usmbguest5318
Gold Member
While I'm not keen on minimum wage statutes, I am willing to forebear them insofar as they help keep increases in price of labor somewhat in line with the various product and service prices employers routinely increase every year. Were employers, firms, to roughly match rate of their product/service price increases (and/or price non-increases) to the rate of their wage increases, I'd fully oppose minimum wage statutes.
For example:
One can see from the charts above that the inflation adjusted price of a burger has increased by nearly 272% since 1985 yet wages have not come close to increasing at that rate since 1985. Indeed, the inflation adjusted minimum wage increase between 1985 and 2014 was zero percent.
Now, I'm very stridently an economic positivist; thus while I principally oppose price floors. Accordingly, strongly prefer initiatives help that individuals alter their wage rates by obtaining notably less commoditized skills and, in turn, selling them. That said, I recognize that in a culture pervaded by firm avarice that outstrips firm responsibility/equity to the communities firms serve and becomes manifest by the above described extreme disparity in rates of implemented price increases, well, it then becomes incumbent upon the government to act. Enacting a price floor for wages is certainly a fast and "easy" fix to the normative disparity; however, it's not the fix I prefer because doing so distorts the market.
As you might glean, I don't have a problem with income (resource) inequality in the abstract. To wit, it doesn't bother me in the least that there are people who earn vastly more than I do. Neither does it trouble me that there are people who earn vastly more than the median wage. The only thing that disturbs me regarding income inequality is that there are full-time workers who are not paid enough to sustain themselves.
Income inequality is inherent to a capitalist economy and I'm very much a capitalist. Not only is that inequality inherent, careful examination of economic history reveals that it is also among a capitalist economy's essential traits if societal advancement is to occur. (Note the following two documents are provided with the intention that their central findings be taken together. The first paper posits a hypothesis and the economically rational basis for the proposition's plausibility. The second paper provides empirical support for the hypothesis' accuracy.)
That said, the free hand of the market must be the engine that effects income inequality. Just as I generally oppose governments implementing price floors because of the market distortions they cause, I also oppose governments enacting subsidies (direct and indirect) because they, like price floors, distort the market.
- Inequality and Wealth Creation in Ancient History: Malthus’ Theory Reconsidered
- Greater post-Neolithic wealth disparities in Eurasia than in North America and Mesoamerica
Therein is found the thematic crux of my normative economics: the government should, IMO, be "hands-off" with regard to both the least and most advantaged among us. In short, the tax code should be used for one and only one purpose -- to produce revenue -- and regulations should exist only insofar as they protect public resources. Too, normative notions are, IMO, the purview of jurisprudence, not regulatory policy.
As you might imagine, I'm vexed about anti-trust laws, which really are just policy regulations that have been given the force of law. Economically, I oppose anti-trust laws/policies because sooner or later someone will "invent a better mousetrap" and the "current" monopolists (those operating in industries that are not natural monopolies) will lose their unchallenged primacy as a result.
Unions are another thing that I don't oppose provided they exist in a laissez faire, "hands-off," economic environment. All the same, there are industries in which there is little, if any, need for unions. My industry, professional services consulting is one such example. It's not at all uncommon for prospective workers to negotiate terms of their employment, most typically their wages, though in some instances other characteristics are what prospective workers haggle for.
Though I care not about the wins and losses either major party may sustain, I suspect you are correct that Democrats need more than their current "hook" as the raison d'etre, if you will, for garnering enough votes to win elections. Social issues are important, but I suspect most voters see them as materially less important than economic ones. Sadly, however, most voters also construe economic policy as a matter of opinion even though they have little or no formal training in the science of economics.
Note:
That's not to imply that "a little" formal training in economics is sufficient for accurately and soundly evaluating the economics of matters that confront us. Having a degree in economics, I'd say that one needs to master the content in five courses to be well enough informed to, as a citizen, soundly assess the impacts of economic public policy.
- Microeconomic Theory I
- Macroeconomic Theory I
- Advanced Macroeconomic Theory I
- Behavioral Economics
- Public Finance I
We don't have capitalism. We have Keynesianism. There is a problem in definitions and understanding of what kind of monetary policy we have.
Agreed, however, that people really do need to learn economic theory.
By the way, inflation correctly defined is the increase in the suppy of currency and credit. Price increases are only one consequence of that increase in the suppy of currency and credit.
You all are trying to solve symptoms instead of the root problem. And in doing so, all that will happen is you'll support compounding the root problem.
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I almost responded substantively to your remarks. Then I saw the statement above and realized you/the post doesn't deserve a substantive reply. I share that with you only because I'd chosen the reference links for my reply and was about to compose it, and then I noticed that you'd included the sentence above as an edit between the time I read the original post and the time I clicked reply.
most unions and union people do NOT support Trump or the new rethuglican tax plan!
