Are high minimum wages ethical?

biochem wrote:It is certainly worth a try. We do know the multinational companies are tax sensitive, locating themselves in Ireland etc to avoid taxes. So it is logical that they would seriously consider taking advantage of this tax break. If they don't take advantage of such a good tax deal, we may need combine it with some regulatory reform as well. Not all of the expenses in employing US workers are direct, the Obamacare mess is one example. There are others.

On the revenue side, there probably won't be much loss to the government. These guys are dodging taxes anyway, so we wouldn't actually lose revenue. This would just give them a tax dodge that actually benefits people. We probably will even come out ahead - not having to pay so much in welfare and "disability" etc. plus the money from individual income tax of the US based employees plus secondary effects. They have a job therefore they can afford to spend money in the local economies etc.

DDHv wrote:
Yes. They also employ a larger proportion of beginning workers.

I'm officially retired (at some years after 65 - problem finding someone who could do the work), but am still called back at times when they get stuck with something. The last time was this month. While I was working, the owner-boss was talking to someone on a nearby phone. He was discussing how it was hard to find people who would make it their business to consistently do the work they were hired to do. Often he needed to fill in for someone who didn't. Yes, a small business. He started as a laborer there, decades back. He has a number of skilled workers, who get much higher pay, but can also be relied on to do more than the unskilled labor. Whenever possible, he promotes from within - someone who has both learned how to do the more difficult work, and is also experienced in the company is worth more.


When just out of my school, things were slow and, partly because of lack of experience, it wasn't possible to find work fitting my training. Going back to the ranch was possible, but didn't fit my interests. Still single, it was possible to live on very low income. Later, given work experience and better economic conditions, that changed.

The real minimum wage is zero - when you can't find work. The basic question here is how to arrange for new workers to get experience without killing the businesses. It looks like different cultures have various methods, as is to be expected. One problem is that some don't balance these needs: in the USA, many of the governments which tried to provide people's wants and needs from taxation are having very bad financial problems. I assume everyone knows the story about killing the golden goose?

Double entry bookkeeping, done right, shows a balance of value going one direction against value going the other way. We pays our money, and gets our goods; the seller loses inventory, but to survive must get enough to replenish it after expenses.

Should an understanding of the basic principles of double entry (as opposed to just skill in doing it) be a requirement for public office

thinkstoomuch wrote:Peter's comments over in Presidential candidates made me go look.

http://www.pewresearch.org/fact-tank/2014/09/08/who-makes-minimum-wage/ wrote:Perhaps surprisingly, not very many people earn minimum wage, and they make up a smaller share of the workforce than they used to. According to the Bureau of Labor Statistics, last year 1.532 million hourly workers earned the federal minimum of $7.25 an hour; nearly 1.8 million more earned less than that because they fell under one of several exemptions (tipped employees, full-time students, certain disabled workers and others), for a total of 3.3 million hourly workers at or below the federal minimum.

In 2013 total employees was 144 million. or about 2.5%.

Another interesting quote from the above article.

People at or below the federal minimum are:

Disproportionately young: 50.4% are ages 16 to 24; 24% are teenagers (ages 16 to 19).

Mostly (77%) white; nearly half are white women.

Largely part-time workers (64% of the total).

Actually it makes a good read with lots of caveats. Fairly short read though.

As an example went looking around the BLS website.

Picked the lowest wage for FL. Where the minimum wage is $8.05.

39-3031 Ushers, Lobby Attendants, and Ticket Takers

Leads to this table.http://www.bls.gov/oes/current/oes393031.htm

We shall see how the table shows here.

Percentile | 10% | 25% | 50% (Median) | 75% | 90%
Hourly Wage | $8.05 | $8.61 | $9.22 | $10.75 | $14.00
Annual Wage (2) | $16,730 | $17,910 | $19,180 | $22,360 | $29,110

For what it is worth,
T2M

PeterZ wrote:I think this post truly frames the underlying practical question. Is the 2.5% of the working population making minimum wage better off working and learning the skills necessary to make more than the minimum wage or are they better off unemployed?

These are the jobs on the margin. They pay so little because the do not generate sufficient return to the business. If the minimum wage is increased, the business would hire a more productive staff. People who can do multiple jobs that had previously paid minimum wage.

Movie theaters will see some procedures that would reduce the number of ticket takers. Perhaps, double up the concessions sales and taking tickets. Maybe automating the ticket validation process. McDonald's is experimenting with a more fully automated kitchen and point of sale system. They new system would employ far fewer people and those that are employed would have to have sufficient skills to be much more productive. The new positions pay more, but there are fewer of them.

Ps. That 2.5% consists of 1.2% below 25 years old who are learning skills and 1.2% 25 years old and older who either haven't learned sufficient skills or are troubled/handicapped in some way. It is more effective to address the specific problems of that 1.2% of the adult working population than to simply mandate that everyone be paid more whether they have the skills to earn that increased pay or not.