Page 3 of 3 FirstFirst 123
Results 41 to 47 of 47

Thread: What is the point of a border fence with Mexico?

  1. #41
    So, I'm going to play a little devil's advocate here because I have to say I haven't read a whole lot about economics.

    If minimum wage is bad why is approx. 90% of the countries employing it?

    If the minimum wage was not in force then would we see a greater rise in Unions to fight for wage increases and better health care benefits?

    If productivity is the way to get a raise, why is it that I have heard productivity in the american workforce has gone up in recent years but equal pay raises have not?

    As for the original topic of this thread, I am not sure that a wall is going to work. So far, increasing the pressure on companies to be punished for using illegal immigrants seems like the proper thing to do.

  2. #42
    Hall Of Fame
    Join Date
    Apr 2003
    Location
    Boston
    Posts
    11,692
    [QUOTE=F-4 Phantom]So, I'm going to play a little devil's advocate here because I have to say I haven't read a whole lot about economics.

    If minimum wage is bad why is approx. 90% of the countries employing it?

    If the minimum wage was not in force then would we see a greater rise in Unions to fight for wage increases and better health care benefits?

    If productivity is the way to get a raise, why is it that I have heard productivity in the american workforce has gone up in recent years but equal pay raises have not?

    As for the original topic of this thread, I am not sure that a wall is going to work. So far, increasing the pressure on companies to be punished for using illegal immigrants seems like the proper thing to do.[/QUOTE]

    Each of these topics require a long discussion, but I'll answer quicky:

    Re: MW - Why does the rest of the world have less economic growth, higher unemployment, higher prices and lower living standards than the US? Not only do most western countries have MW laws, but also various restrictive "employee protection" laws which make it harder to fire employees, which in turn, makes it more expensive to hire them and thus unemployed workers tend to stay unemployed longer than over here. This is not counting, for example, China's current period of spectacular growth, which itself could be a whole 'nother discussion.

    Here's a thought experiment...if MW laws are so good, why not set it at $5000 an hour? Can you imagine what would happen if the MW was set to that amount? Certainly you can. Now, you can see the impact of raising the MW 40% or so, which is what the Dems want to do. What do you think firms will do if you raise their costs of production by 15% or 20%, simply eat those costs? Hell no, they'll pass them through to us or cut back on hiring. It's not the people lucky enough to keep their jobs - they'll get raises. It's the people who get fired when stores close and the people who lose out on jobs when new stores that would have opened, don't. Crucially, it harms the least-skilled among us, the ones who desparately need work experience the most.

    People who earn the MW aren't paid low wages because of a conspiracy and the way to help them is not to try to meddle, which have have negative effects on the economy as a whole. The way is to help them acquire those skills, through education and work experience. However, government-run education is failing, period. And laws like MW laws or "worker protection" laws actually end up harming the least-skilled and have been shown in many studies to actually be a retardant in terms of helping them develop skills.

    Unions try to negotiate their own minimum wages and wages are typically tied to experience, not productivity, which is why you may see some union workers who are *cough* not exactly the hardest workers in the world...because it makes no difference if they work hard or not. (Simplification) You'd have to do an exhaustive study, but perhaps union membership would increase if MW were struck down, but most union workers have a skill and thus earn far more than the MW, even without MW laws. MW laws are for unskilled workers and I think, conceptually, it is difficult for me to imagine unskilled workers unionizing effectively, mainly because so many different industries employ unskilled workers that skirting that union would be easy, also, unskilled workers may scoff at paying dues or sitting out from work and not getting any money from either a firm or Uncle Sam.

    Regarding productivity, there is always going to be a lag effect with incomes and productivity. In simple terms, think of a firm that gives raises annually...you can have a kick-a$$ year and maybe your raise isn't in effect until December 31st...or think or the time lag in sports from when a rookie is productive yet their income doesn't rise until after their rookie contract expires years later. Incomes have been rising, but again, there are many ways to play with these statistics, so I'd really have to defer a formal response until I can read a specific report.

    I have told this story before, but many people think employment is what creates wealth or raises living standards or incomes...but it is [I]productivity.[/I] To illustrate this, I will tell a story I heard in business school about an American businessman who was consulting in China and was taken to where the Chinese were building a bridge. The Chinese foreman took the American to a site where hundreds of workers were using pick-axes and other manual tools and was told the bridge would be completed in a year. The American said, "There are machines you can buy that can help you build this bridge in two weeks." The Chinese foreman said, "No, that cannot work. Think of the unemployment that would create." The American says, "Oh, I thought the point was to build a bridge. If its just jobs you want to create, take those pick-axes away and give the workers all toothpicks." See, the problem here is that they could build 20 bridges in the time (and cost) it took them to build one if they focused on productivity. If they only needed one bridge, they could free up that money saved to build a school or hospital, rather than pay hundreds of people a year's wages to produce just a single bridge. Also, many of those hundreds of workers could have used their time doing other things and producing that way, which would add to total national productivity for the economy as a whole and raise living standards faster. Americans have understood this to a greater degree than others, though the rest of the world is catching up. Many people will still agree with the Chinese foreman's stance and it spurred a huge debate in bschool that day. It is an emotionally-appealing stance, however, it does not account for what is better for the economy as a whole and "protecting" jobs for a few people can often come at a great cost...it is just that these costs are often hidden, dispersed among many people who are not organized and well-funded like a union is and will involve things that are not really lost, but rather [I]foregone [/I] and thus less immediately noticable or quantifiable. Fir example, if a baby of one of those Chinese workers dies due to a lack of medical care, it may never occur to that worker that had the foreman and his predecessors focused on productivity instead of employment, there may have been an additional hospital in his area. There never has been a hospital and so it's just the way it has always been and the worker probably thinks nothing of it. But it doesn't mean there isn't a VERY real opportunity cost in ignoring the wealth-creating effects of productivity by focusing on protecting jobs for the few. Socialists truly have a profound lack of understanding of this important issue and socialist rhetoric is VERY appealing, and it is why I suspect that most people who have not studied ecnomics lean towards socialism/communism/collectivism subconsiously, even if they have some appreciation for the negative connotations of them. And yes, using a machine to build a bridge will cause workers some workers to lose their jobs and that is difficult for those people. But a flexible economy will allow them to find work, higher living standards will allow them to find work and, crucially, the trade-off is worth it because the economy (i.e. people!) as a whole are better off when productivity is high, not employment. If you can have both being high, you have won and acheived nirvana! But to ensure that living standards to not deteriorate, we have to create and nurture a free system that incentivizes and rewards productivty...that is the key, key component of why capitalism works and why collectivism does not.

    (Only I can be long-winded during a "brief" response! :( )
    Last edited by jets5ever; 06-29-2007 at 10:15 PM.

  3. #43
    [QUOTE=jets5ever]Each of these topics require a long discussion, but I'll answer quicky:

    Re: MW - Why does the rest of the world have less economic growth, higher unemployment, higher prices and lower living standards than the US? Not only do most western countries have MW laws, but also various restrictive "employee protection" laws which make it harder to fire employees, which in turn, makes it more expensive to hire them and thus unemployed workers tend to stay unemployed longer than over here. This is not counting, for example, China's current period of spectacular growth, which itself could be a whole 'nother discussion.

    Here's a thought experiment...if MW laws are so good, why not set it at $5000 an hour? Can you imagine what would happen if the MW was set to that amount? Certainly you can. Now, you can see the impact of raising the MW 40% or so, which is what the Dems want to do. What do you think firms will do if you raise their costs of production by 15% or 20%, simply eat those costs? Hell no, they'll pass them through to us or cut back on hiring. It's not the people lucky enough to keep their jobs - they'll get raises. It's the people who get fired when stores close and the people who lose out on jobs when new stores that would have opened, don't. Crucially, it harms the least-skilled among us, the ones who desparately need work experience the most.

    People who earn the MW aren't paid low wages because of a conspiracy and the way to help them is not to try to meddle, which have have negative effects on the economy as a whole. The way is to help them acquire those skills, through education and work experience. However, government-run education is failing, period. And laws like MW laws or "worker protection" laws actually end up harming the least-skilled and have been shown in many studies to actually be a retardant in terms of helping them develop skills.

    Unions try to negotiate their own minimum wages and wages are typically tied to experience, not productivity, which is why you may seem some union workers who are *cough* not exactly the hardest workers in the world...because it makes no difference if they work hard or not. (Simplification) You'd have to do an exhaustive study, but perhaps union membership would increase if MW were struck down, but most union workers have a skill and thus earn far more than the MW, even without MW laws. MW laws are for unskilled workers and I think, conceptually, it is difficult for me to imagine unskilled workers unionizing effectively, mainly because so many different industries employ unskilled workers that skirting that union would be easy, also, unskilled workers may scoff at paying dues or sitting out from work and not getting any money from either a firm or Uncle Sam.

    Regarding productivity, there is always going to be a lag effect with incomes and productivity. In simple terms, think of a firm that gives raises annually...you can have a kick-a$$ year and maybe your raise isn't in effect until December 31st...or think or the time lag in sports when a rookie is productive and theur income doesn't rise until after their rookie contract expires. Incomes have been rising, but again, there are many ways to play with these statistics, so I'd really have to defer a formal response until I can read a specific report.

    I have told this story before, but many people think employment is what creates wealth or raises living standards or incomes...but it is productivity. To illustrate this, I will tell a story I heard in business school about an American businessman who was consulting in China and was taken to where the Chinese were building a bridge. The Chinese foreman took the American to a site where hundreds of workers were using pick-axes and other manual tools and was told the bridge would be completed in a year. The American said, "There are machines you can buy that can help you build this bridge in two weeks." The Chinese foreman said, "No, that cannot work. Think f the unemployment that would create." The American says, "Oh, I thought the point was to build a bridge. If its just jobs you want to create, take those pick-axes away and give the workers all toothpicks." See, the problem here is that they could build 20 bridges in the time (and cost) it took them to build one if they focused on productivity. They could free up that money saved to build a school or hospital, rather than pay hundreds of people a year's wages. Also, many of those hundreds of workers couls have used their time doing other things and producing, which would add to total productivity for the economy as a whole and raise living standards faster. Americans have understood this to a greater degree than others, though the rest of the world is catching up. Many people will still agree with the Chinese foreman's stance and it spurred a huge debate in bschool that day. It is an emotionally-appealing stance, however, it does not account for what is better for the economy as a whole and "protecting" jobs for a few people can often come at a great cost...it is just that these costs are often hidden, dispersed among many people who are not organized and well-funded like a union and involve things that are not really lost, but rather foregone and thus less immediately discrenable. If a baby of one of those Chinese workers dies due to a lack of medical care, it may ever occur to that worker that had they focused on productivity instead of emlpoyment, there may have been an additional hospital in his area. There never has been one and so it's just the way it is. But it doesn't mean there isn't a VERY real opportunity cost in ignoring the wealth-creating effects of productivity. Socialists truly have a profound lack of understanding of this important issue and socialist rhetoric is VERY appealing, and it is why I suspect that most people who have not studied ecnomics lean towards socialism/communism/collectivism subconsiously, even if they have some appreciation for the negative connotations of them. We have to create a free system that incentivizes and rewards productivty...that is the key, key component of why capitalism works and why collectivism does not.

    (Only I can be long-winded during a "brief" response! :( )[/QUOTE]

    The reason the Minimum Wage hike looks extreme is because it hasn't budged at all in a decade, which is insane. There is no point to having a minimum wage if it is not a living wage.

    It ought to be raised this year, and then permanently fixed to inflation so that we don't have a drastic hike again.

  4. #44
    Veteran
    Join Date
    Dec 2003
    Location
    Somerset, NJ
    Posts
    1,573
    [QUOTE=nuu faaola]The reason the Minimum Wage hike looks extreme is because it hasn't budged at all in a decade, which is insane. There is no point to having a minimum wage if it is not a living wage.

    It ought to be raised this year, and then permanently fixed to inflation so that we don't have a drastic hike again.[/QUOTE]

    You cant have it both ways. An inflated min wage will cause employers to seek out workers willing to work below min wage to keep production costs down. Competitors will need to follow suit. Fining these employers will definitely help in forcing employers to hire citizens, however with the increased production costs comes a higher price for goods. So now min wage earners who just received a raise will pay more for goods or lose their jobs altogether as employers adjust to the rising cost of employment. An inflated min wage creates a dog chasing its tail scenario.

    I agree the min wage should be adjusted annually, but it should be set to market value, not tied to an arbitrary #. If we have millions of illegals working below min wage, thats proof right there that the current min wage > market value.
    Last edited by sect112row36; 06-29-2007 at 05:39 PM.

  5. #45
    Hall Of Fame
    Join Date
    Apr 2003
    Location
    Boston
    Posts
    11,692
    [QUOTE=nuu faaola]The reason the Minimum Wage hike looks extreme is because it hasn't budged at all in a decade, which is insane. There is no point to having a minimum wage if it is not a living wage.

    It ought to be raised this year, and then permanently fixed to inflation so that we don't have a drastic hike again.[/QUOTE]


    What is insane is having one at all. And a "living" wage is a term that makes absolutely no sense at all. If you want to help poor people and the people with the least skills, it should be abolished.

  6. #46
    Jets Insider VIP
    Join Date
    Feb 2006
    Location
    Van down by the river
    Posts
    22,824
    [QUOTE=jets5ever]If you want to help poor people and the people with the least skills, it should be abolished.[/QUOTE]


    Actually...no need to explain this to me anymore, Jets5. I finally understand it. I had lunch with my boss today, who is an economics major from Cornell. He explained to me the two schools of thought on MW regulation.

    I vaguely understand how cutting a poor persons check in half benefits them (?) but I totally understand how minimum wage requirements puts our country at a disadvantage in a global economy. We spent about 2 hours talking about capitalism and global economics. Consider me enlightened. I do have to thank you for piquing my interest enough to have a full blown discussion with somebody about it. He is going to give me some more reading material to round out my understanding but told me flat out to stay away from anything written by Ayn Rand or Greenspan. He laughed alot when he said it...I didn't get it :confused:

    Me and him decided that the best way to help ourselves is to send labor union organizers to China.

    We also decided that laziness is a virtue. I am thoroughly excited at that prospect as I consider myself an expert in the field of doing as little as possible but still getting a job done. I found something new to add to my resume....
    Last edited by PlumberKhan; 06-30-2007 at 05:23 PM.

  7. #47
    Hall Of Fame
    Join Date
    Apr 2003
    Location
    Boston
    Posts
    11,692
    [QUOTE=PlumberKhan]Actually...no need to explain this to me anymore, Jets5. I finally understand it. I had lunch with my boss today, who is an economics major from Cornell. He explained to me the two schools of thought on MW regulation.

    I vaguely understand how cutting a poor persons check in half benefits them (?) but I totally understand how minimum wage requirements puts our country at a disadvantage in a global economy. We spent about 2 hours talking about capitalism and global economics. Consider me enlightened. I do have to thank you for piquing my interest enough to have a full blown discussion with somebody about it. He is going to give me some more reading material to round out my understanding but told me flat out to stay away from anything written by Ayn Rand or Greenspan. He laughed alot when he said it...I didn't get it :confused:

    Me and him decided that the best way to help ourselves is to send labor union organizers to China.

    We also decided that laziness is a virtue. I am thoroughly excited at that prospect as I consider myself an expert in the field of doing as little as possible but still getting a job done. I found something new to add to my resume....[/QUOTE]

    Plumber...just remember that capitalism [B]sucks[/B] and that the only thing it has going for it is that it is a zillions times better than anything we have come up with to date. That's it. It ain't perfect and if someone comes up with a better system, by all means, let's try it. But everything you hear about now as a "solution" to a problem is just a retread of things that have been tried and have failed a zillions times throughout history, across many times and cultures.

    Just remember that economics and wealth have nothing to do with money and that at ALL times you have to ask yourself two questions: (1) Compared to what? and (2) At what cost?

    Economics has to do with scarcity, alternative uses and trade-offs. That's it. Even if money didn't exist, economic concepts would hold. That's why when people say that "money" is the root of all evil they expose themselves as idiots...money merely reflects and quantifies what already exists...evil flourished long before money was invented...trust me! And prices do not dictate reality, they reflect it. Think about that...and you will understand.

    (Full disclosure - I am hammered right now...traveling on business and met up with some old friends amd, well, you know how that goes....)
    Last edited by jets5ever; 07-01-2007 at 08:55 AM.

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  

Follow Us