depression) that, apart from the morality of providing income support to those that could not take care of themselves through no fault of their own, that economic downturns are the result of a slowdown in spending. As a consequence, the further undermining of the spending capacity of those who lose their jobs as a consequence of this slowdown in demand only worsens the situation. Simon Johnson notes that this logic – which is just basic macroeconomic theory – is now ” likely to collapse” in “the face of our modern mean-spiritedness”. What a bunch of morons we are! | |
| 04-17-2012, 06:37 AM | #29 |
| Originally posted by jeffkrol Pretty much but w/o disqualifiers and direct bi-weeky or monthly payments. Quote: no actually it could be administered by "employers" who record and pay and then get reimbursed from the Fed.. see. You also have a whole stack of laws and programs which have income limits based on earnings too so if you did this where refundable tax credits like the EITC were now counted as regular income, you would see a lot of people taxed on that income and based on there income they would either see reduced or eliminated food stamps, medicaid, housing assistance, and other benefits the federal government has the power to try and fix some of these side effects but they will no doubt leave a stone or two unturned. There are a lot of programs which are administered at the state level and state income taxes which would give the states the option of not increasing these limits in step with the federal government's move in order to reduce the cost of services for the poor and increasing income tax revenue. Finally, what would ensure that employers would actually pass that 25% on to the employees in the form of raises (aside for a 25% simultaneous increase in the minimum wage)? Nothing, the employers could just use those payments to reduce their own payroll costs. | |
| 04-17-2012, 01:09 PM | #30 |
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Mikemike I may get back to you on your questions but for now have some fun w/ EU turning right,left........ Knowledge@Wharton: Related to that, austerity has been one of the chief policy levers Europe has been using to deal with the crisis. Do you think European leaders have focused on austerity too much and gone too far with it? Should a better balance be struck between austerity and stimulus? Lagarde: If everybody goes at the same pace with austerity measures, it puts the whole region at risk. What we have advocated consistently now for at least the last six months is that there should be a proper balance within the zone, particularly within the advanced economies. We also need a proper balance between the austerity measures that are necessary and the growth-facilitating measures. So, obviously, it’s not a one-size-fits-all. Translation: “Austerity” means to spend less and tax more, which always destroys an economy. But some nations are spending less and taxing more too much and some too little. Each nation needs to balance between spending less and taxing more vs spending more and taxing less. We want them to balance growth against shrinkage. If you find this confusing, how do you think I feel? Some countries can afford to relax a little bit the austerity policy that they had embarked on. Others cannot relax the austerity measures. For instance, Greece is one country that certainly should not relax its measures. Italy is another one. Translation: The countries in the most desperate economic situation definitely should shrink their economies further, so they can get out of recession and transition directly into depression. Knowledge@Wharton: Can you have too much austerity in the short term rather than it being spread out more evenly towards the medium and long term? Lagarde: It depends on the situation. There are some countries in which sharp adjustment is needed in order to be able to bounce back from that situation. Translation: Rather than answer your question, I’m going to use the same double-talk that made Alan Greenspan fool Congress all those years.  –Very revealing interview with Christine Lagarde, managing director of the IMF | |
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