Minimum Wage

A $15 Federal Minimum Wage Would Destroy Jobs and Hurt America's Poorest Workers

Last week, The New York Times Editorial Board dismissed those concerns and called for a $15 national wage standard.

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"The idea of using a minimum wage to overcome poverty is old, honorable—and fundamentally flawed," The New York Times editorial board wrote in 1987. "It's time to put this hoary debate behind us, and find a better way to improve the lives of people who work very hard for very little."

Last week, the Times editorial board revisited the issue and reached a different conclusion: "The American economy is generating plenty of jobs; the problem is in the paychecks," the paper writes. "The solution is a $15 federal minimum wage."

The current federal minimum wage is $7.25.

The paper's editorial board points to America's strong economy and low unemployment rate as proof that we can afford to raise the federal minimum wage. It dismisses the possible job-killing consequences—the same ones raised by the paper in 1987—as "never entirely sincere" and says the data we have now shows that doubling the minimum wage will have no unintended consequences for low-wage workers. 

Yet the research is anything but decisive, something that freelance business writer Dee Gill points out in the nonpartisan UCLA Anderson Review. "Some 60 years and hundreds of research papers from prestigious universities, government agencies, and private organizations have created little consensus on the subject [of the minimum wage], academic or otherwise," she writes. "Just last year, [in 2017], separate Seattle minimum wage studies by researchers at the University of Washington and the University of California Berkeley suggested polar opposite effects."

The short version of the minimum wage debate can be summed up as follows: some economists say that mandating a higher base pay helps workers without harming their employers; other economists contend that the policy forces employers to slash hours and cut jobs, which ultimately harms workers.

To refute these concerns, the Times board cites a 1993 study by economists David Card and Alan Krueger in which they compared fast-food restaurants in New Jersey, which had recently implemented a minimum wage increase, with businesses in nearby Pennsylvania. Card and Krueger found that the pay hike did not reduce employment in New Jersey.

But consider the first wave of data collected by Card and Krueger in February and March of 1992, before the wage increase took effect on April 1 of that year. New Jersey voted in 1990 to raise the state's wage floor above that of the federal minimum, giving businesses two years to prepare. In early 1992, Card and Krueger observed that Pennsylvania's fast-food restaurants averaged 23.2 full-time workers, while New Jersey's only employed 20.2. That may not have been mere coincidence. "Employers typically don't like to fire workers," writes Thomas Firey, a Senior Fellow at the Cato Institute, "so a rational strategy to prepare for the policy change would have been to reduce employment through attrition in anticipation of the policy change, rather than issue morale-crushing pink slips on March 31, 1992."

The Times also invokes economist Arindrajit Dube's compilation of studies, from which he deduced that raising the minimum wage has a "very muted effect on employment." Yet you don't have to look very far to find studies that come to the opposite conclusion. "Although the wide range of estimates is striking, the oft-stated assertion that the new minimum wage research fails to support the traditional view that the minimum wage reduces the employment of low-wage workers is clearly incorrect," write economists David Neumark and William Wascher. "Indeed, in our view, the preponderance of the evidence points to disemployment effects." Approximately two-thirds of studies they surveyed show a negative impact on jobs.

Neumark and Wascher add that "among the papers we view as providing the most credible evidence, almost all point to negative employment effects, both for the United States as well as for many other countries."

What makes for credible evidence? No two economies are identical or immediately comparable, a fact researchers have been wrestling with since they started exploring the minimum wage question. Regional, state, and municipal economies vary in ways that lead to different outcomes when wage floors change. This fact helps explain the vast variability among researchers' conclusions.

"For many years, researchers have manipulated these control groups to weed out factors that don't equally affect employment in both locations," notes Gill. "But there are huge differences among experts over how the data can justifiably be manipulated."

In all reality, the result of any given minimum wage hike likely lies somewhere in a mushy middle: some workers see a bump in pay; some workers see no change in income (because they're making at or just above the new minimum wage); some workers are let go; some workers are never hired.

The research can be confusing, so let's consider Target's $15 minimum wage. In 2017, the retail colossus promised to voluntarily bump pay nationwide, and eventually delivered. Except, for many of the intended beneficiaries, the results weren't positive.

"I got that dollar raise but I'm getting $200 less in my paycheck," a Target employee named Heather, whose hours have been cut from about 40 to 20, explained to CNN. Twenty-two other Target employees were interviewed by the network, all of whom had seen their hours reduced even as their hourly pay increased. Put another way, minimum wage increases don't have to lead to layoffs to hurt the people who are supposed to benefit. Companies can reduce hours to keep take-home pay roughly the same, or slash hours even further, as happened to Heather.

The Times never addresses the very real potential for companies to reduce hours in response to wage increases. But they do eventually grant a more dire concession: "It is possible that a national $15 standard would produce the kinds of damage critics have long predicted," they write at the end of their piece in reference to unemployment issues they initially dismissed. Indeed, the Congressional Budget Office (CBO) recently estimated that about 1.3 million workers would be priced out of the labor market entirely should Congress double the federal minimum wage to $15 an hour.

"For most low-wage workers, earnings and family income would increase, which would lift some families out of poverty," the CBO writes. "But other low-wage workers would become jobless, and their family income would fall—in some cases, below the poverty threshold."

That comports with the conclusions of Neumark and Wascher, who say that research looking at how the minimum wage affects low-wage workers "provide relatively overwhelming evidence of stronger disemployment effects for these groups."

Yet those individuals wouldn't be the only ones to suffer under a $15 federal minimum wage. Tipped workers, often employed at bars and restaurants, earn a fraction of the mandated minimum and make up the rest of their pay in tips. These employees would see an explosion in hourly base pay from the current federal tipped-wage floor of $2.13. If New York City's tipped wage increases are any guide to what we'd see in other parts of the country, then restaurant staff and their patrons stand to lose quite a bit from a federally mandated increase in the minimum wage. 

And what about communities outside of big city centers? An approximate 100 percent increase in Mississippi's minimum wage, for instance, would likely shutter small businesses across the state. 

The Times editorial board proposes a workaround to these concerns: a directive "to include exemptions from the $15 standard for low-wage metropolitan areas and rural areas." How would that exemption process work? What would it cost to review requests? How much would businesses and cities spend lobbying for or against carveouts? And with so much money on the line, why not just leave the decision in the hands of policymakers closer to the problem? After all, 24 states raised their respective minimum wages at the start of 2020. 

As localities across the U.S. continue to engage in this discussion, politicians and pundits alike should remember that objections to a minimum wage are rooted in genuine concern for the people who will bear the brunt of these policies if they fail. 

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  1. “Hurt America’s Poorest Workers”

    Indeed. And as Koch / Reason libertarians, that’s the last thing we want to do.

    You know what wouldn’t hurt America’s poorest workers, though?
    Unlimited, unrestricted immigration.

    #OpenBorders
    #AbolishTheMinimumWage

    1. Im curious as to why Tony decided to post as 3 other people in this thread.

  2. And this is why one should not engage in statistics in these debates. The age of the internet has brought forth a time when anyone can find whatever “evidence” they want to support their bias.

    Mind you, there is a known mechanism (supply and demand curves) postulating that the increased minimum wage will lead to disemployment. And a slight preponderance of studies indicate that this mechanism is in effect. Counter studies have no mechanism to explain why making labor more expensive won’t lead to less labor being purchased, they just claim to find no effect. So I believe the evidence leans towards Minimum Wages in fact causing dis-employment.

    That said, if the NYT editorial board can find a statistic somewhere else, then so can any other socialist. The argument needs to be on principals- on why it is wrong for the government to tell two people that they cannot agree among themselves the nature of their transaction.

    1. It’s not wrong because employers and workers are not negotiating from an equal place. And nobody wants to live in fucking Bangladesh. Labor’s real cheap there!

      1. ^^ slave to the traffic light

      2. Gee, Tony, here you show up and ruin my fantasy that you’d died and taken your fucking stupidity with you.

      3. It’s not wrong because employers and workers are not negotiating from an equal place.

        Are governments and employers “negotiating from an equal place?”

      4. You’re right Tony – with a strong economy and record low unemployment, its obvious that *workers* have the upper hand right now.

        Therefore, to ‘even the playing field’ as you prefer we’ll need to force wage cuts across the board.

        After all, if ’employers and workers are not negotiating from an equal place’ then the solution is to equalize that – so unless you can come up with some justification as to why employers should always be getting the shaft . . .

      5. You’re right. I’m very good at my profession and the labor market is tight right now.

        One of my coworkers quit and the company was scrambling to fill the position. I was promoted to fill the position. You best believe we did not have equal negotiating positions when I was hired. I leveraged my superior negotiating position for a massive raise. They had little choice but to agree.

        1. Well played.

        2. To be fair, I’d venture to say that most workers do not have your negotiating skills.

      6. Labor’s real cheap there!

        Yup and a $15 minimum wage here will drive employment there. Stick to what you know best, on your knees.

      7. Everything is so terrible and unfair.

      8. Shorter version: it’s wrong because workers aren’t worth as much as employers.

        Clearly a problem with the universe.

    2. I think that the only reason minimum wages haven’t done a lot of damage is that they have usually lagged behind prevailing wages. Trying to actually increase people’s wages through minimum wage would do a lot more damage. And I think that that has been borne out in the states and municipalities that have tried doing that.

      And it totally fucks young people just starting out working. Who is going to pay some 16 year old shithead kid with no skills $15/hour?

      1. “”prevailing wages.””‘

        Last time I heard that term it was mentioned by a NYC executive regarding why a bathroom costs 2.2 million.

        1. I mean actual prevailing wages, not union bullshit.

      2. “I think that the only reason minimum wages haven’t done a lot of damage is that they have usually lagged behind prevailing wages.”

        Where they would, as in a nation-wide M/W, it would shortly show the effects. Sadly.
        I had the pleasure of sitting in the Central Cafe in Vienna where many of the Viennese professors had coffee. It was there where Schumpeter applauded the Soviet coup in Russia, with a comment that ‘Now we will have a demonstration of the failure of central planning’.
        He was criticized by the others; ‘There will be many deaths’, responding ‘They chose that path, not me’.
        Paraphrase from “Prophet of Innovation”, McCraw.

  3. One of my concerns with minimum wages is the government support to employers offering low wage jobs. How many minimum wage workers get housing, nutritional, and medical support from the government because some large employer doesn’t want to pay wages needed in the area were their employee live. These big box or fast food shops want there employees health and clean and they expect the government to provide that through housing and other support. So I would say that employers can pay what they like in wages, but the government bills the company for any government assistance their employees need to live.

    1. “So I would say that employers can pay what they like in wages, but the government bills the company for any government assistance their employees need to live.”

      Who determines what someone “needs” in order to live? A breath will get you three minutes, a drink will get you three days, and a meal will get you three weeks. Is the IRS responsible for billing companies; which agency collects? Sounds expensive to implement and enforce. We better have a generous definition of need so that we can invoice these companies lots and lots of money to pay for it all.

      1. “Sounds expensive to implement and enforce.”

        Is it any less expensive for government to provide housing, nutrition and health subsidies for a low wage employer’s workers. That’s my tax dollars subsidizing a companies workforce because they don’t pay a liveable wage for the area where their business is located.

        1. In your proposed scenario, the government still provides those things; you’re suggesting that we should add extra complexity, arbitration, and administration. So yes, in effect, the status quo probably is less expensive.

          The term “liveable” is very subjective. I don’t particularly like the idea of one party taking from another to satisfy what they might consider “livable”.

          You seem to be operating under the impression that workers are owned either by the government or by employers. Perhaps individuals have agency, self-ownership, and free-will regardless of their employment status.

          1. You seem to be operating under the impression that workers are owned either by the government or by employers. Perhaps individuals have agency, self-ownership, and free-will regardless of their employment status.

            ^ This.

            What happens if someone has two jobs? Which employer is responsible for them? If I hire a babysitter, or a local teenager to mow my lawn, do I need to then take ownership of their personal welfare? If one of them collects a government benefit I had no role in offering them, do I become responsible for paying it now?

            What if my babysitter that I’m now responsible for goes and hires someone to mow their lawn? Is my babysitter now responsible for that person’s total welfare? And what’s my relationship to the babysitter for whom I’m responsible vis-a-vis my babysitter’s new dependent?

            1. If we keep piling obligations onto employers we’ll solve unemployment in no-time!

          2. The worst landlord in NYC is NYCHA.
            The worst hospitals in NYC are H&H which is ran by the city.

        2. Or the government could stop subsidizing those things so much so that employers would have to pay more if they want well housed and fed employees. And get rid of zoning and building code requirements so people can find or build an affordable place to live.

          And it’s always worth pointing out that you can live just fine on a pretty small wage. Much of the problem of poverty isn’t not enough money, but not being able to manage money well.

          If you are an adult without significant mental disability supporting a family and you can only get a minimum wage job, you probably need to take a good look at yourself.

    2. “How many minimum wage workers get housing, nutritional, and medical support from the government because some large employer doesn’t want to pay wages needed in the area were their employee live.”

      Well, we can dismiss the notion that Tony is the only stupid shit here.
      Hint: Your whine is a good reason to reduce the welfare state, not raise the minimum wage.

    3. Have you considered a possible solution to your problem is removing the government support? If they want workers to show up “healthy and clean” as you say, they’ll need to pay more. Gov. programs just shunt off funds before reaching the ‘Target.’

      1. If they want workers to show up “healthy and clean” as you say, they’ll need to pay more.

        ^ This. It’s looking at the situation exactly backwards to pretend that it’s WalMart forcing the government to give its workers welfare.

    4. “How many minimum wage workers get housing, nutritional, and medical support from the government because some large employer doesn’t want to pay wages needed in the area were their employee live.”

      How many minimum wage workers need fewer government handouts because they have a job that they might not have, with a higher minimum wage?

    5. You don’t correct problems caused by government intervention with more government intervention.

      1. Also, what in the fucking fuck would this have to do with a Federal minimum wage? Because that’s forcing a wage increase across the country when the problem you’re talking about is area specific.

        What that means is that some areas – if we take this utter bullshit as real – are paying more, other areas are paying the right amount. So those two types of places get screwed over because you want to ‘fix’ the one area where they’re paid too little – but you don’t know (and can’t know) where exactly those areas are.

      2. Amen!!! Stupid freak-en voters..

    6. . . . but the government bills the company for any government assistance their employees need to live.

      So, in other words, you want people on welfare to never be able to get a job and eventually move off welfare.

      The real question you should be asking is why, if cost of living is so high and wages are so low, what is preventing these people from moving.

      Because, interestingly enough, its the *low-skilled* who have the most mobility within the country. One McJob is much like another. Stocking shelves in a Whole Foods in Palo Alto is directly transferable to stocking shelves in a Walmart in Houston.

      What’s keeping these people static? Could it be that welfare benefits are a trap?!

      1. Yes, there is a pretty good correlation between states with generous welfare and states with homeless problems and lack of affordable housing.
        As I said yesterday, you will have as much homelessness and welfare cases as the government is willing to pay for.

    7. So I would say that employers can pay what they like in wages, but the government bills the company for any government assistance their employees need to live.

      9 out of 10 industrial robots agree.

    8. You’re going to end up in wants vs needs, and very likely end up arguing for particular lifestyle that many might categorize as lower-middle income as the minimum acceptable “living wage” level.

      If the employer provided a cot in a barracks adjacent to the workplace and provided them rice and beans for food, and access to a staff doctor, some might argue that they were being provided the minimum their employees need to live.

    9. Moderation4ever
      January.10.2020 at 12:24 pm
      “One of my concerns…”

      Did you get enough of your ass handed to you to learn something, or are you still a fucking lefty ignoramus?
      Just checking to see how long someone chooses “stooopid”.

    10. Why would an employer want to pay more if the government is going to do it? Why would a worker care who the money is from as long as he gets what he thinks he’s worth?

  4. Hidden in this piece is the tidbit that the New York Times (2019) does not trust the New York Times (1987).

    1. Saw that.

  5. Brilliant!
    Pass this, demolish the thriving economy, blame it on Trump, and get one if the D clown-car occupants elected!

    1. In all fairness, if trump signed it into law, it would be his fault.

      1. He’s not perfect, and if he did that, he deserves the next ‘Economic Nobel’, just like Obo deserved that ‘Peace Prize’.

  6. Idiotic, a one-sized fits all policy like this is beyond stupid. Soviet style central planning.

  7. The same people who argue that the price of cigarettes should be raised in order to get people to quit buying them support raising the price of labor with the argument that employers won’t buy less of it.

  8. “no unintended consequences”
    How long until some idiot at the NYT proposes that doubling the price of the newspaper will have “no intended consequences” on circulation and the bottom line?

  9. “some workers see a bump in pay; some workers see no change in income (because they’re making at or just above the new minimum wage); some workers are let go; some workers are never hired.”

    This is what the study in Seattle shows as well. Your most experienced workers will see a rise in wages. Mid experienced workers will so no gain or loss and least experienced will most likely see less money or be fired.

    1. Yes! Not much remarked on is this: The remaining higher-paid workers will be dumped on by their bosses, TO WORK THEIR ASSES OFF to make up for the absence of the lower-paid ones! How about some sympathy for those workers as well, from all the leftists?

  10. When they mandated that all full time employees of companies over a certain size must get healthcare benefits, employers cut jobs and hours. Acting like raising the minimum wage will have a different effect is plain incorrect.

    Some areas will be able to absorb it better than others. It will essentially be a hand out to large corporations since it will reduce their competition with local businesses. Rural areas will be fucked.

    1. Predictable consequences are never unintended.

      1. Wrong. It’s perfectly valid for any predictable consequence to also be unintended. For example, the predictable consequence of over-eating is getting fat, but there are very few people who intend to get fat.

  11. It’s the same old story. Every time someone makes the obvious observation that wages are too low to live on, some educated genious comes along and warns that raising wages will put some out of jobs. That is true that setting a minimum wage will prevent you from legally hiring a desperate homeless person willing to do all the work you refuse to do for fifty cents an hour but that’s part of the reason it was created. Unfortunately, our business leaders have adopted an attitude that they don’t have to lead by example or do what’s in the best interest of the country. They just want to get rich as fast as possible and to hell with the country. We don’t have business leaders anymore like Ford and others who paid living wages. Globalism is the ethic now it’s mandate is to push the world into slavery. Thus, global corporate owners/executives foam at the mouth over the possibility of lowering wage rates even more so they can compete with China labor rates, which are peasant level. That’s right, these ‘leaders’ pretending to worry about putting some poor people out of work by being required to pay a living wage are actually saying, “Global billionaires need more peasant slaves to compete with the global billionaires in other countries with lower labor costs”. If you want a violent, unihabitable, war zone for a country, just accept their advice. The country was healthiest before globalization destroyed the middle class. At some point, the destruction won’t be reversible and the value of every life will be the value that it represents to global corporations, who will inevitably make our laws, much like they already do to a large extent.

    1. That is true that setting a minimum wage will prevent you from legally hiring a desperate homeless person willing to do all the work you refuse to do for fifty cents an hour but that’s part of the reason it was created.

      You’re close – the reason it was created was to prevent desperate black people willing to work for less than the white people from “taking jobs” from white people. Why do you feel it’s your right to choose who works and who doesn’t?

      The country was healthiest before globalization destroyed the middle class.

      The global middle class is larger now than it ever has been in the history of humanity. The only class that is really shrinking is the poor.

    2. Every time someone makes the obvious observation that wages are too low to live on,

      These wages aren’t too low to live on. They are too low to live on with two cars, a handful of kids, multiple tvs, and smartphones for everyone.

      1. Indeed, if a single person works full-time (50 wks @ 40 hrs/wk), even at a minimum wage job, they are well above the poverty line.

        That same wage cannot keep that same person and a kid above the poverty line. Of course, minimum wage was not intended to provide a lower-middle class income for a family of 4, either.

      2. If people weren’t getting a living wage, they’d be dead, no?

        This idea that every job needs to support a family of 4 is absurd. Maybe don’t have kids unless you have some kind of a plan to support them.

    3. The country was healthiest before globalization destroyed the middle class.

      The middle class was ‘destroyed’ by turning a significant percentage of it into the upper class.

    4. It never ceases to amaze me that there are people who are willing to publicly admit that they’re too stupid to understand how prices work.

    5. “educated genious ”

      Lol

      1. Once the progressive froth spat out “slavery” I realized that “educated genious” was probably the least of this guy’s problems.

    6. Early
      January.10.2020 at 1:44 pm
      “It’s the same old story. Every time someone makes the obvious observation that wages are too low to live on, some educated genious comes along and warns that raising wages will put some out of jobs…”

      Are you posting here to prove how stooooooooopid lefties are? If so, you’re going for the gold.

  12. I’d like to see a study on the worker that is paid$4 or $5/hr and the transfer payments that come their way from the federal and state taxpayer (especially the federal taxpayer, since only 50% of us pay into that cesspool). If SNAP transfers, dept of ed meal supplements, dept of education, dept of transportation grants, HUD housing, energy assistance and best of all MEDICAID expansion through Obamacare are transferred to an majority of these workers, then we are supplementing business that would never make it in a non-welfare state.

      1. Yeah, good luck with that. The conservetives in Britain just passed a minimum wage, makes me question this.

        1. That’s not an answer. You can’t penalize businesses for your political choices.

          1. I know its not an answer. An observation is something I can see that is right in front of me.

            Importing welfare dependent visa holders or socialists (California gets 1/3 of the U.S. welfare transfer payments) is a sure way to keep the left in power and take the republic down. Seems like everyone on every side of the political aisle wants Denmark style welfare and taxes (60%-70% effective), so be it. As DeBlasio says “there’s a lot of money out there, its all in the wrong hands”.

        2. So, we can’t get rid of welfare – so we’ll make things worse.

          Because we have to do something and this is something. So we have to do this? Is that your reasoning?

          1. Whats better, a Denmark style tax system or minimum wage?

            1. Although Reason suggests that Denmark and Sweden have more freedom than the U.S., so there’s that.

            2. middlefinger
              January.10.2020 at 2:53 pm
              “Whats better, a Denmark style tax system or minimum wage?”

              What’s better is ignoramuses like you to fuck off.

            3. A Denmark style tax system.

              Low-regulation, low barrier to entry – all things libertarians want.

              High taxes – we don’t like this. But its better than what we’re doing now.

              Of course, we could just get rid of the welfare state – and kill the impetus for those coming here illegally seeking benefits. And then we won’t need the wall. Killing 3 birds with one stone.

              1. “Of course, we could just get rid of the welfare state”

                Some of us remember that ol
                “repeal and replace” x 6 years. Six fucking years of repeal and replace and eight years of time to come up with a simple catastrophic plan for American citizens with market insurance to fill in those gaps. Here we are in 2020, the ACA is almost 30% of GDP and I say to you:
                Good. Luck. With. That.
                Why am I paying million dollar pensions to retired senators and every fucking government do nothing at every level? Why not 401k like the rest of us?

                For the record, I don’t wish a federal or even state level minimum wage on business owners (Im one of them). I gravitate towards a Yang/Murray type UBI that consolidates all of these programs, including entitlements. Yeah, I’m on a RANT, so let the name calling begin.

          2. My suspicions on the Denmark Model come from Reason. Tyler Cowen. In a 2007 article entitled “The Paradox of Libertarianism”, Cowen argued that libertarians “should embrace a world with growing wealth, growing positive liberty, and yes, growing government. We don’t have to favor the growth in government per se, but we do need to recognize that sometimes it is a package deal.”

            Nick had a column a few weeks ago with Mr. Cowen promoting the Denmark model for the United States.

        3. middlefinger
          January.10.2020 at 2:20 pm
          “Yeah, good luck with that…”

          So you don’t like the proper solution, and therefor your idiocy should be what we do?
          Fuck off, slaver.

  13. Few points.
    1. For those making sub livable wage, it sucks. Those against minimum wage have no answers for them and also usually oppose government assistance.
    2. If raising minimum wage lowers hours so that those work less hours for same pay, that is a good thing for the workers.
    3. Corporate profits are very high now, they can afford to pay their workers more.
    4. If your business is not good enough to pay your employees a living wage then you should not be in business. Demanding people work for low pay so that you can have a business is entitlement at its highest.

    1. 1. Jesus. For those making ‘sub livable wage’ it wouldn’t suck, they would, by definition, be dead or dying. Starving to death. Because they don’t make enough to live off of.

      2. That’s not what happens. Especially when you see benefits cut alongside the pay increase.

      3. Corp profits are not particularly high nor low right now. They can’t afford to pay their employees more in any meaningful way. *Really profitable* companies pull less than 3% net profit (after all expenses and taxes are paid). Most are well under two percent.

      4. Go fuck yourself. I’ve worked at small businesses where the owners were making sub-minimum wage. I’ve worked for companies where I made more than the owner. These people are sacrificing short-term gain for long-term gain – and taking real risks with their money. You’re out here making broad generalizations secure in your weekly paycheck.

      1. When I started my first business, I paid myself nothing for 5 months. Once I started taking pay, I paid myself according to market rate for what I did. The real money only came when I finally sold it.

      2. Exactly. Small business owners may get some perks but it’s not like the way like assholes like this guy think where they go vacationing in Tahiti. The other part is SME owners generally pay a salary and use the sale of a business to FUND THEIR PENSION because they don’t have fancy pensions like some do.

      3. I’ve worked at small businesses where the owners were making sub-minimum wage. I’ve worked for companies where I made more than the owner. These people are sacrificing short-term gain for long-term gain – and taking real risks with their money.

        ^ This. I worked for a small contractor from 2009-2014, and through most if not all of that time I made more money than he did. 2009-2012 he was losing money hand-over-fist and hocking his wife’s jewelry to be able to cover my paychecks. He had a nicer house and car than me, and took better vacations, but was also in debt up to his teeth. Meanwhile, I earned a steady and reliable paycheck, which is more important to me personally than the chance of some future grand payoff.

      4. 3. Corp profits are not particularly high nor low right now. They can’t afford to pay their employees more in any meaningful way. *Really profitable* companies pull less than 3% net profit (after all expenses and taxes are paid). Most are well under two percent.

        I can personally confirm this fact. I work at a financial institution.. my job involves approving/denying loans and financial analysis so I have seen loads of financial statements of small to medium sized companies across a great many industries throughout the country. In addition to that, I’m invested in a few small local businesses in the area. Most businesses I deal with make between 0% an 5% profit margin. Also, employee wages and benefits are usually a massive part of the income statement – an across the board increase due to government mandate would have a huge impact.

        1. Yeah – I deal with/negotiate construction costs constantly, and a 2% profit margin is pretty common. 5% is golden.

          You could cancel out that margin completely and distribute it to the workforce, but spread it out among all the workers it wouldn’t be enough to even notice.

          1. Thanks for that extra $1.15 in my paycheck.

    2. “Demanding people work for low pay”

      ?

      Slavery was outlawed. These are voluntary exchanges.

    3. “Demanding people work for low pay so that you can have a business is entitlement at its highest.”

      Saying “I’ve got a job available, it pays $X/hr. Do you want it?” is not a demand.

    4. “If your business is not good enough to pay your employees a living wage then you should not be in business.”

      Nothing gets me going than this smug line from know-nothing clowns.

      Ah yes, the tiresome ignoramus lefty line. Another one these assholes who know jack shit about business spew is ‘so what if a business closes because of bureaucratic regulations another one will sprout up!’

      Which just goes to show how much they don’t care about people in the end because when a business fails, it may make them feel great from an ideological point but what they fail to appreciate is there are PEOPLE and LIVES behind a business both owner and employee and when a business flops mostly to government interventionism ultimately the community suffers as a whole. Sure, someone may come in ‘take over’ but this is an inefficient way to run an economy (there are costs to failed businesses think all the other businesses who get screwed like utilities and others who were associated with said business). Idiot.

      Just so I’m here. You have a said of brass balls to say something so fucken stupid. Go fuck yourself.

      I own a small business. It took me three years before I paid myself a SMALL salary. It took another six just to get a medium salary and it’s a struggle to each higher levels EXACTLY because of bull shit like this getting in the way of my growth which my employees benefit.

      The government DOESN’T KNOW what MY employees are worth. I KNOW. Not shit heads like you who fucken disrespect people like us who are responsible and dedicated to our businesses AND EMPLOYEES.

      Don’t deserve. Do you realize how much of an impact min. wage ESPECIALLY when not deserved hurt not just the owner but the employees? It’s getting next to impossible to just higher a simple hand without going under the table because I’m paying someone $15 to clean tables or simple work like that.

      Now go get a clue and stop talking about shit you know nothing about and make spurious, insulting and arrogance proclamations showcasing your stupid left-wing progressive anti-business MSNBC garbage.

      1. Corrections:

        -Just so I’m here.

        -It took another THREE just to get a medium salary. Not to saying nothing about the debts and loans I have to carry.

        -You’re still a cunt.

        1. Vicious. Sounds like you own a restaurant. If so, godspeed when it comes to this stuff. A $15 minimum wage would be absolutely brutal to restaurants. Are you considering letting your wait staff go and switching to kiosks?

          1. Not a restaurant. But in services.

            Tired of jack offs like that.

            1. And that’s a talking point line because all the NPSs use it. That’s why I was vicious. It’s not borne from any practical knowledge or experience. They spew it because they’re told to think it.

              1. I totally hear you. Best of luck. I live in a locality that already decided to raise the minimum wage to $15. We’re stepping up slowly.

                1. Thanks. Same to you.

    5. “”4. If your business is not good enough to pay your employees a living wage then you should not be in business.””

      Look Greta, It’s not your job to decide if someone should be in business.

      Perhaps if the business doesn’t pay enough, no one should take the job. Then they either increase their wages or close up shop.

    6. MollyGodiva
      January.10.2020 at 2:08 pm
      “Few points.”

      One point:
      You.
      Are.
      Full.
      Of.
      Shit.

      1. Notice the shit stain is nowhere to be found.

    7. 1. They could try working their way to lowest management:

      https://www.google.com/amp/s/www.latimes.com/business/story/2020-01-09/taco-bell-higher-salaries-paid-sick-time%3f_amp=true

      This idea that people have no answer for them: perhaps they should look for an answer themselves. These aren’t hard questions that only the likes of Bernie Sanders can answer.

    8. At first, I though this was just generally naive and foolish. When I got to #4, I realized it was actually much worse.

  14. Of course the NYT editorial board would deny it. Have you seen the bunch of SJW clowns who represent it? They couldn’t care less about poor people. Poor people are the racist deplorables.

    It makes perfect sense they would support min. wage.

    1. White poor people are racist deplorables. The last marginalized group you’re allowed to mock. Other kinds of poor people are magically wise and good. And if they aren’t it’s because of the grand white people conspiracy.

    2. “”Of course the NYT editorial board would deny it.””

      They can deny it all the way to the front door when the Times closes because it can’t afford to stay in business.

  15. The utility of these studies is questionable. Moreso lately.

    1. And I mean all of them.

  16. You don’t even need “research” to be honest. It’s fucking common sense. If minimum wage has no effect on job availability, why not just make the minimum wage $2000 an hour?

    1. Look up why min. wage was invented in the first place.

      It wasn’t for nice reasons.

      1. Can you enlighten us?

  17. The market may dictate a prevailing minimum wage of $15 (and higher) just by virtue of having to compete for workers. What I see in retail, for example, is positions go unfilled and it really hurts the business. After a time, the company wage scale goes up, the pain is just too great to not pay more.

    With a 3.5% unemployment rate, the prevailing minimum wage will rise. It is economics 101. High demand for workers, restricted supply = higher cost to employer from paying higher wage.

    It may take longer, but why not let the market do the work.

    1. The local Taco Bell is hiring new people at $13.50. And they are still understaffed. NH min wage is still the federal. No one is making that wage who isn’t a teenager or someone who cares more about other things besides the wage rate.

        1. I know, right?!

    2. It’s already happening.

  18. Hmmm … the connection between a massive influx of legal and illegal immigrants and declining wages seems not have been made by Reason staff, or the connection between declining wages and people’s desires to be paid a fair wage for their labor.

    Restrict immigration and there is no need for minimum wage laws as the labor marked will stabilize.

    But, Reason wants it both ways. Let’s have open borders, no minimum wage, and then bitch about the vapidity of American citizens who feel (rightly so) that they’ve been screwed.

    1. Well, there’s the whole ‘wages aren’t depressed because a bunch of unskilled laborers entered the country’ dataset that pretty conclusively guts that idea.

      There are reasons to oppose immigration. Depressed wages is not one of them.

      1. Most unskilled immigrants are illegal. This should be an obvious alliance between those who believe we should restrict unskilled immigration (rightly or wrongly) and those who believe in the rule of law.

  19. It dismisses the possible job-killing consequences—the same ones raised by the paper in 1987—as “never entirely sincere” and says the data we have now shows that doubling the minimum wage will have no unintended consequences for low-wage workers.

    Then why stop there? Why not triple it? Quadruple it?

  20. Progressive liberals seem to believe that everyone is entitled to at least a lower-middle class lifestyle, through government redistribution programs and no effort of their own. Or at least through minimal effort at their employer’s expense.

    How utterly lacking in skills or work ethic must one be to be working at a minimum wage job for more than some introductory period in a period of 3.5% unemployment?

    1. Everyone has a right to an above average income.

  21. Do we really need to have this overhead for a group that primarily consists of young people just starting out, flipping burgers as a first job? And who constitute such a small fraction of the workforce?

    All this will do is make Big Macs cost $10 and the “families living in poverty” will still be families living in poverty, since they are not generally the ones earning minimum wage.

    P.S. want to avoid being a family living in poverty? Avoid having kids you can’t pay for. Having kids in a very real sense CAUSES poverty.

    BLS:

    The percentage of hourly paid workers earning the prevailing federal minimum wage or less edged down from 2.3 percent in 2017 to 2.1 percent in 2018. This remains well below the percentage of 13.4 recorded in 1979, when data were first collected on a regular basis.

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

    About three-fifths of all workers paid at or below the federal minimum wage were employed in this industry, almost entirely in restaurants and other food services. For many of these workers, tips may supplement the hourly wages received.

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

      The point is to ensure that flipping burgers becomes a viable career choice for people of all ages. Creating an incentive to participate in otherwise unproductive labor creates the perfect proletariat; a nationwide union, in effect, consisting of politically active, under-skilled workers.

      The point isn’t to be fair to the poor. The point is to create more poor people. Poverty is an ingredient without which socialism cannot thrive.

      1. Everything you wrote there is gibberish. Its doesn’t even support, let alone follow from, your thesis that the point is to make flipping burgers a viable career.

        To start with, flipping burgers is not ‘unproductive labor’.

        1. It’s obviously less productive than jobs that pay more. Otherwise, burger flippers would be paid more.

  22. Thin margins are a thing, especially with businesses that create lower paying jobs.

    1. And I swear, those who favor a M/W claim that it’s better if that company closes its doors!
      Yes, they are stupid enough to desire NO job compared to a job which pays less than some number they pull out of their asses.
      That takes a large degree of stooooopid.

      1. They do that in everything.

        Sweatshops ‘r bad, m’kay. Well, if your options are backbreaking labor on a farm in the middle of nowhere from sun up to sun down 7 days a week, a 12 hour shift in a hot factory making 10 times the wage looks pretty attractive.

        1. Nike (to pick a stereotype) has probably saved more kids from looking at an oxen’s ass for 12 hours a day than ANY do-gooder busy-body.

  23. When labor costs go up, the company has to deal with it in some way. Some can just eat it. Some sacrifice something (benefits, what not) to make up the difference. Some pass it to the consumer. Some hire less people. There are a few ways to deal with it. But people are ignorant to deny that it does not affect the company in a way that the company must make adjustments.

    People misinformed think companies make money hand over fist and the only adjustment option is executive pay. They see the company value which is not cash, or the CEO’s package which is often stock heavy. The cash is often over time too.

    A friend of mine just retired and the company gave him a pretty good package. If you look at it lump sum it looks really good. But they are just continuing to pay his usual salary over the next 13 months.

    1. “” But people are ignorant to deny that it does not affect the company “‘

      Oops, that it does affect the company.

  24. Even if you do support (whatever) minimum wage – the federal government IS NOT the place to do it !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

  25. It just seems that the broader you apply a minimum wage, the worse it is. A national minimum wage is the worst since it acts as though all parts of the country are equal in their needs when they are not. It is bad but not as bad when states do it, because you still have pretty significant differences in cost of living within states. I know people in rural areas that do okay on under $15/hour. But it always seems that people in the cities that really want this, and often have it locally, feel the need to push the policy onto everyone whether they want it or not. It is something that should be done as locally as possible so that the wage, if it is going to be set, is set at a level that suits the community.

    1. Even when states do it it is bad. Very bad.

      Because the state governments see only what is happening in the capital and other large cities and ignore what happens in the rural rump.

      A $15 min wage *might* be doable in a city. It would be absolute murder in small towns.

      1. Check the effect of even the Federal minimum wage on Puerto Rico. Now imagine how much worse it would be if the MW was doubled. They have enough problems with hurricanes. They really don’t need the Federal government to add to it.

  26. “To refute these concerns, the Times board cites a 1993 study by economists David Card and Alan Krueger in which they compared fast-food restaurants in New Jersey, which had recently implemented a minimum wage increase…”

    Supply and demand. Obey it, it’s the law.

    And what was the state of automation in 1993? Never mind the theory, what has been the reality of raising the minimum wage. At its most basic a business is run on income vs outgo. By arbitrarily raising the cost of labor (outgo) the business is, out of necessity, going to charge more for its goods and services (income)—prices go up. And this cost increase will go the entire length of the supply chain. Let the market decide.

    1. “…By arbitrarily raising the cost of labor (outgo) the business is, out of necessity, going to charge more for its goods and services (income)—prices go up. And this cost increase will go the entire length of the supply chain…”
      Thereby reducing the value of any blanket M/W increase.

  27. There is no valid reason to stop the increase in minimum wages. The US has always protected business interests over the interest of worker’s interests. The math says the best deals are 50-50 deals. But capitalism usually does not work out to be 50-50 deals thus one party gets exceedingly wealthy or the opportunity to do so from the efforts of others. The argument against increasing minimum wages would be the same argument to argue for slavery. If an owner can’t afford to give his or her employees a wage that would give them a decent standard of living then what is the value of the employment to the worker? The US has been operating for centuries on the idea that the employee does not matter. But if every employee walked off their jobs would their actions prove they are valuable or that they don’t matter? Employers should be embarrassed if their employees work and still need government assistance. If they cannot afford what they want and need and are working, what are they working for? The easiest way for one to get what they are work for it. But if employers undervalue the work of labor then they destroy the reason for working. If people did could survive the elements without discomfort and could survive and maintain health over a month without eating wages would be much higher because people would not be so desperate to gain employment. Undervaluing employees to their detriment is just exploiting their humanity. It’s the same ugly ship as slavery. Only some money is given versus no money. The real attraction of capitalism is to gain wealth from the efforts of others. If all of capitalism had to be 50-50 deal it would not be as popular. Humans have a strong propensity to not view other’s the same as themselves.

    1. The I
      January.10.2020 at 8:34 pm
      “There is no valid reason to stop the increase in minimum wages…”
      You.
      Are.
      Full.
      Of.
      Shit.

    2. The US has always protected business interests over the interest of worker’s interests.

      The existence of the NLRB and the deference – even support for – given to union-backed violence says otherwise. Oh, and the existence of the minimum wage you like would say otherwise also.

      The math says the best deals are 50-50 deals.

      No, the math doesn’t say that at all. Like, *at all*. I don’t know where you got that from. I don’t even think you understand what that means.

      . . . thus one party gets exceedingly wealthy or the opportunity to do so from the efforts of others.

      Because capital has no value? Because business owners do no work? What?

      If an owner can’t afford to give his or her employees a wage that would give them a decent standard of living then what is the value of the employment to the worker?

      Well, that’s up to the worker to decide, isn’t it? You don’t know. You admit you don’t know. Yet you’re demanding the power to determine these things for other people?

      The US has been operating for centuries on the idea that the employee does not matter.

      I don’t know where you’ve been working, but I’ve only once been in a place where that was true. And I quit that job. Everyone else understands *exactly* – to the penny – how valuable their employees are. They have to. They’re cutting them checks that could otherwise be going into their own pockets.

      You remind me of some of the junior enlisted I worked with. They all come into the service and wonder why no one is recognizing their amazing skill and talent and haven’t put them in charge already.

    3. You have absolutely no idea how a business or the economy in general works. Someone has to organize the factors of production and manage it and they can’t be expected to to this out of altruism. This is what makes any work valuable. It doesn’t just appear magically out of thin air as you seem to think. That’s the problem with people like you. You take the immense wealth generated over the past few centuries worldwide for granted and don’t care whether you destroy the foundations that made it possible as long as you can momentarily satisfy your selfish, self-righteous impulses.

  28. Last week, The New York Times Editorial Board dismissed those concerns and called for a $15 national wage standard.

    Proving that once you have gone fully deranged, you simply can’t return to even a semblance of sanity.

  29. Related:

    No Labor Shortage: 11M Americans Out of Work, but All Want Full-Time Jobs

    There remain more than 11 million Americans who are out of work but want full-time jobs, despite claims by corporate interests and the big business lobby of a so-called “labor shortage.”

    ….

    While Americans have enjoyed significant wage growth in Trump’s economy for blue-collar and working-class Americans, corporate interests have increasingly suggested that the U.S. must continue importing millions of foreign workers every year to fill jobs.

    In April 2019, former Chamber of Commerce President Tom Donohue said the U.S. needed more legal immigration because the country is “out of people.”

    Extensive research by economists like George Borjas and analyst Steven Camarota has found that the country’s current legal immigration system — wherein 1.2 million mostly low-skilled workers are admitted annually — burdens U.S. taxpayers and America’s working and middle class while redistributing about $500 billion in wealth every year to major employers and newly arrived immigrants.

    Camarota, director of research for the Center for Immigration Studies, has found that every one percent increase in the immigrant composition of American workers’ occupations reduces their weekly wages by about 0.5 percent. This means the average native-born American worker today has his weekly wages reduced by perhaps 8.5 percent because of current legal immigration levels.

    https://www.breitbart.com/politics/2020/01/10/no-labor-shortage-11m-americans-out-of-work-but-all-want-full-time-jobs/

    1. There remain more than 11 million Americans who are out of work but want full-time jobs, despite claims by corporate interests and the big business lobby of a so-called “labor shortage.”

      They could be working in the construction, landscaping, and other blue collar jobs. Unfortunately, they are competing against illegal aliens working in those jobs for below minimum wage.

      And, yeah, that is due to corporate greed importing cheap slave labor from Mexico.

      Thanks Democrats for making this possible! /sarc

  30. The question of whether we should have a minimum wage to restrain the greediness inherent in capitalism was decided 100 years ago: society could not thrive without protections in place for workers. Back then, Republicans complained of losing the “freedom” of paying a nonliving wage because workers had no choice but to accept, and lost the presidency for 20 years. How about a minimum wage of $15 for companies employing 10 or more people, and a minimum wage of $13 for smaller companies? This would mean the big corporations would have reduced power to drive small competitors out of business, while still making it possible for full time workers not to live on the streets.

    1. Employing 10 people makes you a big corporation?

    2. “…to restrain the greediness inherent in capitalism was decided 100 years ago:…”
      You.
      Are.
      Full.
      Of.
      Shit.

    3. BTW, your choice of handle is amazing; fucking lefty ‘bleevers’ like you have no claim to anything like skepticism.

    4. The question of whether we should have a minimum wage to restrain the greediness inherent in capitalism was decided 100 years ago

      Yeah, 100 years ago is when the 25 Point Program of the NSDAP came out; it sounded just like you.

      How about a minimum wage of $15 for companies employing 10 or more people,

      That’s about the median income in Germany, paid to educated productive, experienced workers. That’s what you want for people with no education and no skills in the US. If you think the US can be competitive that way, you’re a fool.

    5. The real question you need to ask yourself ‘skeptic’ is why an American worker – already in the top 50% of worldwide income – needs more money.

      Why isn’t that money being taken and given to the poor?

  31. Sure, increase the minimum in wage to $15. But you’ll still be making minimum wage.

  32. The goal is not to “overcome poverty”, but to destroy the economies of those states that have a lower cost of living, which are generally “red” states.

  33. The only thing government should do to help poor workers is to stop ruining the value of their wage by doubling the money supply every 11 years. Eventually you’ll win the “Fight for $15” only to realize you need to immediately start fighting for $25.

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