General Question

iphigeneia's avatar

Do you consider the minimum wage to be fair?

Asked by iphigeneia (6207 points ) November 4th, 2010

I was quite surprised to hear an American friend’s hourly rate was less than mine, even when I was underpaid at my last job, and especially because I only earn junior rates, being under 21.

What do you think about the minimum wages in your area? Assuming full-time work/40 hours a week, is it really enough to live on?

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70 Answers

ANef_is_Enuf's avatar

No, it is not enough to live on.

Pandora's avatar

Nope its not enough to live on but it is fair in my opinion. If a person wants a better wage than you have to climb your way up the ladder through hard work and determination and pay your dues or pay your dues by going to college and getting educated at a more difficult field of work that pays well.

Facade's avatar

Definitely not enough to live on.

Cruiser's avatar

Illinois’s min wage is a buck higher than the Fed rate and even then $8.25 is pretty low for a bread winner to survive on. Had to imagine way back when I was 16 at my first real job I got the minimum wage of $2.30 an hour and damn happy to get that $73.00 bi-weekly paycheck.

jrpowell's avatar

It is enough if you don’t drive and don’t have kids and have roommates. Luckily Oregon ties or min to the CPI-PDX so it at least keeps up with inflation. When the Federal minimum was around $5.15 ours was over $7 and it goes up every year.

JLeslie's avatar

It is an outrage. Way too low. But, solving the problem is a little tricky, I can understand some arguments against. In the US there the minimum is the same no matter how old you are. When it has been considered to pay younger people less, there was an argument that employers might favor employing young people, when adults need the work more.

Also, I don’t know what industry your friend works in, but you should know that minimum for waiters, for instance, who work serving food in restaurants have a much lower minimum that most other jobs, because in America there is the assumption they will be paid mostly by tips.

Carly's avatar

It’s good for a teenager who wants to save up for a car in 4 years. Other than that, I couldn’t imagine working for more than 12/hr.

CaliBuddz's avatar

I don’t get it but a lot of people seem to be living on it somehow some way.

Go into SEARs, Publix, Taco Bell, WalMart, Autozone, UPSstore, Uhaul, JCPenny, or almost any “general store” you can think of and there will be MANY adults there. Those jobs do NOT pay much more than minimum wage. When you get raises at these places it’s usually a quarter MAX.

How do they do it? It boggles my mind

JLeslie's avatar

@CaliBuddz they don’t they get money at the end of the year through EIC, or, they also get food stamps, or they are married and there is another income in the household, or they are young living with their parents.

iphigeneia's avatar

@JLeslie Oh, I can understand the arguments against paying younger people less. I used to be annoyed that I would get paid less for having more responsibilities and being more experienced than some of my older colleagues. Now I’m glad that I was seen as a more desirable employee in the first place, giving me a chance to be more independent while I go through university.

Also, my friend works in computers/administration, no tips involved.

Okay, just to expand the question a little: would you support raising the minimum wage? Social consequences aside, what would the economic effects be?

CaliBuddz's avatar

@iphigeneia

An overall rise in prices accross the board. If the minimum wage was increased to lets say $10 per hour (which is somewhat livable) the prices in all those general stores would have to increase. $10\hour wouldn’t be so livable anymore

BarnacleBill's avatar

My daughter works full time while going to school full time. She can afford to live with 4 roommates, buy food and pay gas on minimum wage. She cannot make car repairs, pay car insurance, pay tuition, afford health insurance, or pay for a cell phone as well. She walks to work, doesn’t eat out, doesn’t own a television, and shops at the goodwill when she needs something. Once her lease is up, she’s moving back home.

JLeslie's avatar

@iphigeneia yes, I would support it. I think that we have so many people who are part of the working poor it is disgraceful. Anyone who works a full time job, working hard with integrity, should be able to live safely and afford the basics in America.

However, how the system is set up now, people will purposely work less, to make sure they earn below a certain amount so they can get public assistance, the system is all screwy. I don’t think raising the minimum wage will solve this problem, there are several things that would have to be done at once to try and cure the problem.

JLeslie's avatar

@CaliBuddz Depends on how much the owner is making. If he is making a huge profit, maybe he should make a little less to show his appreciation for the hard work his employees do, and still make things affordable for the consumer. If the businesses did it themselves, we would not even be talking about the minimum wage. The auto industry is the classic example of the industry making billions, paying their employees shit, the union coming in and getting wages that were probably too high, the companies still charged too much to the consumer, didn’t care about quality, still paid senior executives and stock holders lots of money, and eventually wound up in a really bad place. I think doing the right thing from the start is better.

iamthemob's avatar

I think that the other side of the coin is the small business – I’m not sure what the proper balance really is, but raising the minimum wage may often have the side effect of preventing start-ups because people can’t afford to hire people. This, of course, will have the effect of producing an economy where only larger companies with efficiencies of scale exist, and we’ll have large barricades to the market, and less competition.

I’m for a living wage, of course – but the problem is finding the balance.

LuckyGuy's avatar

The minimum wage for working 30 hours per week should be higher than public assistance. Right now in NY it’s not.

JLeslie's avatar

@iamthemob I agree. I would support an exemption for business under a certain amount of employees. Small business defined by the government is under 500 employees for most industries, I am thinking more like under 50.

iamthemob's avatar

@JLeslie – The problem with an exemption is that you potentially prevent small businesses from being competitive for employees – if they can get work from another place at a higher wage.

At the same time, it could reduce the probability of outsourcing – smaller businesses would have potentially less qualified employees in their pool, but then could make cheaper products/services. With price equalized, we have to go back to competition being based on quality…

…so their are interesting pros and cons on that front. I don’t know, @JLeslie – you may be right…

JLeslie's avatar

@iamthemob I don’t really know either, just throwing ideas around. Each idea has pro’s and con’s. I think it is hard to know until put into practice, watch it work or fail, and adjust again. In my idealism I prefer a free market done with integrity, without the government having to set regulations, minimums and ceilings, but that seems to be impossible.

iamthemob's avatar

@JLeslie – Yeah – the problem with a free market with integrity is that a free market can’t have integrity – it requires the participants to use the system with integrity.

Every system is near perfect until you get the people involved. ;-)

I never thought of the positive aspects of an exemption, though – thanks for that one!

JLeslie's avatar

@iamthemob I just came up with that exemption idea. I have never heard it mentioned or debated, so I am sure there are plusses and minuses not occurring to me. I just know there are exemptions to quotas, and other laws for small business, why not with the wage? Maybe we should ask a question regarding that to see what people think about it?

iamthemob's avatar

I’m game – I’ll leave it to you, as it’s your idea…and I don’t want to take credit (well, I WANT to, but think I shouldn’t. ;-)

jrpowell's avatar

Not having a minumim wage was tested. We didn’t have one until 1938. Kids were locked in factories.

iamthemob's avatar

@johnpowell – I’m pro-minimum wage. However, the triangle factory fire was about (1) worker safety associated with wage-hour law, (2) protection of gender equality in the workplace, and (3) OSHA-style workplace safety – not the minimum wage directly. Having a minimum wage without any one of the others wouldn’t have stopped that.

jrpowell's avatar

I disagree. With a minimum wage the employees could have been more mobile or not needed to work to cover what their parents can’t make.

iamthemob's avatar

But without hour laws, safety laws, child labor laws, and the EEOC, the most oppressed people would still take the lowest-wage laws…which would allow for all the triangle factory (current) violations as a means to reduce price because they couldn’t reduce it through wages.

In fact, such conditions would likely be more common place, as poor conditions increasing profit margins would have to take place of poor wages increasing them. Mobility doesn’t matter if you can’t find a safe place to work, regardless of wage.

RealEyesRealizeRealLies's avatar

Mom works 45 hrs a week at $7.50 prhr. she lives alone in a small duplex at $380 per mo. Social Security check $600 per month helps.

Imagine my suprise when she announced that she’d saved $4000 in a year and wanted to buy a new car. “Mom! How’d you do that?”

She said “Be frugal and very precise with what you’re saving money for. Set a goal and stick with it”.

She said it was a great feeling putting the money aside every week, and it adds up faster than one might think.

Simone_De_Beauvoir's avatar

Anyone who says it’s fair was never paid it.

iamthemob's avatar

Here’s the deal, though:

NYS minimum wage for full time work means that you make $1160 per month. If we consider average rent in NYC at $800 (considering that if you have a roommate, this is totally reasonable), and a $200 a month food budget, this allows you $160 a month for recreation and sundries. This sounds livable.

However, the issue is that a minimum wage, you still deal with withholding. If you don’t know how to claim exemptions right, this could be significant. It also doesn’t take into account other deductions such as pension contributions or health insurance. This minimum wage in a vacuum is a livable wage (I made about this when I first moved to NYC and lived quite decently – and minimum wage is at entry level without raises throughout time). The problem, unfortunately, is that your take-home is well below the minimum wage in the end.

Simone_De_Beauvoir's avatar

@iamthemob What of the people who don’t have roommates, who have families, whose food budget per month is above $200 – and who do you think can live on $160 a month for ‘other’ stuff – I have a student loan payment of $400 a month and $100 for a metrocard and etc. etc. – you are not being realistic, whatsoever. Perhaps for a college student this makes sense.

iamthemob's avatar

@Simone_De_Beauvoir – we have to deal with averages, unfortunately, if we’re going to deal with regulation. Personal choices (whether to have a family, whether to be a single parent, etc.) shouldn’t come into a discussion about minimum or living wages – but are rather issues that deal with social welfare programs (WIC, for example, for single mothers). Having a roommate may be a necessity to make life affordable – a living wage doesn’t entail you being able to have the life you want, simply enough to get by.

The average university graduate makes, throughout life, well above the minimum wage in any state. Although much would get eaten up by student loan repayments, this is more an education funding issue than a minimum wage one. And we shouldn’t use the minimum wage to offset, again, people’s education choices – minimum wage is about keeping people out of welfare systems as much as possible in relation to their work and making sure that we can still have a competitive commercial market (e.g., not crippling smaller employers if possible). I’m all for making advanced education more affordable, forgiving student debt in bankruptcy, etc. – but you’re not being realistic at all if you think that minimum wage is the way to deal with these issues. It’s not – we’re dealing with completely different support systems.

Simone_De_Beauvoir's avatar

@iamthemob What I don’t get why, when considering the living wage, one may have to extrapolate a room mate, no children, etc etc. If you are considering a single invididual, then you shouldn’t be considering concessions they have to make in order to ‘make it’.

iamthemob's avatar

@Simone_De_Beauvoir – We don’t. I was considering it in terms of the most expensive option for an NYS place of residence. $800 is completely reasonable if you’re considering NYC (see above that I went to NYC not NYS – NYS average rent will be much less in most areas) – but you may need a roommate to meet this in some areas. The point is if you want to live in Manhattan, let’s say, you may need a roommate or two to do this. If you don’t, you have to go with a living situation where you end up commuting to work, potentially, for a much greater distance.

I never said you need a roommate – I was factoring it in in case people started yelling about how “you can’t live alone on $800 a month in manhattan!”. ;-)

Consider if I had used Akron – where a two bedroom is around $600, meaning you could be paying $300 a month – which makes the minimum wage seems like a windfall. The average wage in NYC is, of course, well above minimum wage.

State minimum wage should factor in what people reasonably need to live, need, not want – and therefore should factor in whether they can make responsible decisions about their living situations. For those that qualify on other need-based issues, that’s where we take truly individual situations into account…but we don’t use the minimum wage. Therefore, we always consider the individual, but the average individual – and we do so considering only need based factors, but err on the slightly higher end if possible.

Whitsoxdude's avatar

Raise minimum wage = companies hire less people.

JLeslie's avatar

@Whitsoxdude are you saying companies now have people sitting around barely working? You can only give so many tasks to one person, then you have to hire another person.

squirbel's avatar

Answering before ive read answers;

No, I do not think it is fair.

Going back to read now.

squirbel's avatar

Wow, so the essence of what iamthemob is saying is that poor people should avoid creating families?

iamthemob's avatar

@squirbel – was that a question to me? If so, please re-read and tell me if you think, really, that’s the “essence.”

squirbel's avatar

When you say something like this:

“Personal choices (whether to have a family, whether to be a single parent, etc.) shouldn’t come into a discussion about minimum or living wages – but are rather issues that deal with social welfare programs (WIC, for example, for single mothers).”

Having a family is not always a “personal choice”. Not all families begin with a planned start. Most “just happen”. Only a select few, mostly those from the middle or upper crust “choose” to have families, and even plan for them. What if social services weren’t in our society? Would those still be a responsibility for that system?

So yes, I am questioning you, and your word choices, which denote your beliefs.

Response moderated (Off-Topic)
iamthemob's avatar

@squirbel

(1) Birth control is cheap and readily available.

(2) The minimum wage should be about what an individual needs to survive. As I said, whether they support a family and have a single income which is used to support a family is a social welfare issue, and there should be programs to support it (as there are) outside the minimum wage.

So – businesses should not be required to supplement people with families because of personal choices they make. Families shouldn’t be left to suffer because they have single-income minimum wage households, but this should be supplemented through need-based welfare programs.

Therefore – people should live as they can afford to live. Having a large family if you can’t afford it is dreadfully irresponsible. For the most part, everyone “chooses” to have a family – you decide whether to have sex, when to use protection, how often to use it, whether to have an abortion, whether to give the child up for private or public adoption, etc. Taking these factors into account for minimum wage puts that burden on average on employers to take care of, when it is properly placed on individuals and welfare programs.

What do you think, @JLeslie

Whitsoxdude's avatar

@JLeslie That’s not what I meant. I should have said Companies have the ability to hire less people.
Not saying it shouldn’t be raised, just that that’s a possible side affect.
Of course it makes sense to raise it if the value of the dollar goes down.

CMaz's avatar

Would be nice to find any wage fair.

Seaofclouds's avatar

Raising minimum wages would also lead to an increase in other entry level pay as well. If you started paying the people working at McDonald’s the same that a nurse makes after going to school for years to get their degree, you’re going to have less people going into the specialized fields unless their pay rate goes up as well. Why would people go get student loans and spend a bunch on education if they aren’t going to get an increase in pay?

An increase in pay often also leads to an increase in cost. If a company has to pay their employees x amount, they are going to raise their prices to cover the increase, thus negating the raise of the minimum wage to begin with.

I understand the desire to raise it, but I don’t know if raising it is the best idea.

JLeslie's avatar

@Whitsoxdude Ability to hire fewer people. Why would they hire more than they need anyway?

@squirbel what gets to me is typically the middle and upper class plan their children because they think logically about their life circumstance, why should the poor not have to? Someone on a different Q a long time ago, who is on public assistance asked,” why are so many people angry when people on public assistance have computers, and iphones, why can’t we have nice things too.” The answer is obvious I think. Or, maybe it isn’t?

Anyone can get pregnant by accident, anyone, at any income level, and I am not saying everyone should abort or give away their babies, that is an individual choice. But 2 or 3 accidents are unnacceptable in my opinion. I am not saying there is something inherently wrong with growing up poor, my father grew up very poor, and I think his father who earned very little was one of the most admirable men I know, having had a very difficult life, but being on public assistance for a long time is frustrating to those of us, who have sacrificed in our own lives to avoid public assistance.

Why don’t people plan? I don’t understand.

squirbel's avatar

People who grow up poor are not exposed to the idea of planning for children. It’s not been done for ages in their family line, so why would they automagically learn it when the upper class sees fit?

iamthemob's avatar

@JLeslie – and when people don’t plan, but are surprised when people are upset that they expect to have luxuries that are paid for based off of the work of others, are the group I find infuriating.

@squirbel – like @JLeslie, I don’t think that anyone should be required to do anything but be responsible, in the end, for the drawbacks of particular choices made. That responsibility should not be shifted onto other parties to assist in anything beyond a safe, subsistence-level of modern survival.

Poor people who grow up poor know about birth control, and know that kids cost money. They’re not stupid – they in fact will often be more acutely aware of what a budget is than people who are more comfortable. The declining rate in teen pregnancy, which is at the lowest it’s been in the U.S. in about 30 or 40 years, is a testament to nationwide sex-ed about the family repercussions of sex.

Personal responsibility given the above factors isn’t something that the upper class is “automagically” expecting – it’s what we all should and have expected. But more to the point, the problem is simply one that is not the purvey of minimum wage to rectify – it is an education and social welfare issue.

BarnacleBill's avatar

this allows you $160 a month for recreation and sundries.

My washing machine went out. I am horrified at how much it costs to do laundry at a laundromat.

squirbel's avatar

No, I will tell you, without a doubt, that poor people do not typically think of children as a financial burden. I have experienced this mindset straight in the face. They think of children as being all the wonderful things that they are, or the annoying things that they are – but rarely [and I am not speaking of all poor people, just a large set] do they see children as equalling money flying out the door.

You speak from the lofty pulpit of thought, but I am speaking from experience. Which holds more water in this argument? Even I only learned the concept of saving and planning for children when I went to college and attended a seminar for couples. I thought it was the most brilliant thing! But I’m telling you, common sense does not lead to that conclusion.

iamthemob's avatar

Personal experience means very little unless you can back it up with statistics. Also, it suffers from bias based on geographic regions. For instance, the truly poverty stricken in developing nations often consider children as potential labor – where the nations have no limitations or no enforced limitations on child labor, or where agriculture is the chief means of their production.

The more important question: how again does the minimum wage become the proper method to combat this instead of education funding, social welfare programs, etc. You’re arguing about poor people now, not the minimum wage.

I also find it interesting that you ignore the fact that I lived and worked in the city while making $12,000.00 a year, and assume that I’m speaking from lofty thought only without any experience with being “poor” myself or with being around poor people.

JLeslie's avatar

@squirbel I think your comment makes perfect sense. :) My question to you is, since you grew up not thinking about planning children, and now understand the concept of planning, where do you stand? Do you think it is better to plan?

JLeslie's avatar

Oh, I just reread your comment, you said you thought it was brilliant, so ignore my question. That means to me we should be educating teens on family planning. Not just the sex part, but also the economic part. Interesting.

nikipedia's avatar

I know plenty of people who live on the minimum wage or thereabouts. They’re called grad students. We do okay for ourselves.

My roommate’s computer broke and she had to buy a new laptop. She put it on her credit card and it took about 4 months to pay off.

People who don’t make a lot of money can have nice things. It just takes planning.

Frankly I don’t understand why making a choice to have a child you can’t afford is any different from choosing to buy luxury items you can’t afford (cars, electronics, jewelry), except that you can give the luxury items back when you realize you fucked up.

squirbel's avatar

Have you ever met a middle class person/family earning minimum wage? Of course minimum wage equals poor people!

And statistics is the tool of the wealthy and the scholars, not the people in touch with real hardship. Statistics is a crock science because it never paints a true picture. But that is a debate for another day – I’m just letting you know how little I think of statistics.

I will tell you of my experience.

My father is a doctor. I tell you of him so you can grasp what class I’m from. But he is not the focus of my story, my mother is. My mother was the Chief Executive Officer of various Housing Authorities. Not familiar with Housing Authorities? Those are the “projects”. The “ghettos”.

My mother was a part of a two man team, who the HUD in Washington moved around the country, having them clean up corrupt housing authorites. Of course they carried along their various secretaries and those who they trusted, but that was only for efficacy.

I was a child who grew up, living practically at my mom’s workplaces. I worked out in the ghettos, being a tutor at the young age of 11 on up. I met people. I listened to the people who hated my mother and her people [always the rich white people upset at the status quo being shaken], and listened to the people who were oh-so-grateful for their appearance [the poor people who were finally living in better housing, and moving upward and out of the cycle they’d been born into]. As a child, I listened in on many of these people’s hardships and frustrations. They were never speaking to me, but I understood nonetheless.

I was always a precocious child. I didn’t flaunt it, either, as many of my peers did – saying “I know, I know,” all the time, or disrespecting my elders. I was quiet, and just listened. I have gained much experience this way.

I have worked [by way of my mother] in many areas of the country. You people who rely on statistics say that it varies greatly, even so much as to be different based on region. I’m telling you that it is the same in every region. The same.

The only difference that can be derived are the actual numbers, but when you place them side by side, they are directly relational and proportional to each other. For this reason – the difference is nullified. Statistics aren’t worth the paper they are printed on or the pixels they occupy. Once again, this is an opinion, and a strong one at that. Please address it as so, or ignore it.

The problem with viewing children as luxury items is that not everyone thinks that way. Not everyone knows that children are a luxury item, or even a treasure. Maybe if children were educated in the public school system to think this way, it would help.

But what this has come down to is you people blaming children, or families, or their desires for what is truly lacking in the minimum wage system. Does that really make sense?

- “Minimum wages are fine – it’s the people earning them that are doing wrong by having children?” That’s what you are saying, is it not? I believe this is wrong, and shifts the blame from where it should truly be.

- “Minimum wages are fine – they just have to avoid excesses and luxuries unless they save for them?” I completely agree.

At the end, I believe minimum wages are far too low – they are not enough to live on. People cannot buy groceries for their families, pay the rent, or pay for utilities. They often find themselves behind on all of these, because they have to pay all of one one time, all of another another time, and some of this one this time….they live from paycheck to paycheck because just to live, their entire paycheck is gone 1 day after getting it.

iamthemob's avatar

At the end, I believe minimum wages are far too low – they are not enough to live on. People cannot buy groceries for their families, pay the rent, or pay for utilities. They often find themselves behind on all of these, because they have to pay all of one one time, all of another another time, and some of this one this time….they live from paycheck to paycheck because just to live, their entire paycheck is gone 1 day after getting it.

No one is arguing that a family cannot be provided for on minimum wage – but it’s not the job of minimum wage to fund families. Imagine that we raise the minimum wage to assume that everyone has to support, say, a family of two. Because the burden is shifted to the employer, they employ fewer people (as mentioned). They also pass costs onto the consumer – which is a regressive form of funding as it will affect the poor moreso than the rich (as mentioned). You also may end up bankrupting small businesses who can’t afford the employment costs. So, you increase employment, and decrease wage because there’s no associated COLA.

That’s the problem. I’m not saying that the number is perfect right now, personally. As I mentioned, the wage sounds reasonable for an individual until you consider the deductions and effective take home amount of the pay. But the issues you have a problem with are, I can’t say this enough and I’ve said it repeatedly, about social welfare (housing, supplements through food programs like WIC, etc.) and education – both programs and funding. We supplement the individuals in need, but we don’t raise the minimum wage because it shifts what is arguably a public burden to private employers (who, also, fund it partially through taxes).

So I clarify – nobody is saying “poor people don’t deserve more.” But, that supplement shouldn’t be coming from wage increases – or most of it shouldn’t, as it inappropriately burdens a sector that should have more liberty. Unless we’re thinking about exemptions for small employers, like @JLeslie suggests.

Ironically, increasing the wage in the manner making it reflect a family-based instead of individual-based cost actually encourages people not to think about the costs of having a family – because they are already making the money necessary to pay for one! This is where I’m coming from. ;-)

JLeslie's avatar

@squirbel Half serious I have said in the past that if a person has a child while on public assistance I think they should get less money. I am all for redirecting the money to provide for the children through social services, but not money in the hands of the parent. It is not that I think people have kids to get more money, it is that I thought it would give people insentive not to have babies when they cannot afford them. However, this conversation is interesting, because it impresses upon me that money is probably not part of the equation for many poor people regarding having children. But, I think it should be. In society today, for the most part, money matters.

Generally, do you feel poor people want to move up into the midde class, or they accept their life, and feel it will always be their life?

Did they know about birth control, but never consider it? Because preventing babies is not part of their mindset? I’ve told this story before…a relative of mine was a big sister through Catholic charities and one day, because of how a conversation was going, she told her teen little sister that she thinks it better she waited to have sex, but if she did, wanted to make sure she knew about birth control. The girl said she would never use birth control, because that would be a double sin, sex and preventing pregnancy, Ugh. That is how she twisted it all up in her head.

Nullo's avatar

I’d say that it’s fair enough; it’s a minimum, after all, with the possibility of getting raises. In Missouri, a full-time minimum wage job is enough to support one person at poverty level.

I don’t think that raising the minimum wage is a viable solution. Say you raise it by $1.00. The employer (say, a small retail store) is going to either fire someone or else raise the prices of their services, in order to remain profitable. Then you either have unemployed people who used to have a job, or else you have higher prices that will turn away more customers, causing you to have to either get creative, raise prices again, or fire someone else.
Nobody is required to employ people. The point of the private sector is to make money for the owners and shareholders.

squirbel's avatar

The real thing no one is saying is that the store owner will have to raise prices in order to maintain his current income level. He must be allowed to suffer a few thousand dollars a year for the sake of the class below him, nooo! The atrocity!

Nullo's avatar

@squirbel As I said, the purpose of business is to make money. It’s not a social program, and it never has been. That’s why employers get to fire people, too.

When the recession hit, my previous employer – a small businessman – rather charitably decided to keep all of his staff, and not reduce anybody’s pay (though he did end up cutting everybody’s hours). That was his own decision.

iamthemob's avatar

@squirbel – I’m sorry – you’re assuming that all business owners can make that sacrifice – that their families should sacrifice – for the sake of others. Again, that can be done through means other than the minimum wage where the cost is spread effectively to those making more money than smaller business owners – and an increase in minimum wage always has the greatest effect on those who are making minimum wage and in the least skills-related sectors.

Are you saying that business owners should consider reducing the quality of their children’s lives to increase the quality of others? The problem still is that the most negative effect is on businesses making the least money, start-ups, and family-owned smaller businesses. LARGE CORPORATIONS can take the hit. A minimum wage increase is a regressive solution as much as a flat tax is a regressive tax solution, an increase in sales tax is a regressive solution, etc. – regressive solutions have the most negative impact on the people making the least money. That, in fact, IS an atrocity.

JLeslie's avatar

@squirbel I said it above, the owners can take less profit or a lower salary themselves. I agree with you.

@iamthemob I would say that someone making $3million a year can make a little less. I would even say a manager making $300K when other employees are barely scraping by the manager can make less. There is some stat out there that 50 years ago the top paid person in a company made no more than 40 times the average employee in the lowest position. Now it is something like 400 times. It is unethical in my opinion. Either reduce the price of the goods, so people making less can afford things, and take a hit on the highest paid and profits, or raise the wage of the staff. IMHO. It creates a larger middle class, and middle class is what makes the economy go around. It is not just altruistic it is selfish. A very wealthy person does not buy a lot more, they just have more savings, or have it sitting in property, a lower to midle class person gets some more money and they do buy more typically. Someone who is wealthy only buys so many cars and houses, if more of his money is given to employees they might be buying houses they never could have purchased and cars, and vacations. more spending will happen by growing the middle class in my opinion. We have demonstrated this with our own history, and we see it in other countries as well.

iamthemob's avatar

Either reduce the price of the goods, so people making less can afford things, and take a hit on the highest paid and profits, or raise the wage of the staff. IMHO. It creates a larger middle class, and middle class is what makes the economy go around.

I agree with you in theory, @JLeslie – the real-world problem, though, is that if you reduce the wage of your skilled employees and no one else does, then you’re going to lose your skilled employees to competition. They only have to keep this up long enough to run you out of business. So, we either depend on cooperation, or we regulate businesses so this has to happen – which is the kind of regulation of business that will never pass.

I think this is possible, but it’s up to the consumer to make it happen, which requires a lot of work. If we commit to using the products and services of people who do this, regardless of the cost and service difference, so that we inspire others to do so because of lost business, we have a chance. It’s just that depends, to a good extent, on massive consumer self-education.

The point we’re discussing, however, is not to increase our wealth overall – but to ensure that we can all afford what we need. To be honest, everything after that – what we can put into savings and to purchase true luxury items – is, for the most part, gravy.

Your discussion seems to be directed more at decreasing, overall, the gap between the comfortable and the super-wealthy. The only way to get this to address the lowest economic class is through consumers holding their companies, like their government, accountable.

JLeslie's avatar

@iamthemob True; the employers have to compete against other employers with salaries and benefits to maintain the best people. My previous example of the auto industry, the consumer eventually redirected enough of their purchasing so the American auto industry had to improve quality, took a long frikking time, too long for them to get a clue, they screwed themselves. Not to mention Japan was able to make cars cheaper, which honestly I think America could also if they took lower profits or paid execs less, and the union is at fault also. The greed, crossing the line, not typical wanting to make money, but extreme amounts of money comes back to haunt eventually. The government could create a ceiling on salries for the top tier, and then the companies would still be competitive for salaries, but I would much rather people just get their sanity and integrity back on their own.

Whitsoxdude's avatar

@JLeslie It’s harder for a company to grow if they don’t have the workers to do so. The more successful a company is, the more people they can afford hire.

iamthemob's avatar

@JLeslie – The salary cap is kind of part of what got us into this mess. I’ll say that I may have been involved in the TARP restructuring of a certain big three company on the salary and benefits issue – and leave that at that. The problem with the caps is that they led to alternative performance-based structures (e.g., executive stock option plans). These were linked to quarter- and annual- based performance metrics, and were pretty much profit-measured. Therefore, executives became inclined through both their salaries and shareholder desire to turn immediate and huge profits without long-term health concern.

Salaries were also replaced with golden parachutes, severance plans, and other fringe-benefits.

I’m not saying that I think it’s proper, or fair – but these people do get paid a lot for a reason. And trying to regulate the way they get paid just gives us lawyers work to determine how compensation can be given – because the companies want to attract top-notch performers.

I feel as if the regulation is starting to turn to bonus-structures that are tied to long term performance…but I think that salary caps are a backwards way of dealing with it. If it were ALL salary…for instance, you have executives, in a way, pre-funded to do well…and if they don’t, they get reductions. This may very well provide incentives for them to perform well consistently as they’re already locked in. I don’t say it will…but I don’t think that we address the problems of the lower class by going after individuals who make a lot – we reformat the system in a way where money that we have in taxes goes to true problem areas – away from defense, for instance, and drug prosecutions and to education.

jerv's avatar

The minimum wage where I live is $8.55/hr, but even my $10/hr isn’t enough to cover rent and utilities while still leaving enough to eat, pay for transportation to/from work, or pay for health insurance. If my wife wasn’t also working, there is no way I could live on my own without food stamps and access to low-cost healthcare. Even with her income (of which nearly half goes to insurance), things are a little tight.

I think that the minimum wage is based on the cost of living as of a decade ago. Look what happened when Morgan Spurlock tried to go 30 days on minimum wage, and remember that many of the politicians that make the laws probably got more for allowance as a child than most minimum wage earners ever earned in a year. I have always been well above minimum wage and have still had to postpone/eschew medical care, burn sick days because I couldn’t afford the gas to get to work, and turned the heat off in the middle of a New England winter due to the price of propane.

If I had the money to spare, I would wager that many politicians never faced that sort of hardship, and it sickens me to know that millions of Americans are far worse off than I have ever been.

JLeslie's avatar

@iamthemob I agree, they worked their way around the government putting salary caps, I don’t think that is the real answer. Although those rules were for the tippy tippy top levels only. I would guess the government is not so stupid that they did not know it would happen. Some of it must be trying to do something that will sounds good to the public. The first nill under Bush truly gave away money with almost no strings, and literally pushed into the hands of banks. It was set up so even banks that could do without had to take the money. It was ridiculous, although I think overall it helped prevent a total crash of the markets. But, now I am drifting onto another topic.

I like Ben and Jerry’s original rule, wasn’t it not more than 9 times for them than the lowest guy on their staff? If you take the Ben and Jerry’s tour in VT, the guy tells you that back in the beginning he would constantly be given checks of money.

dealrrr's avatar

they never raise it even when prices go up and housing prices go up and food prices go up. minimum wage has become a cap. NEVER WORK FOR MINIMUM WAGE! if an employer offers you minimum wage they are taking advantage of you. always ask for more than minimum wage and they will think highly of you.

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