Wealth Distribution in the USA

Yes, this is the most important thing. People who not poor or desperate or disenfranchised or persecuted or warred upon do not (usually) commit crimes or fire missiles at neighbors or blow up innocent civilians or fly planes into buildings. The key to the western world's safety and prosperity lies not in imposing our military power but in sharing our wealth around the world.--Percy

Well, I am trying to "follow along". But on the one hand you write: And on the other hand you write: I think that you ought to try to think up a coherent concept of value. Something that might help you is that I explained to you the neo-classical concept of value last time we talked about economics.The reason that I cannot "follow along" with your arguments is that they are plainly inherently self-contradictory. I cannot "follow along" with someone who simultaneously asserts as his dogma that the sky is blue and that the sky is pink. I hardly know how I should begin to talk to such a person.Edited by Dr Adequate, : No reason given.

This is your idea of asking me what I mean? As I keep saying, Mod, you're going to have to ask that question of someone who was arguing that point of view. What the heck is your problem with normal English, anyway? Does using the phrase "independent of" never get used in the sense of "other things being equal", or "leaving other factors aside for the moment" in the UK? And if not, did my repeated protestations that that what you were asking me to defend was not my meaning followed by my clarifications not hint to you that perhaps you were misinterpreting something?Every once in a while you slip into this mode of polite but incredibly persistent poking that's just a smokescreen for some very passive/aggressive behavior. Give it a rest. You're getting to be like the reincarnation of CrashFrog. Yes, of course. The question was obviously rhetorical. No, not since the diamond cutter example. Funny, that. You can legitimately question whether current minimum wage levels have cost jobs, and you have. I believe such laws are a necessary but highly flawed as implemented blunt force instrument, and that as currently structured they have cost jobs at the lowest skill levels. You believe not. I'm content to disagree as it's not particularly important to my key points.But you can't legitimately question that there are minimum wage levels that absolutely would cost jobs. Well yes, of course. What you're actually describing is a dramatic devaluing of the currency. You need to rethink both this misbegotten example and your highly questionable assumption that minimum wage increases just cycle money back into the economy in a way that doesn't affect businesses.--Percy

Yeah, well, maybe you're trying, but it doesn't show. You pulled one quote from one context (value of a job in terms of what it contributes to a company's value, something very difficult to measure), and you pulled the other quote from another context (value of a job in terms of wages).Better luck next time.--Percy

Well I work for a multinational company of considerable size and complexity and I'm telling you that if were to go to the IT director and request an additional network engineer the estimated cost of hiring that network engineer Vs the cost to the company of not doing so would very very much be what the final decision was based on.It might well be largley finger in the air stuff but unless someone is making the assessment (rightly or wrongly) that the employee in question will add rather than subtract value from the company then they won't be hired. Unless companies are in the business of hiring people for reasons of social good or somesuch they are hiring people on the basis that they wll make more money from their labour than it costs to employ them. How can any company aim to be profitable otherwise?Your position seems to depend on the idea that no assessment of an employees economic benefit to a company can be made. I would suggest that in most businesses everytime a new employee is hired someone has made the assessment (correct or otherwise) that hiring them would be of economic benefit to the company in question. Well if you had actually read the link you would appreciate that whilst your position may well be nothing more than a truism if simple theoretical models of supply and demand are assumed to be true the empirical evidence on these matters suggest that things are not so simple and very far from clear cut.Is your insistence that a raise of minimum wage will necessarily result in an increase in unemployment based on a theoretical "law" or on empirical evidence? Your answer seems to be based on some rather simplistic and outdated models and assumptions rather than on the empirical evidence available. Here is another quote from the same link you don't seem to have read:

quote:

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Several researchers have conducted statistical meta-analyses of the employment effects of the minimum wage. In 1995, Card and Krueger analyzed 14 earlier time-series studies on minimum wages and concluded that there was clear evidence of publication bias (in favor of studies that found a statistically significant negative employment effect). They point out that later studies, which had more data and lower standard errors, did not show the expected increase in t-statistic (almost all the studies had a t-statistic of about two, just above the level of statistical significance at the .05 level).[52] Though a serious methodological indictment, opponents of the minimum wage largely ignored this issue; as Thomas C. Leonard noted, "The silence is fairly deafening."[53]

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In 2005, T.D. Stanley showed that Card and Krueger's results could signify either publication bias or the absence of a minimum wage effect. However, using a different methodology, Stanley concludes that there is evidence of publication bias, and that correction of this bias shows no relationship between the minimum wage and unemployment.[54] In 2008, Hristos Doucouliagos and T.D. Stanley conducted a similar meta-analysis of 64 U.S. studies on dis-employment effects and concluded that Card and Krueger's initial claim of publication bias is still correct. Moreover, they concluded, "Once this publication selection is corrected, little or no evidence of a negative association between minimum wages and employment remains."

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LinkDo you continue to maintain that an increase in minimum wage necessarily results in increased unemployment of low skilled workers?

Yes, you're absolutely right. I was using each side's public expressions of their philosophy of government, but both sides will characterize government as playing either role according to the political needs of the moment. According to the political parties, government is variously the problem, the solution, and sometimes both at the same time.--Percy

But that would be my point. That's exactly what I'm charging you with. You use the word "value" in one sense, when you're arguing for one thing, and you use the word "value" in a completely different, opposite, contradictory sense, when you're arguing for another thing. What I am charging you with is exactly that you apparently think that the word "value" means whatever you think it should mean, according to what you want to argue for, rather than it having one definite meaning. I am accusing you of committing the fallacy of ambiguity: you reply that "value" means whatever you want it to mean according to the context in which you use it. I rest my case.Edited by Dr Adequate, : No reason given.

I'm not sure why our discussion had to devolve into personal criticism, I suggest you give that a rest. To what end? Actually, I know not. Which is why I asked if you had seen some study or somesuch - to present it for my illumination. Why is example misbegotten? You neglect to say. Nor am I making the assumption you claim I am making. What I was saying is that if wages go up, prices go up. But that's fine, because wages have gone up. As long as prices aren't rising faster than wages we're all good.I was quite clear that raising the minimum wage to $1million/hour clearly has multiple real world difficulties, it's not like I'm pretending this would be a good idea. It was just to highlight that higher wages doesn't intrinsically lead to less employment. It certainly might, I don't know.

Yeah, right. Why don't you take me through this so called calculation, you can use a network engineer as the example. Well, of course they are. Your only mistake is in thinking it can be broken down into a per-job contribution. It can't. Yes, of course, but not on a per-job basis. Here's a hypothetical. A project is late. If they don't hire another person the product won't be available in time and they'll lose a million dollar sale. What's the value to the company's bottom line of the newly hired person? Does the million dollars get assigned to him alone? His group? His division? The whole company?The reason a person is hired has nothing to do with this fictional calculation you claim exists. I never insisted on any such thing, but to address what you mistakenly think was my point, increases to minimum wage over the years have tried to keep it in line with inflation rates, and when I look at the increases since 1968 it hasn't even kept up with inflation, so one wouldn't expect a minimum wage that effectively declined over time to have caused higher rates of unemployment.But it is a fact that wages can price a job out of the market (supply and demand again), and to the extent that minimum wages laws do this they will make it more difficult to find employment at the lowest skill levels.--Percy

It devolved into personal criticism when you devolved it into personal criticism. You seem blissfully self-unaware. But I didn't neglect to say. You've got a massive currency devaluation parading as a minimum wage increase. Only for those who were below the new minimum wage level. Everyone else has the same amount of money. Prices rise, sales decline. Yeah, we're all good except for the impact on unemployment at the lowest skill levels. And I quoted you describing them and acknowledging that you were actually devaluing the currency (you called it "destroying savings" or some such). You don't know? What do you *think* would be the effect of a 100,000:1 devaluation? Don't try to answer, it would be pure chaos with the specifics being unpredictable.--Percy

You've done this one before. I've answered you before.My answer was on the lines of --- well then, why doesn't a major multinational company hire me as their CEO and pay me tens of millions of dollars a year? After all, I can flip a coin with the rest of them.Heck, I'd do it for five million dollars a year.If it is genuinely impossible for people to figure out what would or wouldn't be a good activity for the company, then each company is paying the managerial class for nothing, and we might as well just sack them all and get the company janitor to make the business decisions.If the managerial class deserves to exist at all, it is precisely because they can make "this so called calculation". If they can't, they are worthless parasites sucking the blood out of the economy by getting paid to get the big bucks for making random decisions, while swindling people into thinking that they can do something that is impossible to do.Your call.Edited by Dr Adequate, : No reason given.

And it seems I am destined to remain so. Give me a clue, in which post did I devolve this discussion into personal criticism? That is, criticising your personal behaviours or attributes. I was talking only about jobs in isolation, independent of the all the mess that would cause for other reasons. In what sense was my reasoning more problematic that talking about a minimum wage of $50,000? I mean, assuming America keeps the dollar long enough, minimum wages will reach $1million dollars/hour and unless the future is Mega-City 1 (a comic book city with 87% unemployment rates due to robots doing all the work) I don't see why we must assume that this would be a problem for unemployment. What's the alternative? More people working hard but being as impoverished as the some that were previously unemployed? What would you prefer: More employment, at wages that won't pay rent and food at the same time (ie., what happens when we let non-human market forces decide), or less employment at wages that do pay rent and food? Devaluing currency occurs during inflation. My use of hyperinflation (which is what I called it) doesn't really make any difference on that point.If I had said $50,000 then I would have spoken about the fact that prices would rise to compensate for the higher overheads (and to capitalise on the increased amount of capital available to the market), so that coffee prices might rise to $25 / cup, which would be fine, because wages had gone up.The unemployed? Hopefully whatever unemployment benefits they are entitled to will also rise in line with inflation.

Hi Mod,I understand that you believe raising the minimum wage will just cause prices to adjust leaving everything pretty much as before. And I understand that you reject my view that jobs can be priced out of the market, that raising the minimum wage too much will cost jobs at the lower skill levels. I'm content to let you go on believing what you believe.--Percy

Great, then just answer the question. Take me through this so-called calculation. Comb the Internet looking for it. I'll even help you. Google "MBO job value" (including the quotes). The first result describes one approach to precisely calculating this value except for one tiny detail: "employee's worth to the company."Search though you might, you won't find any formula for this calculation. That's because it doesn't exist. Companies are cooperative enterprises with many contributing individuals. Determination of the contribution of any single individual usually isn't possible. It would be like trying to assign a value to each of your cell's contribution to your life.--Percy

I'll walk you through the sort of analysis that is required to justify a new network engineer position - Sure.It’s a construction and leasing company. So it’s all about the estimates. A business case for an additional network engineer would include an estimate in days per year of delays to primary, secondary and tertiary projects caused by having insufficient network staff resource in place. Delays to primary construction projects can run into the millions so, for obvious reasons, we wouldn’t have a single network engineer here or there as a dependency on such projects. But a single day per year accumulated across all secondary projects and 5 days per year on tertiary implementations would be a reasonable estimate for a network implementation engineer. Estimating a figure for the cost of such delays would be down to the construction and leasing departments. Construction has a whole sub-section called ‘Estimating’ whose entire purpose to is to estimate the impact of time and materials changes to projects.On the operational, as opposed to the new-business, front the obvious quantifiable for a network engineer is in-business-hours network downtime. A business case for a new network engineer would absolutely include an estimate in hours per year for main and satellite site network downtime as well as site link failures caused by having insufficient resource to adequately maintain network equipment, security and configuration. The IT director has done his own finger-waving to estimate the costs of such outages. If I was writing the business case I would also state that delays to daily change requests (digital marketing requests for changes to web security and suchlike) have a difficult to quantify yet persistent and accumulating cost to the business.Finally, if I were writing the business case, I would end with something like the following: With inadequate network staff resource the ability of the infrastructure team to undertake full site failover disaster recovery is significantly compromised. In the event of such disaster recovery measures being necessary lack of adequate network staff resource will have an impact on the time taken for key infrastructure to be brought back into an operational state and thus on business continuity. The impact, and thus cost, of this could be of major significance to both the UK and wider global operations.Why that last bit? Because this is the sort of shit that will get the IT director’s attention. Because one of the reasons the company employs him is to take responsibility for assembling a team of people who are capable of making sure that economically disastrous IT problems don’t occur.Does that answer your question?
Do you still think businesses go round hiring people without making any assessment at all of whether those positions will provide any economic benefit or not? There are two sides to this. How much is the worker willing to sell their labour for and how much is the employer able to pay that worker whilst still remaining sufficiently profitable.A minimum wage needs to lie above the wage desperate workers will otherwise sell their labout for but below the limit that makes low skilled workers unprofitable to employ. As long as it lies in that range why would it have any effect on unemployment?