Minimum wage? Be careful of what you ask for!

With an honest congress, a minimum wage wouldn’t be needed! And the effects on the economy would be fabulous.

By Jack E. Lohman

But wow. Do you mean cutting politicians off from taking bribes?

As it is, corporate law so favors the CEOs and Fat Cats that you, Mr. America, are totally screwed. Look to the cash that changed hands. Nothing else. Don’t be blinded, and don’t get hung up on the little fires.

No country can survive this corruption, especially one registering 24th on the corruption index scale, as is the United States. But the people who can change this — the politicians — don’t want anything to do with it and in fact receive cash bribes to keep hands off.

I blame Republicans mostly, because they get 60% of the bribes. But the Dems are not free of guilt.

It all started in 1976, but culminated under Clinton

And the Republicans loved it. Actually ALL politicians loved it. So when the politicians spend your taxes on Fat Cats rather than health care and growth of America, understand WHY! And do something about it!

Yes, George W. Bush gave the drug industry a payback in 2003, by prohibiting Medicare from negotiating the same 50% discount given to the VA system. Because HE AND CONGRESS WERE PAID CAMPAIGN BRIBES TO ROLL OVER!!! And they did.

But the real question is MINIMUM WAGE!

I’ve worked for minimum wage… more years ago than I care to remember. Even before we had a minimum wage. Of course I felt used and abused, but I moved on and started my own company.

Yes, some people will like $10 per hour… at least those who still have a job will. But until our politicians are willing to rewrite the laws that permit sending jobs to lower-wage countries, our lower-waged people are screwed. It is what it is.

Looking at who would actually PAY for these higher-paid jobs — lower-wage consumers — this would clearly be a very regressive policy. It would do more damage to overall employment than anything else I can think of.

This is yet another of those little fires!

2 Responses to Minimum wage? Be careful of what you ask for!

  1. For the most part, only production jobs can be outsourced. However automation, especially computer controlled also eliminates a lot of jobs. Most Americans today work in the “service” industry, where services are provided to other Americans. These jobs however tend to be “labor-intensive” where productivity is relatively low. The only high paying jobs in “service” tend to be in the skilled trades and the licensed professions. There is a growing shortage of skilled trades people because young people are encouraged to go to college instead of going into the skilled trades. We are creating a surplus of college educated people and at the same time a shortage of skilled trades people. I just had my toilet repaired by a plumber and the labor cost was $80 for about 1/2 hour’s work. I’d obtained the necessary part earlier from Home Depot so the total cost was just for the work he did and his fee for coming to my home.

    Wages and salaries are determined to a great degree by supply and demand. Where there is a “surplus” of workers, wages will be low. And today we have a big “surplus” of workers, mostly however not highly skilled. So far as relatively unskilled type work is concerned, we have an “employer’s market” where without the minimum wage, pay would probably be down around the $5 range duee to the fact that the “supply” considerably exceeds the “demand” for such labor. When most industry was unionized, the unions were able to restrict the “supply” of labor and force the employer to pay a higher price. Since the cost of labor in most industry is a fraction of the total cost of production, this system did “work” for decades. Also, organized labor had economic power that allowed for the election of pro-labor representation in government.

    As most workers today are in “service” type jobs, the employer isn’t able to replace them with workers in another country as can be done with production workers. However in the service industry labor is usually a larger portion of the cost of production of the service rendered. So an increase in labor cost will be reflected in a higher price for the service. This of course means the consumer must pay a higher price than before. In the case of “marginal services”, the consumer may decide that the higher price isn’t worth it and seek other means of meeting the need previously provided. So a higher minimum wage will have some effect upon employment along with an increase in prices. A lot depends upon the nature of how much an increase there is at one time. A slow rise on a yearly basis will have less effect than one large step will.

    • Thanks much for the detailed comment. Largely I agree, and most certainly believe that it is (near) time to increase the minimum wage. But I’d first like to see our politicians get off the payroll of corporations, so that the minimum wage can be set fairly and product pricing is adjusted to reflect our “returning” manufacturing industry.

      Unfortunately, like it or not, our politicians are not ours; they are theirs. They are corrupt and take cash bribes from the industries that pay the most to mangle our laws to their benefit. And that we must change in 2014 with a near-100% turnover in our elections.

      I’ve learned that if I am going to do any investing, it is going to be in an industry that owns the politicians (drugs, health care, petroleum, and guns are just a few).