The enemies of progress (real progress) always lash out when bested. They fear the market. They fear the free flow of prices and the competition it brings.
Things change. Buggy whip companies go bust. So do cab companies. Sorry, my suggestion is that you learn how to do a better job than the Uber drivers.
Most of us over the age of 35 have seen massive changes to our livelihoods. I certainly have. This is the nature of the economy. Thankfully a changing economy is also an economy which is full of new opportunities.
As we’ve argued many times before, arbitrarily raising the minimum wage, particularly to a level which is far above the real wage rate is an idiotic move. It creates unemployment for low wage earners, and in many cases for the people who formerly employed low wage earners. A “living wage” sounds nice. It sells to economically unsophisticated people. But a job doesn’t suddenly become “worth” more just because the government declares that it is. One can not revoke gravity. Likewise one can not revoke supply and demand.
Magic is not real, no matter what the politicians say.
This is an old article, but given the current debate it is worthy of a post.
By Ed Ring, executive director, California Policy Center
Emperor Palpatine: There is a great disturbance in the Force.
Darth Vader: I have felt it.
Emperor Palpatine: We have a new enemy, the young Rebel…
Darth Vader: How is that possible?
Emperor Palpatine: Search your feelings, Lord Vader. You know it to be true. He could destroy us. The Force is strong with him.
– Quote (edited for brevity) from Star Wars Episode V: The Empire Strikes Back, 1980
There are indeed great disturbances in the force. There are indeed challenges to the imperial monopoly that, for nearly 40 years, has eroded the quality and escalated the costs for California’s system of public K-12 education. And the imperial stormtroopers who enforce their educational edicts on California’s state legislature, its thousands of public school boards, and by extension, millions of parents and children, are all part of an evil empire called the California Teachers Association, or CTA. In plain English, the teachers union.
This is a significant development. One would think that the teachers unions, dominated largely by a female teacher rank and file, would be in the bag for Hillary. That the teachers (arguably the most important constituency for any Democrat running for president) would be a done deal.
They must be loving this at Clinton headquarters.
I have come to the conclusion that a large part of the voting population just wants ponies. Or maybe unicorns. There is a real live contingent which believes that such things can be simply conjured out of the air or perhaps that the government can force “rich people” to pay for them. Ponies for everyone courtesy of the Kochs.
Now most reasonable and rational people don’t believe that ponies or unicorns can be conjured into existence in the literal sense. However some people are absolutely convinced that a minimum wage which is far above the real wage of workers – a pony – is entirely possible without massive disruption. Simply force those greedy entrepreneurs – you know the ones who provide the goods and services people want – to pay their workers more. So what if many of these businesses operate on very thin margins and will be forced to close because they can‘t afford to pay nonsensical wages? So what? We will have conjured a pony into existence. $15.00/hour for $7.00/hour work. Magic.
But, but, but…that’s not magic. That’s “social justice.” We’re making the system work for “the people.”
No, it’s magic pony economics. And you’re just making things worse for the people you think you’re fighting for.
The minimum wage debate is a bizarre one. Anyone who understands the simple concept of supply and demand can see why arbitrarily raising the minimum wage above the real wage rate for unskilled workers is a boneheaded idea. Raise the cost of labor and jobs will diminish, margins will be cut, tax bases will be reduced.
But a $15/hour wage sounds good to people who seriously DON’T understand supply and demand. It’s just those greedy employers who are holding back. We need to squeeze more from those terrible business owners. You know the ones who sign the pay checks, take on the risk, and pay all the taxes. Those bastards.
It was not that long ago that Detroit was one of America’s and the world’s great cities. A center of industry and commerce which rose up out of the American Midwest as testament to innovation and ingenuity.
By Ed Ring, executive director, California Policy Center
“If you say there is an elephant in the room, you mean that there is an obvious problem or difficult situation that people do not want to talk about.”
– Cambridge Dictionaries Online
If you study California’s legislature, it doesn’t take long to learn there’s an elephant in both chambers, bigger and badder than every other beast. And considering the immense size of that elephant, and the power it wields, it doesn’t get talked about much.
The unions don’t like it. Many libertarians and free market types don’t like it. But Obama and the Chamber of Commerce are keen. Something smells here.
Something else to keep in mind. Just because something is called free trade doesn’t mean it actually is free trade. My bet, and the author alludes to this, is that the agreement will be full of crony nooks and crannies. Nooks and crannies some would prefer the public not learn about.
Until it’s too late.
Seriously Democrats is Hillary Clinton really going to be your nominee? So she’s taken millions of dollars from the head of an oil company which has strong connections to the Colombian military, which also just happened to “round up” the striking workers of Pacific Rubiales, the company in question.
I mean, I get that she is a woman, and that she has name recognition, and that she has long been the presumed nominee. But guys, I may not agree with you on most things but this is an integrity thing. At least don’t throw in with someone who many of my friends on the “Left” would probably call a union busting, fossil fuels promoting, political profiteer if she wasn’t named Hillary Clinton. At least stand for something lefties – other than cronyism.
Many people wrongly believe that politics is to a large extent a battle between government and business. That the 2 represent opposite dispositions. This is a foolish notion. Business and government are more often partners than adversaries. Especially now.
But crony capitalism has a long history in this country.
By Ed Ring
Increases to the minimum wage in California are moving closer to reality. As reported on March 30th by MyNewsLA.com, “Los Angeles County Supervisors Sheila Kuehl and Hilda Solis will ask their colleagues to approve spending up to $95,000 to have the Los Angeles Economic Development Corporation review a series of studies of the issue performed in relation to the city of Los Angeles’ proposal to raise the minimum wage to $13.25 an hour by 2017 and to $15.25 an hour by 2019.”
California’s minimum wage is currently $9.00 per hour. The federal minimum wage is currently $7.25 per hour.
Largely lost in the debate over the “fight for fifteen” (dollars per hour) is America’s inflation adjusted minimum wage based on historical precedents. It’s an interesting topic that deserves discussion, because historical minimum wages expressed in 2015 dollars vary a great deal. Since establishing the first federal minimum wage in 1938, the amount has been adjusted 22 times. As can be seen on the chart, between 1938 and 1968 the minimum wage expressed in 2015 dollars rose steadily. In 2015 dollars, for example, the 1938 minimum wage would be $4.13, rising to $11.01 per hour by 1968. Since then, it has been in decline – in 2015 dollars the minimum wage was roughly between $9.00 and $10.00 per hour during the 1970’s, then fell to roughly between $7.00 and $8.00 from 1980 through 2009, when it was last adjusted.
Historical Minimum Wages
Expressed in 2015 Dollars
The other day we wrote about how government employees are a big part of the crony problem.
Of course the municipal union guys came out and explained that the government employee bit is not a scam, and that taxpayers – who pay their salaries – shouldn’t complain.
We should do a lot more than complain. We the taxpayers should insist that the salaries for government employees be indexed to the average pay in a municipality. Adjust this pay for experience, competency, and the high level of job security which government work always affords. (Notice I did not say education level should be a factor.)