![[dr. bob]](/dr-bob-sm.gif)
Dr. Bob is Robert Hsiung, MD,
bob@dr-bob.orgShown: posts 6 to 30 of 85. Go back in thread:
Posted by alexandra_k on November 14, 2005, at 18:31:46
In reply to Re: justice, posted by alexandra_k on November 14, 2005, at 18:30:49
the 'you' is general.
nobody in particular.i think i might...
have gone and done it again???i don't know anymore.
Posted by alexandra_k on November 14, 2005, at 18:42:06
In reply to Re: justice, posted by alexandra_k on November 14, 2005, at 18:31:46
Posted by alexandra_k on November 15, 2005, at 0:37:20
In reply to Re: justice, posted by alexandra_k on November 14, 2005, at 18:31:46
okay so i know verrrrrrrrrry little indeed about politics. and history. declan, are you reading????? i bet you are busting to say something right now. to set my facts straight on australian history and / or new zealand history or something...
i went and had a chat to my friend...
the one doing her thesis on an authentic democracy. she has been told to lose the 'authentic' bit. because... shes talking about what democracy is supposed to be. she doesn't need to rub it into peoples faces that we aren't there yet. hmm.the difference between the ideal and the practice of the ideal to date. sometimes... that can lead to us ruling out an ideal completely without comprehending that there were practices in the implementation that are really what needs to be improved upon for next time.
so...
dictionary definitions.
fairly interesting to contemplate different definitions merely at the level of a dictionary definition.democracy
capitalism
socialism
communismyeah. you know communism isn't so bad at the level of the ideal... so why are americans known to be particularly phobic about communism?????
china
russiacommunism doesn't have to be practiced as the minimum standard of living for the most citizens...
it could be practiced as the maximum standard of living for the most citizens...
but that...
would be pre-supposing that the welfare of the citizens (where each citizen counts for one) would have to take priority over...
the economy
the persuit of material happiness...but then...
how much does the latter buy you anyway?if we give a few the chance of material happiness...
then the consequence is that there are more citizens who lack the basic building blocks of life (primary needs such as food shelter healthcare education) that enable one to feel content.contentment.
harder to find when your basic needs aren't being met.
hard enough to find for those with material excess...
Posted by alexandra_k on November 15, 2005, at 0:53:32
In reply to Re: justice, posted by alexandra_k on November 14, 2005, at 17:05:38
what frightens me is that new zealanders are typically considered to be the world leaders with respect to indigenous relations.
that frightens me because i see how far we have got to go...
and i feel ashamed when i think thats the best that people have been able to do with that to date.
people say that where we are... is in virtue of the treaty.
because... the indigenous people to new zealand were not considered to be animals. they were considered to be 'noble savages'. that meant they were considered to be human beings with their own goals and dreams and desires and wants.
and their retaining soverignty... was something that was granted to them in virtue of that.
and some people...
lots of people in new zealand say...
that they just need to get over things and move on. people come. people fight. people win. you lose. thats life. get with the program. make the most of the 'opportunities' that are offered. assimilate or be a 'couch potato' etc etc.but its just not that simple
(as people seem to understand with respect to their own lives over on the psychology board)
its just not that simple.i think...
indigenous groups should all be allowed to retain their soverignty.
more than that. i think indigenous groups should be assisted to achieve soverignty.
i think that all cultural groups should be assisted to achieve soverignty.so instead of thinking 'get over it and move along'. instead of hoarding resources because we are afraid other people will come along and do unto us as we did unto them...
we might just consider that its not so nice to come and take and pronounce 'mine and get off'. and assimilate or perish. and move on or become a 'couch potato'.
and maybe...
if we respect other cultures...
then other cultures will show comperable respect when they come to 'visit' us...perhaps...
Posted by AuntieMel on November 15, 2005, at 14:01:44
In reply to Re: justice » Damos, posted by alexandra_k on November 14, 2005, at 16:44:16
You seem to have some incorrect impressions of the US.
We *do* have progressive taxation. Granted the tax code is complicated and there are tax shelters and loopholes, but for the most part even the rich pay their share.
The rates this year are roughly between 20% and 35% for single people and between 20% and 35% for married couples.
The first 10,000 to 15,000 (roughly) of income is not taxed. The rates apply to money above that.
Low income people with kids get a credit, so they can end up with "negative tax"
We also have programs for the poor, what your article calls "welfare"
But - like I've said we also have, at least in the part of the country where I live, an expectation that people will help themselves.
The state I live in instituted a program several years ago that was designed to recognize that all education is not created equal. The top 10% of graduates of all schools (even the poorest with the most disadvantages) are guaranteed a slot in a state university. You can't be bumped out by the rich kid across town because the rich kid has tutors and all the help he needs.
And there are programs to help pay for this.
And as an acknowledgement of school inequality the universities have "remedial" programs to get the kids who need it up to standard.
And *that* is what *I* call fair.
Posted by alexandra_k on November 15, 2005, at 14:39:27
In reply to Re: justice » alexandra_k, posted by AuntieMel on November 15, 2005, at 14:01:44
((((Auntiemel))))
:-)
:-)Hello.
> You seem to have some incorrect impressions of the US.
:-)
Okay.
> We *do* have progressive taxation.Okay.
>Granted the tax code is complicated and there are tax shelters and loopholes...
Yeah. We have those too... Apparantly, thats what 'personal finance management' is all about... Knowing relevant taxation laws. You don't want to 'avoid' your tax by breaking a law (that would be illegal), but you are allowed to 'evade' your tax by exploiting a gap that a law hasn't been made to plug at that present point in time. And I guess... Personal finance managers pay their own way... Hmm... Hmm... And there are things you can do... 'Charity' is tax deductible etc etc.
>but for the most part even the rich pay their share.
I guess it depends on what you mean by 'pay their share'. I would say... (Just as an example). Yeah, Bill Gates worked hard. And yeah Bill Gates had a good idea or two or three. But did he work millions and millions and millions and millions of times harder than you or most of the people you know??? I think the answer to that is no, he did not. So how come he gets to keep (invest) all the wealth? I think he could stand to be paying a little more in taxation... I think most of the people living in billion dollar mansions... The 'hardworking' movie stars and models etc etc could stand to be paying a little more in taxation... And paying a little more in taxation wouldn't impact on their practical lives very much at all... Yet that could be made to have an enormous impact on the lives of the people who are really struggling (if well spent, admittedly).
> The rates this year are roughly between 20% and 35% for single people and between 20% and 35% for married couples.For which tax bracket? Sounds high for the working class (I bet some people really struggle there). Sounds... low for the top few... But I guess it really does depend on the available loopholes. How much people who are investing can get around taxation laws. Easy to make money once you have money and know how to invest it wisely...
> The first 10,000 to 15,000 (roughly) of income is not taxed. The rates apply to money above that.Okay.
> Low income people with kids get a credit, so they can end up with "negative tax"
Welfare? We have the 'domestic purposes benefit'. That means... If you have children younger than school age... You have enough to stay home and look after them (which is terrific for all those single parents out there). Is it that kind of thing??? How long can you get that for? Just wondering because I heard the unemployment benefit was capped to a maximum of 6 months in a persons lifetime.
> We also have programs for the poor, what your article calls "welfare"?
What sort of programs?> But - like I've said we also have, at least in the part of the country where I live, an expectation that people will help themselves.
Help themselves how?
> The state I live in instituted a program several years ago that was designed to recognize that all education is not created equal. The top 10% of graduates of all schools (even the poorest with the most disadvantages) are guaranteed a slot in a state university.Okay. And the top 10% is governed by... standardised tests... Still... Hard to know how else to do that I suppose... I guess we have similar with university entrance tests... Dare I say... Not all state universities are created equal... Does it really work like that???? So if you live in New York and you manage to get in the top 10% of your school... You are guaranteed a place at the State University of New York??? How are you supposed to pay for your 'guaranteed place'?
>You can't be bumped out by the rich kid across town because the rich kid has tutors and all the help he needs.
:-)
Though... Think how much more likely you are to get to be in that top 10% with tutors and help and encouragement from your parents etc etc.> And there are programs to help pay for this.
:-)
> And as an acknowledgement of school inequality the universities have "remedial" programs to get the kids who need it up to standard.I have to say...
I favour that over 'affirmative action'. Oh yes I do indeed :-)
> And *that* is what *I* call fair.Okay.
Though...
What about the inequalities of native ability.
One kid has the native ability which combined with a little hard work could get them in that top 10%...
Another kid doesn't have that native ability but with a little hard work they can do unskilled labour...
The first kids earning capacity (after completion is ____)
The second kids earning capacity (after completion is ____)I appreciate...
Things are much more complicated than I'm aware of. Because each state has its own laws and way of doing things as well as the federal stuff.
And... Charity work is something that I think people are bigger on in the US than they are over here. Especially... When most scholarships have loads of space for you to list your charity work. Seems to be... Very nearly a pre-requisite for scholarships as a matter of fact. Seems to be something that most people... Do in fact do. So in a way... I think that maybe in the US people are more generous with individuals doing that kind of thing. Whereas over here... People aren't typically so generous with volounteering their own time. Maybe because... We think it is part of the role of government. And... We have already done our bit as individuals because the government took our bit already in tax.Hmm.
And that is my one post for today.
No more.I'll allow myself another tomorrow :-)
Posted by verne on November 15, 2005, at 21:31:04
In reply to Re: justice » AuntieMel, posted by alexandra_k on November 15, 2005, at 14:39:27
Alexandra,
What is being rewarded in a case like Bill Gates is not more "work" units but creativity and risk taking.
In fact, what drives this runaway train (I need at least one train or horse in my post) is risk. This is why trains are such delicious targets - risk. And this is why the pony express was such a short-lived hit.
I, myself, don't like huge gaps between the rich and poor, I'm hopelessly liberal but I recognize the value, and even need, (i hope not for another comma) to reward risk taking and ingenuity. The creative risk takers actually create more prosperity for the rest of us.
Verne
Posted by alexandra_k on November 15, 2005, at 21:50:23
In reply to Re: justice » alexandra_k, posted by verne on November 15, 2005, at 21:31:04
> What is being rewarded in a case like Bill Gates is not more "work" units but creativity and risk taking.
Hmm.
But other people who are creative and take risks manage to lose most everything they have...I mean... thats kind of what a risk is... matter of luck.
I'm not saying that he shouldn't be rewarded...
My understanding is he worked very hard indeed... But i don't think we have to choose between him being rewarded the way he is presently or him not being rewarded at all.> The creative risk takers actually create more prosperity for the rest of us.
because... of the economy?
because... people like to think they could similarly 'strike it lucky'?
Posted by alexandra_k on November 15, 2005, at 22:45:48
In reply to Re: justice » verne, posted by alexandra_k on November 15, 2005, at 21:50:23
...on the politics board.
i hereby declare that i shall not post to the politics board until my thesis is done.
bang!
thump!so...
who wants the last word???
;-)
Posted by verne on November 16, 2005, at 1:41:10
In reply to Re: okay... time for me to call it a day..., posted by alexandra_k on November 15, 2005, at 22:45:48
How much is the last word going for these days? I'd give it up if the compensation is right. (hee,hee).
I don't know how to make smiley faces or emoticons so I resort to "hee,hee" which is really sort of sad in comparison. I'm emoticon impaired.
Can I rent out time shares for the last word?
Verne
Posted by Dinah on November 16, 2005, at 10:09:40
In reply to Re: justice » AuntieMel, posted by alexandra_k on November 15, 2005, at 14:39:27
There are is also sorts of data available on how much taxes each group of people pays. I'm pretty sure that the x% richest people pay y% of taxes, with y being far larger than x. How much larger it should be might be a matter for debate, but that the richest Americans pay most of the total tax intake is a matter of record.
Posted by Dinah on November 16, 2005, at 10:49:25
In reply to Re: justice » alexandra_k, posted by Dinah on November 16, 2005, at 10:09:40
http://www.treas.gov/press/releases/reports/factsheetwhopaysmostindividualincometaxes.update.pdf
Posted by alexandra_k on November 16, 2005, at 14:29:32
In reply to Re: justice, posted by Dinah on November 16, 2005, at 10:49:25
Uh... I wonder what it means when it says in the footnote: 'Estimates of taxes paid ignore any behavioural responses to the tax cuts'???
Okay. So there *is* progressive taxation.
But then how come...
The distribution of wealth is still so imbalanced???See for example:
http://multinationalmonitor.org/mm2003/03may/may03interviewswolff.html
I thought this looked fairly interesting
http://www.globalpolicy.org/socecon/inequal/indexinq.htm
So I suppose that what I'm thinking...
Is it fair that there is such a radical imbalance in the distribution of wealth?
If you think it is unfair then...
What (if anything) should be done about it??
Posted by alexandra_k on November 16, 2005, at 17:34:26
In reply to Re: just one more..., posted by alexandra_k on November 16, 2005, at 14:29:32
http://www.globalpolicy.org/socecon/hunger/2003/0808blame.htm
Posted by AuntieMel on November 17, 2005, at 13:44:55
In reply to Re: just one more..., posted by alexandra_k on November 16, 2005, at 14:29:32
"Okay. So there *is* progressive taxation.
But then how come...
The distribution of wealth is still so imbalanced???"Now we are back to the book I recommended a while back, "Rich Dad, Poor Dad"
A lot of the problem is that those with money know how to handle it, amass it, make it work for them. And they pass this economic knowledge down.
Those with much less money never had that training.
Accumulating wealth has more to do with living habits than earning potential. Read also "The Millionaire Next Door" - most millionaires don't *look* like millionaires - they shop at discount stores, buy used cars and generally just live below their means.
I can't see (except for the most destitute homeless) why anyone who makes ends meet couldn't do it on 5% to 10% less and save and invest the rest. It really doesn't take cutting much - a CD here, a movie there, a meatless night, whatever fits.
Posted by cricket on November 17, 2005, at 15:37:53
In reply to Re: just one more... » alexandra_k, posted by AuntieMel on November 17, 2005, at 13:44:55
> A lot of the problem is that those with money know how to handle it, amass it, make it work for them. And they pass this economic knowledge down.
>
> Those with much less money never had that training.
>
> Accumulating wealth has more to do with living habits than earning potential. Read also "The Millionaire Next Door" - most millionaires don't *look* like millionaires - they shop at discount stores, buy used cars and generally just live below their means.
>
> I can't see (except for the most destitute homeless) why anyone who makes ends meet couldn't do it on 5% to 10% less and save and invest the rest. It really doesn't take cutting much - a CD here, a movie there, a meatless night, whatever fits.Hi AuntieMel. I absolutely agree with you that it's not about earning, it's about saving.
However, the problem is so much deeper than that.
And right now I am speaking from my own personal experience and not from any statistics or sociological study or anything like that.
When you live in a neighborhood where it's almost impossible to get decent food (fresh produce or bread) and everything is fast food or chemical ridden sugar laden indefinite shelf life cr*p...When you work at a mind numbing job for 10 hours a day ...
Then ride public transportation (standing, jammed in like a sardine) for another two hours ...
When you come home to a cramped apartment with a bunch of other people and you have nowhere to go to be alone and think for a moment...
When everything is noise and dirt and bad smells ...
When your only form of more mind numbing entertainment is a television that parades images of glamor and glitz and incredible wealth before your very weary eyes ...When you lie in bed at night and listen to the gun shots...
Then someone could give me all the lessons in money saving in the world but you know what I still want those jeans that are way too expensive and that fancy coffee latte junk and even that Ipod because you know what for one moment that makes me feel okay, that I'm like other people.
I know many would say I'd be better off saving that $100 or $1,000. But $1,000 is not going to get me out of here, not even $10,000 will do that. $100,000 - maybe? But where in the world would that come from?
And that's why so many people live for the lottery. What else is there to hope for?
Posted by alexandra_k on November 17, 2005, at 17:14:27
In reply to Re: just one more... » alexandra_k, posted by AuntieMel on November 17, 2005, at 13:44:55
> But then how come...
> The distribution of wealth is still so imbalanced???"
> A lot of the problem is that those with money know how to handle it, amass it, make it work for them. And they pass this economic knowledge down.
But that amounts to whose *with* money handling their money well. I'm most concerned... About those *without* enough money to meet their basic needs in the first place.
> Accumulating wealth has more to do with living habits than earning potential.Well... For those who earn an excess to what they need, sure.
> I can't see (except for the most destitute homeless) why anyone who makes ends meet couldn't do it on 5% to 10% less and save and invest the rest.
Maybe... It comes of people *just* being able to meet their basic needs. Not being able to do that on 5% or 10% less.
And maybe... It comes of those little 'luxuries' in life being what... Enables one to persist in living. To manage to get up out of bed and work long hours in a mind numbing job etc (as Cricket noted). Because... The minimum wage is pretty low... Pretty low indeed.
I found this article... I don't know how dodgey it is... But it said that a low ranking military guy would get $1,000 per month to live in New York City. That... There were food banks set up for military personel because... Sometimes they needed that. Even with their wives earning two jobs... And for those with kids... So there... You have hard working people... Still unable to meet their basic needs. I'm not sure that they could do with 5-10% less.
Thats to say nothing of all the unskilled laborers out there. Factory workers. Etc.
If you are talking about the middle class... Those who have an excess to their basic needs in the first place... Then savings helps. Sure.
I'm a little concerned that this idea...
That *most* people could be a millionaire if only they saved harder. If only they worked harder to save harder. I'm a bit concerned that this idea... Is what 'resigns people' to accept the status quo. If they are not a millionaire then it is somehow their own fault because they didn't work harder or save harder.But...
Is it fair that some people are born millionaires already while others are not?
Is it fair that some people *can* work harder and save harder and become millionaires, while others could not?
Is it fair that a large portion of the worlds population doesn't have their basic needs met...
While other people... Could possibly be millionaires?And if it is not fair...
Then what (if anything) should be done about it?
Posted by Gabbix2 on November 18, 2005, at 18:04:55
In reply to Re: just one more... » AuntieMel, posted by cricket on November 17, 2005, at 15:37:53
> However, the problem is so much deeper than that.
>
> And right now I am speaking from my own personal experience and not from any statistics or sociological study or anything like that.
>
>
> When you live in a neighborhood where it's almost impossible to get decent food (fresh produce or bread) and everything is fast food or chemical ridden sugar laden indefinite shelf life cr*p...
>
> When you work at a mind numbing job for 10 hours a day ...
>
> Then ride public transportation (standing, jammed in like a sardine) for another two hours ...
>
> When you come home to a cramped apartment with a bunch of other people and you have nowhere to go to be alone and think for a moment...
>
> When everything is noise and dirt and bad smells ...
>
>
> When your only form of more mind numbing entertainment is a television that parades images of glamor and glitz and incredible wealth before your very weary eyes ...
>
> When you lie in bed at night and listen to the gun shots...
>
> Then someone could give me all the lessons in money saving in the world but you know what I still want those jeans that are way too expensive and that fancy coffee latte junk and even that Ipod because you know what for one moment that makes me feel okay, that I'm like other people.
>
> I know many would say I'd be better off saving that $100 or $1,000. But $1,000 is not going to get me out of here, not even $10,000 will do that. $100,000 - maybe? But where in the world would that come from?
>
You spoke for me too there Cricket.
(Though I don't deal with gunshots, I'm so sorry you have to)
Things are getting much better for me, Still there are *many* times I cannot not afford laundry, or tampons, or aspirin or even polysporin and bandaids when I have an infection..things other people just have on hand.
I was *so* harrassed about my very occasional coffee out, (maybe once every two months)
And I remember thinking, they have no idea, for that half an hour out, in that coffee shop with the lovely atmosphere, I feel like part of the world, I feel human, and it keeps me alive.I realize you are not on assistance, I am.
And I have to say that those "mysterious" people out there who prefer assistance to working (having others tax dollars foot the bill for them while they are a couch potato) must be selling drugs, or have another form of illicit income, because with all the time you have, there is nothing you can do with it. What, go shopping?Go out with friends for drinks? HA! You don't even look forward to meals because you can only afford crap. And you can't afford cable to watch t.v while you're being the so called "couch potato" If you are doing something with it, something worthwhile, like volunteering well where's the problem?
Besides, welfare recipients as far as I'm concerned are more than those on what's considered public assistance. It's not uncommon for a politician, after 2 years in office (or less in some cases) to retire with with a yearly salary in the triple digits, even when they've been forced out because of impropriety. That to me, is nothing more than welfare.
Posted by Gabbix2 on November 18, 2005, at 18:29:19
In reply to Re: just one more... » alexandra_k, posted by AuntieMel on November 17, 2005, at 13:44:55
> I can't see (except for the most destitute homeless) why anyone who makes ends meet couldn't do it on 5% to 10% less and save and invest the rest. It really doesn't take cutting much - a CD here, a movie there, a meatless night, whatever fits.
I'm speaking from a Canadian perspective here I don't know what the U.S public assistance rates are.
Here there are people who choose to be homeless because if they can find someone who will sign a fake rent receipt they can collect money from Welfare for rent, and then actually have enough to live on, and no I'm not criticizing that.A single person on welfare receives 500.00 month. 325.00 of that is designated for rent, which means if you share an apartment and get cheaper rent, say 250.00, then 250.00 is all you'll get from welfare.
A study I read about just yesterday (which I really didn't need to know) showed that a single person on welfare, on average lives on 20.00 a month. That's for everything but rent, because they have to take usually at least 75.00 out of the alloted support money, to make up for the cost of a place to live. Even a rooming house is 425.00
Twenty dollars a week (slightly less) is what I lived on until I recieved disability benefits.
Sure there's a food bank here, I can't afford bus fare to get to it though.I think that's why it's not just the homeless who can't save 10% of their income.
Posted by Jakeman on November 22, 2005, at 20:01:00
In reply to Re: just one more... » AuntieMel, posted by Gabbix2 on November 18, 2005, at 18:29:19
The big picture is who is better off. There has beeen a massive shift of wealth to the upper income classes in the US over the past 20 years. This phenomenon does not sustain capitalism in the long run, because middle and low income people need money in their pockets to buy stuff and keep the whole machine running. I'm speculating, but that may be a reason that billionaire George Soros supported Kerry in the last election. A quick search came across this article:
"Meanwhile, income inequality has grown. In 2001, the top 20 percent of households for the first time raked in more than half of all income, while the share earned by those in the middle was the lowest in nearly 50 years."
http://www.washingtonpost.com/wp-dyn/articles/A34235-2004Sep19_2.html
I need to research this more, but it's possible that the the reason the rich are paying the most tax is because their incomes have increased.
warm regards,
~Jake
Posted by AuntieMel on November 23, 2005, at 13:45:14
In reply to Re: just one more... » AuntieMel, posted by cricket on November 17, 2005, at 15:37:53
I'm sorry if I came across as judgemental. I didn't mean to.
It's hard for me to imagine what those conditions are like. I'm from the south where even the poorest of the poor have some elbow room.
When I had a baby at home and worked three part-time jobs to pay for it and go to school I at least had some breathing space and room to think.
I didn't know squat about saving then. I'm still learning.
I'm just trying to say there is a big difference between *earning* a lot and *having* a lot (definitition of "a lot" being a relative, and nebulous thing)
Posted by AuntieMel on November 23, 2005, at 13:55:12
In reply to Re: just one more..., posted by AuntieMel on November 23, 2005, at 13:45:14
Posted by alexandra_k on November 23, 2005, at 15:01:08
In reply to Re: just one more..., posted by AuntieMel on November 23, 2005, at 13:45:14
> When I had a baby at home and worked three part-time jobs to pay for it and go to school I at least had some breathing space and room to think.
Wow. I can't comprehend... How some people can do that. Really.
> I'm just trying to say there is a big difference between *earning* a lot and *having* a lot (definitition of "a lot" being a relative, and nebulous thing)Yeah, there surely is. I'm pretty bad with money now. It comes and boy oh boy does it go. I think the problem is that I'm so used to going without. And constantly worrying about it... When I got my Masters Scholarship I spent it in about one month. Gone. Brought a TV and a laptop and a surround sound speaker system and an i-pod etc. Not exactly necessities... But I guess I was kinda thinking 'when on earth am I ever going to get the opportunity to do this again???'
And I guess... It is those kinds of things that help one feel human...
But yeah, in a way I regret having done that.
Things are going to be hard if I move overseas to do my PhD. And I blame myself for that... Because I could have saved that... But I chose not to.And in the A semester I was doing a lot of work tutoring. And the more money that comes in... The quicker that money seems to go out. Drinking coffee... Buying lunch... Eating out more... Clothes. But none of that was really necessary, that is true.
I was thinking...
The trouble with having a welfare system so that people get their basic needs met for free...
Is that you can't really do that when people work long hours for minimum wage and still can't meet their basic needs.
I mean... One would be better off on welfare than working...
Of course people would stop working to go on welfare.Hmm.
I guess...
Sort out the minimum wage first...
(Which would have ramifications of pay rises right through the working class...)
Then look at welfare???;-)
You know... It could be done...
With that tiny percentage having over half the wealth in the whole darned country and all...
Posted by Dinah on November 23, 2005, at 22:30:57
In reply to Re: just one more... » AuntieMel, posted by alexandra_k on November 23, 2005, at 15:01:08
Economics is rarely simple. A major raise in the minimum wage has many effects, not all the intended ones. For one thing, you just can't take one group of people and raise their hourly rate without a ripple effect in the rest of the employees of the region. Those who now make the minimum wage + $5, or +$10, or +$25, would likely expect a raise in their wages as well. This would all mean added costs to a company. Companies rarely absorb cost without action. There are two possible actions. Cutting costs (by perhaps cutting employees or perhaps by outsourcing to areas with lower labor costs) or raising prices (causing a raise in inflation and reducing the actual buying power of the raise in the minimum wage). The actual inflation rate could increase by more than the increased cost. Since most small companies, at least, judge their bottom line by percentages rather than strict dollars. So they want x% gross profit, x% net profit. So a $5 increase in cost either means a $5 cut in other costs or a $5+5% profit increase in prices. Not to even mention the countless other costs that are based on the $ amount of payroll. Workers comp insurance comes easily to mind.
By the way, most big businesses are owned by regular folk. Their stock is held in retirement accounts everywhere, and savings for retirees, and middle class people. It's rarely helpful to the economy at large to assume that "big business" will absorb the cost of anything without also remembering that. Certainly, I suppose a lot of raises could be absorbed by the those exorbitant executive salaries that we all hear about. But honestly, is that likely to happen in the real world?
And the owners of small businesses? Well, a lot of them are my heroes. Putting their entire wealth on the line on shaky prospects. Often earning less than their employees, when times are lean. I hesitate to think what raising the minimum wage substantially, and the resulting higher salary demands by people all up the pay scale, would mean to those people who are trying to make ends meet in the current business climate where increased insurance costs alone... Well, dont' get me started on that.
I'm assuming you're proposing a rather drastic increase in the minimum wage?
The only way you can control one element of the economy without countless other elements also being shifted is in an economy controlled by the government. But that style of economy clearly has drawbacks as well.
Posted by Dinah on November 23, 2005, at 22:33:38
In reply to Re: just one more... » AuntieMel, posted by alexandra_k on November 23, 2005, at 15:01:08
Mind you. I'm not actually coming out against raising the minimum wage. I am actually rather shocked when a major US company blames the lack of health insurance for its workers on cutbacks in Medicaid.
I'm just saying that minimum wage increases do not occur in a vacuum. And that in order to really do any good, all possible outcomes need to be considered.
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