79% of economists agree that the minimum wage should be abolished. Should the market or Govt. decide wages?

Question

One view: "We can set the minimum legal wage to be whatever we want it to be! We don't have to stop at $8, or $10, or so. We could mandate something that guarantees a certain standard of living at 40 hours/week, perhaps $25/hr.

The trick is, though, that while we can set the minimum wage, what we can't set is the minimum value of an hour's worth of work. We can't control the return a business gets on the investment of hiring an employee (paying the wages, paying the unfriendly-to-job-creation payroll taxes, following the countless laws and regulations on employers).

So the problem should be immediately visible: If we set the minimum wage at a certain point, then all jobs whose value is below that value get destroyed. Instead of raising wages for the minimum-wage people, you kick them out of work.

And that's why youth unemployment is sky-high in liberal-infested cities: 'living wage' laws guarantee it." -by Neil Stevens

Survey was shown in this book:
http://www.amazon.com/exec/obidos/tg/detail/-/0324319169?v=glance

kujigafy- So you say that only 21% of economists "understand the market"?

DelusionRoad- Yeah, it's some dude who happens to be a professor of economics at Harvard or something like that.

dstr- I said the survey is in the book. I didn't look it up online. I'm sure you can do your own research and find that most economists are not in favor of the minimum wage.

April 1996
Raising the Minimum Wage: The Illusion of Compassion
"[B]ut as Clinton himself explained two years ago, hiking the minimum [wage] is 'the wrong way to raise the incomes of low-wage earners.'"

Interesting link. Higher minimum wages lead to higher unemployment.
http://www.mises.org/story/2130
Everybody knows that when a price floor is set above equilibrium, loss occurs.

The key to increasing the wages of the poor is increased education so they can compete in our changing economy.

Answer 1

Any time the government gets involved in private enterprise, they screw it up. Look at Social Security, Medicare, or better yet, look at national health care in England and Canada.

If you do not like what a job pays, do not work there. If you cannot find a job, start a business like many do. Do not expect some government bureaucrat get in the middle. The reason why we have so many people who cannot be self-reliant is because everytime someone has a problem, there is someone in the government that they can go to.

Excellent points and research

BTW, look at what recently happened in Chicago. The city council passed a mandatory minimum wage and the projects that Wal Mart and Target were planning were halted immediately. Wal Mart has a store 1 block outside the city. At some point, these communists have to learn that if there is no profit in a venture, no one will do it. Profit is what motivates someone to take the risk and put up with all the crap that goes with it.

Another myth associated with minimum wage is who actually works there. There are a lot of teenagers and retired people who do. These jobs are not a permanent position. It is used as an entry to other opportunities.

Answer 2

you know...minimum wage....damned if you have it, damned if you don't. Corporations really don't care what they pay you. If they had it their way they would pay you nothing. I think if you get rid of minimum wage, we would cause a national crisis called "the drop of living standards"! I have done money for corporations for many years on one level or another. It is always a bonus if you can get away with paying someone less than what they are worth!

My belief in my heart, that helps me sleep at night, tells me that if America didn' t have a decent standard of living than WE SURE the hell would have a revolution. I mean why come to America to work your butt off like a slave and not get paid? That would mess up the American dream!

Minimum wage is the line, a set standard, made by the government because corporations would not pay women and immigrants equally to white men. Companies today can go from there, i.e.....cost of living, job market price for position, blah blah, and usually pay more to hang on to their workers.

I have always found that well paid and well cared for employees are more dedicated and content.

All and all, I am grateful to be out of corporate America!

Take Care.

Answer 3

right, except that those jobs you say that get destroyed don't get destroyed. they are made to pay better. here in florida we voted to raise the minimum back in 2004. Business and conservative economists were saying that it would drive up unemployment and business could afford to hire fewer people. But none of that has happened. There has been no increase in unemployment. The only effect so far has been that people working minimum wage jobs are getting paid more.

what will happen if you abolish minimum wage is that business will be able to better exploit people. people who work minimum wage jobs now will be threatened to work for cheaper or see their jobs given to others who are willing to work for cheaper. thats what you see on an international scale today with companies outsourcing jobs to the cheapest countries possible. it would be a drive to the bottom. wages would diminish as people would be threatened to work for less while companies would be making more money by decreasing their expenditures. to use a cliche, the rich would get richer and the poor would get poorer.

Answer 4

Economists always tell us there are too many farmers, too. "You will never hear an economist say that there are too many economists." -Wendell Berry
See, I can quote people, too.
The root of an economy is the wealth it creates. If we create useless wealth, such as the demand for high priced workers who sit on their a## all day and play computer games with other people's money, then eventually, our local communities dry up and our food is grown with poison so that we become too stupid to know what a community is.
The first thing you have to learn is that economists make one assumption above all others, and that assumption is that we need money. This premise allows them to play around with people's lives by remote control, never being held accountable for the layoffs, foreclosures, landfills, and pollution which come from living as though the Economy is God.
No, we don't need a minimum wage law. We need a minimum WORK law, and a MAXIMUM consumption law. We need freedom FROM government laws, so that people can start enterprises without paperwork, and we need people who are capable, skilled, and educated; not people with purchased 'school' credentials that 'fit' the 'economic System of Systems'.

http://www.normeconomics.com
http://www.acresusa.com
http://www.fairtax.org
http://www.solari.com

First the marketers, then the economists, THEN the lawyers.
The revolution will not be televised.

Answer 5

I say let the free market set minimum wage, you can only pay someone so little before they go to over to the guy paying the better wage, and under most economy conditions in the past many years people would have done better with no minimum wage.

Answer 6

Are we back to the "invisible hand" again?

The simple fact is, most economists are conservative.

Conservatives believe poor people DESERVE to be poor because they are either lazy, stupid, irresponsible, or out-right immoral.

Of course, I think making moral judgements about whole groups of people based on their net worth is an empty, materialistic, and fundamentally mean spirited thing to do.

Conservatives are often fond of characterizing the minimum wage as an effort to reward the lazy and put honest people out of work. As if that's what liberals really want.

But what do I know? I'm just a "stupid" liberal.

Answer 7

Did you ever hear of the Great Depression? If you take government out of the business of regulating business, you end up in a Great Depression because business by its nature is short sighted and greedy.
The definition of a balanced economic picture is appropriate distribution of money which means the bottom getting enough to survive at an acceptable level, which means health care for all, for example, and the rich being rich enough to provide financing for free enterprise.
If you do not have balance in your society, you eventual create the conditions for a class struggle that may spell the end of free- enter prize.
Think in the terms that this world is a gift to all of us, not some, but all of us. Now that is not phsyics nor is it peaks on the nose, but it is tranquiality and order which free enterprize needs to survive.

Answer 8

Thats it, some dudes book?
Who are these 'economists'?
Youth unemployment is high because there is 'no new jobs'.
Youth unemployment is sky-high in major cities because it always has been, and will be as long as the 'welfare communes'
(projects?) exist, and those who live in them breed a half-dozen more into the system they will never leave.

Minimum wage effects working people! Not the free-riders.
You've been spun.

Answer 9

There is no one in charge of American law except the government. Economists do not make laws. They can try to advise all they want, but it is just advice. I happen to agree with you and those economists, but you, I, and the economists are outvoted in government. We have to just continue making our argument.

Answer 10

This is an opinion, and an unproven one at that. Economists have a poor track record when it comes to predicting anything with accuracy - not a single one has ever predicted any of the crashes that have occured, for example.