Flordia as a Case Study in Rasing the Minimum Wage
07.27.2008
I have this very strange -- apparently radical -- belief that the more money typical people have, the better the economy will function as whole. This has contrasted the United States' political leadership's view, which was "Give it all to Trevor McRichy -- he'll see it goes to good use, and he'll give you a great job later..." Frankly, that sounds more like a proposal from a con-artist, than sound government policy.
I don't look to Florida as a role model -- in fact I consider it the United States' canary in the mine. Yet, this study seems to confirm my beliefs. So I blogged about it.
One year after the Florida state minimum wage took effect, there is no evidence to support the dire predictions levied by critics of the measure. Far from having a devastated economy, Florida continues to experience record job growth. Instead of businesses leaving the state, the number of private employers in Florida has grown substantially in the past year, and the state is a national leader in the insourcing of jobs from overseas. Far from workers losing their jobs and being worse off, more of them are working and wages across the state have risen. However, far from wages rising sharply across the pay scale, Florida continues to be a low-wage state, and many workers have a hard time supporting their families on what they earn, even with the new state minimum wage. All available data suggest that the critics of the state minimum wage were wrong about the law’s effects.
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Comments
It's so great to hear other
It's so great to hear other people espousing my theory on economics. REAL Econ can be taught in next to no time if the "Leaders" and "educators" actually looked at the state of American Economics from as short as the reagan era through the present. (by the way, I apologize now -I don't know the fancy econ terminology)
Economically, you can choose to channel more money to the Poor (commonly and mistakenly mislabeled as -horror music here- 'SOCIALISM'), Middle Class (erroneously seen as financially 'straining' companies to appease unions), or the Rich (hailed by conservatives as Trickle Down Economics)
* - The Poor spend their money --All of it-- on necessities, thereby putting it immediately back into the economy to be recycled back into the system several more times. Because of their financial distress, they do not invest in their retirement and eventually rely on the Social Security system (which will further adversely affect the economy).
* - The Middle class spend it on keeping up with the joneses. New refrigerators (extra fridge in the garage), Saunas, skis, vacations, vacation toys, local medially priced entertainment, Lots of electronics (large screen TVs, XBOX and games, Ipod, and toys of medial comfort). This again strengthens the economy by putting the money into companies that give it to their employees who then recycle it into the economy again. They attempt to subsidize their futures and those of their children with retirement/college funds. This puts less strain on the publicly subsidized programs except in the cases when companies succeed in taking away the workers benefits or lowering their pay.
* - Rich people/CEOs/Controllers of Large Companies, however
a) spend their money in other countries (Milan, Paree, the Riviera, etc.)
b) Buy extremely high priced products from small companies (i.e., specialized jewelers)
c) or they hoard it.
It is not shared with the Middle Class or the Poor in the form of Higher wages/reasonable benefits/Retirement packages. it does not get recycled back into the economy... it gets filtered away while the economy slowly sinks into Recession/Depression/Etc. The one up side for the economy is that Rich people subsidize their own retirements and the education of their children. On the downside, while workers are portrayed by CEOs and conservative politicians as straining company finances by maintaining retirement packages and fringe benefits, there is still far too little public discussion about the financial strain to a company when the high level administrators are given Million dollar bonuses, huge stock options, equally large severance packages --especially when companies that show losses are still forced into these Million Dollar Give-a-ways.
Lies, Damn Lies, and Statistics
@Chris Morgan
The statistics from the Heritage Foundation are a joke, if you think about them for a moment.
Over half the people earning minimum wage are under 25? Well, duh. After you've worked someplace for a year or five you get that damn quarter-an-hour raise. (Believe me, the thrill wears off in about 30 seconds and you continue to work Sundays and overtime to at least get time and a half.) All those people who are working hard and reliably for our corporate overlords still have wages that are tied to the minimum wage, however. That is, their starting wage is likely minimum or close to it. A minimum wage that is not insulting to human dignity, even a teenager's human dignity, helps this far larger group of people (who are more likely to be supporting families, since the Heritage Foundation has decided if you aren't supporting a family you might as well be paid in pebbles).
But I agree that there should not be minimum wage laws. Everyone should simply have money, resources, a fair share of the common human wealth created by no individual but by everyone in common (with no small assist from the planet and sun) over the last several thousand years. Then everyone would have the bargaining power to work at jobs and at compensation that enables them to grow as people and as contributors to the well-being of others– way above any present-day minimum wage.
benjamin, Agaric Design Collective
But who earns minimum wage...?
Hi Nick!!
Every once in a while, I've got to see what you're up to... love your blog (especially the parts I can actually understand). Here's a link to some more stats that may inform the discussion: http://www.heritage.org/Research/Labor/minimumwage.cfm
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