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When The Left Opposed A Minimum Wage

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Guest BoomBoomCrash
Prog on R4 'Where Did It All Go Right?' earlier tonight about the minimum wage. Will be on R4 Listen Again.

The minimum wage was a good idea in principle, but labour chickened out and let big business lobbyists water down the legislation to the point where it was meaningless. As it stands the minimum wage is little more than official government sanction of poverty wages. There should be a stigma attached to businesses paying it, but I've seen many companies proudly proclaiming 'we pay minimum wage' as if doing so was some great virtue.

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Guest sillybear2
Prog on R4 'Where Did It All Go Right?' earlier tonight about the minimum wage. Will be on R4 Listen Again.

Err.. where did it all go right? We have 2.5m people sitting on the dole!

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Err.. where did it all go right? We have 2.5m people sitting on the dole!

Erm Right as in the right wing now oppose it. Tories and the CBI I guess. But to me right wing would be ZanuLab.

Unassailable argument is that it has worked for many a long year in the US of A.

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I heard a tory MP arguing that the minimum wage was a restriction on the freedom of the low paid to negotiate their way into a job via accepting lower pay.

I belive his next policy suggestion will be to remove health care on the basis that it restricts the freedom of the masses to die from the disease's of their choice. The new law will be called 'right to die'.

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When they made the minimum wage legislation, they seemed to have forgotten the fact that with a fiat currency, you need to set a maximum boundary as well, or the legislation is pointless and will just result in inflating the money supply to the point where the low paid are back where they were.

With liveable benefits and tax credits, the minimum wage is largely irrelevant anyway.

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When they made the minimum wage legislation, they seemed to have forgotten the fact that with a fiat currency, you need to set a maximum boundary as well, or the legislation is pointless and will just result in inflating the money supply to the point where the low paid are back where they were.

With liveable benefits and tax credits, the minimum wage is largely irrelevant anyway.

Correct.

Who can argue with the moralality of having a 'minimum' wage? A minimum level at which he can transfer the value of his labour to feed his family..............You can't argue with the morals............but you see as ever socialism always falls foul of the law of unitended consequences.

People should be free to trade their labour at whatever value they believe to be fair

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Not another MW thread! :lol:

There are many reasons why it is a bad idea too. Now the economy has hit the skids, I would expect to see these to become more obvious, as people can't get a job with a business that can afford minimum wage.

Is that "if they can't afford MW then they shouldn't be in business" I hear retorted? Then what do you suggest the would be employer do? Go on the dole and sponge instead?

IMO, it's a daft law, tackling the symptom, rather than the problem. We need good businesses able to offer good rates. Without the former, we can't afford the latter.

How to attract good business? Make it easy to create and run one. Remove the read tape and the complications and just let people trade as easily as possible.

"But the fat cats get fatter in big business!" - Ultimately, if it is simple to start running your own business, it makes it harder for big businesses to monopolise. The more barriers, rules and red tape you put up, the more people won't bother trying.

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But if the employee consents to the contract, what right have we to intervene?

If I threaten to break you legs unless you give me your wallet, and you consent, what right do the police have to intervene? You did, after all, agree to our arrangement.

Unless you hold the curious opinion that people can be made to agree to things when under pressure that might not be in their own interest.

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If I threaten to break you legs unless you give me your wallet, and you consent, what right do the police have to intervene? You did, after all, agree to our arrangement.

Unless you hold the curious opinion that people can be made to agree to things when under pressure that might not be in their own interest.

employers (as a rule) don't threaten to break people's legs

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Guest sillybear2
If I threaten to break you legs unless you give me your wallet, and you consent, what right do the police have to intervene? You did, after all, agree to our arrangement.

Aside from stories of migrant slavery, nobody is under any duress to accept certain jobs or a given level of pay, not even A4E people!

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It must be a week or so since BBC last started a MW thread, we're well overdue for another.

Stand by for.........

- wonderpup to tell us that McD's can't serve burgers without flippers, so they should be paid a profit share (but in times of scarce labour wages should be set by supply and demand, not employee profit).

- BBC to accuse everyone laughing at him of hating unskilled people.

It's all so sadly academic; as the price of goods fall and the cost of people rise there's only one fate that awaits these guys.

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- wonderpup to tell us that McD's can't serve burgers without flippers, so they should be paid a profit share (but in times of scarce labour wages should be set by supply and demand, not employee profit).

Thats an assertion, not an inevitability.

What I cannot seem to get a straight answer to is why people who claim to belive that those who create wealth ought to be rewarded also want to insist that employer profitability ough not to figure in the calculation of employee remuneration-

there would seem to be a basic contradiction between these two positions.

So when I pose my simple question;

company A employs unskilled workers and makes huge profits, while company B employs high skilled workers but makes very little profits- which workforce should be paid the most?

I simply cannot get a straight answer.

If you claim to belive that a persons reward should be determined by the wealth his labour contributes to creating, then the argument that a million other people could have added the same value that he added is not relevent.

To say to someone that while their efforts did in fact create wealth, they are not entitled to share in that wealth on the basis that a million other people could (in theory) have made the same efforts in their place is moraly absurd and a flat contrdiction of every moral precept regarding effort and reward.

To revive my lost cat scenario:

You lose your cat- you offer a reward to the finder. Someone finds your cat, but then you say that because a million other people could have done the same, on that basis you will not pay the reward- does this make sense?

I'm not denying the reality that lack of scarcity makes it possible to drive down the wages of the unskilled- I'm simply pointing out that the philosophy of 'reward linked to wealth creation' is incompatible with 'reward linked to scarcity value of the wealth creator.

In my A and B scenario, the unskilled workforce has in fact created more wealth than the skilled one, so according to the wealth creation=reward position, they should be earning the most- but this conclusion seems to stick in throat of those who advocate the model, hence the wriggling and squirming I encounter whenever I pose the question.

Yes, we can pretend that the unskilled workforce at Mcdonands add no value to the operation, or pretend that their easy replaceability somehow negates the value they do in fact add- but the reality is that they do create wealth through their efforts and they are then denied any benefit from that wealth creation.

It seems that the advocates of the wealth creation= reward model want this rule to be applied to themselves, but for those lower down the social scale they want a kind of 'safety valve' to avoid the nightmare scenario in which they might have to share their profits with those who helped to create them.

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It's bleedin' obvious that the skilled worker will be earning more, wherever he works. Why do you need so many words to ask such an daft question with such an obvious answer?

That straight enough?

EDIT: The cat analogy is stupid. You AGREED to pay the reward, that's a deal. If you thought anyone could have found the thing then your reward would have been small wouldn't it?

Edited by bogbrush

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Thats an assertion, not an inevitability.

What I cannot seem to get a straight answer to is why people who claim to belive that those who create wealth ought to be rewarded also want to insist that employer profitability ough not to figure in the calculation of employee remuneration-

For the same reason your wages don't figure in the calculation of the prices you pay for fruit and veg or to hire a plumber

You keep getting a totally straight answer to this question and you ignore it.

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Thats an assertion, not an inevitability.

What I cannot seem to get a straight answer to is why people who claim to belive that those who create wealth ought to be rewarded also want to insist that employer profitability ough not to figure in the calculation of employee remuneration-

You are never going to get a straight answer because this is the principle con-trick in capitalism. After all the shouting and yelling and the bickering between dead men of German extraction, this is what it ultimately boils down to. A lot of people think this is right and proper of course, but still, you are asking a very fundamental question that a lot of people don't want to look square in the face.

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You cannot artificially increase wages or decrease the cost of living.

But you can remove those things that artificially increase the cost of living (such as planning permission, 50% to university, overregulation, etc)

If the government wants to help the working poor they should build more homes and suppress rent prices. Simple as that really.

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You are never going to get a straight answer because this is the principle con-trick in capitalism. After all the shouting and yelling and the bickering between dead men of German extraction, this is what it ultimately boils down to. A lot of people think this is right and proper of course, but still, you are asking a very fundamental question that a lot of people don't want to look square in the face.

more nonsense

The fact is the money the employer gets to keep does not represent wealth created by the employee, or the employee would create it without the employer and keep it himself.

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Guest sillybear2
Thats an assertion, not an inevitability.

What I cannot seem to get a straight answer to is why people who claim to belive that those who create wealth ought to be rewarded also want to insist that employer profitability ough not to figure in the calculation of employee remuneration-

there would seem to be a basic contradiction between these two positions.

So when I pose my simple question;

company A employs unskilled workers and makes huge profits, while company B employs high skilled workers but makes very little profits- which workforce should be paid the most?

I simply cannot get a straight answer.

How do you define profits? One year you could have a highly profitable company, the next minute they could be taken over by a private equity group that then goes on to load up the company with debt and pay themselves a massive dividend, from that point on they purposefully don't turn a profit and claim back the interest payments against tax. Or instead of running at a high profit level you could just run a business on continuous expansion, even if it means diminishing returns, just so you never cross a threshold to profit share with workers.

People just need to accept that the cost of labour is just that, for a business it's no different from the cost of electric or raw materials, your pay is dependent on your skill level and how easily you can be replaced. That's the harsh reality, nobody is 'owed' anything relating to how much value added they actually generate for their employers, unless your contract works on a commission basis, and a good salesman for example would probably insist on that. If your skills are highly fungible then you're stuffed, but if you don't like it then you can leave, it's not exactly Stalin's salt mines.

Edited by sillybear2

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more nonsense

The fact is the money the employer gets to keep does not represent wealth created by the employee, or the employee would create it without the employer and keep it himself.

Well I own shares and get a dividend. I am, fractionally, the owner.

I don't do any work and they pay me. So I certainly haven't created it, who has?

Leaving aside the concept of a chamber maid who works for herself without a hotel.

I'll put you in the "right and proper" camp, I don't disagree.

If people weren't paid relative to the labour market and instead paid relative to production, there would be no return on capital so it wouldn't be worth owing a hotel would it. Not that complicated to understand surely?

Edited by Cogs

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It's bleedin' obvious that the skilled worker will be earning more, wherever he works. Why do you need so many words to ask such an daft question with such an obvious answer?

My question was- which group of workers should be earning the most- the low skilled but highly profitable group, or the high skilled but non profitable group.

What is your answer?

EDIT: The cat analogy is stupid. You AGREED to pay the reward, that's a deal. If you thought anyone could have found the thing then your reward would have been small wouldn't it?

I did indeed agree to pay the reward. Would you then find it acceptable that, having agreed to pay it, I then refuse to do so on the basis that a million other people could have found the cat also? Or do you belive that the finder of the cat should be rewarded on the basis of his efforts?

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