Who owes you a living wage?
Jason Brennan, over at Bleeding Heart Libertarians argues that employers do not owe their employees a living wage. This is in the context of whether the government subsidises Wal-Mart by providing the welfare state so that Wal-Mart does not have to pay a living wage. But as Brennan argues this presupposes that it is already antecedently the case that it is the employer who specifically owes it to the worker to pay him enough to live a life with sufficient standard of living. But why couldn’t it be our loved ones or even us collectively* as a society? Why does the default burden fall on the employer?***
Suppose a homeless person offers to squeegee my car window while I’m stopped at an intersection. Suppose washing my window will take 60 seconds. Suppose that having my window washed is worth very little to me–I’d lose money on the transaction if I paid more than 10 cents. However, suppose that a living wage amounts to $30/hr. Am I morally obligated (not out of duties of beneficence, but out of justice) to pay him 50 cents, and thus lose 40 cents on the transaction?
*If you’ve been paying attention positive rights are all pervasive. Arguing that collective provision is suspect because in the breach there is no one person at fault commits you to saying something very similar (and at the least extremely implausible) when it comes to genuine public goods like defence and the protection of other negative rights. Consider, if Alan rapes Betty, Alan may have violated Betty’s negative rights, but strictly speaking failure by everyone else to prevent Alan from raping Betty or subsequently fairly prosecuting Alan does not violate Betty’s negative rights. If justice were to consist only of duties of non-interference, then there would be nothing remotely unjust about society’s further failure to punish Alan.**
**Of course, it doesn’t mean that society has to on pain of injustice. After all, Alan still has rights to a fair trial which if yields a not-guilty verdict can over-ride Betty’s claim for redress.
***We all as a society have decided… does not count because firstly, because it is false. The sheer fact that roughly half the country thinks otherwise means that no, you as a society did not decide. Secondly, even if there was some significant portion whose decision could bind the rest regardless of the content of the decision, that is the wrong sort of reason to invoke. We could very well say something similar about banning gay marriage. But clearly, the just-ness of marriage equality does not depend on whether enough people have pronounced it just or otherwise.
The fact that food stamps, subsidized housing, and other safety net features are available changes the supply curve for labor: the potential employees won’t all say “Minimum wage? I can’t even afford to live indoors on that!” But since discussions of wages generally assume that people are magically paid exactly the marginal value of their labor (it’s the only market in the world with no consumer surplus), that gets ignored.Report
The issue of what the marginal value of their labour is irrelevant (even if Brennan runs the two together). After all, safety net improves people’s BATNA. So clearly even if wage ends being reduced, a lot of intangibles are improved.Report
Of course there’s consumer surplus, the source of it is the difference between the marginal product of labour (the value a worker generates by producing one extra unit of labour) and the average product of labour (the total value a worker produces divided by the units of labour they provide).
Barring some special cases that aren’t relevant here, marginal product decreases with output – a worker working 60 hours produces less than 150% of what they would produce if they worked 40 hours. This means a worker’s marginal product of labour will be less than their average product of labour (if you get less productive with each hour of work, your next hour of work will be less productive than the average of all the hours you’ve worked so far). This means that your employer will get more value out of you per hour you work than they are paying you for. That’s their consumer surplus.
Is this a perfect representation of the labour market? Unlikely, but wages will still be drawn to marginal product of labour, if imperfectly. If you believe the market has erred, then it is incumbent on you to explain how you arrived at this conclusion.Report
A top programmer will be four or five times as productive as the mediocre programmer sitting next to him. It’s exceedingly unlikely that their salaries differ by as much as 30%. But articles like the linked one constantly go on about workers being paid the marginal value of their labor as it it were an iron law.Report
Any coder that good doesn’t stay on salary long. Once they realise how much more consulting pays (usually 3x the equivalent salary) and the nature of the work, they leave. Nobody’s going to stick around to maintain the TPM Reports and write yet another CRUD app. It’s all the difference between building the aircraft and sweeping the hangar.Report
As usual, Blaise overstates. I’ve met lots of people that good, in “principle engineer” or “chief scientist” positions who prefer building products to doing consulting projects.Report
Heh. I’m interviewing with a Chief Scientist type just now, for a large division of a German firm. We’re talking about a scope of work on a large-ish SCADA system. I came in to interview on a completely different requirement and this aspect of the problem cropped up. The first requirement was tabled and we started in on this completely unexpected SCADA gig.Report
So…what? They just lie down and die? More likely they do whatever it takes to survive. Sleep six to a room and live on potatoes. It’s not as though people haven’t been living on less than the US minimum wage for roughly all of history.
No doubt welfare affects the labor supply, but probably in the other direction, by giving workers a reserve wage. When working over a certain number of hours means their benefits get cut, and the extra income doesn’t cover it, or if working more would just barely make up the difference in welfare benefits, then it’s rational for workers to decline to work more, reducing the supply of labor.Report
And go blind in five years. And die in ten.
Or did we not want a diet of potatoes and cholera?
I’m sorry, but I kinda like living in a nation where we don’t have hordes of dead bodies on the roads.Report
The point is not to deny that people need a certain minimum income in order to maintain a certain decent standard of living. The question is why should only employers be stuck with the bill?Report
Or they enter the black or grey economy. They certainly don’t go off to Walmart and cheerfully greet people as they’re starving.Report
A simpler refutation is that no one who claims that welfare is a giveaway to Wal-Mart actually wants to get rid of it on those grounds. It’s a stick to beat a favorite whipping boy, not an actual prediction about what would happen if we got rid of welfare.Report
“Refutation” != “Attacking the motives of the proponents”.Report
Are you trying to make life as hard as possible for the maximum number of people?Report
Suppose a homeless person offers to squeegee my car window while I’m stopped at an intersection. Suppose washing my window will take 60 seconds. Suppose that having my window washed is worth very little to me–I’d lose money on the transaction if I paid more than 10 cents. However, suppose that a living wage amounts to $30/hr. Am I morally obligated (not out of duties of beneficence, but out of justice) to pay him 50 cents, and thus lose 40 cents on the transaction?
Saying nothing of his conclusion, I hope it’s clear that this is pretty much one of the worst analogies ever composed. If someone were going to argue that Walmart and McDonald’s owe their employees a living wage, it wouldn’t be because those “employees” simply showed up one day, sat in the dining room, and then asked for $15/hr. And that’s before we even get to the relevance of his math to Walmart or McDonald’s and their compensation levels.Report
The main thing I took from that discussion is the idiocy of being able to place that precise a value of your windshield being clean. “Let’s see, I could get out of the car while I’m filling it, but then I’d miss the next play on the radio. Sandoval’s up, and hearing one of his at-bats is worth 8 cents, but getting rid of that annoying bird poop is worth 10. I’d better do it now, before Posey comes up, because his at-bats are worth 15.”Report
I was trying to figure out where the 10 cents came from. Maybe from the time it delays the next paid car wash?
I was not joking when I said it’s one of the worst analogies I’ve ever seen. It’s both silly and completely unrelated to the issue about which it’s supposed to license inferences. To give an analogy for this analogy, it’s sort of like me telling you that hitting a major league fastball is easy because I once got hit in the nose by a football my neighbor’s kid threw over the fence.Report
Plus the fact that his reductio is having to give some homeless guy an extra forty cents.Report
Did you once so get hit, Chris?Report
I did, except it wasn’t a football, it was a discarded can, and it wasn’t the neighbor’s kid, it was a homeless guy, which is why I refuse to give them an extra $0.40.
With me, they get strictly the value of their labor to me, which I’ve determined via a carefully constructed, multi-layered linear regression model that considers things like the current unemployment rate, the exchange rate, and weather forecasts, along with such personal variables as cleanliness and the quality of the squeegee.Report
I figured there was a story.Report
Murali,
Thank you for sharing this. I think it appropriately challenges many assumptions. As I initially read the piece, teh question that floated to the front of my mind was similar to what this is titled: Why does an employer own someone a living wage? Why does an employer own someone any wage?
We just had a child. Does my boss owe me a raise because my expenses have gone up? What if we had twins or triplets? Does any individual owe me anything as a result?Report
“We just had a child. Does my boss owe me a raise because my expenses have gone up? What if we had twins or triplets? Does any individual owe me anything as a result?”
That is a lot to chew on in the context of Living Wage. Does the “Head of Household” Deserve more?Report
If you did pay people with kids more, then employers would start to favor employees without kids. they’d favor parents of two working incomes over parents of one income, and so on. They’d favor employees that need less.
My understanding of living wage is that it would basically make certain assumptions. So Octomom might still not be making enough to support herself because of her particular circumstances. But someone without kids would be making more than a living wage. Which is one of the problems I have when I hear the question “How is someone supposed to support themselves on a minimum wage?” (Well, a whole, whole lot of people on minimum wage don’t have to support themselves.)
I honestly think we have about the right approach now. We don’t pay according to need or guarantee a self-supporting wage, but people who need more to get buy get supplementary income from the government. We can quibble over the amounts, but I think the model is about right.Report
But it would seem that the logic in favor of a living wage would be similar to the logic in favor of paying people with kids more.
“He has to eat! He can’t eat on $7.50 an hour!”
“His kids have to eat! He can’t feed them on $12.50 an hour!”
Etc.
I agree that the current model is the right idea, even if the execution is off.Report
In point of fact, the minimum wage puts a single person with no dependents above the federal poverty line. Usually the comparison I see from the left is the minimum wage vs. the federal poverty line for a single parent with two children.
Q: How do you support two children on minimum wage?
A: You don’t. Seriously, what the hell were you thinking?Report
There’s always a differential for employees with children. They pay more for insurance. They need more personal time. There’s more stress in their lives. There’s more to compensation than a check and if a single person might seem to have fewer needs, a person with children needs more security and has more reason to stay in place.Report
BP,
I was just about to make that point. Some employers see people married with kids as assets because they are likely seeking stability. Others see them as liabilities for the reasons you offer. Much of it depends on the type of work.
There are also things that employers can do to mitigate some of the inequality. My school has a really good policy for health insurance:
1.) They calculate the per-year costs of HMO coverage for a single adult.
2.) They offer this amount to each employee regardless of salary (I believe a pro-rated amount is offered for part-time employees).
3.) If you are single… congrats! Free insurance. If you want the PPO plan, you pay the difference.
4.) If you are married and/or have kids, you can put this money towards covering them and pay the difference.
5.) If you are covered under another plan or get insurance elsewhere (you must show proof of being insured), you get the money as additional taxed salary.
For me, getting married and going onto Zazzy’s very generous insurance plan netted me an immediate $5400 raise.Report
Brandon,
Yes. You don’t.
So go crawling back to your husband to beat you bloody,
and pray his whore don’t give you the crabs.
Fuck off, life ain’t always sugar and sunshine.
Sorry folks, if I’m making this too real for y’all.Report
I don’t think it challenges any assumptions. I think it shows the value of cartoon libertarianism at its finest.
By calling themselves, bleeding heart libertarians, the site is presumably trying to soften the edge that is frequently attributed to the libertarian movement and show that libertarianism can be good for the “little guy”
Here they seem to be trying to convince the “little guy” (or giving themselves high-fives) that the no one owes the little guy a living wage. How the fuck is that bleeding heart? All they are doing is laying themselves down on the altar of the Koch Brothers and Walton Family.Report
If you read Brennan’s article or for that this post, Brennan says that it should be shouldered by society as a whole, not specifically by the employers. So its not that no-one owes you a living wage, but that society collectively owes everyone a decent floor on their income. The question is not nobody vs employers, but everybody vs employersReport
Murali,
$40k in every pocket seems decent. Would put TONS of folks out of work, of course (nobody wants to be a garbageman if they’re already earning enough)/Report
So supporting a welfare system is the new FYIGM? So now to qualify as compassionate you not only have to want poor people to have mroe money, but you also have to want them to ge t that money from their employers specifically?Report
As a social democrat, I support a welfare system because it’s the best option to help people who otherwise can’t get specific needs met. But, do you know what’s a better way to get those needs met? To be paid enough to afford those needs themselves.
It’d be one thing if numerous companies that employ people in low-wage jobs were on the brink of going broke. So, yes, all shifting the burden of helping these people to the welfare system does is protect the profits of large corporations while increasing taxes on average Americans.Report
Jesse;
But that still begs the question – you’re assuming it’s automatically right to take money from a business simply because they hire low productivity workers. Why does the obligation to support people at a given standard of living apply to them specifically?Report
Much of it seems like vague intuition to me. “This is not the way the world should be… therefore, it should be different.”Report
The Japanese I worked for had some odd accounting practices. They booked my invoices against capital expenditures. They felt they were buying knowledge. Come to think of it, they were.
If all an employer can see is “owing” his employees anything, of course he will view it as an unfair proposition. Such a viewpoint is stupid. Without an employee to do the work, nobody gets paid. Competitive market my ass. Such as Jason Brennan, boy wonder epistocrat, have never developed a callus from doing an honest day’s work. I shall never consider him an Expert, not until he’s served some time in grade as anything but an effete Alice in Wonderland, giving excellent advice but never taking it. He is a pretty little koi, oblivious to the water in which he swims. Out here in the land of the air breathers, employees are the lifeblood of a corporation and only an idiot would pay them any less than a “living wage”.Report
Sadly there are many idiots in this world.
Most of them aren’t CEOs, luckily.
We put psychopaths in that position, unfortunately.
“Steal from the poor, give to the rich”… it’s the
way the world has worked from time immemorial.Report
Being a lecturer in a university is not honest work? Stop with the insults and tackle the argument.Report
If you’re an adjunct professor in history peddling outright statistical nonsense on the side, I’d say it’s not honest work.
Hope you’re not in history!Report
Jason Brennan has nothing to say to me. The cobbler must stick to his last and Jason Brennan ought to confine his pronouncements to academia. He is beyond worthless. As we rise in altitude, gravity and time operate differently for us. The Ivory Tower is Jason Brennan’s province and his world is very different from mine.Report
So who is qualified to speak to you on labor and economics?Report
Those who can, do. Those who can’t, teach. When it comes to labour, I’d really like to talk to someone who’s managed a payroll and paid his people on time for oh, at least a year — in the real world. Economists, well, how about someone who’s done some quant work in the real world?
Academia is fine for teaching theories. Pedagogy is a craft. But it does not make anyone an Expert, which is what’s implied by Epistocracy. Episteme, to experience something and derive a principle from that knowledge, in short, a skill. Nobody masters a skill on theory alone.Report
You know, it used to be a source of pride in the US for its working class to own their own homes, drive good cars, raise families free from want.
I wonder what happened to those days.Report
Everyone has an X-Box and a smart phone. Why are they complaining about not owning a home!?Report
*Looks at Chris for a long moment. Shakes head. Walks away.*Report
Because the roof’s leaking, and the furnace won’t start.
Living in slums sucks because you have to live with the widows.
Black widows that is.
(yes, the spider. laf at joke.)Report
DRS, I didn’t mean to be flippant. The ethos of this country has changed, and one of the major signs of that is the focus on stuff rather than, well, more than stuff. Having an X-Box and a smart phone serves many of the same functions, in terms of social status, that owning a home did once upon a time (this is a bit of an exaggeration, of course — it’s not just smart phones and X-Boxes, it’s a particular car, particular headphones, particular shoes, particular jeans, particular etc.). They’re all mostly minor luxury goods that do less to improve quality of life than they do to demonstrate a certain status, and which really only do that short term (particularly since the newest smart phone is never more than 6 months away, and the fashions change, and new car models come out). Perpetually chasing status, rather than getting it by having a home in the right neighborhood and making your lawn looks nice, can seriously warp people’s incentives, and it really creates a radically different ethos.Report
Chris,
capitalism grinds ever on.
How do you extract money from people who are already in debt?Report
I agree with the analogy if we are talking about cars. Not so much about affordable housing.Report
I don’t mean people buy X-Boxes and smart phones instead of a home (though in a lot of cases, they spend that money short term instead of saving it for a down payment). I mean the ethos of working class social status has changed, and the house has been replaced by short-term value consumer goods. Once upon a time, what got you social status among the working class was buying a nice little home, taking good care of it, owning a car or two, and working at the same respectable job for most or all of your adult life. Today, that’s not true, or at least not to anything approaching the extent it was true 50 years ago.Report
When?
I think in 1940, about 36% of the population lived in owner-occupied housing. The promotion of homeownership – with the financial innovation of the 30 year fixed rate mortgage – began with the foundation of the Federal Housing Administration in 1937. The share of the population living in owner-occupied housing reached a plateau around about 1980 if not somewhat earlier (IIRC) and has fluctuated only within a narrow band since then. The most recent unpleasantness in the housing markets was co-incident with a slight increase in the homeowner share (from 65% to 68%). There are sound reasons for renting for many people and there has not been a time when a large minority of wage earners were not renting. There are also large blocs of people for whom contracting debt is inadvisable for one reason or another.Report
I commented on Brennan’s piece, and noted that the problem starts with the basic assumption that the employment is nothing more than an financial transaction between consenting adults.
No one actually behaves as if this were true. Work has a value to the employee that is far different than the value to the employer.
Asking how we establish a minimum floor of living standards is a useful question- but we need to first acknowledge the concept of dignity and and discuss the value of useful participation of the entire labor force.Report
Do you feel that a good source of dignity is having society lie to people about how much their labour is worth?Report
That’s the biggest problem with Maslow’s Hierarchy. The topmost levels are difficult to achieve to the point where you have to do it yourself. No one else can do those things on your behalf.
That said, semi-regular speeches and explanations of how those guys think that they’re so smart but it’s people like us who keep the wheels turning can do a good job of making people doing menial labor feel like their labor is less menial. Shouldn’t be *OVER*done, of course…Report
How much labor is worth is relative and I would question a lot of assumptions on what the market thinks various forms of labor are worth.
We undervalue teachers, we undervalue home health aides (especially because we have a rapidly aging population and this kind of work is going to become more necessary).
I question whether a Wall Streeter is worth what he gets paid sometimes.
What room is there to challenge market determinations of value in the libertarian mind? Why should I take it that a home-health aide is worth 10 dollars an hour on a prima facie value without resistance or challenge and a 23 year old just out of school is worth 125,000 dollars because he landed at the Boston Consulting Group or Goldman Sachs?
And it is a better source of dignity to live well than to deal with the solace of honesty of “market worth” Whatever that means.Report
No. But then again, I’m not a CEO, who seem to only know how much they are worth through how much money they extort.Report
I’d bet they would rather have society lie to them about its worth than have their employers do so.Report
New Dealer;
Let’s unpack the concept of worth here.
Value is subjective, when you get down to it nothing is “really” worth anything.
Market prices are the aggregation of the subjective values such that the supply matches demand. This may or may not be fair in some cosmic sense (I’m past the point of figuring out what the hell the word fair is supposed to mean), but it does tell you what the people involved in the transaction think about the situation. If employers could get away with paying less, they would. If employees could grab more, they would. If you want me to believe something is wrong, show me a market failure, and then we can talk magnitudes.
But is money what you’re really getting at here? After all, you don’t pay the Goldman Sach guy’s salary. I think the real issue you have is that the distribution of status is wrong, not the distribution of income. That an entirely reasonable concern, but you can’t fix it by screwing up the labour market.Report
James,
I’m not sure I see how this account you’ve offered leaves conceptual space for a market failure, to the point where I’m not sure New Dealer or I can even know what you’re saying one even is in this formulation. If a market failure like the one you’re asking about did exist, what might it look like?Report
In the labour market, the most likely failure would be monopsony – a market with a single buyer (or a small group of well-coordinated buyers). I would expect for non-government jobs the magnitude of any monopsony power to be pretty small though.
Of the types of workers New Dealer listed, that would make teachers the most likely to be underpaid.Report
A monopsony in labour markets does seem pretty rare outside of a company-town situation (which I suppose is functionally not all that rare even today, come to think of it, and perhaps that’s the kind of example you have in mind), but beyond that, you agree, then, that you’re basically saying that in a normal context (or, say, and urban labour market with lots of employers), this is pretty much a thing you’re defining out of existence for the purpose of actually pointing to and talking about?
I guess maybe what I’m looking for (and thanks for helping me clarify with your example, since I certainly did ask for something along the lines of a description of a specific example) is a slightly more general, abstract description of what kinds of situations would meet your definition of a labor market failure (esp. relating to price, but we could look at other variables as well), within the description of what the labour market is that you give above (“Market prices are the aggregation of the subjective values such that the supply matches demand”).Report
To be more explicit about it, if “Market prices are (just) the aggregation of the subjective values such that the supply matches demand,” whatever that does or does not end up looking like, then I guess I’m just not seeing how the market fails or doesn’t fail. It’s just that – that aggregation, however it turns out. If we introduce a normative element to it, I’m having a hard time seeing how you think that only takes on, say, a very clear, controllable, analytically operative definition in something like one or two dimensions, rather than just re-importing all of the murkiness associated with questions of fairness and the like that you’d (understandably) rather not have to deal with in their full complexity when analyzing economic questions. We’re either morally agnostic about the normative outcomes of various economic dynamics, or we aren’t. If we aren’t, then it’s likely to be a complicated and in large part non-scientific discussion, not a clear definitional-analytic one that can be addressed by morally neutral economic analytics, it seems to me.
Under your definition of markets that I’ve quoted, when you say that markets fail, what are they failing at?Report
It occurs to me that Market Failure is something I should do a post (or more) on. It’s probably too much for me to explain in a comment.Report
James,
Thanks for getting back. As I was writing through all that it occurred to me too that, “Whoa, this is a way more general question than the scope of this conversation was really meant to cover.” So I very much endorse the idea of your writing that post. Thanks again.Report
Who owes you a fucking job, man?Report
no one.Report
I strongly recommend every Libertarian spend some time as an independent contractor. That way, when they submit invoices, they’ll understand what Being Owed anything actually means. An employee cannot be a Libertarian. Such people are just Tree Huggers.Report
And they won’t say “I can’t believe I’m paying this much in taxes, I can’t believe the government is taking this much from me… and, by extension, from FREAKIN EVERYBODY every week???”
Are you sure?Report
An independent contractor pays roughly twice what any employee pays in taxes — and he writes his tax checks in advance. It’s just amazing how working for myself clarified all this for me.Report
I am aware of that, Blaise.
Do you think that an independent contractor would be more likely to say “WHAT THE HECK?” due to that fact or less likely to say it?Report
I leave the What the Heck questions to my tax guy. For me, taxes are just a cost of doing business. My point is this: Murali says nobody owes him a job. I would concur with this opinion, insofar as he’s willing to recognise the gap between the Real World, where debts are part of Accounts Receivable, and the cheap talk from the likes of Jason Brennan, who starts out with the proposition that an employee’s labour is “worth” $1 per hour.
Brennan doesn’t understand capitalism: the only reason anyone employs anyone else is to make a profit: nobody thinks about how much they have to pay the employee. The employer think about the difference between what the employee is paid and what he’s actually worth to the firm. That difference means everything and the salary means nothing. It’s the difference between staying employed and being laid off.
I don’t know what sort of contract Jason Brennan has with Georgetown. This much I do know, he’s begging the question. If the McJob is subsidised by government food stamps, the value of those food stamps is a variable in the aforementioned difference between what’s paid and what the employee is actually worth. Simple arithmetic.Report
I said it above to Kazzy but I will say it again down here. This is stuff that makes it very hard for me to take libertarianism silly. It seems that libertarians are people who want to live in the worst exaggerations of the Gilded Age and a Dickens novel.
Will there be an article about bringing back the workhouse next? Or something about why should we send children to school?
You might think so but the arguments above are not very clever or smart or even very philosophical. It is “deep” in scare quotes.
An employer owes their workers a living wage because the employer is also part of society and relies on the labor of the worker to generate a profit. Corporations are nothing but ideas without their employees. This is especially so for corporations that rely on consumerism and retail to generate their profits. How could people shop for goods (and grow the economy and profit) if they were not paid a living wage? An employer is also morally obligated to pay a living wage if they would like to live in a society that does not fester in social unrest and promotes peace and tranquility.
I would also argue that happy and healthy employees are productive employees and part of this involves getting paid a living wage and not living in constant fear or want. But what do I know? I’m only a bleeding heart liberal who was shocked that Paula Deen’s “soul sister” was paid a miserly 10 dollars and lived in a trailer while Deen rocketed to fame and fortune.
I’m a firm believer in the “no man is an island” form of thought and the constant message of the libertarian mind seems to be that “everyone is an island” or “at least the corporation is a special snowflake and free from the bonds of morality and ordinary consideration”
As stated above, I thought the goal of “bleeding heart libertarianism” was to form a liberal-libertarian alliance. Yet whenever I read the site, they seem completely incapable of seeing things from the liberal prospective on economic issues. This is another example of merely trying to get liberals to abandon liberalism. That is not forming an alliance, that is destroying an ideology.Report
From the opposite POV, it seems that the liberal argument is to tell people who work and bust their asses “you didn’t build that” and the people who do not that the fact that they aren’t successful isn’t their fault.
I mean, if we’re getting all caricatury and whatnot.Report
From the opposite POV, it seems that the liberal argument is to tell people who work and bust their asses “you didn’t build that” and the people who do not that the fact that they aren’t successful isn’t their fault.
I dunno about the liberal argument, but my version of “you didn’t build that” is built largely on the fact that the people who work and bus their ass for your company, and for the companies you contract, built it. I mean, often “I built that” amounts to being in charge and ponying up the capital (or at least talking others into doing so). “Built that,” if it means anything, must mean more than that, right?Report
Hey, I’m reading a book about that right now!Report
Chris,
Perhaps this is a basic divide between liberals, conservatives, and libertarians on how we view the economy and profit.
To me an idea or corporation is nothing without employees to build the stuff and do the work for the idea. Google was a great idea but it needed employees and physical objects and space for it to be anything more than the fancy of two graduate students at Stanford.
Perhaps conservatives and libertarians start out with the other assumption and believe that without the ideas, there would be no wealth and employment.Report
While we’re getting all caricature-ish, the Liberal observes people who work drive on public roads and the best spot for a supermarket is often at the intersection of two such roads. Liberals also observe nobody builds supermarkets in bad neighbourhoods: The homeless guys steal all the shopping carts.Report
Do you believe that every wage ought to assume self-sufficiency (with kids? without? Two incomes? One?)? Or alternately, that wages should be determined by need? Do you believe that the belief in one of these things is required to be taken seriously?Report
There are worse things in the world than “from each according to their ability, too each according to their need”.
But in general no. But everything should be need based and I have no moral or ethical problem with the idea that a single person without any dependents might make much more than they need.
However, I still think employers have a moral requirement to pay a reasonable wage. And my observation on happy employees being productive employees still stands.Report
Whether he believes it or not, the question arises as under what circumstances employers would pay systematic respect in their compensation program to the variation in the domestic situations of their employees. (In the architecture of fringes and in leave policies, yes; in cash wage and salary scales, no).Report
In theory, anyway. In practice you end up with “from each according to his ability, to each according to what is available”.Report
When you state a ‘need’, you have a particular purpose in mind. Whose purpose is that?Report
There are always allocative decisions. You end up adjudicating between the competing purposes of various parties.Report
art,
“Whether he believes it or not, the question arises as under what circumstances employers would pay systematic respect in their compensation program to the variation in the domestic situations of their employees.”
why, in a more liquid market, of course! and a more information rich one as well!Report
It honestly strikes me as silly when only a percentage (and not a dominant percentage) of the people making minimum wage are under “living wage” circumstances with children and whatnot warrant a change in wage law to accomplish a livable wage. As Brandon points out, if you’re by yourself, then the minimum wage puts you above the poverty line. Countless minimum wage workers are in circumstances where they don’t have to support themselves.
If we’re worried about people on minimum wage who are supporting families or in particular circumstances, then that strikes me as something worth addressing on its own, rather than declaring that everybody should get a wage that supports people in such circumstances. There are downsides to pushing wages upwards.Report
Above the poverty line does not necessarily entail a liveable wage.
Also, the people who are on their own and working at minimum wage are precisely the sorts of people you probably want to keep in the market (e.g., ex-cons, unskilled women rejoining the workforce, former addicts, even lots of vets). A good way to do that is to ensure that they don’t need to look elsewhere — the government, the black market, etc. — to find other sources of income.Report
There’s a catch to every policy decision. Read Narrative of the Life of Frederick Douglass, an American Slave and you will see Douglass was employed — while being a slave — and was made to give his wages to his master. Wasn’t uncommon in the Roman world, either, to put a skilled slave out to work in the world of free men — or even unskilled slaves, to hoe another man’s fields.
Sure, there’s a down side to the minimum wage. It sets a threshold for where wage exploitation can start. I repeat myself in saying Exploitation is no bad thing. If every employer had to pay minimum wage, insofar as all the others had to pay it, too, it would just be a simple cost of doing business if you needed another human being to help you make more profits.Report
There are worse things in the world than “from each according to their ability, too each according to their need”.
Malaria, I guess. But it’s a pretty serious contender, as far as body counts go.Report
@chris, one of the better arguments in favor of the minimum wage, in my view, is that it encourages people to enter the workforce rather than some of the alternatives available. (I get the argument about government payroll, though not sure where you are going with the black market since I would think that raising minimum wages would exacerbate rather than alleviate that potential problem.)
Whether being above poverty equates to “livable” depends on how you define the latter, I suppose.Report
Whether being above poverty equates to “livable” depends on how you define the latter, I suppose.
If you define it according to a baseline of goods/services that are time independent, you get a very different answer than if you define it according to what everybody else has.
And the people who use the one definition tend to see the people who use the other definition in a fairly negative light.Report
Will, one of the things you see with ex-cons is that they come back into the workforce, have a difficult time finding a job, and have to settle for some demeaning job at minimum wage. There’s very little incentive for them not to simply drop out and get all of their money outside of legal means, as a result.Report
If you can’t afford a roof over your head, a minimum amount of seasonally appropriate clothing, electricity, heat/air (which may mean gas and/or fuel oil), transportation, basic health care (above the emergency level you’d get in an ER), and a phone (even just a simple house phone with local only), then your income is not liveable, Minimum wage will not buy you all of these things, or even most of these things, in many if not most places. So you have to get a second job (at least). I kinda thought we were trying to move away from making people work 60-80 hour weeks to survive, though.Report
Ex-cons who are honestly trying to get back on the Straight and Narrow are surprisingly common. They have their own networks so they can get legit work. Now I can’t speak to every ex-con but I do know guys who formed friendships in AA meetings: lots of them got in trouble as a result of addictions.
The one truth about an ex-con on the straight and narrow: he’ll readily admit to his past. All he wants is a chance to prove himself. As long as these guys fill in their applications correctly and don’t lie about their pasts, many employers are reasonably forgiving. Let’s face it, plenty of people with felony drug convictions are as respectable as anyone else on the street.Report
JB,
Might there exist a way to define it that is neither of those, but instead focuses on likely outcomes?
For instance, suppose we identified that 85% of people who earned over $35,000/year were able to be productive members of society by whatever objective standards we choose to define productivity (e.g., debt levels, criminal records, etc.). And that 75% of people who earned less than $25,000/year were unable to be productive members of society. Could we then aim for something between those two numbers?
I’m just spit ballin’ here, so maybe I’ve gone cuckoo.
Or, oooo…. better yet… X% of people who receive government assistance to place total income at or over $Y cease to need government assistance within 5 years. If X is a high enough number and Y is reasonable enough, that might be something, no?
Again, just spit ballin’.Report
Kazzy,
Man, I’m liking those metrics!Report
“So you have to get a second job (at least). I kinda thought we were trying to move away from making people work 60-80 hour weeks to survive, though.”
Chris,
I think this actually takes us in a new direction when thinking about minimum wage. Why do we want to move away from that? I’m not disagreeing, mind you, but that idea seems predicated on a standard of living being not just about the things one owns, but the things one is able to do, with time being a factor in there.Report
We want to move away from it because lives with 60-80 hour work weeks, particularly menial labor, are short and hard, and much of the late-19th/20th century labor struggles were about reducing the number of hours in the work week.Report
You are supposing a more encompassing set of relations than are present between ’employer’ and ’employee’ than are actually present. The employee is not an apprentice craftsman (or journeyman) living in the home of the master craftsman (or under any kind of contract of indenture). He has his own household and his dealings with his employer are a function of the mutual advantage to be had for each in the exchange of labor for wages. The relationship between them is terminable at little or no notice and may be for the very circumscribed purpose of supplementing rather than supplying household income (and minimum wage employment is usually of that character). It must have been noted somewhere here that administered wage floors reduce the interest of employers in actually employing (all else being equal). The labor market just is not the best locus for the ethic of common provision to be expressed.Report
Not jolly.Report
That’s my point.
Labor isn’t a market, and can’t be. No one behaves the way market analysis says they should. And Further, treating labor as a market item isn’t achieving our societal goals of universal participation in the labor force, meaningful exchanges of skill, and the flourishing of society.
And maybe there are better ways of achieving these than minimum wage laws.
I would welcome such a discussion.Report
Labor is not a market? Please tell that to people placing and scanning ads.Report
Still not jolly.Report
All else isn’t equal. Employers will always attempt to pay the minimum required to keep an employee on staff. Let’s quit thinking about Exploitation as a bad word. It’s a perfectly acceptable term to describe the profitability of employing anyone to do a job at any rate.
If minimum wages seem to attenuate hiring, the opposite is equally true, that employers will always attempt to maximise employee profitability. Slavery was justified on economic grounds: the Peculiar Institution was perpetuated because every slave owner was also in competition with every other slave owner. Keeping the slave alive and healthy enough to work was a considerable expense, really no different than maintaining a piece of machinery on a factory floor. Slaves weren’t cheap, either.
In the days of slavery, it was considered very bad form to abuse a slave, especially house slaves other people would see in the course of interaction with the master. But with the advent of machinery, especially the cotton gin and the sugar mill, it became profitable enough to work a slave to death. There’s a good argument for the minimum wage: we’re far more mechanised in 2013 than 1861 and no society ever survived an evolution into a two-tier society, one reasonably well fed and the other not. Which isn’t to say that employers shouldn’t seek to maximise profitability, but if every employer has to pay minimum wage, we can keep that House Divided thing from cropping up in our times, as well.Report
It’s a market, just a terribly screwed-up market. There’s poor information, huge transaction costs, great difficulty in evaluating the value of the exchange, in both directions, and in general all sorts of unstated assumptions on both sides. One of the purposes of union is to turn the unstated assumptions into stated ones, e.g. no, it’s not allowed behavior to tell someone at 4:30 that he needs to work until 10:00 that night with no compensation other than being congratulated for being a hard worker. This kind of clarification is of course evil and coercive.Report
An employer owes their workers a living wage because the employer is also part of society and relies on the labor of the worker to generate a profit. Corporations are nothing but ideas without their employees. This is especially so for corporations that rely on consumerism and retail to generate their profits. How could people shop for goods (and grow the economy and profit) if they were not paid a living wage?
You have no business telling other people that you can’t take them seriously when you try to pass this sort of thing off as a serious argument.Report
And you have no business passing yourself off as believing in human dignity and decency….or much of anything human at all…Report
New Dealer, Brandon doesn’t think that objective morality exists, so he doesn’t pass himself off as believing in human dignity etc. He has been rather explicit about it.Report
Except that the original article does’t say “low productivity people deserve to be poor”, which seems to be how you read it, presumably because that’s what you expected it to say.
The article’s argument is that “if we think some people’s productivity makes them unacceptably poor, we should fix that with the welfare system rather than lumping one employer with that burden”. This is exactly the opposite of “everyone’s an island”, it’s explicitly calling for taxation-funded collective action.
There’s a problem I see with many non-policy-experts, where they have trouble handling unfamiliar policy proposals. Too often people equate the achievement of a particular goal with one very specific policy proposal as if that were the only way to achieve it. In this case the goal being higher standards of living for the poor and the goal being higher minimum wages (at least in some contexts). Often people think of policy in symbolic terms, as if minimum wages per se were symbolic of compassion, and anyone who doesn’t support them (even if they support a policy with similar effects on poor people) doesn’t care about the poor.
It’s important to look at the effects of the policy, not its mechanism, to tell what goals your interlocutor is trying to solve. If you think the mechanism is implausible that would give you a reason to think the policy is flawed, but not that the person advocating it cares about different things than you.Report
You might come up with the idea that your interlocutor isn’t looking for the same goals you are, if they constantly propose things that are obviously flawed, and if the flaws will benefit the originator.
… not that I’m trying to say that in this case.
So. Off the top of my head: who does this benefit? Who does this hurt?
1) Minimum wage laws don’t appear to be providing much of a floor for wages ATM.
2) Pay someone $1 an hour, they’re not going to want to have long travel times to get there, I don’t suppose. Just won’t make sense. So more benefits to those in the inner city…Report
I’d argue that employers owe their employees, a living wage because they aren’t going to like the wealth redistribution required for government or society to take up the slack. Either they pay the high taxes required for guaranteed minimum income or they pay a living wage.Report
Or they move to Uruguay.Report
A guaranteed income for working aged and able bodied people is not an advisable policy (in the social sectors in which it has been attempted). You can attempt a negative income tax; the rates it requires rather depend on the specific quantum of redistribution you are seeking. Social Security as is conjoined to unemployment compensation could be financed with a flat rate on personal income in the single digits. You would require an exemption high enough to exclude 25 or 30% of the population from the pool of taxpayers ‘ere you would need a marginal rate in the double-digits.Report
Is there a difference between a negative income tax and a guaranteed minimum income?Report
@murali, EITC’s can be more targeted depending on circumstances (whether they are living on their own, whether they have children, whether they are married, etc.). Which has both upsides and downsides.Report
In the distribution method, yes, depending on the specific model. In the simplest guaranteed income model, we just cut checks to everyone and assess income taxes to pay for the checks – rather like universal Social Security. With scarcely a doubt, the feedback effect on labor supply would be disastrous.
Alternatively, one can compute tax liability by assessing a flat rate on personal income from which you then subtract a dollar value credit for each member of the household. People with low earnings would have a negative liability. One could cap net distributions to taxpayers at a particular share of earned income or return funds to the taxpayer in the form of contributions to medical savings accounts, or both. The point being to contain the distribution of free-to-use cash to the working aged and able bodied to a level related to their earnings.Report
And yet equivalent income supplementation would be less socially burdensome than a living wage would be.Report
What I have realized is missing from most discussions on libertarians sites is the underlying premises. What are we trying to achieve, when we assert opinions on economic policy?
Is universal participation in the workforce- finding ways to get everyone working at something- a desireable goal?
Is the flourishing of human dignity a goal?
Is there a rightful level of wealth inequality?
And so on. There doesn’t seem to be, even at BHL, a lot of discussion about these sorts of questions.Report
Is the flourishing of human dignity a goal?
I think that Libertarians who agree that human dignity is a goal would also argue that it is a good that cannot be provided centrally.Report
But can it be incentivized centrally?Report
I dunno. I think we’d have to hammer down what “human dignity” consists of and whether we can assume a significant amount of overlap between individuals.Report
Is universal participation in the workforce- finding ways to get everyone working at something- a desireable goal?
I know a handful of housespouses who work taking care of their children (and, occasionally, the children of others) who are not, exactly “in the workforce”. Is this undesirable? It seems to work for the folks for whom it seems to work.
Is there a rightful level of wealth inequality?
My dislike for this question is the degree to which it can be addressed through expectations management. A television show such as “Lifestyles of the Rich and Famous” could be seen as actively harmful.
By hammer, axe, and saw, etc.Report
Is universal participation in the workforce- finding ways to get everyone working at something- a desireable goal?
Yes, but the view is that hands-off is more effective than intervention above and beyond promotion of schooling.
Is the flourishing of human dignity a goal?
Yes, but state intervention in labor markets has diminishing returns when directed toward this end, and, eventually, is injurious.
Is there a rightful level of wealth inequality?
Hard to quantify. The economic historian Stanley Engerman will tell you that (historically) skews in income distribution are inversely association with economic dynamism over the long haul (there are likely some problems of causality in that statement). Let’s just say that a society which looks like Brazil – malintegrated labor markets, horrendous street crime, and a distribution of income that earned the country the moniker “Belindia” at one time (half Belgium, half India) – is not the most pleasant of prospects. (It was conjoined to terrible rent seeking as well. A generation ago CBS interviewed a Brazilian physician being paid a pittance and she offered this observation – “in this country, work does not make money; money makes money”).
The big problem in the United States is in the quality of public spaces. After that, it is in the proper structuring of institutions of common provision. Distribution of cash income per se is not such a problem (though the amount of boardroom looting – esp. in the financial sector – does call for some sort of address).Report
OK, so this is a good place to start-
If we say we want near-universal participation int he workforce, and we want work to be meaningful, and we want it to lead to a flourishing of the human spirit, then we have milestones by which we can assess success or failure.
For example- lets say for the moment that wealth inequality DOES augur economic dynamism- but also is an affront to human dignity.
We can then have a meaningful discussion as to what we choose, when economic dynamism comes into conflict with our mission of promoting human dignity and workforce participation.Report
Who’s implied by “everyone” ? Obviously not little children or old people, or full-time students or many another class of unemployable people. Is the military actually an employer, considering it doesn’t operate on a profit basis?
When capitalism is pulling the train of society along, it’s pulling more than just the workers. Even when it’s operating at full steam, not every employable person will be employed. There’s three sorts of unemployment:
1. The temporarily unemployed. Factory workers who come and go on the basis of factory orders. People like me, contractors between gigs. Skilled people who lost their jobs for one reason or another, highly likely to obtain another position, even if they have to move to get it.
2. The long-term unemployed. Semi-skilled people, cubicle bees whose skills are not in high demand. The workplace is constantly changing: today’s skills are old hat tomorrow.
3. The unemployable. Mentally ill people, felons, people with bad attitudes who can’t stay employed.
The first group will do well enough on their own. The second group might benefit from some training. There’s no doing anything with the third group, try as we may. They might benefit from some psychotherapy or some workplace training and they might be promoted to the second group, if they’re willing to change — but capitalism will never employ everyone who can work.
All this talk about Human Dignity is squishy. Work does give dignity to life but it’s not the be-all and end-all. The best we can hope for, the only guide to progress, is to invest in society with a view to turning as many people as possible into taxpayers and not into dead weight on the body public.Report
Just to point out that there is a great deal of dispute among specialists as to the share of the population in category 3, and the distribution therein among causes.Report
Well, sure. These categories are just data points along a spectrum. But they do serve to clarify the problem: it’s better to say “This 35 year old steelworker has been unemployed for 1026 days” than to maunder on about The Unemployed. We can do some statistical work with age and skills and days unemployed. Hand wringing about The Unemployed is just unscientific nonsense. Capitalism can’t employ everyone. Full employment is a meaningless phrase.Report
Let me give my two cents which I plan to soon expand into a post on political liberalism. The answer to all three questions is something along the lines that the state should be agnostic about these questions. This is because the central concern of liberalism is how to get people with diverse and conflicting ideas about what the human good is, what human dignity consists in and what levels of inequality are appropriate in society to live together on a more or less amicable basis. The only defensible liberalism is one which confines itself as afar as possible to purely political concerns and does not deal with more comprehensive values.
Fundamentally, I’m a liberal. I just think that neo-classical liberalism (moderate libertarianism) is the most consistent version of liberalism we have and that it comes closest to realising neutrality with respect to conceptions of the good.Report
But isn’t politics essentially the art of resolving these issues to reach a consensus?
Laws are not agnostic whatsoever- “Free Exercise” means drinking sacramental wine, but not peyote- it means marriage at 18, not 12, and so on.
Just because “dignity” means different things, doesn’t mean we can’t establish a consensus that works, and is enforceable.Report
The point is more that we cannot and should not try to get a consensus on values. Rather, we should try to get a set of rules which is acceptable (even if not the best) from the point of all value systems.
But the political process can itself be defective in trying to achieve this. Of course rules may often end up disparately affecting different values, but we should avoid this where possible. So, for example, if we didn’t have laws against marijuana, then the issue of whether it is allowed under free exercise does not even arise.
But more importantly, the kind of neutrality that is important is justificatory neutrality, not neutrality of effect.* In many of the most important ways, insisting that your own idea of human dignity is correct and should be the basis of laws is the same as insisting that your own idea of Christianity is correct and should be the basis of laws.
So, the state shouldn’t say that this or the other notion of dignity is correct, or that employment is inherently elevating or any such thing. Rather, the state could say something like this law is okay according to everyone’s values. Everyone has got reason to support this law.
*Although some neutrality of effect may be in principle required by justificatory neutrality. But that’s for another post.Report
Laws are not agnostic whatsoever- “Free Exercise” means drinking sacramental wine, but not peyote- it means marriage at 18, not 12, and so on.
And marriage means a man and a woman.
Consensus has had no compunctions against being odious in the past, shows no sign that it has any compunctions against being odious in the future, and the present ain’t lookin’ so hot.Report
Murali-
You make the point better than I did.
Whether the values that underlie our laws are the Ultimate Truth or not, when they represent the consensus, they can form an effective structure that works to move us closer to the goals we agree on.
So in the discussion about wage laws, we can discuss whether the current laws are helping us move closer to a flourishing of human dignity or if there is a better way to accomplish that goal.Report
LWA, I think you are misunderstanding me. The point of consensus should be deliberately shallow. For example, suppose I were to say that really, we should abolish minimum wage and provide for the poor via a negative income tax. That is just the policy.
Now, I could support that because it is a more efficient way of ensuring that everyone has an adequate income necessary for a decent standard of living.
You could support it because it engenders a society with more widespread employment.
Maybe Stillwater could support it because it gives people real freedom to reject an employment contract that is offensive to human dignity.
I don’t have to think that there is anything great about your goals or Stillwater’s goals to agree with you about abolishing the minimum wage and replacing it with a negative income tax. So, there need not be any deeper underlying consensus about values when it comes to agreeing on rules. That’s the type of agreement I’m getting at.Report
I’d entreat those who think Brennan is clearly endorsing addressing low “natural” wages with a welfare state to read the recent posts on this topic carefully. I read them last week and initially came away with the same impression, commenting more or less to that effect on the follow-up to the linked one, with the title something like “Ideologically Convenient Arguments For And Agaonst A Living Wage.”
But I’ve since read them more carefully, and I’m not at all sure Brennan is committing to actual advocacy for a regime in which something like a living wage is received by everyone who works (or a basic income guaranteed to everyone). He links to others making the case that we should establish a generous welfare regime/GMI in order to allow the price of labor to humanely float at economically efficient levels (Will Wilkinson, John Rawls), but he links to them as people making good arguments about why enforcing a living wage (i.e., just having a minimum wage at some fairly high level by current low-wage standards in a given economy) is economically inefficient and morally not obligatory. It so happens that those people do want to address concerns about the effects of low wages (on utility, on demand in the economy, etc.) by instituting a generous welfare regime (depending on whether one would agree with them about what would be generous). But I don’t see either why it would be necessary for Brennan to endorse those parts of those people’s view when the part that actually coincides with his argument is the rejection of high minimum wage requirements, nor do I see where he otherwise elects to do so. He says
…and that’s what initially led me to think he did endorse a welfare state that provides something in the vicinity of a living wage and takes the burden of employers to do so. But it’s not at all clear from that statement that he does. He could, first, dispute the notion that there’s some enforceable positive duty to provide Bob with enough stuff to lead a life; he could accept that such a duty exists and falls on “all of us,” but that that doesn’t empower the government to tax the public to create such a system; he could even turn around and say that it’s more plausible still that one or more of those latter candidates he mentions – Bob’s family, etc. – are even more plausibly on whom the enforceable duty falls. It’s entirely unclear to me what his position on the provision of a general income guarantee or at least broad wage subsidy by the government actually is here, despite his links to others who make clear what theirs is.
If Jason Brennan supports the establishment of a generous welfare state-administered program to provide a GMI or similar subsidy to earned wages in lieu of living (or even minimum) wage laes, either on the merits or in order to alleviate political pressure on employers to pay living wages, I haven’t seen where he has expressed that support in his recent series of posts opposing living wage requirements.Report
My experience at the BHL site is that Jason and others like to express a general support for a “safety net” without being terribly specific about what that entails. So the U.S. currently has a safety net, or more specifically, fifty versions of a safety net since the main programs are primarily administered by the states.
So in Alabama, for instance, you’re considered to be having too much income to qualify for Medicaid if you have an annual income of something like $1300/yr. Not a month; but a year. Similarly, welfare benefits cap out at something like $190/month.
So does Jason consider that (hopefully!) too stingy, about right, or (even??) too generous? I have no idea based on his writing.Report
Those numbers don’t smell right to me. The Alabama Medicaid page doesn’t seem to agree with them either.
http://www.medicaid.alabama.gov/CONTENT/3.0_apply/3.2_Qualifying_for_Medicaid.aspx
Where are you getting your information on this?
Also: are the numbers that the webpage itself says it handles more in line with your sense of justice?Report
Interesting. Ok, I’ll take that back. Lesson: Don’t believe everything you hear on the radio.
As to your second question… I’m a single-payer guy. As much for utilitarian economic reasons as for moral ones.
Anyway, $2-3k/month is not a lot of money depending on where you live. And I priced insurance on the private market once for myself and my wife before I took my current job. The premiums for even a catastrophic plan for a couple in their 50’s ran around $1500/month. So I guess you’re supposed to be able to live–rent/mortgage, utilities, food, etc., etc.– on $1500/month? And that’s assuming you don’t ever actually USE the insurance, because first you gotta pay the deductable and then the copays. Ummm… I have a relatively cheap mortgage payment of around $600 and I can’t see living on that little bit.
One problem is that these things rarely get adjusted for inflation regularly. These qualification numbers may have been reasonable twenty or even ten years ago but you know as well as I do what’s happened with premiums and the cost of living over that time.
Finally, I think framing it in terms of justice and desert and such is the wrong approach. Both from liberals who make such arguments and from libertarians/conservatives who castigate them. I mean, there is a basic moral justification for all this, I believe. But that’s a useless basis for trying to get at benefit levels and qualifying cutoffs.Report
Anyway, $2-3k/month is not a lot of money depending on where you live.
That’s between $24K and $36K a year… now, I agree that it’s not a *LOT*… but, for ‘bama?Report
That’s between $24K and $36K a year… now, I agree that it’s not a *LOT*… but, for ‘bama?
Well, sure… the cost of living obviously varies depending on your location and ‘bama, at least the rural areas, likely have a COL on the lower side than average.
But remember the context here. This is to qualify for Medicaid. Which you only need if you’re not getting health coverage through an employer, and the alternative would then be the private, individual market and then you’re looking, like I said earlier, at premiums in the $1500/month range for my wife and myself. Assuming we could even get coverage pre-PPACA, which we couldn’t given her pre-existing conditions. So you take that $36k and subtract half of it and now you’re below the federal poverty level and living damn poor even by ‘bama standards.
And then you get to pay deductibles and co-pay on top, further reducing what’s available for just living expenses. Alabama ain’t that damn cheap.Report
Medicare isn’t supposed to go to the folks who are pulling down $40K/year, though.
I mean, I can understand the whole single payer thing but if you’re not using that paradigm, you could do a lot worse than “people making less than $24K/year qualify”.Report
I mean, I can understand the whole single payer thing but if you’re not using that paradigm, you could do a lot worse than “people making less than $24K/year qualify”.
At first glance, maybe. But it enshrines some awful incentives.
Let’s say that today I have a job that pays $23k and I qualify for Medicaid. Then let’s say I get an offer for a job that pays $30k.
But that puts me over the line for Medicaid, so if I want (need, actually) health coverage, now I have to pony up $18k+ out-of-pocket. This effectively reduces that $30k income to $12k or less.
So tell me again why I want to get a better job??
Ironically, this is an actual instance of a phenomenon that folks who bitch a lot about taxes imagine exists for them. Earning more money but keeping less of it due to bumping up into a higher bracket. (It only happens in their imagination because of the way progressive taxation actually works. I assume you’re bright enough to understand their confusion.)
If you view government benefits as a kind of negative taxation–which isn’t an unreasonable view–then the way these benefit qualification schemes work amount to incredibly high marginal rates, and they get stuck on the poorest in society.Report
“Out here in the land of the air breathers, employees are the lifeblood of a corporation and only an idiot would pay them any less than a “living wage”.”
Blaise makes a great point, although I’d not call it a “living wage”, rather a “market wage”. Here’s why. My employer, and everyone of my past employers, did an annual salary survey. That survey determined the “going pay” for employees of various backgrounds: finance, engineering, etc. The company’s policy was to ensure that they employees were paid amounts within those ranges.
Those wages were for services rendered. No one owes you anything. As an employee you get paid some portion of the value you contribute to the company’s profitability. Consequently, no one owes anyone a living wage.
“Out here in the land of the air breathers, employees are the lifeblood of a corporation and only an idiot would pay them any less than a “living wage”.”
Blaise makes a great point, although I’d not call it a “living wage”, rather a “market wage”. Here’s why. My employer, and everyone of my past employers, did an annual salary survey. That survey determined the “going pay” for employees of various backgrounds: finance, engineering, etc. The company’s policy was to ensure that they employees were paid amounts within those ranges.
Those wages were for services rendered. No one owes you anything. As an employee you get paid some portion of the value you contribute to the company’s profitability. Consequently, no one owes anyone a living wage.
“Out here in the land of the air breathers, employees are the lifeblood of a corporation and only an idiot would pay them any less than a “living wage”.”
Blaise makes a great point, although I’d not call it a “living wage”, rather a “market wage”. Here’s why. My employer, and everyone of my past employers, did an annual salary survey. That survey determined the “going pay” for employees of various backgrounds: finance, engineering, etc. The company’s policy was to ensure that they employees were paid amounts within those ranges.
Those wages were for services rendered. No one owes you anything. As an employee you get paid some portion of the value you contribute to the company’s profitability. Consequently, no one owes anyone a living wage.Report
that was a bad copy paste from Word. Apologies.Report