Posted on 03/23/2005 2:41:51 AM PST by JohnHuang2
Sens. Edward Kennedy, D-Mass., and Rick Santorum, R-Pa., both introduced proposals to increase the minimum wage from its current $5.15 an hour. Sen. Kennedy's proposal would have raised the minimum wage to $7.25 in three steps over 26 months, while Sen. Santorum's would have raised it to $6.25 in two steps over 18 months. Two weeks ago, both measures failed passage in the Senate.
Sen. Kennedy said, "I believe that anyone who works 40 hours a week, 52 weeks a year, should not live in poverty in the richest country in the world," after telling fellow senators that minimum wage workers earn $5,000 below the poverty line for a family of three. Sen. Santorum said, "I feel very comfortable that our proposal keeps the balance between the ability of lower-skilled employees to enter the work force at a wage in which they are compensated for the skills they bring to the job."
The idea that minimum-wage legislation is an anti-poverty tool is simply sheer nonsense. Were it an anti-poverty weapon, we might save loads of foreign aid expenditures simply by advising legislators in the world's poorest countries, such as Haiti, Bangladesh and Ethiopia, to legislate higher minimum wages. Even applied to the United States, there's little evidence suggesting that increases in the minimum wage help the poor. Plus, according to the Bureau of Labor Statistics, only 2.2 percent of working adults earn the minimum wage.
The crucial question for any policy is not what are its intentions but what are its effects? One of its effects is readily seen by putting yourself in the place of an employer and asking: If I must pay $6.25 or $7.25 an hour to whomever I hire, does it make sense for me to hire a worker whose skills enable him to produce only $4 worth of value per hour? Most employers would view doing so as a losing economic proposition. Thus, one effect of minimum wages is that of discriminating against the employment of low-skilled workers.
For the most part, teenagers dominate the low-skilled worker category. They lack the maturity, skills and experience of adults. Black teenagers not only share those characteristics, but they are additionally burdened by grossly fraudulent education, making them even lower skilled.
Bureau of Labor Statistics unemployment data confirms the economic prediction about minimum-wage effects. Currently, the teen unemployment rate is 16 percent for whites and 32 percent for blacks. In 1948, the unemployment rate for black teens (16-17) was lower (9.4 percent) than white teens (10.2 percent). Plus, black teens were more active in the labor force.
How might we explain that? How about arguing that there was less racial discrimination in 1948, or back then black teens were more highly educated than white teens? Of course, such arguments would be nonsense. The fact of the matter is that while there was a minimum wage of 40 cents an hour prior to 1948, it had been essentially repealed by the post-World War II inflation; however, with successive increases in the minimum wage, black teen unemployment rose relative to white teens to where it has become permanently double that of white teens.
If the minimum-wage law has these effects, then how does it pass political muster? The current Social Security debate over private accounts gives us a hint. In the political arena, you dump on people who can't dump back on you. Few politicians owe their office to the youth vote. Despite the "concern for the children" malarkey they spout, it's voting-age adults to whom politicians are beholden. It turns out that adults benefit from the discriminatory effects of minimum wages, and older adults benefit from Social Security intergenerational transfers.
See Post #20.
Teens shouldn't be working at all during the school year.
I disagree. I look at a having a part-time job as an avenue to channel energy & help keep a kid out of trouble. They're earning their own money, opening bank accounts, learning money management skills, time management skills, interpersonal skills and how to take instructions. The kids I know who don't have jobs are largely the ones who are in trouble.
The people I know from high school who worked long hours during the school year are still doing menial jobs today.
And I know a lot of them who are highly successful.
Absolutely--parents need to keep a close eye on their working teens and be prepared to step in if the kid gets too much on their plate.
The cost of goods and services are tied directly to the cost of labor. When the cost of labor rises, the cost of goods and services will rise proportionally.
Therefore, employers will simply pass on the cost of higher wages to the consumer in the form of higher prices for their goods and services. Hence workers will see any wage gains offset by higher prices.
Speaking from first hand experience, apprenticeships in Auto body, Heating / HVAC, carpentry....you can go all the way down the list depending on what trades these vo-tech schools offer.
All you have to do is go to a State Trade high school and poke your nose around. You'll be amazed at what you'll find.
There are work study programs for these kids that enable them to leave school for 2-3 days a week and work in their chosen trades. Too bad scumbag employers are circumventing this whole system by hiring illegals, thus short changing these kids out of jobs they've trained for for 3 or 4 years.
see: Reality.
Exactly... One thing that happens in parts of Europe where the minimum wage is very high.. besides crushing unemployment and high costs for things like food..
Is there is no incentive to move up the skill chain. Why give up your job at hte video store making 18$ an hour, to take 2 years training to become a carpenter.. then bust your butt for 22$ an hour?
Minimum wage jobs are for people getting started, and so they can get a downpayment on a student loan in some trade or profession. If Kennedy wants to help these low end people.. stop the protectionism in so many trades which disallows poor people with no connections from getting in.
I'm aware of those programs. The key is that they have to be accessed thru 'The System'. A 16-17 year old kid whose interest is in Computer Geekology or Accounting & earning money to buy a bigger & better computer or saving for college isn't going to get a summer job working as a laborer on a construction site without being in 'The Carpentry Program'. And he/she isn't likely to be in 'The Carpentry Program' because they've been consumed with taking computer & math classes.
The dirty little secret is that many union wages are tied to the minimum wage. If the minimum wage increases, then the union wages will increase as well. It puts upward pressure on all hourly wages, even those that are not the minimum wage.
see: Reality.
About 'reality'. I have a two sons--one is fourteen & the other is seventeen. Fortunately, the local public school system is large & offers many of the programs you noted. Such is NOT the case for many smaller schools in small communities & in more rural areas of the United States. And, if a kid is in the automotive program & there aren't enough Program summer jobs to go around but there are plenty of jobs for construction laborers, do you think that underage kid is going to be approved to work in carpentry? Suggest that you append your version of 'reality'.
I may append it, but still stick by my guns.
50 feet from me are 6 illegals who have jobs that might have gone to some of the kids graduating from this City's Vo-Tech school.
50 feet from me are 6 illegals who have jobs that might have gone to some of the kids graduating from this City's Vo-Tech school.
I don't doubt that. But I think we've been operating under different definitions of 'teens'. You're referring to teens who have graduated from vo-tech schools (indicating that they're 18 or 19) & who are considered 'adult' in the workforce. I've been talking about kids under 18 and it's underage workers that I think Walter Williams was talking about in the article...acknowledging that I don't recall WW being specific about the ages of the kids he was writing about.
Obviously, given that my kids are under 18, I've been posting from that angle. And, given that I live in Wisconsin, the subject of illegal immigrants in my town is of a less pressing nature than it is in areas of the US that are closer to the border. All of that said, the subject of illegals is one must be heavily considered when a youth is mulling over the choices of future occupations. With my oldest son, the one most geared to Vo-Tech types of jobs, I put heavy emphasis on the 'tech' part, the absolute necessity of specialized education & to keep an eye peeled to selecting something that can be owner-operated.
You've obviously never taken a class with a foreign graduate student teaching. It sucks to say the least.
In other words minimum wages are inflationary.
Now I'm the owner of a custom paint shop and my work has appeared in every major motorcycle magazine in the US and even a few mags overseas.
Holy cow. That's almost exactly what my son wants to do. He's talking about UTI...Arizona. I'm a little leery... If you've the time, I'd appreciate your thoughts & suggestions about the better places for him to look into as far as schooling is concerned. He's more oriented to custom auto body.
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