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What is the purpose of setting a minimum wage?

By TonytheTiger ·
(This is an offshoot of the "How can American IT Professionals Compete with asian workers?" discussion)

And how is it determined?


For what area is it determined? Some places cost more to live than others (sometimes even within the same city), so what do you do? Set it to be minimum for the 'cheapest to live in' place and let those in more expensive places suffer? or set it for the most expensive place, and give those who live in cheaper places a windfall? or do you tell people they can't live in certain places where the cost is too high?

And who do you set it for? Do you set it to suit a single young man? a married couple, no children, both work? a maried couple, two children, one works? a single mother who has to pay a baby sitter? (and does the babysitter get minimum wage too?) or do you have different minimum wages for different people in different circumstances?

And how are businesses supposed to pay for it (especially small businesses)? Does he raise his prices? Lay off some workers? And if he raises prices, doesn't that defeat the purpose? Soon prices on everything will be higher and the new minimum wage will have the same purchasing power as the old one does now, wouldn't it?

And finally is there anyone else who has thought all of these things through?

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The purpose is

by mjwx In reply to What is the purpose of se ...

In my definition, to ensure that every person can earn enough money to meet the minimum standards of living. To ensure that each person working can afford, food, housing and utilities (power, water, etc). The second purpose is to stop exploitation of workers by unscrupulous employers.

I then decided to look it up.
http://en.wikipedia.org/wiki/Minimum_wage

How it is decided, in Australia it is based on the Cost of Living.
http://en.wikipedia.org/wiki/Cost_of_living
I am not too well versed in specifics of the minimum wage is decided for families but I should be <rant> as our benevolent leader John Howard is slowly striping away workers rights </rant>.

I'm not sure which side of the argument you are on but the minimum wage has supporters and detractors and Max you may call me a socialist if you wish but the minimum wage is good as it prevents some businesses from exploiting under skilled or young workers (16-25). By exploitation I mean paying the workers less and forcing them to work longer hours so they can earn enough to pay all of their bills.

I'm sure we've all heard the stories of the slave labour factories in China I believe the minimum wage and other labour laws such as the work safety and fixing the hours in the work week (40 hours plus overtime) help protect people from working in sweat shop type conditions.

However Tony I am interested in hearing your perspectives on why the minimum wage is good or bad.

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The problem is

by Too Old For IT In reply to The purpose is

The problem is that, as many small businessmen continue to pointout to me, there are some people whose labor is not worth the minimum wage.

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I would have to disagree my friend.

by TekBoyNY In reply to The problem is

Everyone's is worth at least 6.50 -7.00 and you can't even live on that. You not only pay for the work done bu tthe person's time and commitment as well. Besides, for the "small business man" who can't stay in business without illegal workers at lower wages than minimum, drive a mid sized sedan instead of a mercedes. Live in a slightly less expensive home. Stop living in excess. Why should I have to pay for the cost of your "cheap lab or" with my taxes? A bit off topic but I think it kind of is related.

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Wrong

by frgough In reply to I would have to disagree ...

Nobody is "worth" just 6.50 to 7.00 an hour. A person's worth is
incalculable. However, I believe you are actually referring to the
worth of a person's labor, and that is determined by how many
others can do the same job.

More people can dig a ditch than can build a nuclear reactor.
The ditch digger's labor is worth less.

This is a fundamental law of human interaction. A government
telling you a ditch digger labor is worth $6.50 does not change
the actual worth of his labor, it simply assigns an arbitrary value
to it. The Nuclear scientist is still worht 50 times more and his
salary will increase correspondingly, thus re-asserting the true
value of the ditch-digger's salary.

Minimum wage legislation does nothing except slow economic
growth, increase unemployment and create inflation. Oh, yes,
and buy votes.

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Wrong

by bharris0 In reply to Wrong

A nuclear scientist can't/won't dig the ditches to build a nuclear reactor. Someone has to do that. If companies don't pay for a living wage, then our tax dollars will make up the difference in food stamps and medical care while executive salaries are raping EVERYONE.

Easy solution. Pay the executives a lot less and pay everyone else a reasonable wage.

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Wrong

by TonytheTiger In reply to Wrong

It's popular to attack the CEO's, but the fact is, it you took every cent they made and divided it among everybody else, it might be barely enough to buy an extra gallon of milk.

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Hate to tell you this,

by TonytheTiger In reply to I would have to disagree ...

but there are several hundred thousand people who are living on that, and more than likely at least as many living on less than that. (for comparison, I think Welfare and foodstamps in ohio were, when a single person could get them, $216 and $128 respectively... that's $344 a month, so that would be equivalent to what, about $1.90 an hour using 40 hour weeks?)

Perhaps you've never been in the position to know just how little you really can get by on. IT might not be a bad skill to learn... you know, just in case....

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"you can't even live on that"

by Absolutely In reply to I would have to disagree ...

If that is true, "my friend", there is no need for a minimum wage because corpses are notoriously lazy & non-productive.

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Hate to tell you this,

by TonytheTiger In reply to I would have to disagree ...

but there are several hundred thousand people who are living on that, and more than likely at least as many living on less than that. (for comparison, I think Welfare and foodstamps in ohio were, when a single person could get them, $216 and $128 respectively... that's $344 a month, so that would be equivalent to what, about $1.90 an hour using 40 hour weeks?)

Perhaps you've never been in the position to know just how little you really can get by on. IT might not be a bad skill to learn... you know, just in case....

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Food for thought.

by TekBoyNY In reply to Hate to tell you this,

That is true . Perhaps part of the point I was trying to make was unclear. Living and surviving are two different things. Now , I am of the school that everyone should have the right to make whatever their abilities will take them . Realistically, while it isn't my problem the guy who can't make more that xyz lives above their means, I think to expect someone to "Live" on so little. And although its not going to happen what if the people at the top lived a bit less over the top and minimum wage was a bit higher. As far as the little guy who claims he can't survive on paying out higher wages, I see plenty of them at least in my parts living it up. As far as the argument I can't be in business if I don't pay illegal workers illegal wages, the price of a meal may be a dollar cheaper but for sure your paying the difference in taxes. Oh and try living in NY on Minimum wage its all but impossible without public assistance which comes from taxes which I pay.

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