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Michele Bachmann Would Consider Lowering Minimum Wage To Match The Cost Of Labor Overseas

I have be saying for a while that no matter how badly Obama fucks up, whomever emerges from the GOP primaries will be so fucking batshit they'll terrify the electorate into re-electing him.
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gwendally
Aug. 27th, 2011 07:08 pm (UTC)
I totally and frankly support the lowering of the minimum wage. The author of that piece got it exactly backwards: it doesn't matter if the wage being offered is too low for a decent lifestyle. If you don't want it, don't take it.

At issue here is that a great deal of the labor in the United States is not productive enough to warrant being paid more. In other words, they do not produce goods and services that are worth $10/hour to an employer.

So what happens in those situations? A bunch of stuff: the employers don't hire them is the main one, the one I see everyday as a counselor to small businesses. I hear them ALL THE TIME saying they'd like someone for $8/hour but can't afford to pay $10/hour. So they just don't hire someone.

The other thing that happens is that employers hire sub-contractors and pay them what works out to be less than minimum wage with no paid holidays or sick time or payroll taxes or unemployment insurance or worker's compensation insurance or tax withholdings or vacations or maternity leaves or fringe benefits.

The third thing that happens is that employers pay people under the table, forcing them into a world of tax evasion and lack of coverage under the social security safety net.

These three things are ABSOLUTELY already happening. You can't just mandate that employers pay employees more than the employee's worth is to them. They simply won't do it.

An interesting question that I think we all have to grapple with is why a laborer in Kansas should expect to get a better rate of pay for their labor than a laborer in Bangladesh. What would make this true?
badnewswade
Aug. 27th, 2011 09:54 pm (UTC)
* It costs more to live in America than it costs to live in Bangladesh

* If productivity is low, that could easily be because wages are so low people don't really consider it worth bothering to do a decent job of it

gwendally
Aug. 27th, 2011 10:12 pm (UTC)
Americans have shown over and over again that they are not willing to pay for goods and services priced at the amount Americans would charge. That's why manufacturing has gone out of business. "Made in America" is sweet, but no one will pay twice as much for a wrench to be patriotic.

If the employer cannot make money selling the goods and services they make at a price that will cover the cost of doing business in the United States then they will not do that business in the United States. Sometimes they'll go elsewhere, sometimes they just plain old won't do that business. I can point to a half dozen businesses that did not start during this recession because the business model didn't work: it wouldn't make money. In a couple of those cases it was because the cost of labor was higher than it was worth it to the employer to pay them.

Instead of some people making $8/hr, now they make $0/hr and these particular goods and services are not generated and added to the GDP.

Don't you understand, it doesn't matter what it costs to LIVE. It matters whether your skills are valuable enough - whether you can transform enough energy in such a way as someone else is willing to pay for it - so that you can earn the standard of living you would like to have.

In a lot of cases the answer is absolutely not.

Now, whether or not there should be base-level economic assistance so that everyone lives in dignity even when their labor has little economic value is a different question. It's not the one being discussed. The question here is what happens when the economic value of someone's labor is less than the minimum wage? What then? Is it right to deny them entry into the workforce AT ALL?
badnewswade
Aug. 27th, 2011 10:28 pm (UTC)
It matters what it costs to live because if people don't have enough money to live on, they can't function well enough to work properly. (They also end up having to take government welfare handouts while working, as wages don't pay the bills - I guess you'd get rid of that too)

Ever wondered why build quality is so low on all those third world sweatshop produced goods you're so in love with?
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nebris
Aug. 29th, 2011 05:59 pm (UTC)
they'd like someone for $8/hour
And this was a disingenuous opening as the Federal minimum wage is $7.25, with Oregon having the highest state minimum wage at $8.25.

~M~
gwendally
Aug. 29th, 2011 06:13 pm (UTC)
Re: they'd like someone for $8/hour
No, it's not disingenous.

I live and work in MA. The minimum wage here is $8/hr. To this you have to add the OTHER expenses the employer has of obtaining that person's labor: unemployment insurance is a minimum of 3.65%, but quite likely higher, so let's say 4%. The employer's share of the employee's social security and medicare tax is 7.65%. The employer is also obligated to pay worker's compensation insurance for the employee, which can be extradorinarily high - in the thousands of dollars, but let's say for sake of rounding that it's 3.35%. That's 15% extra that the employer has to pay to the benefit of the employee in exchange for the employee's labor. That's $1.20 on top of the $8.

The other portion of the calculation (which I assure you, the employer calculates) is how much time are they paying for where they do not obtain any economic benefit. If they are required to pay 5 holidays that works out to roughly another 2% of the $9.20, making an effective hourly rate of $9.40.

That's in the example where the minimum wage is $8/hour and taking moderate estimates for unemployment and worker's comp. Those figures are considerably higher in construction industries.

The knee-jerk emotional answer is to maintain that these taxes are on the EMPLOYER. But reason it through: if that is the amount that the employer is required to pay to or on behalf of the employee to obtain the employee's services, and is in fact the amount that the employer paid to obtain the employee's services, then how can you NOT say that these taxes are on the employee's labor?

Payroll taxes are cleverly disguised as taxes on the meanyhead employers. Not one worker in 100 realizes that they're the ones who actually pay them.
nebris
Aug. 29th, 2011 06:26 pm (UTC)
Re: they'd like someone for $8/hour
And this is still fighting over scraps. The Corporate State marginalizes small business and makes these nickle and dime calculations life and death. Chopping the minimum wage is a destructive band-aid solution when the issue is Systemic.

~M~
Re: they'd like someone for $8/hour - gwendally - Aug. 29th, 2011 08:11 pm (UTC) - Expand
chipuni
Aug. 27th, 2011 07:16 pm (UTC)
With all due respect, I have a few comments:

1. Most voters are not making minimum wage. For most voters, the only time that they made minimum wage, they were living with their parents. Therefore, they don't think that making minimum wage is so bad.

2. Most voters think that lowering minimum wage means that more people will be able to work for less money -- in short, creating jobs without raising costs. Since it doesn't seem to affect them directly, this sounds like a good deal to them.

3. Many voters RESENT the poor. The Wall Street Journal calls people who don't pay Federal income tax "lucky duckies". Out of spite, some voters will vote to lower wages on the poor JUST to hurt them.
badnewswade
Aug. 27th, 2011 09:57 pm (UTC)
Exactly - when things get tough people are scum, and they will be more than happy to turn an effective and powerful nation like America into a third world country simply out of spite for their fellow man. I'm sure it's happened before, it's just strange to see it come out as naked class warfare rather than taking the form of ethnic tensions, racism or seperatism.
gwendally
Aug. 27th, 2011 10:14 pm (UTC)
That's a pretty heady assertion. You assume people who see things from a different point of view than you do are spiteful and evil. That's probably not a good assumption. You should examine your prejudices a bit.
badnewswade
Aug. 27th, 2011 10:24 pm (UTC)
If you want to make poor people even poorer, you're spiteful and evil
gwendally
Aug. 27th, 2011 10:26 pm (UTC)
I don't want to make poor people poorer.

I want to get people who have low skills into the workforce where they can gain some skills.

There are more than one way to look at this. I think it helps a great deal if you assume goodwill from the people who are considering how to deal with intractable problems like unemployment.
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shmigs
Aug. 28th, 2011 05:19 am (UTC)
This could totally be the next Republican-for-President talking point:

"If we cut the minimum wage, we will create X number of jobs."

The Republican could then then take credit for "creating" those jobs and hold themselves out to be a miracle worker. No matter that said jobs likely are low-paying, provide no benefits or skills training and have very limited potential for advancement.

So, instead of $7.25 an hour, cutting the minimum wage by half would yield a (hypothetical) wage of $3.63. The employer could now hire 2 workers for the same amount of money. Twice as many people would be employed! A true miracle.

What a joke.
gwendally
Aug. 28th, 2011 01:23 pm (UTC)
It's not a zero sum game. More goods and services would be created when more people are employed. So if you cut the minimum wage and got two workers on the job, they'd produce nearly twice as much and the GDP would increase.

Right now we've got a troubling rise in NEETS: "Not in Education, Employment or Training." How do you propose that these people with scant ties to the workforce and low to non-existent skills be brought into the world of productive work?

And why do you think that minimum wage work is not a stepping stone? Have you ever worked for minimum wage? I have on several occasions. I never did for long.
badnewswade
Aug. 28th, 2011 02:36 pm (UTC)
So your plan to save the economy relies on exploiting people who are desperate and driving them ever deeper into poverty.

That really sounds like the kind of thing a nice person would support.
adcott
Aug. 29th, 2011 02:48 pm (UTC)
badnewswade,

You seem incapable of comprehending the possibility that someone can hold opposing views from yourself and not be evil. I find this utterly infuriating to read.

I have a genuine Real Life conundrum for you, though...

I am a small business owner. My best friend would like to work for me in a marketing role. I can't afford to pay her minimum wage but she is prepared to work for what I can afford to pay her. Minimum wage law makes it illegal for me to employ her in the role she wants for the wage she's prepared to work for - so she doesn't work for me.

If she could work for me for less, she would acquire hugely valuable skills/experience which could land her a well-paying job in the future (or she could perform brilliantly and I would be able to raise her wage). As it stands however, she is stuck either on the dole or working behind the bar somewhere... She's losing out by not being able to acquire experience/skills; I am losing out by not having her marketing bring in more customers; my customers are losing out as my prices are higher due to lower customer volume.

The way I (and my friend) see it is that the minimum wage is hindering her working her way out of poverty... what would your solution to this be?

Edited at 2011-08-29 02:48 pm (UTC)
gwendally
Aug. 29th, 2011 04:00 pm (UTC)
It's been really interesting talking with him. I was just in a fairly deep ethical conversation about the ability to use democracy when the governed insist on ruling by emotion and prejudice without reaching for reason or wisdom, never considering second or third order effects. This was a useful conversation to be in for me.

I live in a world with such educated, thoughtful people that I hardly ever run across the ones ruled by thoughtless emotion and fearful prejudice. I appreciate the reminder.
(no subject) - nebris - Aug. 29th, 2011 05:11 pm (UTC) - Expand
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nebris
Aug. 29th, 2011 04:59 pm (UTC)
This sounds a lot like a Corporatist Talking Point to me, but I'll take it at face value.

Figure out how much you can pay your friend per month and then hire them as an Independent Contractor at that amount. Here are the IRS guidelines.

As I figured that out before I'd even had my fucking morning coffee I really don't have much faith in your ability to survive as a so-called small business owner.

~M~
nebris
Aug. 29th, 2011 05:16 pm (UTC)
Ah, I see that you're in the UK. In that case, you're fucked, as you live in a full blown Police State. Oh, well....



~M~
(no subject) - adcott - Aug. 29th, 2011 07:06 pm (UTC) - Expand
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Born In England Before You Were.. - nebris - Aug. 30th, 2011 12:55 am (UTC) - Expand
Crippled By Your Anger - nebris - Aug. 30th, 2011 01:02 am (UTC) - Expand
Re: Crippled By Your Anger - badnewswade - Aug. 30th, 2011 04:51 pm (UTC) - Expand
brittdreams
Aug. 30th, 2011 03:39 am (UTC)
Actually, can you explain this to me? I'm thinking about a fast food restaurant owner. You only need a certain number of workers at any given time, based on the amount of food you expect to sell. In that instance, lowering the minimum wage doesn't lead to more employment since there isn't more work to do.

FWIW, I have worked for minimum wage and not just as a teenager. It sucked.
gwendally
Aug. 30th, 2011 03:56 am (UTC)
What if a taco joint wants to open up across the street? They run the business plan and realize that they won't make enough money to stay in business unless they can lower their expenses. If they could get staff super cheap they might just make it. And, as they make it, and as staff gets trained and the valuable ones prove themselves, they can get raises (or go across the street to another location that wants higher quality staff, because now they have a decent resume showing they have work experience.)

One of my clients ran a bakery that simply could not make it as a solvent business when the price of gas went up and the price of flour went up and they weren't able to sell their breads for more. Something had to give. Because they couldn't pay their waitstaff any less (or cut any other costs) they closed and the waitstaff were therefore unemployed. The people who run that store now use under-the-table help and the owners do a lot of it themselves, so now it works - as something that pays less than minimum wage.

There are places with bakeries that pay decent wages. Whole Foods Market is one. But the people around here call it "Whole Paycheck Market" and don't shop there because their prices are too high. Happily, they find people who aren't price conscious to shop there and that's wonderful and I'm glad.

But the people who are price conscious shop at the places with low prices and the places with low prices pay shit for wages or they wouldn't be able to keep the lights on and the store staffed.

I've worked for minimum wage before, too. I never did for long.

An important piece to remember here is that the employee is not a slave. If they aren't agreeable to the terms then they don't have to take the job. But if someone DOES want to agree to the terms, if they'd rather work for $5/hour than not work at all, why stop them from doing their bit? Or force them to work under the table with NO protection whatsoever? Sometimes a job just isn't worth that much to an employer, and in those cases the job just doesn't get created, period.
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badnewswade
Aug. 30th, 2011 11:03 am (UTC)
She's no peasant
"I routinely hire people in at a low rate and then give them a bump up once I get them trained. I do this because I want to retain them. They are valuable to me as trained employees whose character I like who works well with my work environment. "

"Yes, I am actually rich."

"also, I have a master's degree in a related field and have taken economics at the graduate level."


As you can see, gwendally is in fact a member of the exploitative class.
nebris
Aug. 30th, 2011 11:17 am (UTC)
Re: She's no peasant
She'd like to think she is, but that's simply her buying into Corporate Propaganda. That makes her feel safe. But if she was truly Rich, she wouldn't bother talking about in a forum like this.

And you too are being fooled by the same bullshit by thinking her so.

~M~
gwendally
Aug. 30th, 2011 03:44 pm (UTC)
Re: She's no peasant
It's your party and I don't want to argue with your terms, but I personally do not feel that I am as powerless in my life as you appear to feel.

Anyway, I *am* rich. I'm educated, I'm healthy, I've got good work habits. I have everything I desire or at least the ability to obtain it if I focus on that priority. I have money put by for retirement, and emergencies, I give to charity, I don't lay awake at night worrying (much) about my debt level.

The compassionate rich interested in relieving misery and creating a more socially just world doesn't fit with your worldview, but it's endemic in MY world. We just use actual reason and thought to figure out how to get it, instead of rioting and railing against the establishment.

But, hey, do it your way.
badnewswade
Aug. 30th, 2011 05:04 pm (UTC)
Re: She's no peasant
See what I mean, Nebris? She has the same mentality as the bankers - the world owes her a living, we owe her the right to pay employees food-stamp levels of pay because she's a (self described) "nice person".

There's a real sense of entitlement about her: We should subsidise her rubbish business because... er... well we just should, and those peasants who work for her are just ungrateful scum because without the Small Business Owner they'd be out on the streets.

Incredible arrogance.
Re: She's no peasant - gwendally - Aug. 30th, 2011 05:15 pm (UTC) - Expand
Re: She's no peasant - badnewswade - Aug. 30th, 2011 10:19 pm (UTC) - Expand
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Q: Isn't a recession a period of diminished economic activity?

A:
It's more accurate to say that a recession–the way we use the word–is a period of diminishing activity rather than diminished activity. We identify a month when the economy reached a peak of activity and a later month when the economy reached a trough. The time in between is a recession, a period when economic activity is contracting. The following period is an expansion. As of September 2010, when we decided that a trough had occurred in June 2009, the economy was still weak, with lingering high unemployment, but had expanded considerably from its trough 15 months earlier.









What is a
"Double Dip Recession"?


In the most general sense a Double Dip Recession occurs when an economy falls back into contraction for at least a couple of months (usually at least six) after a relatively brief expansion.

By this definition, the recession of 1981-82 which followed a year-long expansion after the very short, two quarter's long 1980 recession, seems to qualify. Also by this broad definition, the 1937 recession that occurred four years after the end of the 1929-1933 recession also qualifies. While each of those were technically "new" recessions, they happened so soon after their predecessors that many people tend to think of the separate 1980 & 1981-82 recessions as one nasty, long recession. Similarly, most people think of the 1929-1933 & 1937 recessions as encompassing "The Great Depression."

Another definition of a "Double Dip Recession" would be that of a recession which technically has not ended, and was only punctuated by a quarter or twos worth of head-fake rise in GDP. Many recessions throughout history have had such false hopes, only to swoon back down into contraction, until they finally came to an end.


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List of Recessions:
Post-1900 US Recessions

Mo/Yr Started Duration
Sep 1902 - 23 Months
May 1907 - 13 Months
Jan 1910 - 24 Months
Jan 1913 - 23 Months
Aug 1918 - 7 Months
Jan 1920 - 18 Months
May 1923 - 14 Months
Oct 1926 - 13 Months
Aug 1929 - 43 Months
May 1937 - 13 Months
Feb 1945 - 8 Months
Nov 1948 - 11 Months
Jul 1953 - 10 Months
Aug 1957 - 8 Months
Apr 1960 - 10 Months
Dec 1969 - 11 Months
Nov 1973 - 16 Months
Jan 1980 - 6 Months
Jul 1981 - 16 Months
Jul 1990 - 8 Months
Mar 2001 - 8 Months
Dec 2007 - 18 Months


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What is
Gross National Happiness (GNH)?


An alternate measure of a nation's wealth was conceptualized several decades ago as a means of cutting through the overemphasis on materialism of traditional wealth measures, and seeing the bigger picture.

According to GNHUSA.Org

  Gross National Happiness (GNH) is an indicator developed in Bhutan in the Himalayas, based on the concept elaborated in 1972 by the then King Jigme Singye Wangchuck. Since then, the kingdom of Bhutan, with the support of UNDP (UN Development Program), began to put this concept into practice, and has attracted the attention of the rest of the world with its new formula to measure the progress of a community or nation.

GNH is based on the premise that the calculation of "wealth" should consider other aspects besides economic development: the preservation of the environment and the quality of life of the people. The goal of a society should be the integration of material development with psychological, cultural, and spiritual aspects - all in harmony with the Earth.

The Four Pillars of GNH

  • the promotion of equitable and sustainable socio-economic development
  • the preservation and promotion of cultural values
  • the conservation of the natural environment, and
  • the establishment of good governance.



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