Economics

Minimum Wage, Maximum Unemployment for Youths, or, Bummer in the Summer

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Interesting piece in the DC Examiner, looking at the effects of minimum-wage hikes on summer job opportunities for teens and other relatively low-skilled workers. Snippets:

This year, it's harder than ever for teens to find a summer job. Researchers at Northeastern University described summer 2007 as "the worst in post-World War II history" for teen summer employment, and those same researchers say that 2008 is poised to be "even worse."

According to their data, only about one-third of Americans 16 to 19 years old will have a job this summer, and vulnerable low-income and minority teens are going to fare even worse.

The percentage of teens classified as "unemployed"—those who are actively seeking a job but can't get one—is more than three times higher than the national unemployment rate, according to the most recent Department of Labor statistics.

One of the prime reasons for this drastic employment drought is the mandated wage hikes that policymakers have forced down the throats of local businesses. Economic research has shown time and again that increasing the minimum wage destroys jobs for low-skilled workers while doing little to address poverty.

According to economist David Neumark of the University of California at Irvine, for every 10 percent increase in the minimum wage, employment for high school dropouts and young black adults and teenagers falls by 8.5 percent. In the past 11 months alone, the United States' minimum wage has increased by more than twice that amount.

More here.

For more about the minimum wage, check out this classic 1995 reason article on the subject.

Update: Here's something from Steven Horwitz on the subject:

If one is tempted to minimize the role of self-interest in the political realm, one might wish to read the debates surrounding the creation of the first federal minimum wage law in the US as well as similar laws as part of apartheid in South Africa.  The backers of the US law were not ignorant of its effects;  they knew exactly what it would do (shut out immigrant and black labor), which is precisely why they supported it, and also why a number of politicians voted for it.

For example, in the April Freeman, David Henderson reports the following story:

At a 1957 hearing on increasing the minimum wage, a northern U.S. Senator who favored the increase stated: "Of course, having on the market a rather large source of cheap labor depresses wages outside of that group, too-the wages of the white worker who has to compete. And when an employer can substitute a colored worker at a lower wage-and there are, as you pointed out, these hundreds of thousands looking for decent work-it affects the whole wage structure of an area, doesn't it?"

Who was the senator? Here's a hint: just four years later he was the President. His name: John F. Kennedy.

JFK was not ignorant of the economics of the minimum wage and neither were the unions he was responding to.  The unions were looking after their collective self-interest and JFK knew where the votes came from.

More here.

NEXT: Perestroika Begins in the Cafeteria

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  1. Economic research has shown time and again that increasing the minimum wage destroys jobs for low-skilled workers while doing little to address poverty.

    I guess we’ll find out if joe is awake yet… 😉

  2. There ain’t no cure for the summertime blues

    – Rock n Roll

  3. It’s better for some to get paid more, even if it means some don’t work at all. Especially if the ones with jobs are the white kids, and the ones without are black.

  4. Teenagers shouldn’t be working for money, they should be volunteering for national service…or even “volunteered” forcibly!

    I couldn’t decide whether to pretend to be McCain or Obama when making this joke.

  5. Speaking of summer jobs…

    The Today Show had a segment on what you can teach your kids by letting them have a lemonade stand.

    Initial thought: Tax them 25%, and give it away to any neighbor kids who didn’t help them with the stand, especially any who they asked to help and refused or the mean-ass bully kid down the block.

  6. I’m a teenager living in a beach town, so even when I was 15 it was relatively easy to find work at the boardwalk. This year I don’t have any friends who have been hired to new jobs, anyone working is back at a job they had last summer.

  7. Economic research has shown time and again that increasing the minimum wage destroys jobs for low-skilled workers while doing little to address poverty.

    Except, of course, when it shows the opposite. But we’re not going to talk about that.

  8. Are these guys saying the Congress cannot rewrite the laws that govern space and time . . who’d a thunk it.

  9. I guess which Party will be blamed for the lack of summer jobs for teens.

  10. The Today Show had a segment on what you can teach your kids by letting them have a lemonade stand.

    That, in this day and age, no one will buy lemonade from a kids roadside stand? Just guessing.

  11. Maybe teenagers are getting better at bullshitting unemployment claims. I knew a girl in college who worked at a restaurant over the summer and collected unemployment the rest of the year while she was in school, which was total BS.

  12. The next step is to make it nearly impossible to fire someone. Then we will see US inner cities during into French suburbs.

  13. Keep the minimum wage alive !!!

  14. during turning into French suburbs.

  15. Except, of course, when it shows the opposite. But we’re not going to talk about that.

    Got a link, joe?

  16. Eddie Cochran said that.

  17. Just look in the archives, Episiarch. Reason itself linked to a couple of studies that contradicted the local consensus back in 05 or 06.

  18. kinnath,

    Wait till Obama’s first hundred days with two-thirds Democratic majorities in both houses in 2009, when we get a card-check constitutional amendment and whatever else union bosses want.

    I keep bouncing back and forth between thinking McCain’s warmongering is going to be more destructive and thinking unopposed Democratic rule is.

  19. Hey Joe-

    Are you the type of guy who thinks that you have the right to tell me what I have to pay my employees? Are you the type of guy who thinks that you have the right to steal that which I produce so that you can fund your bureaucracy that will be needed to make sure that I pay my employees what you say I have to pay them?

    If the answer is yes, you are a totalitarian. People, one is a totalitarian if one espouses minimum wage laws.

  20. Unemployment is a statistic but one one person that wants to get a job is not a statistic. There are many 75K, 100K and 150K jobs out there.

    http://www.realmatch.com
    http://www.monster.com
    http://www.careerbuilder.com

    You see?

  21. Our federal government now spends billions on job training programs to help improve the chances of the unemployed to reach one of the lower rungs of the career ladder. If the minimum wage were eliminated (in which case the FAA would need to staff up its control towers to deal with all the flying pigs), a number of additional rungs would be added to the bottom of the career ladder, allowing the young and otherwise unproven not just the chance to get on the ladder, but to ascend it in a steady, incremental fashion.

    Of course, the government entitlement regime continues to compete all too effectively for the labor (or the idleness) of those whose labor is currently worth the minimum wage or less (or, in too many cases, more). While the nineties ushered in a brief spell of bipartisan cooperation to reform concerning this variety of market-distorting state action, such consensus would appear to be beyond reach for the foreseeable future.

    I find it unlikely that any educational program designed and implemented by the government (or with governement funds) would be able to match the quality of training offered by a job market unfettered by wage regulations. Pay stubs communicate far more effectively than report cards the value one brings to the marketplace and the improvements one must make to get ahead.

  22. The (higher and higher) minimum wage is correcting a market failure –
    I’m going to tell that to the next person who can’t get a part time/summer job to help pay for their schooling and other expenditures. You’re SUPPOSED to be unemployed! Don’t you get it?!

  23. liberty mike,

    I’ll take from your little outburst about how much more moral your position is that you can’t really defend it on the pragmatic terms the blogger claimed.

    You, sir, are a hysterical child.

  24. Wait till Obama’s first hundred days with two-thirds Democratic majorities in both houses in 2009, when we get a card-check constitutional amendment and whatever else union bosses want.

    I keep bouncing back and forth between thinking McCain’s warmongering is going to be more destructive and thinking unopposed Democratic rule is.

    In the spirit of true bipartisanship, I say we unionize the DoD. We’ll never have to worry about going to war again.

  25. joe,

    I wouldn’t go as far as lm, but are you claiming that moral considerations shouldn’t enter into the discussion at all? Wouldn’t that sort of attitude kind of torpedo a whole slew of beloved liberal programs that society would be better off in pragmatic terms without?

  26. Joe, did you click on the link at the bottom of the entry? Great job taking down many of the minimum wage studies.

  27. Hands up who’s shocked joe’s dealing out ad hominems rather than addressing the topic at hand.

  28. Just look in the archives, Episiarch. Reason itself linked to a couple of studies that contradicted the local consensus back in 05 or 06.

    (ponders some way to insult joe to motivate him to do the looking up for me)

  29. Of course moral considerations should enter into the discussion, Chris. I’ve never suggested otherwise.

    It’s just that the flip-flopping between naked assertions about concrete benefits, and the retreat to “moral” considerations when called on that nakedness, is a rather irritating debate tactic.

  30. If the answer is yes, you are a totalitarian. People, one is a totalitarian if one espouses minimum wage laws.

    That’s a pretty good parody of a libertarian for this early on a Monday.

  31. The experience at my job in New York City is that it’s very difficult to find unskilled workers to hire even though we pay higher than the minimum wage. (That’s higher than the New York state minimum, which is higher than the Federal minimum to begin with.) I don’t know of any employer in the city that does pay minimum wage. I’m sure there are businesses that do so, but as a rule those competing for unskilled labor find it necessary to set wages higher in order to get the workers they need, and most need to hire some percentage of undocumented workers anyway. Even those undocumented workers earn more than minimum wage.

    What parts of the country have employers who would be able to pay less than they currently do for entry level jobs and still find people willing to take them? (People who, at a minimum, would show up within 30 minutes of their scheduled starting time at least 4 out of the 5 work days each week.)

  32. joe,

    What Chris said.

    Also, your description of liberty mike is dead on.

    That said, I, personally, never feel the need to defend anything on pragmatic grounds. The minimum wage law is morally wrong.

  33. Wah wah wah, joez bad, he responded when someone calle him a thief and totalitarian.

    Why must you reply to a reasonable statement like “anyone who supports the minimum wage is like Hitler” with an ad homenim attack, joe? Is it because you hate the children?

    Fucking hypocrites.

  34. joe,

    It’s just that the flip-flopping between naked assertions about concrete benefits, and the retreat to “moral” considerations when called on that nakedness, is a rather irritating debate tactic.

    I agree, I havent seen anyone do that in this thread yet.

  35. That, in this day and age, no one will buy lemonade from a kids roadside stand? Just guessing.

    No, the lemonade stand would probably get shut down for not having a permit, not using FDA approved lemons, and failing to list the nutritional information on the jug.

    I knew a girl in college who worked at a restaurant over the summer and collected unemployment the rest of the year while she was in school, which was total BS.

    I used to know several people in college who signed up for food stamps. It’s sad that people my age (25) think that’s just a program for any person who signs up…

  36. Joe-

    The hysterical child is the one who demands that Caesar steal from those who produce in order to get his way. The people who want to take stuff from others are the hysterical children.

  37. I doubt minimum wage is the reason why teenagers are having trouble finding jobs. There was a 0.5% jump this most recent month. Generally there is a trickle down effect with more experienced employees taking jobs previously reserved for teenagers. The economic environemnt is the primary reason for the job drought, not minimum wage.

    Oh and Krueger and Card did a study on fast food employment on NJ and PA fast food restaurants and employment that found a very small effect on unemployment due to minimum wage hikes.

    Plus, it seems disingenuous for Reason to be so concerned about teenage employment. As I’m certain “he who will not be named” will point out IllegalImmigrants take FastFood, EntryLevel, construction and ag jobs from teenagers.

  38. Wait, has anyone made an actual argument in favor of the minimum wage yet? Has anyone called someone else on naked assertions?

    No?

  39. Come on Joe, who has the minimum wage laws helped?

  40. People who use the word “steal” to refer to taxes should have their wallet lifted by a guy with a gun.

    People who use the word “totalitarian” to describe minimum wage laws should run a political web site in China for a year.

    Hysterical children who could, at a minimum, stand to get a real job under their belt.

  41. People who use the word “steal” to refer to taxes should have their wallet lifted by a guy with a gun.

    People who use the word “totalitarian” to describe minimum wage laws should run a political web site in China for a year.

    A good sign of failure in an argument is when you say that things are awesome one way because you can easily think of worse ways.

  42. Good point, Mo.

    Remember the wailing and gnashing of teeth that greeted the post-Katrina speculation about hurricanes and global warming? Oddly absent from this thread.

    As the economy slides into a credit-market-induced recession, we’re blaming the subsequent uptick in unemployment on a minimum wage hike?

  43. I just read the linked article and wanted to note, the Krueger-Card study I linked to is an updated version of the study taken down in that 1995 article. rather than using their own survey data, they use data from the BLS. So rather than finding a negative relationship between unemployment and minimum wage, it finds a positive, but very small positive relationship.

  44. Joe-

    Give me my minimum wage, now. I know I don’t have the skills and I know that I can’t get what I want on a voluntary, consensual basis, but.. I want my minimum wage. I demand my minimum wage. Wine, wine, wine.

    Look at it logically. Can you do that? Who is the hysterical child? A, who makes and produces on a voluntary, consensual basis and proclaims that his company shall decide what it will pay its employees, or B, who, upon discovering that he can’t get the wage he wants, goes to gvmint and demands that the guvmint force A to pay him what he wants.

  45. Steve,

    Tens of millions of low-income wage earners over the years – those at minimum, and slightly above it.

  46. People who use the word “steal” to refer to taxes should have their wallet lifted by a guy with a gun.

    So if I stop paying taxes, a guy with a gun won’t come and take my wallet?

  47. I like wine, too, liberty mike, but I think you know as much about economics as English diction.

  48. Oh and Krueger and Card did a study on fast food employment on NJ and PA fast food restaurants and employment that found a very small effect on unemployment due to minimum wage hikes.

    I dont know about in NJ and PA, but most fast food places I know of pay well above the minimum. Thus, a change doesnt really have any effect. Back in the mid/late 90s, downtown Louisville McD’s were starting at $9/hr.

  49. I like wine, too

    I pictured you as more of a boilermaker type.

  50. Taktix,

    Had you ever actually been robbed, or had your house broken into, you wouldn’t have any trouble whatsoever understanding the difference between that, and paying your taxes.

  51. Good point, Mo.

    Remember the wailing and gnashing of teeth that greeted the post-Katrina speculation about hurricanes and global warming? Oddly absent from this thread.

    As the economy slides into a credit-market-induced recession, we’re blaming the subsequent uptick in unemployment on a minimum wage hike?

    Hey I have a new game! It’s called Count the Strawmen!

    1…2…

  52. If I don’t pay my mortgage, and stick it out long enough, someone with a sidearm on his hip for self defense will come to my door, too, Taktix.

    That’s not robbery, either.

  53. I wonder what joe thinks would happen if he didn’t pay his taxes.

  54. I have a better game: it’s called write something about the fucking topic, instead of me.

    It might take some of you some getting used to.

  55. Had you ever actually been robbed, or had your house broken into, you wouldn’t have any trouble whatsoever understanding the difference between that, and paying your taxes.

    Hey fuckface,

    I have been robbed, and even pistol whipped, and all they got was a playstation an a few games.

    Now, if they’d have taken 20% of my income…

  56. Gotta love a good pre-buttal, eh NNG?

  57. Except a mortgage is entered into voluntarily, in a contract.

    I never signed a contract saying I was obligated to pay taxes.

  58. Minimum wage hikes hurt low-level management in that money isn’t taken necessarily from CEOs and high level executives and investors and given to the poor unskilled workers, but is rather taken from assistant managers and retail managers in the form of delayed promotions, smaller or non-existent or harder-to-obtain raises/bonuses, fewer hours and less pleasant working conditions for the minimum wage employees, which means more hours for the low-level salaried managers at the same pay.

  59. joe is right. Paying taxes is like what the mafia does with protection rackets, not like robbery.

  60. I disagree with joe about minimum wage, but I completely agree with his reaction. Not a pure libertarian does not make totalitarian. Joe is probably pretty firmly on the middle left of the Nolan chart, if I had to guess. One position does not a totalitarian make.

    News to you, I know, but I’ll help you out here too. Strict constitutionalists or even minarchists aren’t totalitarian either, even though they don’t embrace anarchist ideals.

  61. Whats more, with mortgages and car payments I’m at least getting something directly back for myself.

    Its not like I’m paying my mortgage, and someone else’s mortgage, and welfare, and for the Iraq War, and agro subsidies, and all kinds of other worthless crap.

  62. joe,

    Had you ever actually been robbed, or had your house broken into, you wouldn’t have any trouble whatsoever understanding the difference between that, and paying your taxes.

    Having been robbed, having had my house broken into (multiple times) and having paid taxes, the biggest difference is the first two didnt require me to do paperwork first.

  63. Except a mortgage is entered into voluntarily, in a contract.

    Beat me to it, but additionally, I get a house in exchange for the money as well.

    I have a better game: it’s called write something about the fucking topic, instead of me.

    Is this some strange new aspect of joez law? I was pointing out that you’re arguing premises that no one has posed, and you accuse me of not sticking to the topic at hand?

    Also, I’d like to see how you wiggle your way out of your robbing statement, since you didn’t know me and can’t see the scars on my head from where a robber hit me with his .45…

  64. Reinmoose may hive hit it exactly right. I dont think I have seen any studies looking at the affect on hours worked/bonuses received of low level salaried employees due to minimum wage changes.

    However, anecdotally, the big round of minimum wage hikes in the 90s were followed by the “tech boom” market where all the peons were working 60+ hour weeks.

  65. No Name Guy | June 9, 2008, 10:26am | #

    Except a mortgage is entered into voluntarily, in a contract.

    I never signed a contract saying I was obligated to pay taxes.

    Whether you dissent from the widespread opinion on the social contract or not, the metaphoric connection between taxation and robbery is a slap in the face to those who’ve suffered the latter. It’s the equivalent of the Dworkin-defition of “rape.” Tasteless, misleading, hysterical, and used only as an emotional bludgeon.

  66. As to the minimum wage, I don’t think its high enough to the point where it does much harm (additionally, it doesn’t do any good). Its just a way for Democratic politicians to grand stand.

  67. It’s just that the flip-flopping between naked assertions about concrete benefits, and the retreat to “moral” considerations when called on that nakedness, is a rather irritating debate tactic.

    Anyone want to give me an over/under on when joe will engage in just this flip-flop?

    Had you ever actually been robbed, or had your house broken into, you wouldn’t have any trouble whatsoever understanding the difference between that, and paying your taxes.

    And had you ever had to pay protection money to a criminal syndicate, you wouldn’t have any trouble whatsoever understanding the similarity between that form of robbery-by-extortion and paying your taxes.

  68. To summarize what Parse said @ 10:09:

    The “real” minimum wage is whatever McDonald’s has to pay to find workers that will stay for more than a month.

    The McDonald’s on International Drive and Sand Lake (which at least was the largest McDonald’s in the world) was advertizing jobs at somewhere around twice the minimum wage circa 1983. Orlando has grown a lot since then, but I still bet they have to offer more than the minimum to get workers.

  69. Also, I’d like to see how you wiggle your way out of your robbing statement, since you didn’t know me and can’t see the scars on my head from where a robber hit me with his .45…

    OK. You’re a lunatic.

  70. Way to go there Dictator Bush! So consumed with Global domination you have completely run your own country right into the ground!

    JT
    http://www.Privacy-Center.net

  71. Whether you dissent from the widespread opinion on the social contract or not

    Social contract = “pay…or else.”

  72. Tens of millions of low-income wage earners over the years – those at minimum, and slightly above it.

    at the expense of millions more who won’t be able to get in the door at all because the payroll budget has been allocated by Congress rather than the business owner.

    joe, is it really the legislature’s mandate to decide that the former group is more deserving of employment than the latter?

  73. The experience at my job in New York City…. + What parts of the country have employers who would be able to pay less than they currently do for entry level jobs and still find people willing to take them? (People who, at a minimum, would show up within 30 minutes of their scheduled starting time at least 4 out of the 5 work days each week.)

    This was a joke, right? Standard of living costs are substantially different throughout the country, and to use NYC as a typical example… it was a joke, right?

  74. Based on my ex’s experience working as a retail manager, I think Reinmoose has it right: “…which means more hours for the low-level salaried managers at the same pay.”

  75. What parts of the country have employers who would be able to pay less than they currently do for entry level jobs and still find people willing to take them?

    NYC can skew your perspective on a lot of things, including what constitutes an entry level wage.

    Anyhow, prevalent areas for minimum wage jobs are summer tourism spots. You think the local water park really wants to pay their employees more than the minimum?

  76. People, one is a totalitarian if one espouses minimum wage laws.

    Why stop with minimum wage? What about those totalitarians who countenance the 40-hour week, unemployment insurance, child labor laws and the end of indentured servitude?

  77. People, one is a totalitarian if one espouses minimum wage laws.

    Tiresome rhetoric. Regardless of the veracity of the statement, it’s best left unsaid.

  78. joe said,

    … the metaphoric connection between taxation and robbery is a slap in the face to those who’ve suffered the latter. It’s the equivalent of the Dworkin-defition of “rape.” Tasteless, misleading, hysterical, and used only as an emotional bludgeon.

    Yes, taxation and robbery are not identical. Specifically, taxation has widespread social support and robbery does not. But the connection is more than mere metaphor: the use or threat of literal physical coercion is fundamental to both.

  79. Hugh,

    at the expense of millions more who won’t be able to get in the door at all because the payroll budget has been allocated by Congress rather than the business owner.

    A claim not backed by the data. It’s an article of faith among some that this is the effect of minimum wage laws, but notably, it seems to be far more common among those who ended their economic education after Econ 101 than among practicing economists.

    Markets can be less-than-perfect in a manner that underpays workers as well. People at the bottom of the income scale are, almost by definition, going to be those at the most severe disadvantage in negotiating benefits. To the extent that minimum wage laws counteract this effect, they’re going to be a net gain for the economy.

  80. Tens of millions of low-income wage earners over the years – those at minimum, and slightly above it.

    The ones who can’t be hired because employers have to pay more to their current employees?

    Example: my Father inlaw is general manager for a small town movie theater, not rocket science to do the jobs he hires high schoolers and high school drop outs to do, but now he has to pay them about $2.00 more an hour than he was, had to get rid of 1/3 of them to do so. Of course the “raise” doesn’t mean much when right after a min wage hike prices raise, it also doesn’t mean much when the employer takes a second look at the benefits ( health ins ect) that are offered to the employees…

    So you end up with more unemployed low wage workers, and those who keep their job are paying relatively the same percentage of out of pocket expenses and possibly getting less in other areas from their employer to compensate for the hike.

    I don’t see who this would help other than the people doing the raising of the min wage and getting pats on the back for it.

  81. joe, I already covered that part this thread

    see?

  82. I wrote not far above, “Specifically, taxation has widespread social support and robbery does not.” I might better have replaced “Specifically” with “E.g.”, as the cited difference can be expanded upon with others, such as the typical emotional effect on the victim (if he perceives himself as such), etc.

  83. liberty mike might be a blowhard, but I agree that the minimum wage is a good place to draw a line in the sand.
    I’m pretty sure the moral high-ground is over on my side of that line, and I’m tired of seeing it conceded to the “do-gooders” who do no good and, in fact, do real harm to the very people they claim to want to help.
    Do I think they intend harm to the poor? In most cases, no. But good intentions do not excuse the real hurt such policies, and those who promote them, cause, damn it.
    What the fuck do I care what the minimum wage is, personally? Even my teenagers are skilled enough to have jobs that pay above the minimum.
    But a lot of kids aren’t so fortunate, and it’s those kids these misguided policies are hurting. So I could just say, “Fuck it. Me and mine have ours. Let the morons have their minimum wage. Bwahahaha!”
    It certainly would be easier than fighting this losing battle. But I can’t seem to let it go. The minimum wage sticks in my craw like few other idiocies.
    (And just for the record, my economic education did NOT end with Econ 101.)

  84. Anecdotes aside, Steve, the correlation between wage hikes and increases in unemployment just aren’t there. The minimum wage went up at the McDonalds I worked at as a teenager and the staffing didnt’ change a lick.

    It doesn’t take much imagination to understand how, in theory, an increase in labor costs can hit a business, but if that was all that was happening, we’s see robut and predictable data about job losses. We don’t – the studies are all over the place on this question – so there is clearly more than that at work.

  85. Teenagers are, in many cases, being displaced by adults who have higher “overhead.” The grandstanding politicians want to make it look like they’re helping those people, by putting a floor under wages, which prevents teenagers from underbidding.

    “I’d like to help you, son, but you’re too young to vote.”
    -also Eddie Cochran

  86. Whether you dissent from the widespread opinion on the social contract or not, the metaphoric connection between taxation and robbery is a slap in the face to those who’ve suffered the latter.

    As much as a slap in the face to claim I’m a lunatic for being a victim of a robbery?

    Jeez, sorry I couldn’t get assaulted in a more suitable fashion.

    Since I’m a “lunatic,” please explain how forcing me to pay… rather, taking my pay before I even have it… to pay for a wide variety of things I don’t agree with or use… barring the fact that it’s being used incredibly inefficiently… and at many times working against my rights and livelihood…

    Tell me how all that is not robbery.

  87. President Obama + Democratic Congress = $15/hr minimum wage.

    Get ready for almost univerisal unemployment among inner-city youth. But don’t worry too much about them — Obama will make sure that they’re compensated plenty by the government.

  88. Nick, Nick, bo bick. Where and what is “Northeastern University”? The link you give takes to “commentary” by Kristen Lopez Eastlick, and her link takes us to, um, Kristen Lopez Eastlick. I’m sorry, but I don’t believe that 2007 was the worst summer ever for finding a summer job since WWII, and that 2008 looks “even worse.” In 1984 the overall jobless rate was over 10%. Try finding a summer job in that job market. If the teen unemployment rate is so much higher than the overall rate, it’s because the overall rate is so low.

    Furthermore, Kristen offers no evidence to prove that the “drought,” which itself is phony, is caused by minimum-wage hikes. As you know, but don’t tell us, the research on the impact of minimum-wage hikes is, um, conflicted. We don’t need a minimum wage, as some Democrats other than me would tell you (if they were drunk enough), but the public keeps falling for it.

    Not a good posting.

  89. Taktix,
    Apparently it’s not robbery because a majority of your neighbors say it’s not robbery and would like some of your money.

  90. A claim not backed by the data. It’s an article of faith among some that this is the effect of minimum wage laws, but notably, it seems to be far more common among those who ended their economic education after Econ 101 than among practicing economists.

    I was going to but a cute note in like “citation needed” but you insulted me.

    So tell me where the fuck this “data” is?

    Come on joe, where is it?

  91. No, Taktix, you’re not a lunatic for getting robbed.

    You’re a lunatic for getting robbed, and thinking “this is just like FICA withholding.” This is one of those things you can’t really have explained to you. If everything is in proper working order up there, you understand it without anyone needing to walk you through it.

  92. Taxation is theft. Just because taxation may enjoy widespread support does not change the basic proposition: Give me your stuff or bad things will happen to you.

    I agree that the theft of taxation is not identical to the theft of your wallet by a mugger. The latter does not act under the color of law and she does not enjoy the benefit of a multi-trillion dollar juggernaut to ge the job done.

  93. Not so sure, Colin. I know for a fact that you can get a decent job while getting great exercise in Baltimore for a taste of the package.

  94. To the extent that minimum wage laws counteract this effect, they’re going to be a net gain for the economy.

    —-

    The minimum wage went up at the McDonalds I worked at as a teenager and the staffing didnt’ change a lick.

    ’nuff said

    Move along, now.

  95. joe,

    there is clearly more than that at work.

    I think this is the key point. The economy has lots of frigging confounding factors. I think that minimum wage hikes have a tiny negative effect, but it is swamped/bolstered by other things going on, hence studies all over the place.

    Also, when you go a long period of time between minimum wage hikes, the number of workers at or near minimum gets very tiny, meaning the hike will have a very small effect.

  96. It’s linked to right in Reason’s own archives, Taktx.

    If you can rouse yourself from your perpetual victimhood, maybe you can enter some search terms.

  97. As much as a slap in the face to claim I’m a lunatic for being a victim of a robbery?

    You misunderstand, Taktix. joe called you a lunatic for actually having the temerity to pwn him by responding to “If you’d ever been robbed” with “uh, I have”.

  98. My Econ “101” class was actually a class in how classical economics has failed us – so if you went to school where I went, you’d have an opinion much like joe’s from just having one course…
    In other words, the opinion that the minimum wage is correcting a “market failure” is not necessarily more informed than the opposing view.

  99. joe,

    You still have yet to link us to this much-vaunted data.

  100. joe | June 9, 2008, 10:09am | #

    Of course moral considerations should enter into the discussion, Chris. I’ve never suggested otherwise.”

    If we are gonna use moral considerations, I humbly suggest we use mine. Being a christian that leans heavily toward egalitarianism, I believe my morals to be the best all around basis for minimum wage and benefits policy.

    fwiw, the state minimum wage here for waitressing is $2.90/hour + tips and it is the prevailing wage for such jobs in the local area.

  101. “…but since you insulted me…”

    Well, I am a fuckface, you know.

  102. If you can rouse yourself from your perpetual victimhood, maybe you can enter some search terms.

    The onus is not on me to verify your bullshit.

  103. Anecdotes aside, Steve, the correlation between wage hikes and increases in unemployment just aren’t there.

    The typical MacD’s 35 years ago (when I worked at one) had about twice as many teens working on any given shift as they do today. And we did everything by hand (such as taking orders or drawing drinks) that is typically automated now.

    Raising minimum wages does not produce an instantaneous loss of teen jobs. But if the market can’t support the wages, within five years or so, the teens will be replaced with automation.

  104. Hugh,

    I’m not your secretary.

  105. Raising minimum wages does not produce an instantaneous loss of teen jobs. But if the market can’t support the wages, within five years or so, the teens will be replaced with automation.

    Well observed, kinnath.

    It’s a market distortion that causes things that would otherwise be more expensive to be cheaper. What do you call this… a subsidy?

  106. You’re a lunatic for getting robbed, and thinking “this is just like FICA withholding.”

    I didn’t say it was just like FICA withholding.

    Being robber in my junior year of college: Lost $250-$300 tops, one time.

    FICA withholding: $600 every two weeks for at least the last two years, and more to come.

    These are nothing alike, but since you obviously don’t read anyone’s comments before laughably attempting to respond to the them, I didn’t expect you to pick up on that.

  107. kinnath,

    You don’t think there would tecnological advance and greater automation without a minimum wage?

    On the macro scale, teenage unempoloyment overall (not talking about pronounced ups and downs in a given period here, but the aggregate economy over time) hasn’t doubled, or even risen appreciably, since 1983.

  108. Hugh,
    I provided a link to some data.

  109. Make that “being robbed”

  110. Taktix? | June 9, 2008, 10:21am | #

    So if I stop paying taxes, a guy with a gun won’t come and take my wallet?

    Taktix? | June 9, 2008, 11:08am | #

    I didn’t say (being robbed) was just like FICA withholding.

    Don’t be a worm, Taktix. Either stand by your argument or stop making it.

  111. McDonald’s has already responded to the supply of employees too poorly educated to add and subtract; the cash registers have little pictograms of various menu items on the keys, and show how much change to return on the little screen. They even have been experimenting, I believe, with self-service credit/ debit card order stations; why on earth would they do that?

  112. joe said,

    A claim not backed by the data. It’s an article of faith among some that this is the effect of minimum wage laws, but notably, it seems to be far more common among those who ended their economic education after Econ 101 than among practicing economists.

    …and then later after a request for a citation,

    It’s linked to right in Reason’s own archives

    Here is Reason’s 1995 article debunking (my term) the Card and Krueger study which raised many eyebrows.

  113. I’m not your secretary.

    joe, when you make a claim about data, it is your responsibility to link to it. If you don’t, it can safely be assumed you are talking out of your ass, even if you aren’t.

    This is intertubez 101, joe. You know this.

  114. On the macro scale, teenage unempoloyment overall (not talking about pronounced ups and downs in a given period here, but the aggregate economy over time) hasn’t doubled, or even risen appreciably, since 1983.

    You know what else hasn’t risen appreciably since 1983? The real minimum wage.

  115. Reinmoose,

    Good point. Which is what makes the hysterical predictions about what a wage hike would mean so over-the-top.

    Minimum wage increases, at this point in American history, are about replacing what’s been lost to inflation.

  116. Taktix,
    Here’s the argument: you are paying $600/2weeks in fica. That means you are makin lots of money. Many others aren’t as fortunate. They don’t make enough at work to even get by. If those of you with plenty don’t help those without, then the govt. feels it is their responsibility to help you in your charitable giving. Many many voters are willing to let their “leaders” have that responsibility.

  117. Make that “being robbed”

    Try not to make that slip when you’re being interrogated by the cops… 😉

  118. joe – do you think it should be mandated that, if prostitution were legal, the prostitutes should be paid minimum wage for their work?

    If so, why do you want government in our bedrooms, again?

  119. Umm
    Just because it’s being raised to what it was in 1983 doesn’t mean that it doesn’t have an effect on the economy.

  120. You don’t think there would tecnological advance and greater automation without a minimum wage?

    Complicated business case.

    Wages & benefits (plus learning curve) to train a 16-year-old to draw a Coke from a fountain versus acquisition costs, maintenance, and depreciation of capital equipment.

    Labor needs to be pretty fucking expensive to justify replacement by capital equipment.

  121. joe,

    Ah, so you have one Keynesian scheme mitigating the adverse effects of another Keynesian scheme, like the infinite cascade of epicycles upon epicycles in the Ptolemaic model of the Solar System.

    But where oh where is our economic Copernicus, our monetary policy Isaac Newton?

  122. “Economic research has shown time and again that increasing the minimum wage destroys jobs for low-skilled workers while doing little to address poverty.”

    Economic research also has showed that slave plantations had full employment!

  123. joe – do you think it should be mandated that, if prostitution were legal, the prostitutes should be paid minimum wage for their work?

    Minimum wage laws should apply to all businesses, but prostitutes make a lot more than that where it is legal.

    If so, why do you want government in our bedrooms, again? The Bunny Ranch is not your bedroom. It’s a place a business.

    Softballs.

  124. Wait wait! I think I finally understand the argument for the minimum wage!

    It’s:
    1. The minimum wage helps all kinds of people who are earning a very little amount of money.
    2. It has no effect on the macro economy

    Is that about right?

  125. Has a federally mandated minimum wage kept wages at an artificially low figure for all these years. iow, if the market were alowed to truly regulate itself, would average, unskilled, entry level wages be higher than the fed. minimum?

  126. joe,

    You don’t think there would tecnological advance and greater automation without a minimum wage?

    It would be adopted more slowly.

    If I pay someone $5/hr and could replace them with a machine that cost $6/hr, Im not going to do it. If min wage goes up to $7/hr, they are gone.

    Realistically what happens is that, as with most tech advancements, it is expensive early on and price drops over time. Thus, with a higher min wage, the break even point is reached sooner and the technology is adopted sooner.

  127. kinnath,

    Labor needs to be pretty fucking expensive to justify replacement by capital equipment. That depends on the volume, and the amount of value added from the “human touch.”

    McDonalds would be automating regadless of the minimum wage, because automation makes sense for a business like that.

  128. Er, after linking in my previous comment to Reason’s 1995 article as archived on another site, I noticed that Nick linked to it on Reason’s site at the end of the H&R entry we’re discussing.

  129. On the macro scale, teenage unempoloyment overall (not talking about pronounced ups and downs in a given period here, but the aggregate economy over time) hasn’t doubled, or even risen appreciably, since 1983.

    might even be true, but i’d be interested to see the effect on small business owners over that period of time…

  130. Also note that coporate america may be more than happy to replace people with machines, but start-up businesses (mom & pop shops)get hurt (potentially fatally), because they can’t afford the capital outlay to buy automation.

  131. robc –
    stop it with your voodoo economics you learned from your intro class. Can’t you see that the minimum wage helps a lot of people who need it, hurts noone who doesn’t deserve hurting, and has no effect on the greater economy? You’d know that if only you had a *better* understanding of economics (which apparently the general electorate has over you)

  132. The Bunny Ranch is not your bedroom. It’s a place a business.

    it doesn’t all occur in places like that, joe.

    I find it exceptionally curious you’re an advocate of “what consenting adults do behind closed doors should be private”…except when Person A agrees to work for 6 bucks an hour instead of 6.85 (and rising).

  133. Can’t you see that the minimum wage helps a lot of people who need it,

    Who, for how long, until the next time they need a wage hike? Not much of a solution then is it?

    hurts noone who doesn’t deserve hurting,

    Who? Small business and franchise owners?

    and has no effect on the greater economy?

    then why do it?

  134. I get that, robc. There is going to be some effect, just not the simple one-for-one replacement that was postulated.

    The net effect does not appear to be any job loss, if we’re comparing 1983 and today.

    Contra the luddites, automation is not a net loser for the labor market.

  135. One analogy to the tech adoption thing:

    The high gas prices are leading to people adopting more energy efficient means. Hybrids and etc. Also research into non-oil methodologies and such.

    That doesnt mean the increased prices are a good thing. It also doesnt mean, like some have argued, that we should have higher taxes to keep oil expensive and encourage the new tech development.

    Mother necessity will solve the problems, but let her do it at her own damn pace.

  136. Ayn Randian, you can keep pretending not to know the difference between a business and a home, but I’m not playing.

  137. The high gas prices are leading to people adopting more energy efficient means.

    You’re talking about a situation of real increases in overall costs.

    As has been mentioned, the real minimum wage is not increasing over time.


  138. Wages & benefits (plus learning curve) to train a 16-year-old to draw a Coke from a fountain versus acquisition costs, maintenance, and depreciation of capital equipment.

    Labor needs to be pretty fucking expensive to justify replacement by capital equipment.

    Once you’ve got the machine, you don’t have to replace and retrain it on a recurring basis (unlike human employees). And capital expenditures get a pretty favorable treatment, tax-wise.

  139. Is Joe a statist?

  140. Don’t be a worm, Taktix. Either stand by your argument or stop making it.

    If you would actually read my comments, you’d see that I didn’t say they were the same. The actions are similar, but the FICA withholding is worse than being robbed, because at minimum, I could press charges against a common thief.

    I have no one to go to when the government takes my money. They kinda have a monopoly.

    I am not going to respond to any of your comments if you can’t take the time to read mine and respond to them, Paddy Tanniger.

  141. joe,

    Anyone who lost their job one day earlier because of the min wage increase was hurt by probably wouldnt show up in the statistics.

  142. Is Joe a statist?

    Yes

    Why he spends his days arguing with non-statists on a non-statist site is beyond me though…

  143. Is Joe a statist?

    duh.

    Maybe you should read this blog a few months before you start posting.

  144. joe at 11:30: The net effect does not appear to be any job loss, if we’re comparing 1983 and today.

    joe at 11:33: As has been mentioned, the real minimum wage is not increasing over time.

    Duh? I mean, that’s like saying “there’s been no change in conditions (between 2 indicators), so your suggestion that if we changed conditions there would be a change in effect doesn’t make any sense”

  145. I think we can both live that, Taktix. Buh bye.

  146. and Steve –
    I was being sarcastic

  147. BTW,

    While Im probably alone on this, Ive always considered “read a online forum long enough to know its tone before posting” to be a basic rule of netiqueete.

  148. A coke machine won’t call you thirty seconds before he’s supposed to clock in, to “let you know” he’s at Buffoonaroo, and *might* be back in two weeks.

  149. I was being sarcastic

    lol, a little too dead on, those are the arguements i’m used to hearing.

  150. I conduct a thought experiment ever 3 or 4 years. How many minutes do I need to work at MacDs to buy lunch at MacDs (two regular burgers, small fries, and the smallest drink)

    In the last 35 years it has ranged from about 45 minutes to about 55 minutes — consistently for more that three decades. There are some small aberations such as the last big jump in minimum wage drive the minutes down for awhile. But my guess is that it will even out in another two or three years.

    Regardless what the Congress thinks, they cannot alter the basic ratio of labor cost versus labor value when it comes to establishing wages.

  151. Reinmoose,

    The real minimum wage – that is, the wage adjusted for inflation – hasn’t changed. The nominal minimum wage has gone up a few times, to keep pace with inflation. I’m saying that keeping the minimum wage about constant in REAL terms, by increasing it in NOMINAL terms, isn’t going to have much of an impact, because (as you say), it doesn’t reflect much of a real change.

    robc,

    Anyone who lost their job one day earlier because of the min wage increase was hurt by probably wouldnt show up in the statistics.

    They would certainly show up comparisons of overall unemployment statistics over time.

    Is Joe a statist? The dictionary defines a statist as one who worships or reveres the state. So, no, I am not. I am, however, a liberal Democrat, which is somebody who believes that state intervention in the economy can have positive consequences.

    I don’t worship or rever the state any more than I worship or revere my socket set.

  152. I think we can both live that, Taktix. Buh bye.

    Is that a concession? Even Hillary Clinton was more graceful than that. Poor form, sir.

    By the way, it’s 11:45 a.m., and joe still has yet to cite any evidence for his sophomoric, unsubstantiated claims. Just pointing that out…

  153. I am, however, a liberal Democrat, which is somebody who believes that state intervention in the economy can have positive consequences.

    Do you also believe it can have negative consequences? I ask because i see your posts on energy/housing/agriculture and i don’t think I’ve seen you lay any of the blame on state intervention…

  154. Is Joe a statist?

    Is the Space Pope reptilian?

  155. joe –
    This is ignoring that the status quo is unacceptable and destructive in certain ways. It is a market distortion in favor of automation (as others have noted), not a market correction in favor of employees. It requires employees to be more flexible and be able to wait for employers to adjust, forcing them to rely on debt and what little money they have until the automation factory 600 miles away decides it needs more employees – only that transition doesn’t usually happen very smoothly.

  156. It is also a market distortion in favor of large corporations with the money to invest in automation equipment, and against small businesses who are already operating on smaller margins.

  157. All in all, it’s kinda ironic given that the proponents of minimum wage laws are generally anti-corporation/pro-small business and pro-job security in talk, but advocate policies that promote the opposite.

  158. I am, however, a liberal Democrat, which is somebody who believes that state intervention in the economy can have positive consequences.

    Is your default assumption that state intervention is likely to be a net positive for the economy as a whole? If so, why?

  159. Steve,

    Do you also believe it can have negative consequences?

    Of course. I discuss the negative effects of urban renewal and snob zoning on housing all the time.

  160. Is that a concession?

    No, it’s a kiss-off, and far more “graceful” than this fuckface had written the first time.

    Kindly stick your word now.

  161. One of my biggest gripes with Reason is that its arguments are too utilitarian. A lot of commenters agree, in part, but are more concerned with the moral underpinnings. This article and the comments are a case in point.

    Reason: Min wage laws are bad because they craete unemployment, especially among poor, minority kids.

    Commenter: Min wage laws are bad because the gov’t should let me run my business as I see fit (provided I am not encroaching on another’s rights).

    joe then pops in and suggests the same person is making both of these arguments. And there’s nothing wrong with doing that, provided you start with the commenter’s argument. But from what I can tell, no one is flip flopping as claimed (though I’ll cop to not reading all the comments).

  162. Reinmoose,

    It requires employees to be more flexible and be able to wait for employers to adjust, forcing them to rely on debt and what little money they have until the automation factory 600 miles away decides it needs more employees

    That does not seem to be how automation at McDonalds actually works. They’re employing more people than ever.

  163. Is your default assumption that state intervention is likely to be a net positive for the economy as a whole?

    No. I am probably the only person on this thread who does have a default assumption about the consequences of state intervention in the economy.

    I don’t think that a meaningful statement about the general category “state invervention in the economy” can be made. I think you actually have to look at each instance to draw a conclusion.

  164. Er, who does NOT have a default assumption…

  165. but advocate policies that promote the opposite.

    Pretty much sums up everything to do with liberal democrats.

    state intervention says can’t drill for oil must protect some bird or another = less supply of oil = higher prices from the cartel as demand rises = higher prices for consumers = proponents wanting more state intervention in energy

    never ending cycle, their policies have dire unintended consequences and their solutions to those consequences are always more of the same policies

  166. I am, however, a liberal Democrat, which is somebody who believes that state intervention in the economy can have positive consequences.

    I’m sure I can find some conservative Republicans who believe state intervention can have positive consequences. Say, by, allowing prayer in public schools. This doesn’t give them the moral high ground, though. It just makes them a different kind assclown with totalitarian tendencies.

  167. It’s why statists are also driving up prices in housing, medical care, food and education as well.

  168. Ayn Randian, you can keep pretending not to know the difference between a business and a home, but I’m not playing.

    What about a home-based, family business?

    if you could lay out a moral case, or even a utilitarian one, why we should interfere in the operations of one and not the other, that’d be perfect.

  169. Kindly stick your word now.

    Wha?!? Joez Law in effect!

    By the way, it’s 12:10 p.m., and joe has yet to cite any evidence for his ridiculous claims…

  170. X,Y-

    Right on. I have not made any utilitarian arguments here, just the moral ones. I do not need to make any utilitarian arguments when it comes to liberal democrats(read communists) stealing my property. Thus, I must assume that joe was not referring to me as I have not flip-flopped.

  171. joe, Nick posted some additional info under his original post that you might want to check out. Bonus: it involves another Masshole.

  172. Utilitarian Arguments-

    As to matters of evidence in debating this issue, and for that matter, many others, why should a person who has common sense and an appreciation for history, credit any statistic or study promulgaed or paid by the state?

  173. What about a home-based, family business?

    A home-based, family prostitution business? Uh, ew.

    x,y’s comment is perfect. Sometimes, libertarians pretend that people’s economic well being is a universal good, and of course they support that. They are even willing to pretend they believe it in minimum wage threads, and shed croccodile tears for the poor workers (allegedly) negative effects of such laws on the economic well-being of low-income workers. But, when you press them on it, they come up a comparison to something like school prayer, and the wholly subjective “benefits” that result from it. It really isn’t too difficult to get the mask to slip, when there isn’t anything real holding it on.

  174. Episiarch,

    The fact the supporters of the minimum wage realized that it would prevent business owners from replacing their employees with cheaper employees is not terribly groundbreaking, nor is the fact that they realized such laws would prop up wage rates in an entire area.

  175. That does not seem to be how automation at McDonalds actually works. They’re employing more people than ever.

    Wow, you really do have a reading comprehension problem. You also played right into the argument about how it helps the corporations over the small.

  176. + businesses

  177. Sometimes, libertarians pretend that people’s economic well being is a universal good, and of course they support that. They are even willing to pretend they believe it in minimum wage threads, and shed croccodile tears for the poor workers

    joe, go away. I can’t believe you have the downright rudeness and audacity to insult a whole host of people who have put up with your trolling all these years.

    I guess it wasn’t too tough to get your “mask to slip” and get you to collectively denigrate and smear libertarians, was it?

  178. Yes, Reinmoose, whenever I disagree with you, it’s becuz I dunt reed to gud.

  179. 12:35 and still no proof. What say you, joe?

  180. Ayn Randian, I’ve never made an pretense about my contempt for the attidues most libertarians hold towards the poor.

  181. Joe submits that one cannot make general claims about state intervention in the economy and that one has to “look at each instance to draw a conclusion.”

    Well, in each instance, the conclusion I draw is that some loser gets my stuff.

  182. I say I prebutted you by providing links to the statements of professional economists, including the Council of Economic Advisors, who say you’re opionion is nonsense.

    Not much with the consideration of evidence, are you?

    So, how’s that “no longer responding” thing going?

  183. Researchers at Northeastern University described summer 2007 as “the worst in post-World War II history” for teen summer employment, and those same researchers say that 2008 is poised to be “even worse.”

    Doesn’t someone make this claim every year, just after saying the next generation will be the first to have things worse off than their parents?

  184. Yes, Reinmoose, whenever I disagree with you, it’s becuz I dunt reed to gud.

    Or it could be that you didn’t actually say anything that was relevant to my previous statement when making an statement that was supposedly an argument against my statement….

    Or you know, you could just try to be more of a dick – that usually is a very good tactic

  185. Ayn Randian, I await your passionate denunciation of liberty mike for proclaiming that poor people are “some loser.”

    Because of how passionately you all care about the well being of the less fortunate.

    Yep, any minute now.

  186. Ayn Randian, I’ve never made an pretense about my contempt for the attidues most libertarians hold towards the poor.

    Which makes me wonder why you’re here at all. You start off with a faulty premise that collectively smears us all. It’s obvious your mind isn’t going to change and that your intellectual growth got stunted somewhere along the way.

    If you roll into every argument thinking that all of us have contempt for the poor, you might as well pack up your bag of tricks and take your show somewhere else. I’m not going to engage in a sharing of ideas with someone who’s pre-judged me and everyone here.

  187. STRAWMAN ALERT: You can’t think someone is a loser and still care about their well-being

  188. Sounds like as good a fig leaf as any for abandoning the field.

    The assumptions of economic conservatives about the effect of the minimum wage are wildly at odds with the reality that practicing economists understand.

  189. You can’t think someone is a loser and still care about their well-being

    I suppose in some sort of elitist sense that’s possible, but it would be foolish to take such an assertion at face value.

  190. elitist:
    1. The belief that certain persons or members of certain classes or groups deserve favored treatment by virtue of their perceived superiority, as in intellect, social status, or financial resources.

    Hmm…. nope

    English please

  191. You mean like this article joe?

    Minimal Evidence
    Flawed studies drive the call for an increased minimum wage.

    […]

    Unsurprisingly, this new research has quickly become politicized. Labor leaders, who like high minimum wages because they make union pay scales more competitive, have seized on the new research to disparage the traditional view. So have Labor Secretary Robert Reich and President Clinton. “Now, I’ve studied the arguments and the evidence for and against a minimum wage increase,” Clinton claimed in his State of the Union Address. “I believe the weight of the evidence is that a modest increase does not cost jobs, and may even lure people back into the job market.”

    Well, not so fast, please. While the new studies are serious works, done by serious scholars, they are not particularly believable. Indeed, they have several problems in common, as well as various individual flaws. And the (seemingly) most persuasive study turns out to be based on abysmally bad data.

    […]

    Yeah, we have a mountain of evidence on one side. We have, not even a small pile, on the other, lets give most weight to those studies that contradict the consensus. You know, that consensus thing that joe talks soooo much about with regards to oh…I don’t know…global warming anyone?

    Good one joe. Thanks for another laugh, and on a Monday too! You really are a gem to have around here.

  192. Joe-

    There you go again. You are assuming a fact not in evidence. I never said that poor people are losers. Prove me wrong.

    The “losers’ to whom I am referring include defense contractors, the state of Israel, the state of Egypt, the united nations, the police and the police unions in massachusetts who continue to insist that they alone should be manning construction and survey sites and not flagmen. In other words I know that the biggest losers are the big boys-not the welfare queen with 8 kids by 9 different fathers.

  193. No, Mr. Verdon, I was thinking more about the confounding studies that came out, as I said, two-three years ago, as well at the Council of Economic Advisors report, the big push by economists for a minimum wage increase back in 2006, and the poll that came out last year showing that a majority of practicing economists supported a minimum wage increase.

    But you don’t need to worry about that. You already know what you believe, so you can keep talking about mountains and repeating what was conventional wisdom 20 years ago.

  194. I love it when joe makes friends. It makes them all want so much to take his arguments seriously in the future.

  195. “my contempt for the attidues most libertarians progressives hold towards the poor.”

  196. I suppose in some sort of elitist sense that’s possible, but it would be foolish to take such an assertion at face value.

    Uh, charges of “Elitism” more or less require showing that the “elite” advocates that he or she deserves to be treated differently in a structural sense (priva legis would be an example). I suspect a libertarian message board is the last place you will find “elites.”

  197. Then this one maybe, which doesn’t mention any studies at all. It does link to this study by Neumark and Wascher, but I doubt you’ll like their conclusions.

    And funny, I like how analyses that are 5 years old are now 20 years old, and how you don’t have anything other than the old Card/Krueger/Katz studies which are approaching 10 years in age.

  198. Oh and joe, your second link reference to the CEA report is one that goes back to the Card/Krueger/Katz stuff.

    Further, that link doesn’t dispute the negative impact of raising the minimum wage, just that a phased in approach would offer greater benefits than costs. Here is how the logic runs.

    Sure, there is a disemployment effect, but the welfare of those who keep and/or get jobs at the higher wage rate will be better off. This increase in welfare can offset the loss in welfare to those who don’t get jobs.

    Really, do you read your own links?

    Keep up the funny posts though.

  199. Steve, you should know that joe already knows we don’t care about the poor, so anything we say must be viewed through the lens that libertarians are dedicated to oppressing the poor.

    even though, if a poor person wanted to work for 6 dollars an hour, big-hearted people like joe would tell him to stuff it.

  200. Hmmm, a search at EconPapers pulled up only a handful of hits from 2007, 2006, and 2005. Whatever could joe be thinking of?

    Still, this one could help joe. It does note there is no evidence of an adverse employment effect. However, the introduction does have this to say,

    However, the economics of the minimum wage is different in developing countries, where the minimum wage affects many more workers and labor institutions and law enforcement differ in important ways. For example, the limited evidence for Latin America indicates that the wage compression and employment effects are considerably stronger in developing countries than they are in developed countries (Castillo-Freeman and Freeman, 1992; El-Hamidi and Terrell, 2002; Maloney and Mendez, 2004; Montenegro and Pages, 2004). Nonetheless, this literature consists of very few studies (mostly one or two for each country) and the results are sometimes conflicting. For instance, although the evidence for Brazil also indicates that the minimum wage strongly compresses the wage distribution, it suggests a small adverse employment effect (Carneiro and Henley, 2001; Neumark et al., 2005; Lemos, 2004). Hamermesh (2002) argues that much more evidence is required to evaluate measures such as recent Latin American policymakers’ promises of minimum wage increases (The Economist, 2002 and 2003).

    Not exactly a stunning refutation for the claim that raising the minimum wage has an adverse impact on teenage employment.

  201. Did anyone else notice that this post was about JFK? – you know, the woman-chasing (a postiive), shitty-naval-officer, sabre-rattling, average-president that was only idolized because of Oswald.

  202. I think its probably safe to say that the minimum wage doesn’t reduce employment opportunities only when it is set below the prevailing rate of unskilled entry level work.

  203. Steve, you should know that joe already knows we don’t care about the poor, so anything we say must be viewed through the lens that libertarians are dedicated to oppressing the poor.

    You mean like Paul Krugman

    In Praise of Cheap Labor
    Bad jobs at bad wages are better than no jobs at all.
    By Paul Krugman
    (1,669 words; posted Thursday, March 20; to be composted Thursday, March 27)

    For many years a huge Manila garbage dump known as Smokey Mountain was a favorite media symbol of Third World poverty. Several thousand men, women, and children lived on that dump–enduring the stench, the flies, and the toxic waste in order to make a living combing the garbage for scrap metal and other recyclables. And they lived there voluntarily, because the $10 or so a squatter family could clear in a day was better than the alternatives.

    The squatters are gone now, forcibly removed by Philippine police last year as a cosmetic move in advance of a Pacific Rim summit. But I found myself thinking about Smokey Mountain recently, after reading my latest batch of hate mail.

    The occasion was an op-ed piece I had written for the New York Times, in which I had pointed out that while wages and working conditions in the new export industries of the Third World are appalling, they are a big improvement over the “previous, less visible rural poverty.” I guess I should have expected that this comment would generate letters along the lines of, “Well, if you lose your comfortable position as an American professor you can always find another job–as long as you are 12 years old and willing to work for 40 cents an hour.”

    Such moral outrage is common among the opponents of globalization–of the transfer of technology and capital from high-wage to low-wage countries and the resulting growth of labor-intensive Third World exports. These critics take it as a given that anyone with a good word for this process is naive or corrupt and, in either case, a de facto agent of global capital in its oppression of workers here and abroad.

  204. joe | June 9, 2008, 10:17am | #
    People who use the word “steal” to refer to taxes should have their wallet lifted by a guy with a gun.

    People who pay taxes and don’t want to DO have their wallets lifted by a guy with a gun. (Or guys with guns)

  205. joe | June 9, 2008, 10:22am | #
    Taktix,

    Had you ever actually been robbed, or had your house broken into, you wouldn’t have any trouble whatsoever understanding the difference between that, and paying your taxes.

    My house was broken into when I was over in Iraq. And I was mugged as a kid.

    I think because of the latter is some of my vitriol against thieving and robbing.

    So explain to me how the IRS is any different, except that it is much easier to do something about the private enterprise robbers than the government sanctioned ones.

    Joe,
    If I started to tax you. If I came by your home or business, and was very polite and well dressed, but I made evident my ability to use violence against you, and the futility of your resistance. Because I wanted to fund my pet cause that I think is very important.

    Would you not consider yourself robbed? Would it not enrage you?

  206. And as Spooner pointed out years ago, at least the highway robber doesn’t have the chutzpah to try to convince you he’s using your money for a better purpose when he robs you.

    Anyone who has tried to not pay taxes knows that, like robbery, if you don’t turn over your money, physical force will soon follow.

  207. the biggest losers are the big boys-not the welfare queen with 8 kids by 9 different fathers.

    I would say that is real talent. 8 kids by 9 dads.

  208. Got a link, joe?

    Gotta back joe up on this.

    You can find dozens of studies concluding that minimum wage laws cause unemployment, and dozens of studies that say they don’t. Lists have been compiled and shared on past discussion threads.

    The way I figure it, most mandatory minimum wage laws set the minimum wage close to or slightly below the prevailing market wages that the effect of the laws is hard to discern. Which means the laws are mostly about political pandering and posturing.

    Now, “living wage” laws, would be a different animal. It would be really easy to see all the job loss they would create. For that very reason, you don’t see a lot of living wage laws passed.

  209. Hmmm, a search at EconPapers pulled up only a handful of hits from 2007, 2006, and 2005.

    That site must have missed this.

    That study does suggest that Reinmoose might be right. Wages become flattened, at least in the restaurant sector.

    Myself, I lean towards Mike Laursen’s explanation.

  210. kwais-

    Just a little variation on Reagan’s tale about the chicago welfare queen.

  211. That site must have missed this.

    Odd, they use at 10% significance level in that study. The usually accepted level is 5%. I wonder if this is why the results haven’t been published.

    Oh and in case the general reader is wondering what the importance of the significance level is, since the authors are relying on a 10% to obtain statistically significant results, if one were to use a 5% level the results would be statistically insignificant.

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