Retirement savings ....Yikes !

[dave1949]

Excuse my language (economics), but I couldn't resist the temptation to comment on the topic of the minimum wage.

If you managed to stay awake in Econ 101, you may recall your professor using a supply and demand diagram to illustrate the deadweight loss to society when a price floor (e.g., a minimum wage) is imposed on a market.

If you were asleep or are hazy on the analysis, see Political Calculations: The Deadweight Loss of Minimum Wage Hikes for some back-of-the-envelope calculations.

Steve

So according to the Dismal Science, on a macro level the best solution is everyone works for next to nothing and eliminating "dead weight" solves everything? :laughing: I don't mean to be flip about it, I know it is a serious endeavor for you.

That dead weight analysis doesn't account for tax savings offsets or human motivation. There must be some economics principle that describes human reaction to what would amount to an offer of slave labor. It costs something to work, after all. It also assumes that there is a job--whenever needed--that a person can fill and earn something less than the minimum wage. I don't think that is the case.

I think what you will get is more people working for less, and less able to prepare for retirement let alone eat. As Keegs pointed out, upward mobility ain't what it used to be. I have seen articles recently that state upward mobility in the US actually lags that in a handful of other modern economies, and historically we have over-rated upward mobility in the US. The reality has not matched our beliefs.

Why can't we look at it from the human perspective? Why do we work - to meet our needs. How much do our needs cost? Are the proceeds from work equal to the needs? I don't think the minimum wage can be defended as meeting the needs that will result in a healthy and prosperous society.

 

[Gale Hawkins]

dave1949 could you be thinking of a living wage instead of a min wage? Every place I know of in the USA that employees people at min wage also employ people at twice min wage also. I remember when it went from 80 cents to $1.00 and a lot of people did get a raise but in some cases jobs when away too. Personally I am fine with increasing min wage but if it knocks my kids from getting a job and gaining that work experience it has abused their future earnings on average.

People who do not gain OTJ skills to move up from min wage must only being adding limited value to the company.

 

[dave1949]

That video said since 1976 the ratio has gotten much worse! No kidding Sherlock! Look how much freedom and closer to socialism we have gotten since then. And, what is it with using this word "distribution"?? Huh? No way! To me, wealth is made by opportunity and hard work, not "distributing" money around! Another word I don't like being used regarding making a living - fairness. Again, huh? Freedom, opportunity, hard work - to me, that's the ticket, whether I get rich or not. One other thing I noticed in that video - yep, we're getting more like the communists states where there are PLENTY of rich people, just a very small percent in power. I wonder what that chart looks like in North Korea, China, Russia, Cuba, Venezuela, etc., etc.? Even in America, the states that have the most freedoms are the ones where income is more even. Look at New York, California, etc. - yep, again, the gap is wider in the most taxed, restricted states, in other words, the states most resembling socialism/communism.

"Distribution" doesn't refer to someone taking your money and handing it to someone else. Some people want you to believe that. But, what it really refers to is if you look at the spectrum of wealth, and growth of wealth, across a population, how distorted is it? I don't think you would like to live in a country were the distortion is very high, and that is the direction we have been going in for the past 20-30 years.

Do you think that is because only 5% of Americans are willing to work hard and look for opportunity? Or, do you think some fairness is lacking? Did 95% of the population just turn into slackers, or is there something else at work?

I think you also need to ask if what you consider a trend toward socialism is the cause of, or the reaction to the distortion of wealth. Many of the support programs that have grown by leaps and bounds are a reaction to the failure of people earning enough to be independent.

Real life cannot be like a Monopoly game where one person ends up with everything, and then we order pizza.

 

[MacLawn]

“It is a great thing to know the season for speech and the season for silence” ― Maclawn, 2013

 

[dave1949]

dave1949 could you be thinking of a living wage instead of a min wage? Every place I know of in the USA that employees people at min wage also employ people at twice min wage also. I remember when it went from 80 cents to $1.00 and a lot of people did get a raise but in some cases jobs when away too. Personally I am fine with increasing min wage but if it knocks my kids from getting a job and gaining that work experience it has abused their future earnings on average.

People who do not gain OTJ skills to move up from min wage must only being adding limited value to the company.

Yes, I would say a "living wage" is a better choice of words than minimum wage. A uniform federal minimum wage is not going to account for the differences in the cost of living that exists in various areas.

There are economic principles being applied if someone loses a job due to a min. wage increase too. Assuming the least motivated, available or capable employee is the one that leaves, that represents competition between employees. That is presumed to be beneficial in a capitalist economic system. But at some point a reasonable wage floor ought to exist to prevent a massive race to the bottom driven by desperation.

 

[Gale Hawkins]

Real life cannot be like a Monopoly game where one person ends up with everything, and then we order pizza.

But dave1949 to you not realize the video daugen linked claims to be REAL LIFE numbers?

There is nothing based on the last 5000 years of history that I have read that that would cause anyone to think wealth has ever or will ever be more equally distributed than it is today in the USA. Look at the places in the world with the most riots if you want to see serious imbalance of wealth.

 

[dave1949]

“It is a great thing to know the season for speech and the season for silence” ― Maclawn, 2013

Nah. It is an interesting topic. Fire away.

For example, are those support programs too easy, such that people aren't pushed enough to make the choices they will have to make eventually?

 

[Gale Hawkins]

New York state approves $9 minimum wage as part of $135 billion budget - UPI.com

I am go glad for this wage hike. Maybe they will not have to charge out of town guest who get cut off by NYC drivers trying to get into the Holland tunnel at 5 PM $115 parking tickets because their car rear is in the cross wall like they did two weeks ago. I was ok with the part of taking 2 hours to go two blocks. I guess could have jumped up on the sidewalk and keep moving like one Towncar taxi driver did.

 

[dave1949]

But dave1949 to you not realize the video daugen linked claims to be REAL LIFE numbers?

There is nothing based on the last 5000 years of history that I have read that that would cause anyone to think wealth has ever or will ever be more equally distributed than it is today in the USA. Look at the places in the world with the most riots if you want to see serious imbalance of wealth.

According to daugen's video link: http://mashable.com/2013/03/02/wealth-inequality/ as recently as 1976 wealth distribution in the US was considerably different than today. That compares well with other stats I have seen. So, we do have a history of more equally distributed wealth than today.

I wouldn't want us to become like those countries where bread riots and the like occur. But, if the wealth continues to be so skewed, what other options are left to those at the bottom? They ain't going to starve quietly.

 

[Gale Hawkins]

File:2008 Top1percentUSA.png - Wikimedia Commons

dave as you know MASHABLE as an agenda. If the above link is factual then we know MASHABLE was not showing integrity in that video.
http://mashable.com/about/ One might guess most of the five pictured are not farm girls and boys.

If you look at the Top1percentUSA graph then the MASHABLE video you will realize MASHABLE was by intent painting a false picture of history with the snap shot from 1976 forward.

The graph link at the top of this post you can clearly see shows the boom years starting around 1976 for many non 1%'ers occurred when the 1%'ers numbers were climbing as well.

dave do you agree based on the last 100 years of USA history for one to think there are too many at in the 1% group today may be wishing a depression up on the kids?