Flopper
Diamond Member
The reason I suggested indexing minimum wage was to eliminate the divisive minimum wage fight that occurs every few years in congress. Going to indexing versus what we doing now will not make a significant difference in the minimum wage. It will make it easier for businesses to plan their future because they will know well in advance when they will have to adjust wages and since it's based on inflation they will know fairly closely the magnitude of the increase.Define "ineffective".That would depend on what you mean by fixing the problem.There of 10 states,AZ, CO, FL, MO, MT, NJ, NV, OH, OR, and WA that index minimum wage to inflation. Senate Democrats are proposing this.
That's simply pandering - paying lip service without fixing the problem.
History has shown that tying wage increases to inflation has been ineffective, and actually contributes to the problem, rather than fixing it. Congressmen proposing to do that are merely pretending to care about fixing the problem.
One would expect no improvement in the standard of living of minimum wagers by tying increases to inflation. Is that what you mean by "contributes to the problem"?
I think that at this juncture, people who genuinely care about minimum-wagers should be exceptionally careful not to push too hard. A few dollars an hour is the only thing making a flesh-and-blood human worker preferable to a machine in a great many service industries, and the machines aren't getting any slower or more expensive.![]()
"One would expect no improvement in the standard of living of minimum wagers by tying increases to inflation. Is that what you mean by "contributes to the problem"?"
Exactly so, and, it even exacerbates the problem. Since we know that the 'cost of living increases' do not keep up with the actual cost of living, raising wages (and thus, the concordant rise in cost of living) actually negatively impacts the lower level earners more than others. As usual, 'feel good' government policies harm the very people they purport to help.
As for automation - you can count on it. Low end jobs will disappear in an ever-increasing spiral. $15/hour people who bitch and moan, go on strike, show up late for work or not all, get sick, or take vacations, are a significantly greater cost (and pain in the ass) than turning on the burger flipper machine every morning. Not only do I eliminate the low end worker, I can also cut back on my mid-level managers, as well.
Indexing of course will not provide a higher standard of living for low income earners, it will just help them to maintain their standard of living. If Congress wants to elevate the living standard of the poor, then they can do so and index minimum wage so they want have to keep revisiting it every few years.
I agree with your statement that automation will eliminate low end jobs. It's going to happen whether we raise minimum wages or not because the technologies are improving and getting cheaper. Moderate increases in minimum wage will have little effect. Large increase will just make it happen a little faster. However, most minimum wage jobs will be here for a long time because there will always be tasks that machines can't do. In most businesses people prefer to deal humans rather than machines plus machines can never be as flexible as humans.