Posted on 07/01/2017 10:25:57 AM PDT by Renkluaf
U.S. Supreme Court Justice Louis Brandeis wrote: “a single courageous state may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country.” Seattle’s Minimum Wage Ordinance, passed in 2014, exemplifies courageous experimentation by a local government.
The ordinance aims to increase earnings of low-wage workers as one response to the troubling rise in income inequality and stagnant wages of low-wage workers. There is national and international interest in knowing how it is working. Unfortunately, not all social experiments work entirely as planned.
On April 1, 2015, the ordinance raised the minimum wage for Seattle employees from the state’s minimum of $9.47 to $11 for large employers. On Jan. 1, 2016, the second phase-in period started, when the minimum wage reached $13 for large employers — 37 percent higher than the state minimum wage at that time. Since January of this year, the minimum wage for large employers has been $15.
. . . Our research found that during the second phase-in period, hourly wages paid to low-wage employees increased, as intended by the ordinance. However, our estimates also suggest that the higher wages led to the elimination of more than 5,000 low-wage jobs. Standard economic theory predicts that employers will reduce their demand for labor given a higher wage. In percentage terms, the loss of jobs was significantly larger than the gain in hourly wages. As a result, while some low-wage workers may have earned more, we estimate that the net earnings per low-wage job in Seattle fell by an average of $125 per month. For low-wage workers, this is a substantial loss.
(Excerpt) Read more at seattletimes.com ...
“Courageous experimentation” ... what a bunch of idiots. In reality it is marxist economic fairytale land. Why don’t they “experiment” with a $100,000 per year required “livable wage” and see what happens.
Anybody with high school economics training knew what the outcome was going to be.
Beat me to it. I was just going to say: how unusual, how refreshing, to see an honest assessment of the risk/benefit, cost/opportunity, gain/loss calculus which must be applied to *every* prudential judgment in the real world.
So it’s not just evil greedy capitalists vs poor exploited workers, eh?
Who’d’a think it?
There's nothing courageous when the outcome is exactly as predicted.
If only they would. They are so wedded to their ridiculous fantasyland marxist theory of labor that they will never learn or relearn anything. They are immune from learning the most basic theory of supply and demand.
Why do the folks east of the Cascades have to subsidize the whackos on the west side of the mountains?
Here’s the deal. Nobody is being forced to live someplace they can’t afford. MOVE TO WHERE YOUR CAN AFFORD TO LIVE based on the skills you bring to the table. In Mohave County, AZ where I live, you can rent a house, a whole house, for 600. For $800 you can probably get one with a pool. With a few roommates? Well.. you can do the math. In America you have life, liberty and a PURSUIT of happiness. Nobody should have to subsidize your life choices.
The effects of a minimum wage increase have always been the same: lower employment for the very people it was designed to help. The paper did not address the impact the wage increase had on prices, which would be interesting to know as well. Low income people tend to patronize fast food places, so if there is an upward pressure on prices, which there is, low income people manage to lose twice: unemployment and rising prices. But, the good news is that there is a little something for everyone: voters get to shoulder some of the burden as falling income for poor people often means rising food stamp and other transfer payments. Who’d have thunk it: Even the rich lose when you mess around with supply and demand.
I ran into my niece at Walmart yesterday, while self-checking out.
She asked me what I was doing and I told her, “Dealing with the laws of unintended consequences.”
I knew others were listening as I explained.
Walmart raised their minimum wage and then fired half their employees.
So now people are left to do the work of checking out and paying by themselves.
“Courageous” ...Bwaahahahaha
Courageous my ass! More like outrageous. If the Republicans had tried something that didn’t work they would have referred to it as cowardly and mean spirited. I’m so sick of all these media faggots.
Courageous.
An odd word to use in this case.
>>If you knew that, dummy, why did you have to experiment? <<
They think economic truths don’t apply to liberals.
This is worse than they could possibly imagine. The “switch to robots” point is NOT where the total cost of wages = total cost of converting to robots. It is well below that when you factor in lateness, absences, general hassle of managing people, etc.
What WILL happen is that the Seattle experiment has already led to experiments in robotic restaurants. And once entrenched THAT will be the model.
Restaurateurs everywhere will look at Seattle robotic restaurants and say “hey, I can amortize the costs of robots over 5 years or so at $10/hour and not have employee hassles! Sold!
Seattle can repeal their stupid law. But the box has been opened and, for the low wage employees, there is no hope left in there.
Until one comprehends the true depths of the Left’s loathing for small business owners, one can’t fully understand the logic behind these types of political experiments. They were probably expecting - after crushing the dastardly kulaks - that the laid-off low-wage workers would all get jobs with big, socially progressive, politically compromised, quasi-governmental entities like Microsoft, where they could be properly educated in Marxist theory by well-catechized Human Resources officials.
An undiscerning man could mistake courage for stupidity. I kind of suspect that most people wouldn’t need to experiment. It’s rather obvious that eliminating low paying jobs tends to eliminate low-paid workers.
"Standard economic theory predicts that employers will reduce their demand for labor given a higher wage.If you knew that, dummy, why did you have to experiment?”
Perhaps the key question is, did the minimum wage experiment win votes for career local elected representatives?
Think about the idiocy of this logic.
Their policies cause their own residents to lose jobs.
But that is okay because those jobs MIGHT be recreated in another locale where the politicians haven't instituted the same short sighted job killing policies.
And there are basic flaws in their theory of jobs just being relocated.
One flaw is that for some types of businesses the customer base stays where it is.
If you operate a restaurant or other business that survives on providing a face-to-face service for the city population your customers aren't going to follow you out into the suburbs or to a small town in the far reaches of the county.
Another flaw is that the skilled workers you require might not be available or plentiful if you move to another location.
If you manufacture cat towers to sell over the internet you can probably move your business outside the city limits, hire new help and still function.
But if you operate a business that relies on a set of specificly skilled employees it isn't likely that you will easily find skilled replacements in other locations.
Forget the kiosk. Just get the app for your phone, build and save your favorite orders, then just click the app as you get in your car, the payment is built in, and you just drive by and have your order handed to you. No human interaction required. Millennials will love it.
The soluty, to liberals supporting a 15.00 minimum wage in THEIR area, is to require a 15.00 minimum wage in YOUR area, MY area, and EVERY (tax producing ) area!
It failed because not enough people were hitting themselves in the head. Once the national minimum wage is $15 the eeeeeevil employers can't flee across the city line. And unionize robots and kiosks too so they can make $15 per hour.< /s>
“If you knew that, dummy, why did you have to experiment? “
Yeah, the RATs haven’t yet discovered gravity either!
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