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Pew Map Shows One Reason a National $15 Minimum Wage Won't Work

The value of $15 varies greatly across the country and even within the same states.

2016 Marilyn Humphries/Newscom2016 Marilyn Humphries/Newscom

Here's a thought: Maybe the federal government shouldn't be in the business of mandating a one-size-fits-all minimum wage.

That's the main takeaway from a Pew Research Center article published Wednesday. "The real value of a $15 minimum wage depends on where you live," the headline notes. The cost of living is much higher in some parts of the United States, such as New York or the San Francisco Bay Area, than it is in other, such as Beckley, West Virginia.

Pew used federal government data to calculate the real purchasing power of a $15/hour minimum wage in hundreds of urban areas:

These estimates are calculated by using data on "regional price parities," or RPPs, for the nation's 382 metropolitan statistical areas. The RPPs, developed by the federal Bureau of Economic Analysis, measure the difference in local price levels of goods and services across the country, relative to the overall national price level (set at 100).

The result was this handy map:

In the San Francisco Bay area, the real purchasing power of $15 is closer to $12. A $15/hour minimum wage would go the farthest in Beckley, where the purchasing power of $15 translates to $19.04.

In some places, raising the minimum wage to $15/hour means workers in low-skill jobs will be making the same money or close to it as trained professionals. Axios notes that in El Centro, California, the median wage for nursing assistants is $15.07. That money goes farther than it seems at first glance, since the purchasing power of $15 is about $16.80 in El Centro. But a $15/hour minimum wage means many nursing assistants will earn roughly the same as fast-food employees.

This isn't just a problem for a federal minimum wage—it's an issue for state governments too. California's minimum wage will reach $15/hour in 2022. This will have a drastically different effect on El Centro than it will on the San Jose metropolitan area, where the cost of living is 42.3 percent higher. Similarly in New York State, a statewide minimum wage of $15/hour (set to take effect over the next few years) will impact NYC residents much differently than workers in the Utica-Rome region. That's because the cost of living is 30.2 percent higher in New York City, according to Pew.

"Fight for $15" might be a catchy motto, but it doesn't take into account cost of living realities. This is just one reason why the federal government—and state and local governments too—should let the free market do its job.

While minimum wage hikes increase workers' hourly earnings, they also reduce the amount of work available. That's partly why, as Reason's Scott Shackford pointed out in December, the Employment Policy Institute predicted that California's $15/hour minimum wage could cost 400,000 jobs. In Seattle, workers' hours at low-wage jobs went down while the minimum wage went up, leading to a decrease in overall earnings.

Bonus link: Reason TV's Jim Epstein takes a look at how minimum wage increases in New York City have turned car wash workers "into black market lawbreakers":

Photo Credit: 2016 Marilyn Humphries/Newscom

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  • Fist of Etiquette||

    This is just one reason why the federal government—and state and local governments too—should let the free market do its job.

    Yeah, as a politician I'm going to go ahead and define the income inequality gap problem and then cede the powerful responsibility for fixing it to this mysterious market that no one even knows who is in charge of it. Let's see how many votes I get.

  • Sevo||

    Read too long ago to remember the source, but supposedly, during Kruschev's visit to the US, one of his entourage asked 'Who controls the food deliveries to NY City?'

  • creech||

    Who? Why the farmers of Iowa and the cowboys in Montana whose purpose in life is, out of the goodness of their hearts, feed their good buddies the Manhattanites.

  • Cy||

    And in turn it's the good Manhattanite's jobs to destroy rural economies by imposing their desired urban wages on them. It's ok, their intentions were good.

  • Just Say'n||

    To be fair, the Manhattanites are also good enough to ruin those western economies by then insisting that they should have a say in how the land in Montana should remain undeveloped and preserved, rather than used for fracking or cattle grazing.

  • ||

    And in turn it's the good Manhattanite's jobs to destroy rural economies by imposing their desired urban wages on them. It's ok, their intentions were good.

    Hey now. Those Manhattanites have every right to demand that the rural economies live up to all of their standards before purchasing their goods. It's just free and fair trade.

  • CE||

    "Were we directed by Washington when to sow and when to reap, we would soon want bread." TJ

  • Cynical Asshole||

    And then there's also this.

    Yeltsin, then 58, "roamed the aisles of Randall's nodding his head in amazement," wrote Asin. He told his fellow Russians in his entourage that if their people, who often must wait in line for most goods, saw the conditions of U.S. supermarkets, "there would be a revolution."
    ...
    About a year after the Russian leader left office, a Yeltsin biographer later wrote that on the plane ride to Yeltsin's next destination, Miami, he was despondent. He couldn't stop thinking about the plentiful food at the grocery store and what his countrymen had to subsist on in Russia.

    In Yeltsin's own autobiography, he wrote about the experience at Randall's, which shattered his view of communism, according to pundits.
    ...
    "When I saw those shelves crammed with hundreds, thousands of cans, cartons and goods of every possible sort, for the first time I felt quite frankly sick with despair for the Soviet people," Yeltsin wrote.
  • MatthewSlyfield||

    One of the best comparisons of communism and capitalism I've seen:

    Under communism, people wait in stores for goods.

    Under capitalism, goods wait in stores for people.

  • Cynical Asshole||

    It's pathetic and sad that in 1989 Boris Yeltsin was becoming despondent upon seeing the difference between our grocery stores and the Soviet Union's, meanwhile Bernie Sanders was spouting this nonsense.

  • Hugh Akston||

    What A Country!

  • Bubba Jones||

    He had it backwards. The shelves were crammed with goods because no one could afford to buy them!

  • Cynical Asshole||

    I'm hoping that was sarcasm.

  • JFDeplorable||

    The United States is the only country in which the biggest health threat to the poor is that too many of them are obese. I'd say that most people can afford what is on the shelves, thanks to the "generosity" of the American taxpayer. The makers have to live on a budget, however. But they still can eat and buy toothpaste.

  • Woody Chip Hurrrrr?||

    It's things like this that make me despair, occasionally, when I ponder what a truly free market economy and society would do. No one will ever know what advances we would have; it would be the same difference in quality, quantity, and innovation as Khrushchev and Yeltsin saw, except with us, today, as the low side of the teeter totter. Just as we cannot imagine what the world will be like in 100 years.

    Every time socialists want to squander the future for static equality, I think about those comparisons. It's real easy to get depressed at what could be.

    But I believe competition rules and that people want better things, and I believe that in time, anarchy and free markets will rule. I don't know how or when but that is my reality.

  • Qsl||

    Worse-

    You could have libertarian-ish approaches to safety nets/welfare (from UBI to negative income tax), but most libertarians won't argue for them, so what ever policy that does get enacted is among the most damaging possible.

    I mean if you thought the costs of welfare was bad, wait 'till you see the costs of completely distorted labor markets and the bureaucracies to enforce them.

  • Woody Chip Hurrrrr?||

    You mean like the USSR, Mao's China, the Warsaw Pact countries, Cuba, Venezuela, most Latin American countries for varying periods, North Korea, pre-Thatcher Britain ......

    Yeah, everyone has seen them, no waiting required, just any history book not published during those times.

  • Qsl||

    Strangely, most libertarians argue that even the specter of social spending ensures the eventuality of totalitarian communism is right around the corner.

    Almost none see it as insurance against even worse things to follow.

    How did Angelique put it- "The trick is not to decry how bad socialism is, but to avoid putting your society into a position where it looks good."

    Well, we are there now. And against charity for all and kill them all and let the market sort it out, raising the minimum wage seems like the reasonable choice, especially against no alternatives offered.

  • Woody Chip Hurrrrr?||

    we are there now

    Now? Not 5, 10, 20, 100 years ago? Not 5, 10, 20, 100 years in the future?

    The odds of it being right now, even with an uncertainty of a decade or two, are astoundingly low. The possibility of knowing that it is right now, and not any time in the future, is zero.

  • vek||

    Qsl, I think I would disagree with you on many particulars... But I agree on general sentiment. If you allow things to become too shitty, it riles up the mob.

    One of many reasons I am not in favor of low skilled immigration. If we'd not taken in 10s of millions of skill free immigrants we wouldn't be seeing the call for socialism, because market wages would have been higher. We'd also have been forced to automate more, hence increase productivity, which creates a real increase in wealth.

  • Sevo||

    "Qsl, I think I would disagree with you on many particulars... But I agree on general sentiment. If you allow things to become too shitty, it riles up the mob."

    Yes, but extortion is a poor cause to start sliding down that slope.

  • MSimon||

    "raising the minimum wage seems like the reasonable choice, especially against no alternatives offered."

    I propose a $500 an hour minimum wage.

    Just to be fair.

  • vek||

    "Yes, but extortion is a poor cause to start sliding down that slope."

    Sure. But I don't think all of it is extortion.

    Despite what many libertarians like to believe, there ARE many policies which are theoretically neutral, but depending on how you tailor them will either benefit or hurt certain groups. These can be ethnic groups, economic classes, etc.

    Immigration has mostly been designed to specifically benefit the upper middle class on up. I'm a business owner. It's probably benefited me in some ways at least, and also hurt me via higher taxes. But for a working class lower middle class person, their taxes have also gone up some, but it ALSO pushed their wages down.

    Unless you've drunk the kool aide and think ACTUAL open borders are a great idea... Which they're not... Then it's a question of what kind of immigration policy we want. One that hurts the working class, or one that is okay for everybody? I imagine flooding the country with nothing but Doctors and engineers suppresses wages there too... But those people also won't feel the pinch the same if their wages go down.

    So again, neutral policy in theory, but not in practice. If the working class is pissed, perhaps to makes sense to not poke them in the eye with a sharp stick? Just sayin'!

  • vek||

    Crazy thing to think about is if the USSR had just reformed their economy like China they could still be around, and the 2nd most powerful nation on earth. Thankfully he wasn't bright enough to figure that out!

  • Bubba Jones||

    mafia?

  • Presskh||

    Whoever controls it needs to shut it off until the lunes are starved out. Ditto for Chicago, San Francisco, Seattle, etc.

  • Zeb||

    I find the best argument against minimum wage to make to normal people is that it makes no sense to insist that every job pays a "living wage" and that it does great harm to young people and people who might, for other reasons, be risky to hire.
    The only reason minimum wage hasn't been much more harmful than it has been so far is that it usually lags behind prevailing wages. Trying to use it to push wages up significantly is going to be bad.

  • Sevo||

    "The only reason minimum wage hasn't been much more harmful than it has been so far is that it usually lags behind prevailing wages"

    It hasn't killed the labor market in SF, since it is a 'trailing indicator', but SF has managed to keep black and brown kids unemployed by a host of other 'helpful measures'.

  • ||

    I find the best argument against minimum wage to make to normal people is that it makes no sense to insist that every job pays a "living wage" and that it does great harm to young people and people who might, for other reasons, be risky to hire.

    And young people are just a proxy for the underlying contradiction. Even if you insisted that every job pay a 'living wage', minimum wage guarantees just the opposite. If the goal is a few days or even hours worth of work providing shelter and sustenance (It's not the point, I know) for a week or more, setting an artificial floor and pushing prices up is not the solution. Whether the worker is a 16-yr.-old HS grad or an out-of-work coal miner.

    If you wanted to get to a place where an either one of them could do an hour's worth of work and live for a week, setting an artificially high floor for the value of work they can do in an hour is the opposite of the right thing to do.

  • BYODB||

    My arguement is always much more simple: the real minimum wage is always zero.

  • ||

    Sure, but people earning $0 starve to death. The only way the guy earning $1 eats like a king for a week is if it's trivially easy to earn $1 and he gets daily access to the all-you-can-eat buffet for $0.20. Giving him $15 for the buffet just means the buffet people aren't being paid a living wage and that the price of the buffet will go up.

  • JFDeplorable||

    Well, it should really be a penny, not zero. "Wage" implies trading value for value, so unless the value of a person's labor is such that it truly is worth nothing, s/he should receive at least a penny in trade for it. Which brings us back to Amazon and its offshoot, Mturk, which actually DOES pay people in pennies and nickles to do data entry tasks.

  • Azathoth!!||

    The value of a person's labor IS nothing.

    Labor is a cost, even to the individual. To labor, one spends ones calories (replaceable) and one's time (irreplaceable). So one wants a good price for that labor.

    But one can only get a price at all for the PRODUCT of labor.

    Labor is a means, not an end.

    People tend to forget that in a world ravaged by the ideas of the idiot, Marx.

  • JFDeplorable||

    I'd like to know who sets the criteria for a "living wage." I have found ways to live on wages that were just above minimum all the way up to a nice 5-figure salary with benefits by controlling my spending. At the same time, I've worked with people who have much higher household incomes and who are not just broke, but 5 to 6 figures in debt. Minimum wage laws don't take into account differences in consumption and tolerance of risk among people. But that is the problem with every social and socialist program - it assumes (and in many cases enforces) a lack of individuality within the population it is attempting to "help."

  • vek||

    I often use the real world example from Seattle where I live. Before the raised the minimum wage here, the market minimum was $11-12 even for total beater jobs. Over 20% higher than the legal minimum at the time. In short the market had already accounted for the cost of living on its own.

    I have another anecdote about how applying Seattle wages elsewhere is destructive. Boise has several thousand ppl that work at call centers. Washingtons cheap areas, many less expensive than Boise, will never get a call center built there now that we've raised the state minimum to 40% or so higher than market wages in Boise and elsewhere. This hurts cheap places in Washington.

    I think they're both good storied because they're real and concrete, not hypothetical.

  • CLM1227||

    Well this was a take that puts some things in perspective.

  • vek||

    No kidding, who woulda thunk?

    Fact is the market wage is already over the federal minimum practically everywhere in the US... Because the market is doing its thing. I'm thinking about moving to Idaho, a state that uses the federal minimum. Lowest advertised wages I saw in Boise area were $8.50-9.00 or higher, for the lowest jobs out there like fast food.

    Also, those numbers they're using to do their math must be based off of a lot higher standard of living. If somebody is only making $15 an hour in NYC, SF, or Seattle, they literally can't even rent a place of their own... The real disparity on the low end of the pay spectrum is FAR higher than 30-40% because of rents, which eat most of someone's income at that wage level. It's probably more like double+ until you're making more money and housing gets lost in the mix more.

  • Ben of Houston||

    The minimum wage is there to keep businesses from taking advantage of the desperate and the ill-informed. It's supposed to be an extreme low. The government shouldn't be involved in a private transaction like that unless it is extreme. This is, after all a consensual agreement to work for wages.

    To compare, I'd reach for a shotgun if a 40 year old man picked up my 18 year old daughter for a date. However, it's legal because only the most egregious violations of decency and consent should involve the government.

  • vek||

    I get what you're saying, and as a minimum acceptable level of regulation that would be acceptable. I don't think we need one period... But if we were to have one it should be well below market wages, as you say to prevent saaay a retard (a literal retard I mean) from being abused and paid $.50 an hour or whatever.

    If only progressives were sane enough to limit their nanny state laws to things that are actually abusive to most people, they wouldn't catch so much flack. But trying to make the MINIMUM wage an amount that somebody can support a family on or whatever... Pure nonsense.

    As far as your daughter goes though... Is she cute? How do you feel about 32 year old guys?

    I kid, I kid! I could never stomach dealing with an 18 year old girl at 32, no matter how hot they were!

  • CE||

    In Silicon Valley, the de facto minimum wage is already around 15 bucks an hour. Every fast food joint has a sign up that they are hiring, starting between 14 and 17 dollars an hour, with signing bonuses and one had a 401k plan.

  • Vernon Depner||

    And those workers are living in their cars.

  • Ben of Houston||

    Then they can move elsewhere to get work. $15/hr can get you a decent apartment in Houston

  • BYODB||

    Except then you'd need to live in Houston. ^_-

  • Agammamon||

    Weeeeeeell, and this is my bias from growing up in the Southwest showing, Houston doesn't have to hire a team of people to clean the human crap off its sidewalks.

    So, they've got that going for them.

  • vek||

    Shiiit. I'd take anywhere in Texas over anywhere in California at this point. I grew up in the Bay Area, and I'd LOVE to move back if the state ever became sane again... The greatest weather on earth. However the cost of living, and every other human involved thing is like hell on earth. It just ain't worth it IMO. There are too many other places that are decent still. Unless you're a welfare case, OR worth like $50 million bucks and can shelter half your income through tax dodges, it just ain't worth living in that stare, no matter how awesome sunshine is.

  • vek||

    Yup. And Seattle had market wages of $11-12 for dish washers, fast food, etc YEARS ago when the state minimum wage, which was already the highest in the country, was under $10 still. The market DOES adjust wages as needed, including adjusting them up in high cost of living areas.

  • Vernon Depner||

    ... let the free market do its job.

    First we would have to establish a free market for labor.

  • Cy||

    Ha... But then what happens to those that don't want to participate or simply can't?


    .....

    ....

  • Cy||

    and when the 'charity' isn't enough for them and they resort to violence?

  • Cy||

    "Then violence comes back to them"

    Who would be the brains and the fists of that violence?

  • Johnimo||

    Nicely stated SQRLSY One. There can be no civilization without property rights. Without property rights, civilization would descend into a state of chaotic warfare.

    I've lived in the same place for over 40 years and been pleasantly surprised that no one has ever stolen -- to my knowledge -- a single stick of firewood from my wood pile out by the alley. If I caught some poor soul stealing firewood from me, I'd probably offer to buy them some to help heat their home. I keep the NRA stickers displayed on my front and back doors, letting would be thieves know that they might run into some resistance. Imagine how horrible society would be if you weren't allowed to own the cans of soup and beers in your cabinets and refrigerators.

  • vek||

    Cy, I'd have no problem laying down a world of hurt on thieves, or an angry mob of degenerates who don't want to work.

    IMO private charity would still take care of things better... But the ONLY forms of government welfare I think I would actually find acceptable would be for severely physically handicapped people (As in can't use their arms or their legs. Not being able to walk IS NOT an excuse not to work in the modern world with half the jobs being desk jobs.), OR mentally insane people who have no family. And finally, orphans.

    Other than that, able bodied and sane people who don't want to work should do the world a favor and off themselves. If some good Samaritan wants to help them out, then fine. But not on my dime, and if they turn to crime they should get punished the same as anybody else.

  • CDRSchafer||

    Anyone who thinks the government should impose a one-sized-fits-all minimum wage is so economically illiterate they could only be a progressive.

  • esteve7||

    Anyone who thinks the government should impose a one-sized-fits-all minimum wage is so economically illiterate they could only be a progressive.

    Fixed it for you

  • CDRSchafer||

    Thanks you are correct.

  • Pro Libertate||

    May the Market Forces be with you, always.

  • Old Mexican - Mostly Harmless||

    Except when Market Forces are in conflict with #MAGA: Making America Grating Again.

  • TuIpa||

    "Making America Grating"

    No one cares about your personal reason for immigrating from your shithole country.

  • Cy||

    Go home, I can mow my own lawn.

  • vek||

    You know you can hire white people and even blacks to mow lawns too right? My legal Vietnamese immigrant lawn guy I used to have when MIA (sorry I couldn't help it... But he seriously did, couldn't get ahold of him.), but a guy who lives down the street owns a landscaping company. He charges more, but does a better job anyway. Plus his English is actually good... So there's that.

  • some guy||

    I'm always happy to see other reasons come up as to why price controls are bad. But let's not forget the main reason, which is that they are antithetical to free association.

  • Jerryskids||

    All this squawking about what the minimum wage should be set at when the minimum wage is still the same as it's always been.

  • Kristian H.||

    What we need is more, smaller states. Take a few of the larger metro areas, carve out a new state. "Fixes" the discontinuity of cost of living, weird ass open spaces laws, other degenerate economic busybody, gerrymandering, hyper partisan senators that DON'T represent large swathes of the state, a few populous areas driving all spending, education and environmental policies, and more.

    Start with five new states every census until we get to 100 states.

  • NoVaNick||

    This isn't a bad idea-problem is the urban prog elites want to force their will on the yokels and make them give up their guns, tobacco and F150s for yoga, green tea, and bicycles. For them, its a moral war to save the planet, children, etc.

  • vek||

    This would in fact be very practical... Which is why it will never happen.

    The progs DO want to force their will on everybody, and really even a good chunk of conservatives do too, although I would argue it is less of an impulse with them.

    The only way it MIGHT be able to happen is if the new states were all created at once, and it kept the balance of power exactly as it presently is. In short for every new conservative state carved out where they're gonna get Rs in the senate, the Dems would want a new state too. If it was slanted any way, no way people would go for it.

    That said, if the Rs continue to destroy the shit out of the Dems nationally, especially in state governments, they may well be able to force state splitting since IIRC state legislatures can file to be split, and if either a majority of states or congress approves it, it goes through. It's something like that, too lazy to google.

  • esteve7||

    I can't for the life of me understand why it is so god-damned hard to understand the minimum wage. Back when I was a teenager ON minimum wage, I wrote to my governor to veto a bill increasing it, because I knew a stepping stone job was more important. I wouldn't be where I was today if not for that first job.

    At least Leftists of 80+ years past were honest about this crap. They had the black minimum wage be higher and stated it was to keep black people out of white jobs, the same with their union shop crap. They were evil but at least they were honest and honest in admitting the minimum wage kills jobs and hurts people

  • UnrepentantCurmudgeon||

    When all this started one of the arguments was that raising the minimum wage like this would have an adverse effect on employment in the fast-food "industry". "Har-de-har-har" said the proponents. So now I see ads for Little Caesar's extolling their automated takeouts, where you order online, pay at an ATM and get your pizza from an automated takeout machine. I'm sure a human touches the pie somewhere along the line, but obviously several humans are now cut out of the process. One can easily afford to pay one person $15 an hour if one is no longer paying 3 or 4 workers $9 or $10 an hour, even in California.

  • Hugo S. Cunningham||

    They also close dining areas on off-peak hours so that you are forced to order from a takeout window. And many takeout windows require you to be in a car.

  • vek||

    Idiots gonna idiot.

    Although I don't want a minimum wage, I do think in a "perfect world" wages would be higher. Automating things more is what actually moves us forward, and makes society wealthier and more productive. So that is at least a positive unintended (but obvious) side effect of this nonsense.

  • Johnimo||

    The minimum wage should be $0.00/ hour, and you should be free to accept employment at that rate, should you so desire.

  • Hugo S. Cunningham||

    For a society like ours with work-based welfare (Earned Income Tax Credit-- less harmful than other types of welfare), the minimum wage is a necessary check on fraud. Otherwise, people would take 10-cent-an-hour no-show or make-work jobs just to collect EITC. A minimum wage up to 1/4 of the average wage controls fraud without harming the economy.

  • Cloudbuster||

    So we have to have more bad systems to save ourselves from the side effects of our bad systems? I am not sure that is the best strategy. (I am totally sure that is not the best strategy.)

  • Barry Gold||

    Sorry there's no upvote button here, otherwise I'd click it a whole bunch!

  • LarryA||

    "The real value of a $15 minimum wage depends on where you live. The cost of living is much higher in some parts of the United States, such as New York or the San Francisco Bay Area, than it is in other, such as Beckley, West Virginia.
    But we can fix that:
    1. Set the national minimum wage at $15/hour.
    2. Government provides all the unemployed with jobs at $15/hour.
    3. Cost of living will rise everywhere until $15/hour isn't a "living wage" anywhere.
    4. Everything will be equal! Utopia attained!

    Sure, everyone's miserably poor, but they're equally miserably poor, and that's what counts.

  • Spookk||

    This is a stupid argument. Minimum wage is minuscule at the federal level, so increasing it will not keep people from being paid more where the market demands it.

  • Cloudbuster||

    When everything you read is hard to understand, the problem might not be the reading material.

  • DarrenM||

    Since it's so minuscule, there's not reason to have it.

  • Hugo S. Cunningham||

    For progressives, wrecking the economy of low-cost- of-living rural States with a super-minimum wage makes perfect political sense. Converted into welfare slums, they would stop voting conservative and start voting progressive. Like the lobotomized collectivized villages of Soviet Russia (though without the bloodshed), they would be reckoned a worthwhile economic sacrifice in the cause of progressive governance

  • vek||

    Except I don't think that's how it will work in America... I'd imagine we'd finally have a violent and bloody right wing revolution before a good chunk of those people decided to just throw in the towel and become socialists.

  • Hugo S. Cunningham||

    Rural Americans would revolt against a Federal gun confiscation (if a serious attempt were made to enforce it), but not against a large Federal minimum wage increase. To many, it would look attractive at first; the harm would only emerge gradually.

  • vek||

    I'm not saying they would revolt over it, merely that they wouldn't all become leftists because they thought it was great. They'd begrudgingly accept it, as they have a ton of other laws they hate.

    But yeah, if they ever try to mass confiscate guns, that is the one thing I am SURE would kick off a civil war.

  • vek||

    One thing that LarryA kind of touched on above is actually the beauty of a NATIONAL minimum wage hike...

    No matter what the wage is set at, after a very short period of time, the market will adjust via massive inflation until the new minimum is either the market wage, or lower than the market wage.

    If it is national, we'd just have inflation shoot through the roof for a few years. Then it would be business as usual. Granted, we would have a bunch of turmoil in the in between period, but it would sort itself out fine.

    Having only small pockets of crazy is actually worse in some ways, because they're not enough to inflate the whole currency. So the $15 in California/NY, or even the $13.50 that is phasing in in Washington state are going to be genuinely destructive for jobs in those states.

  • Cloudbuster||

    The funny thing is that wage increases don't cause inflation. Only increase in the money supply does that. If the government increased the minimum wage without increasing the money supply, it would demonstrate how insane the proposal is, because businesses would simply be unable to pay the increased wages. The economy would collapse or there would be widespread civil disobedience.

    Once you realize that, you realize the $15 minimum wage isn't about wages at all.

    The US is more in debt than any nation in the history of the world, and the entire world economy is tied to it. The Fed is eager for an excuse to massively inflate the currency in order to devalue the debt a bit.

    But our politicians will simply spend even more, continuing to drive us of a cliff. The Fed just wants to take as long as possible to reach the cliff.

  • vek||

    Well yes, technically.

    However I would assume they would just expand the money supply accordingly. Theoretically one could increase the "velocity" of money in the system. If you're not familiar that's basically everybody not having a lot of standing cash, but rather spending it all through very quickly. The same dollar value could change hands with less money if people spend it faster.

    As far as the debt goes, a decade of 5-10% inflation is certainly one way to screw our bond holders... Frankly it's probably what I would try to do if I were in charge... Well, not really. I'd deal with it totally differently, but if I were an inside the box thinker who believes in fiat currencies it's what I'd do!

  • Duelles||

    If it is true that there fully 10% of the population that has an IQ under 83 which disqualifies them for even an Army job, these people are likely worth very little in a free market environment. Perhaps we have been euthanizing and aborting the wrong non-viable life masses. It is never going to be easy to care for or provide maintenance for all who need from a top down boot heel approach. Some compassion by individuals to individuals is required. A friend at a local shelter claims we should never give a beggar with a sign any money. They should go to the shelter where they will be "safe". Something tells me these homeless have tried it and is distasteful. Trumps economy has more people employed now than ever before. Perhaps he should be King! Oops! No easy answers especially coming out of D.C.

  • vek||

    Yeah, lots of people are barely above retarded. I've known many in my life that were morons. Some of them functional, in that they held low rent jobs, others couldn't even do that. Those people will always be next to useless... But unless we're going to start gassing people or opening up labor camps, it is what it is.

    As far as abortions go, statistically most of them are actually FROM the very classes that have those low IQs. So we'd have even more if we hadn't had so many abortions. Abortion is slightly eugenic versus dysgenic, for whatever that's worth.

  • Earth Skeptic||

    Well now, if the purchasing power of the sacrosanct minimum wage is not equal, then clearly the next step is a set of fairly determined Federal maximum prices. How can we have equality if rent is higher in Berkeley than it is in Fresno?

  • Barry Gold||

    THanks for mentioning California. I live here -- in Los Angeles, where $15 is pretty close to $15. But it's been obvious to me that this is NOT going to work in places like Visalia and Porterville and Glamis, where the cost of living can be 2/3 of LA, or even less.

    What a disaster. I can only hope my state will recover, because I really like living here. (Of course, I'm retired and pretty well off, so it won't directly affect me a lot, but it can do awful things to the economy as a whole. How many of my favorite restaurants will close? What about my dry cleaning place? The place where I get lattes? You get the idea. If they raise prices, I can afford to pay and may just have to cut back a little bit, or maybe just rearrange my budget. But a lot of their other customers won't be in the same situation, and I can't keep any of those places going on just my patronage.

  • Azathoth!!||

    You know, the chart's called 'Where Paychecks stretch the most and least' and I can't help but think that it might be better titled, 'Where prices are inflated the most and least'

    If a thing can be done, with adequate profit for $5, then it can be done with adequate profit--if it's costing $13.75 someplace else, there's an issue.

    That issue might be shipping, or storage, or any number of valid things--but when you see sharp prices changes like that in areas that are literally next to one another something is REALLY wrong.

  • DarrenM||

    It's partly government regulations increasing the cost of doing business. Also, the location may mean substantially higher rent or otherwise adding to the cost. Use you imagination.

  • ||

    It's what I do in my business which is increasingly more and more infested with government intervention. That is to say, stated another way, the government of Quebec is in the process of destroying private enterprise in day-care.

    When an employee demands I pay them to 'government scale' (ie unicorn world), I simply don't give the hours to maintain my margins. But the government, being the little weasels they are, turn around and say, 'yeah? Well, you have to have TWO (not one) 'qualified workers' (educators with university degrees) to run your daycare. So, I'm in a position now where I'm forced to increase my labor costs anyway because in the government's pea-brained mind two qualified workers equals higher quality.

    Nothing can be further from the truth. More educated workers means more self-entitled attitudes has been my experience. My best workers are the ones I pay at minimum wage.

    Quality and education don't necessarily go hand in hand.

    Heaven forbid the province of Quebec let private operators do their damn jobs.

    What a stinking mess. I'd love to divest myself of this politicized garbage but I have to pay off the loans first.

  • vek||

    That kind of stuff sucks... I am moving largely because of minimum wage hikes in my area. I have a couple businesses, and one that started as a hobby thing is growing at a good clip, and requires skill levels only slightly above minimum wage. The thing is, that business is not localized.

    With day care you at least have a captive market geographically. This at least allows you to raise prices to adjust for the crazy wages... It might lose you some business, but most people who need daycare NEED daycare. I can't raise my prices. So I have to move somewhere without crazy wages if I want to grow that business.

  • Liberty Lover||

    Low wages and the minimum wage are a conundrum. You either pay more for goods and services or you pay more in taxes for low wage workers to get food stamps, heating assistance, government insurance and other government programs. In other words you pay one way or the another.

  • Stevecsd||

    This has been a recent argument by the progressives. The argument is that big corporations pay such low wages that employees have to rely on government handouts to live. Therefore, we must force big corporations to increase wages. This is a bogus argument from a libertarian perspective. Group X (big corporations) don't do something so Group Y (low wage employees) use the force of government to get something the free market won't give them, either a raise, through an increase in the minimum wage, or welfare (or both).

  • tlapp||

    If there is a minimum wage at all shouldn't unpaid internships be illegal? Years ago some companies offered job training and a training wage. You would make less but get company paid training while earning a small salary with the end result if you are successful a full time job with better pay.

    All the minimum does is limit opportunity and speed up the move to automation.

  • DarrenM||

    There should be no national minimum wage at all.

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