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On responsibility, government, and the minimum wage

zimmer

Educating the Ignorant
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Dr. Friedman... a one man wrecking ball on the Socialist Monster.
 
Hi everybody, I come from France and I'm socialist (well...nobody is perfect).

I have read from Friedman his book called "capitalism and liberty". There are a lot of things interesting in this book. I liked in particular the fact he disliked positive discrimination policy which is now imposed everywhere in europe (an idea that comes from US).
But I disagree completly with the overall philosophy of the book.

To make it short, Friedman claims on this video that free market is the answer to almost every problems of the society. In particular for those who have lost their job and can't find a new one due to the minimum wage law. I can't believe there are still people that believe this.

If you let the market decide the level of wage, by example, by removing the minimum wage, then it will be always possible to find someone - because as he doesn't have a job, he doesn't have a choice - who "wants" to work with a lower wage. In system economic based upon the competitiveness you have to fix limits to make sure everybody struggle with the sames rules, unless you want a system in which the social lowest bidder wins.
 
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Howdy. Been looking at a couple of threads over the past couple of weeks, but this is my first post on the forum :) I've considered some political views over the years, but I've got a lot to learn - and from time spent on religious discussion forums I've found that discussion and debate can be an excellent motivation and way to learn. This seems as good a place as any to start.

That said, maybe I can open up discussion on Friedman's key points. (Let me know if I've misunderstood him!)
> The most effective mechanism for eliminating poverty is a free enterprise/free market system
Seems to me this is clearly false. More or less by definition the most effective way to eliminate poverty within a society is redistribution of wealth within the society, rich to poor, so the poor are no longer in poverty. So is there anything intrinsic to a free market system which accomplishes this? Not as far as I'm aware; on the contrary, human nature (and ongoing experience) implies that even the very richest will continue to seek to accumulate more wealth for themselves. But in the 19th to early 20th century period Friedman focuses on there was considerable redistribution of wealth occurring globally through political means - the ongoing dismantling or restructuring of the concentrated wealth and power of the old aristocracies. Perhaps more importantly, Friedman seems to ignore the tremendous new opportunities afforded by scientific and technological advances of the period - greater productivity, new goods to make and sell, new resources to extract and use. And most critically, nothing I've read suggests that there even was a genuine free market system in that period; I gather that the United States, for example, imposed substantial governmental tarriffs on all kinds of imported foreign goods, protecting its industries from free (and potentially destructive) competition with foreign industries.

> Minimum wage laws force employers to reject some potential employees
That's undoubtedly true. In 2012 the billionaire Aussie heiress and richest woman in the world Gina Rinehart expressed her desire to pay workers less than $2 a day. It's perfect economic sense. But is exploitation a good thing? More broadly, is the use of cheap labour to extract endless resources and produce endless crap a good thing for our species' future? On a finite planet, promoting unlimited production and hence cheap, mindless consumption would be utterly stupid. Even with minimum wages in developed there's plenty of evidence that we're pushing many of the world's limits. All our technological gadgets and gizmos are supposed to reduce our workloads and make life easier; so is there any reason why we should still be pushing for over 90% of our population to be working 40-odd hours a week? Why not 30 or 20 hours a week? The major reason is simply that even with (very) minimal wages, it remains profitable to keep up that level of production for as long as enough demand can be manufactured for the products - as long as generations X and Y can be convinced they need a new phone every year, and baby boomers persuaded that a ferrari or botox will make them young again.

> Welfare encourages or forces people into poverty
Again possibly true to some extent; if you're gonna lose your welfare payments by getting a job, where's the incentive to do so? But I'd guess the answer is fine-tuning the system, not eliminating it. Most importantly, so that welfare benefits scale down significantly less than the increase in employment income, so folk are actually gaining money by getting a job. But I'd also (very tentatively) advocate reducing 'full-time' working hours so that the same amount of work employs more people. Gradually, of course, because it'd mean employers are paying more in wages overall. But this comes back to the fact that without introducing new sources of wealth - such as the 19th/20th century booms in manufacturing, technology and resources which Friedman forgets to mention - and ensuring much of that goes downwards not upwards, reducing poverty requires redistribution of wealth. Moreover if overall higher costs of employment help reduce our tendencies towards over-production and advertisement-driven consumption, that can only be a good thing for our planet and our descendants.



Those are a few thoughts prompted by the video, anyways. Like I say, I've got some ideas, but I need to have them criticised and learn many more facts before I could consider them good ideas. But for now suffice to say that I'm certainly not convinced that the video portrays "a one man wrecking ball" against more left-wing views :lol:
 
Hi everybody, I come from France and I'm socialist (well...nobody is perfect).

I have read from Friedman his book called "capitalism and liberty". There are a lot of things interesting in this book. I liked in particular the fact he disliked positive discrimination policy which is now imposed everywhere in europe (an idea that comes from US).
But I disagree completly with the overall philosophy of the book.

To make it short, Friedman claims on this video that free market is the answer to almost every problems of the society. In particular for those who have lost their job and can't find a new one due to the minimum wage law. I can't believe there are still people that believe this.

If you let the market decide the level of wage, by example, by removing the minimum wage, then it will be always possible to find someone - because as he doesn't have a job, he doesn't have a choice - who "wants" to work with a lower wage. In system economic based upon the competitiveness you have to fix limits to make sure everybody struggle with the sames rules, unless you want a system in which the social lowest bidder wins.

There is hope for you :)
I was once a Socialist too... but a lot of time in Europe cured that.

Free to Choose is a great book from Dr. Friedman as well... hell... the guy was an exceptional mind and spokesperson for Liberty.
 
Here is Dr. Sowell who was a Marxist and student under Dr. Friedman... as he notes, after one year under Dr. Friedman he was still a Marxist, it was his experience in government that began the conversion. His comment on minimum wage, and the interest of government holding onto it should be illuminating for the Leftists who believe in it.

 
The job killing effects of minimum wage and its use as a tool for racists.

 
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Friedman misses the most important point. Stealing hurts the thief more than the victim. Voting to steal is no better than the mob demanding a hanging outside the old-west sheriff's office. Hate the rich man all you want, it doesn't justify voting for theft. America was founded to reject majoritarianism. Majority rules doesn't allow the many to steal from the few. If every adult paid equally their fair share, the bill would be $14.6k per year, not including debt. Jesus would never sanction stealing, whether from the hated rich or from anyone else. Those paying less than $14.6k should start voting for fewer social programs, until the tax burden is more fair.

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Hi everybody, I come from France and I'm socialist (well...nobody is perfect).
Seems I wasn't the first to respond. Beaten by another newbie - how ironic :lol: Nice to meet you.

If you let the market decide the level of wage, by example, by removing the minimum wage, then it will be always possible to find someone - because as he doesn't have a job, he doesn't have a choice - who "wants" to work with a lower wage. In system economic based upon the competitiveness you have to fix limits to make sure everybody struggle with the sames rules, unless you want a system in which the social lowest bidder wins.
Oddly enough in the last video posted, Thomas Sowell and Walter Williams seem to consider that a good thing :shock:

They make a valid point that if there's a whole class of low-bidders competing for similar work with a higher class wanting substantially more payment, a higher-end minimum wage could favour the higher group. The examples they mentioned were 39c/hr for the low-bidding (black South African) workers vs $1.91/hr for the whites, and $30 vs $100. So maybe a lesson to be learned there is that minimum wages shouldn't increase too rapidly - perhaps increments of 20/50/80% over the existing minimums? I really don't understand how they'd go from that observation to opposing minimum wages altogether though.


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The job killing effects of minimum wage and its use as a tool for racists.
Howdy again Zimmer :) As noted above, seems to me those two fellows are throwing the baby out with the bathwater in their examples; just because imposing a minimum wage equivalent to the demands of a higher class is a bad thing, discriminating against the lower class, does not mean that incremental increases to the existing bottom-end is also bad. The goal here (presumably) is to improve the lot of those at the bottom end, and as Thomas noted earlier that cannot be accomplished in a situation where desperate folk are competing to be the lowest bidders.

A similar point applies regarding the earlier part of Sowell and Williams' discussion. I don't know how things stand in the US, but where I live (Australia) award rates (ie minimum wages) are substantially lower for teenagers than for adults. For example in my workplace a 15 year-old gets paid barely half (55% in my state, as little as 40% in some others) of what a 20 year-old does. So despite being often worse employees, young workers are still in high demand. The minimum wage laws do not kill their job prospects, they merely ensure that unscrupulous employers aren't hiring them for one fifth or one tenth of an adult's wage.

Here is Dr. Sowell who was a Marxist and student under Dr. Friedman... as he notes, after one year under Dr. Friedman he was still a Marxist, it was his experience in government that began the conversion. His comment on minimum wage, and the interest of government holding onto it should be illuminating for the Leftists who believe in it.
Correct me if I'm wrong, but wasn't the only thing he said about the interest of 'government' holding onto minimum wage laws was that it (allegedly) made up one-third of his particular department's budget, or something to that effect? If true, you'd still see some of that kind of petty beaurocratic thinking in any department and government scheme, I imagine - it hardly indicates some grand conspiracy against the people, and nor is it a valid argument against the system itself. Governments are often (usually) imperfect. But again, that doesn't automatically make it a good idea to throw the baby out with the bathwater.

Indeed it is frequently alleged that government in the United States is actually somewhat worse than many other western democracies: But if true, surely a big part of that comes from a system of two parties competing for corporate endorsements to run their election campaigns! Put differently, if there are worse than usual failings in the US government, surely the first place to start looking forpotential improvements would be the peculiarities of the system which make it less of a government-for-the-people and more of a government-for-business. Using the failures of a government-for-business as an argument for abolishing minimum wages - which incidentally would benefit businesses greatly - does not seem to be particularly strong reasoning, wouldn't you agree?
 
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