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CBO Not Competent to Assess Economics of Minimum Wage
An “unreliable” report claiming that raising the minimum wage would reduce jobs
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A Congressional Budget Office Report on the Raise the Wage Act of 2021 underpins a February 11 Washington Post editorial headlined, “Democrats Must Listen to the Data.” The Post laments that a $15 minimum wage would (according to CBO) eliminate about 1.4 million jobs when fully in effect, with half of the job losers leaving the workforce. Because of the projected fall in employment, the CBO also calculates that a $15 minimum wage would increase federal budget deficits by $54 billion dollars over ten years while adding $16 billion to federal interest costs.

This note examines the so-called data: should they be taken seriously as economics? Without in any way criticizing the competence of CBO’s budget analysts, the answer is clearly “no.” In particular, the CBO’s employment forecast is unsupported. As a result, its deficit forecast, though trivial in magnitude, is also unsound.

Much of the CBO report details the effects of an increase in the minimum wage on Medicare, the Affordable Care Act, SNAP, the Earned Income Tax Credit, and on tax revenues, which would increase due to higher payroll taxes on higher rates of pay. Some of this analysis is apparently novel and represents a significant advance on earlier CBO work in this area. However, the net estimated budget effects are small, since the total increases in spending are roughly offset by increases in tax revenue or reductions in tax expenditure. Of the cumulative estimated increase in the (on-budget) deficit, almost $53 billion are due to spending increases in just three areas: unemployment insurance, Medicaid, and CHIP. These expenses CBO attributes to its projection of job loss. The job loss projection is therefore the nub of CBO’s deficit projection, and it is important to understand how CBO arrived at its number.

The method is not explained in the CBO’s analysis, and a paper cited does not offer much explanation either. CBO merely states that it “has formed distributions of values for both wage growth and [employment] responsiveness” and “to generate an average estimate, CBO simulated a distribution of possible changes in employment by drawing randomly from these distributions.” The distributions themselves are said to be based on economic research, presumably academic research by labor economists.

The first problem is that the academic “literature” on which the distribution of estimates of an increase in the minimum wage is based is deeply uncertain and highly controversial. A predominance of studies are based on the simple idea that demand curves for labor slope downward, the proposition that with a higher average wage, fewer people necessarily will be employed. This is a textbook verity, often repeated, and beloved by business lobbies. But it is eminently doubtful in the real world. The real world is shot through with high unemployment in low-wage regions and fuller employment in high-wage regions, and it is also a fact, looking around the world, that more egalitarian regions have lower unemployment, generally, than less egalitarian regions.[1]James K. Galbraith and Enrique Garcilazo, “Unemployment, Inequality and the Policy of Europe, 1984-2000,” Banca Nazionale del Lavoro Quarterly Review, Vol LVII, No. 228, March 2004, 3-28.

A second problem is that few if any studies can fairly assess the effect of a large increase in the minimum wage, which is a different animal from the average wage because no such large-scale increase has occurred in the record. Instead, academic studies generally confine themselves to projecting estimates from small changes that have been observed, out into an environment in which they provide little to no useful guidance. That is what CBO has also done here.

In any event, the minimum wage is a peculiar thing. It is very low and applies to a very small and marginalized fraction of the working population. Who are they? In the main, they are teenagers working a first job, women and minorities in low-income communities and regions, day laborers, and migrant workers. What happens to these workers when the minimum rises is far from clear since one must also take account of the effect on workers who make a bit more than the present minimum, whose pay will also be increased, many of whom are in the same families as minimum wage workers.

For instance, some young people in low-wage employments will find that their family incomes have gone up by enough to justify quitting their jobs and (say) returning to school. Others, working two or more jobs, will be able to reduce their hours or quit extra jobs with little or no loss of income. The fact that these low-wage workers may leave the workforce is a good thing, not a bad thing as both CBO and The Washington Post suggest.

As a famous study found,[2]David Card and Alan Krueger, Myth and Measurement, Princeton: Princeton University Press, 1995. some employers will increase their employment without even thinking about it, because with higher wages job turnover declines, there are fewer vacancies to fill, and such employers will make back part of what they lay out in higher wages through lower training costs. This is a characteristic situation facing fast-food restaurants, a major employer of low-wage teenagers. Some other employers, unable to recruit cut-rate illegal labor from across the border, will offer the same jobs at the higher wage to documented legal residents and US citizens. In these cases, legal employment will go up, not down.

Finally, some employers, perhaps a vast majority, will face an unchanged need for strawberry pickers or wait-staff, and will simply pay the higher wage. They won’t like it but they will do it. And they may find that what they pay out in higher wages, they make back because their customers have more money to spend. What is the net effect of these different forces? The literature cannot say.

The CBO study states that “when the cost of employing low-wage workers goes up, the relative cost of employing higher-wage workers or investing in machines and technology goes down.” This is another textbook verity that does not withstand scrutiny. High-wage labor is not a more-efficient substitute for low-wage labor at a checkout counter or in a burger joint. The entire reason that those jobs are low-wage is that they have been engineered to use people who have few skills, require little training, and are easily replaced! Filling the slots with college graduates does not make the checkout lines any shorter or the burgers any better.

As for machines, CBO’s assertion overlooks the fact that many low-wage people are employed in the business of making machines – if not on the assembly line, then in packing, distributing, cleaning the factory floors, and in many other essential occupations. It is therefore not obvious that raising minimum wages across the board makes machines cheaper – even if there is a good automated substitute for human hands, which there often is not. Further and finally, when such a substitute does exist, it is often no less competitive with labor at $7.25 as at $15. Machines do not shirk, strike, or talk back.

What will happen to jobs when the minimum wage goes up? The truth is that CBO does not know. Its estimates are a hotchpotch of guesses, entirely without serious basis in either fact or theory. They were crafted, one may credibly suspect, to conform to an irrelevant body of textbook doctrine, so as to minimize criticism from people who write and read textbooks, and political figures who pretend to believe them. One can understand this impulse without sympathizing with it.

Since the unemployment estimate drives the deficit estimate, that too should be disregarded. Still, it is worth noting that CBO’s number, $54 billion in increased deficits over ten years, is tiny by present standards. The federal budget deficit for 2020 alone is estimated at $3,300 billion, so the estimated annualized increase in the budget deficit from raising the minimum wage to $15 per hour is less than two-tenths of one percent of the actual deficit last year. Even if the estimate were valid, which it isn’t, it is of no economic significance and the claim that it might lead to a rise of interest rates is entirely preposterous on that ground alone. CBO has a long track record of predicting increases in interest rates that never happened; this is just another bad forecast in that line.

A final issue concerns CBO’s assumption that the growth of nominal GDP (real growth plus inflation) would be unchanged by the increase in the minimum wage. The assumption of unchanged nominal GDP growth is a feature of CBO projections generally, not particular to this report, it is useful for standardizing comparisons of different legislative proposals. But because in this case income would shift toward lower-income families, CBO also predicts that “total demand for goods and services would increase for several years, boosting overall real output.”

In other words, raising the minimum wage is good for the economic growth rate! But if nominal GDP is constant while real GDP is higher, it is mathematically necessary that the rate of inflation must be falling under these projections, relative to the CBO baseline. So we have the following predictions all bundled together: higher wage costs, higher interest rates, more economic growth, but fewer jobs and lower price increases. The story makes no sense at all.

The Congressional Budget Office performs a useful function, in ordinary times, by estimating the budget consequences of spending and tax legislation on the basis of standardized economic projections. These projections are not proper forecasts of the economic future and should not be treated as such. But it is within CBO’s competence to use them as a common baseline for assessing the size of various tax and spending measures, and that is the legitimate function of the CBO.

An analysis of a major increase in the minimum wage is different. CBO can correctly analyze some of the mechanical consequences of such a measure, and it does so in this report. Those consequences include a major increase in the total income of low-income families, especially minorities, a large reduction in poverty, an increase in total demand for goods and services, higher payroll tax revenues, and changes in eligibility for and use of various federal programs in health care, nutrition, and the EITC. None of these, taken together, have much net effect on the budget.

As for the effect on jobs, CBO does not know. Its estimate has no valid foundation. Its deficit score for the fifteen-dollar minimum wage is therefore also meaningless. The blatant contradictions, cited above, in the macroeconomic inferences concerning the Raise the Wage Act are sufficient proof that CBO should not have published this report, and no one should rely on it.

James K. Galbraith holds the Lloyd M. Bentsen Jr. Chair in Government and Business Relations, University of Texas at Austin

Notes

[1] James K. Galbraith and Enrique Garcilazo, “Unemployment, Inequality and the Policy of Europe, 1984-2000,” Banca Nazionale del Lavoro Quarterly Review, Vol LVII, No. 228, March 2004, 3-28.

[2] David Card and Alan Krueger, Myth and Measurement, Princeton: Princeton University Press, 1995.

(Republished from Institute for New Economic Thinking by permission of author or representative)
 
• Category: Economics • Tags: Minimum Wage 
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  1. Ron Unz says:

    Back six or seven years ago, I was pretty heavily involved in Minimum Wage issues myself, and published a great number of articles on the topic, sometimes with a strong focus on the close connection with the illegal immigration issue:

    https://www.unz.com/runz/raising-american-wages-by-raising-american-wages/

    https://www.unz.com/runz/open-borders-american-elites-and-the-minimum-wage/

    https://www.unz.com/runz/whats-good-for-america-is-good-for-wal-mart-and-vice-versa/

    https://www.unz.com/runz/the-conservative-case-for-a-higher-minimum-wage/

    https://www.unz.com/runz/the-minimum-wage-and-illegal-immigration/

    https://www.unz.com/runz/immigration-republicans-and-the-end-of-white-america-singlepage/#escaping-the-low-wage-society

    With regard to the CBO report regarding the current controversy, almost seven years ago I published an article about a previous CBO report on exactly the same subject, and I think that with just a few changes in the numerical parameters, it would be just as applicable today. Here are a few of my key paragraphs:

    Furthermore, any honest advocate of a minimum wage hike must certainly grant that a large increase would surely produce some level of job loss, and raising America’s national wage floor from $7.25 to $10.10—a jump of 40%—is hardly insignificant. The CBO report suggested that somewhere between zero and one million jobs might be lost as a consequence, with the most likely figure being in the 500,000 range. Now I claim no great economic expertise myself and have certainly not reviewed the underlying calculations, but such figures seem perfectly plausible to me. However, I believe that the contending parties and the media have severely misinterpreted their meaning.

    First, how substantial is the potential loss of 500,000 jobs relative to the size of the American workforce? One useful point of comparison is number of workers who would benefit from that same minimum wage hike, and when we include the “spillover effect,” most estimates put that total at roughly 25 million, a figure fifty times greater than the likely job loss. So one way of presenting the numbers is that of the low-wage workers directly impacted, roughly 98% would benefit—in most cases by thousands of dollars per year—and 2% would lose. Major changes in government policy inevitably produce both winners and losers, and I would think that any proposal in which the former constitute 98% of the total should be considered remarkably successful.

    America’s population of low-wage workers themselves certainly come to this exact same conclusion, supporting a large minimum wage hike in overwhelming numbers. To the extent that they are the population group directly impacted—for better or for worse—should not their own wishes be considered a determining factor?

    Consider also that the growing desperation of this exact low-wage population has made them a leading source of government lottery-ticket sales, vainly hoping that a lucky number will improve their miserable economic plight. For most such workers, the fully capitalized value of the proposed minimum wage hike is close to $100,000 cash-money, and such a hike gives them a 98% chance of winning that amount rather than the 0.0001% chance that buying a scratch-off at 7-Eleven might give them. Is it morally right for the elected officials to deny them the former while encouraging them to squander part of their weekly household-budget on the latter?

    And how much would the losers really lose? Economic logic indicates that job-losses would tend to be concentrated at the lowest wage-levels since those are the workers for whom an employer would find the jump to $10.10 most difficult to justify in business terms. But bread-winners currently earning $7.25 or $7.50 already exist at the poverty-level and have high employment turn-over, while also receiving enormous social welfare subsidies from the government. So in many cases neither their personal difficulties nor the amount of their taxpayer benefits would be hugely different if their job suddenly disappeared.

    https://www.unz.com/runz/understanding-the-cbo-analysis-of-a-minimum-wage-hike/

  2. The idea that raising the minimum wage causes large layoffs is idiotic. Jack in the Box does not have extra employees loitering around who were hired due to gracious owners, who would be let go should they be forced to raise wages. Every minimum wage worker works all day. All are essential. They raised the minimum wage to $15 an hour in several large cities a few years ago and disaster was predicted by the corporate media, but nothing changed.

    Ask any minimum wage employee to choose a much higher wage or the risk of losing their job; they will laugh knowing they are essential. The best study was of employment at MacDonald’s when forced to sharply raise wages. Job losses did not occur.

    https://www.marketwatch.com/story/what-minimum-wage-increases-did-to-mcdonalds-restaurants-and-their-employees-11611862080

    If any of these jobs could be automated, they would be, regardless of wages. The minimum wage has fallen far behind the rate of inflation. A $15 an hour wage would return it to the minimum wage of the 1980s. I once had a carpet company owner tell the boosting the minimum wage would put everyone in his industry out of business. I asked if that meant Americans could no longer have carpeted floors, and he realized his proclamation was foolish. They’d all raise rates to install carpets for better paid Americans, while poor workers would need less welfare.

  3. jsinton says:

    Experts on the economy don’t seem to have a clue how to run a business sometimes. $15 an hour is a good way to shut a lot of people out of the labor market. The economy is already under unprecedented stress by pandemic. Mandating unrealistic wages to people with no skills when your business is on the edge of bankruptcy is sheer lunacy. In a sane world, with leaders who care about America, we should be creating policy to help main street mom & pop businesses, which are closing at unbelievable rates, instead of more burden. $15 an hour minimum wage is exactly the wrong policy at exactly the wrong time.

    Why don’t we tax Amazon or Wal-Mart? How about tax stock trades for Tesla? Why should big medical make money on vaccines bought by taxpayers? Why should PPP loans fund junk bonds or zombie corps? Or the Catholic Church that never paid taxes?

    Is there no one in Washington or Wall St that cares about ordinary America anymore?

    • Agree: follyofwar
  4. anon[174] • Disclaimer says:

    I used to be a Milton Friedman devotee who believed that there should not be a minimum wage, that the market should decide. I have since done a 180 and realized how much that scumbag and his (((Chicago gang of thugs))) have damaged this country. Those who place their trust in the market are the biggest fools because the market is wrong all the time. It is wrong all the time because it is always being manipulated by interested parties.

    You simply cannot have zero or ultra low minimum wage and open borders. Employers would take full advantage of workers and exploit them to the death. There will always be people more destitute that our poor who’s willing to take any wage as long as they can get into this country. The only way to deter open borders is to raise the minimum wage, take away the low wage incentive for hiring foreign workers.

    Of course, those who argue against it would say employers will just hire more illegals and pay them under the table. Yes there will always be those. But what we need to target are the big employers like Amazon warehouse workers, flex drivers, Walmart workers, fast food workers, big corporate farms, meat processing facilities…the legitimate employers. Those employers have been making huge profit thanks to open borders suppressing the wages. It’s time to end their gravy train. If Wall Street isn’t willing to shut down immigration, then we need to keep hiking the minimum wage so that Main Street doesn’t lose out.

    • Agree: bayviking
    • Replies: @Alden
    , @Reg Cæsar
  5. The minimum wage argument is ultimately moot, as within 30 years most all work will be performed by machines. The machines themselves originating from China. We will have a large number of Indians writing software to control the machines and a small group of non-Indians employed to correct the insanely flawed Indian software.

    The rest of the population, those surviving their Covid-19 inoculations will be provided a subsistence UBI allowing them to sit on a coach, consuming legal marijuana and watching Holocaust movies, ever more outrageous rappers as well as all types of transsexuals on Netflix.

    That’s the way it’s going to be. Guaranteed.

    • Replies: @augusto
  6. “minorities”? oh you mean Whites who are 36% of the population in California?

  7. GMC says:

    ” They Lie, as Naturally as They Breathe” – T Langdon — but he just wasn’t talkin about the Zionists.

  8. Thomasina says:

    Mr. Galbraith – it’s never how much you earn per hour that matters. What “matters” is what you can buy with what you earn.

    I notice that the Federal Reserve is not mentioned once in this article. What is causing prices to increase in the first place, necessitating an increase in the minimum wage? Is it currency debasement?

    When workers’ wages are increased, this extra money will cause increased “demand” on goods and services. This increased demand will begin chasing assets, only to see these assets rise in price. In no time the workers will feel like they never got a raise at all (because prices will be higher), and they will be back in a few years time demanding more money.

    These workers don’t realize that they will never get ahead because of the insidious, unreported inflation that they’re being intentionally subjected to by their government. They might make more, but if prices rise as a result, they are no further ahead.

    I suspect there must be a realization by the elite think tanks and investors that a good deal of the population can no longer afford to buy their assets or pay the rent. “Look, we can either LOWER our prices (which we don’t really want to do) or we can RAISE the minimum wage so that the workers can afford our prices. Of course they’ll be priced out again in a few years time, but who cares. They don’t really understand that they’re being fleeced, anyway.”

    What is causing prices to rise in the first place, Mr. Galbraith? Could it be massive monetary inflation?

    Instead we talk about band-aids. It’s like handing someone who is lost in the desert a glass with a drop of water in it, a drop that will evaporate before he ever gets it to his mouth.

    • Agree: Old and Grumpy
    • Replies: @bayviking
    , @Timothy Madden
  9. black dog says:

    In the UK (where I live), employers tend to pass the extra expense of minimum wage rises on to customers. This elevates the prices of things, and so in effect, very little is achieved. Private landlords also tend to hike rents, because the market tends to charge what it can get away with. It also creates havoc with the benefits system. Many benefits are decreased or stopped altogether if a person’s income rises above a certain level, and that level is usually pretty low. In other words, an increase in minimum wage often leaves people much worse off. And there’s little incentive to earn more due to the benefits system so many people rely on.

  10. Alden says:

    There maybe some states where teenagers work minimum wage part time jobs. But not in California. I don’t think I’ve seen a teen age fast food worker in Ca since I was a teen myself. California minimum wage workers are mostly pudgy adult Hispanics of varying legality with children. The children’s welfare section 8 EBT supports the family provides the essentials. The parents wages goes for the car, entertainment and most of all the billions of remittances sent back to Mexico every year. Those remittances are Mexico’s greatest source of foreign currency.

    Therefore

    The American taxpayers support the minimum wage fast food workers. The fast food companies do not pay wages that support the workers. The money the fast food companies pay the workers is sent to Mexico.

    Memo to the fertility fanatic MEN OF UNZ who want White Americans to have more children but don’t have children of their own. . Teens are a big financial burden on parents. If teens could work, teens could earn spending money, gas money clothes and enough money so parents would be relieved of some of the expense of having children.

    But in certain parts of America, low wage employers won’t hire American teens preferring to hire non English speaking illegal adults knowing those adults are supported by their children’s welfare.

    Low wages equal high welfare costs.
    High wages equal low welfare costs.
    The shrinking middle class taxpayer supports the fast food industry workforce with its taxes. Another reason to boycott.

    We all know what the chamber of commerce wants. And why they support the high welfare party, Democrats.

  11. onebornfree says: • Website

    Another article by a typical “government can solve the problem” pro-more-government pseudo-intellectual scam artist who will never admit that government interference in the market caused the wages problem in the first place.

    Tagged on to the end of the piece: “James K. Galbraith holds the Lloyd M. Bentsen Jr. Chair in Government and Business Relations,”

    I had guessed that much before I’d even finished reading the first paragraph 😎

    A reminder:

    “States have always needed intellectuals to con the public into believing that its rule is wise, good, and inevitable”. Murray Rothbard

    Wages- The Core Issue:

    The core issue is simply this:

    do individuals desire that government dictates their own wages, or should that issue be solely between employer and employee?

    Of course, short-sighted idiots who fantasize the government dictating the wages of others, never can imagine that at some point in time, the exact same stupidity would be applied to their very own incomes.

    Another reminder: “The kind of man who wants the government to adopt and enforce his ideas is always the kind of man whose ideas are idiotic” H.L.Mencken

    “Regards,” onebornfree

    • Thanks: Emslander
    • Replies: @Mefobills
  12. To Carlton Meyer:

    Come on, man. My first job was at a Carl’s Jr., in the summer of 1983. I made minimum wage, which was $3.35 an hour.

    But you say, “A $15 an hour wage would return it to the minimum wage of the 1980s.” Even adjusted for inflation, $15 per hour is far more than $3.35. And if the minimum wage is raised to $15 per hour, you and I both know that a #1 Big Mac meal at McDonald’s is going to cost ten or eleven dollars.

    And people simply won’t pay that much.

    There’s a difference between populism and socialism, and a $15 per hour minimum wage is in the destructive socialism category.

  13. A few years ago a :living wage was calculated at around $18/per hour which interestingly correlates with the Parity Price of Wheat at something like $18/bushel. Presently a bushel of wheat is like $6.15
    What this means is that real wealth, what keeps us alive, is priced way below Parity which means that the entire economy is losing Earned Income, meaning revenue without interest payments.

    For every dollar earned by Agriculture that multiplies by the economic activity it contributes to the economy by a factor of seven. Short the farmer and everyone gets shorter, including wage earners.

  14. Reaper says:

    Lol.

    Some core capitalist facts then:
    Employers prefer to produce cheap:
    If forced to increase wages that should increase cost (non-direct ways too). So instead to accept it as loss/ less profitable they can for example:
    – Increase selling prices
    – Decrease production (with a side benefit it`s probably increase selling prices)
    – Close business, kick out workers
    – Do tricks to end contracts, compensation techniques to decrease wages, etc…
    – Hire freelancers/ temporary workforce where no actual minimum
    – Employ illegally
    – Bring business elsewhere
    etc, etc, etc…
    There are far more options than accept it and be fair and nice.

    Article full of dreams how should benefit radical minimal wage increase poor people and economy, life situations, education, etc…

    But hardcore capitalist employers are not some social/ socialist institute.
    If they can produce stuff for 1$ in China, instead for 15$ in elsewhere by great chance will prefer the first option, with the benefit of obidient workforce who submissive enought, and never run to the press, or outrage in social media/ start lawsuits.

    But let`s bet, odds are free to choose:
    Employers will be overjoy when their laborer says: bye I get double wages, so will no do you more as second job. Probably even make a party to celebrate they need to find someone, will find it at least double price, or even more, as many say: thanks, need no more job, I well with double wage. Company leaders probably even make a thank you, we are happy march to celebrate the benefits the radical minimal wage increase done to the economy.

    If Joe Smith need some hard laborer in the garden maybe will prefer Senor Senor for 2,5$, instead the nearby teen for 15$. Even if before called the next door teen boy for 7,50$.
    Or wait! Off course people are honest, and socially sensitive sure nobody mind if pay more from pockets, and sure this will decrease illegal workforce employment in favor to patronate low paid folks especially hard to check manual labor/ unskilled labor industries, especially on task when workforce have no need of special skills, knowledge, easy to replace, as true as Flat Earth. lol
    Good morning.

    “looking around the world, that more egalitarian regions have lower unemployment, generally, than less egalitarian regions.”

    Yeah, and who benefit on that?
    Sure whoever needs some unskilled, and hard labor find it very favorable when there are millions unemployed, and sell their workforce, body, organs, soul, kids for a lunch, instead hight minimal wage.
    But let`s dream again the nice corporations who will be happy to pruduce in cloth factory, and pay hight minimal wage for poor laborers in the developed country. They are nice, and fair never produced any cloth in some third world country, or ships on international waters at swetshops, they not even know what is that!
    This is true as the fact as Amazon patronates it`s two dozen union to the benefit of their workforce, while encourages union membership, in a country which don`t know what strike breaker is, never heard the National Guard suppress unrests of workers with machine guns, and confess the nice guy Rockefeller were a kind employer – all that pink and nice, as it was always in that country trought history.

    So dreams about how benefits it`s the poor is just that: dreams. When well detailed called utopia. Or a joke.

    But anybody free to try some role playing: what should employers think, what probably they do? How can they avoid loses?
    Just an idea.

  15. onebornfree says: • Website

    Is Galbraith a eugenicist? :

    “Minimum Wages Had a Eugenic Intent”:

    “…You could of course say that none of this matters. That generation was filled with moral monsters who believed that culling the population of non-normative people was a function of the state. These days, however, the purpose of the minimum wage is to uplift everyone. The problem with this excuse is that the previous generation at least had the economics correct. Price control on wages creates serious market dislocations.

    Let’s say that instead of a $15 an hour minimum, Congress pushed a $15 maximum wage/salary. The rich would simply stop working, while everyone else would likely lose professional aspiration. This is not complicated to understand. So too with a wage floor: it cuts the poor out of the market just as the eugenicists said it would. ”

    From: “Minimum Wages Had a Eugenic Intent”:
    https://www.aier.org/article/minimum-wages-had-a-eugenic-intent/

    Regards, onebornfree

    • Thanks: Reaper
  16. Dumbo says:

    The problem is not minimum wage, the problem is immigration. Who are these people protesting in the picture? Are those the new Americans?

  17. Great analyses coming from the towering economic thinkers who have never worked a real job or run a small business. And with Biden’s proposed plan to kill independent contractors the consolidation of government power through surveillance and elimination of wrong people by certified woke corporations will usher in the new age of compassionate, green fascism. It’s the circular flow of gibs in the racial justice economy. Why, job losses and small business collapse will be offset by profits in the student loan industry as many former low-wage earners can return to school to become doctahs and lawyahs because their median family income will actually go up for the sole employed burger flippers in their fambly who now earn $100K per year!

  18. A rising stock market benefits the poor and lifts all boats more than any other approach. All the poor will do with an increase in wages is spend it on consumer goods, rather than buying stocks such as Tesla and Amazon, or corporate bonds.

    I say cut the minimum wage, go to negative interest rates, and give huge tax breaks to business and the wealthy, as that will lead to a higher stock market, which as we all know, is what makes America great. And endless wars.

    • LOL: bayviking
  19. Anonymous[260] • Disclaimer says:

    This article is a long-winded exercise in ignoring the fact that a $15 minimum wage will result in price increases at McDonalds.

  20. @Carlton Meyer

    You do realize that all raising the minimum wage does is provide a temporary boost. As prices rise in response, the low end worker will once again sink under the new cost of things. This is nothing but the gov’t attempt to get inflation going to cheapen the dollar. If a burger eventually costs $1,000 then the debt doesn’t seem so outrageous in comparison.

    For decades, the dollar has been purchasing less and less real goods while the Fed has been pumping up the bubbles. They know the end game is approaching, but in the interim, getting people used to higher and higher prices makes debt loads look less onerous.

    • Replies: @Realist
  21. bayviking says:
    @Thomasina

    You have correctly identified how the inflationary policies (always underestimated) of the Federal Reserve have created an enormous rift between housing and wages for the average worker. Housing is just one very bad example where in the fifties a house cost twice one’s annual wage, to where it is now more like four years wages. In the eighteen hundreds you could buy a house for one month’s wages.

    Its all been kept afloat with looser and looser lending criteria and and associated financial crisis, but this trend has maxed out, we are entering the twilight zone of deflation, where debts that can no longer be paid will no longer be paid. Anticipating this problem, Banks paid off Biden, Bush, Clinton and others to rewrite personal bankruptcy and child support laws to be more in line with a Feudal Economy. We are seeing more of pay up or go to prison, a once unthinkable unconstitutional outcome.

    • Agree: Thomasina
  22. @jsinton

    No corporation ever pays a tax, regardless of the laws. As a middleman between the consumer and the gov’t tax collector, the corporation is an agent of the state to collect a tax from the consumer and then pass it on to the gov’t. The collected tax is hidden in the price of the product or service so the consumer is unaware of the stealth tax the corporations collect.

    If the laws were such that corporate taxation was abolished, then prices for products and services would fall due to competition and the gov’t would have to get their tax directly from human beings. Tax rates would rise dramatically and there just might be a revolt when the average person see how much the gov’t has always collected from him, but did so via the hidden tax that was buried in everything the consumer purchases.

    In the final analysis, only flesh and blood people pay every cent of tax. Corporate taxation was invented to allow the gov’t to hide the amount they steal and to offer the evil corporations up as something for the stupid consumer to hate and demand they pay their fair share.

    • Agree: jsinton
    • Replies: @onebornfree
    , @WypipoBLike
  23. TG says:

    But missing the point. Low wages are a feature not a bug.

    In the late 1960’s, the rich opened the border to the surplus population of the third world, and as usual, wages went down and rents and profits went up. If the rich had not done that, then if wages had tracked gains in productivity, the true ‘minimum’ wage would be around $25 to $30/hour. Why not? It’s all supply and demand. There is no reason that truck drivers and janitors can’t make a decent wage, as long the supply is limited relative to the demand.

    We don’t so much have a minimum wages, as a maximum wage set by the elite’s forcing of population growth via immigration. Funny how people who say that the government can’t intervene in an economy by mandating a minimum wage, have no problem with a government intervening in the economy by deliberately driving wages down.

    Yeah sure, if wages go up so will prices – a little. So what? In Switzerland wages are high, and so are prices, but the high wages win and the average person is prosperous. In Bangladesh wages are low, and some prices are low, but the low wages win, and the average person is miserably poor. The idea that high wages hurt the poor because of high prices is just bunk.

    And nobody fights supply and demand. The real factors are forced population growth (‘immigration’), and outsourcing to low wages countries. A minimum wage can’t really fight this.

    Although a minimum wage could be useful, but not for commonly debated reasons: if the minimum wage is set to $15, then this eliminates the incentive for the rich to import workers to drive wages below this.

    What’s the point of importing another hundred million refugees, if that pressure is not allowed to drive wages down? I can’t see the anti-labor corporate democrats seriously supporting such an initiative. Biden opened the borders to cheap labor on day 1. Increase the minimum wage? Um, that’s hard. I mean, you’ve gotta have your priorities.

    Another issue is that the minimum wage is not enforced for illegal (‘undocumented’) immigrants, just like labor laws and identity theft laws etc. are not enforced, because that would cost the rich money.

    • Replies: @Reaper
  24. bayviking says:

    In this country, which has long dominated the world, the science of economics has been completely demolished by the ruling class. For example, the Koch Brother’s fund the economics department at George Mason and several Florida Universities. In return, they demand the right to approve all academic hires, maintaining Conservative falsehoods not just in the mass media, but right at the top of academia. Total control of information and the political system. Actual experts like Galbraith, Hudson and Stiglitz are locked out of positions of power in our Government. Instead self serving crooked minds like Friedman, Greenspan, Geithner and Lew run the show…. and oh what a $30 trillion disaster it has turned out to be. The same problems that plagued 2008 began recurring in August 2019 (before the pandemic) and there is now no end in sight to “quantitative easing”.

    • Replies: @Mulga Mumblebrain
  25. Anon[273] • Disclaimer says:

    Perhaps the GOPe members of the Senate could compromise on a $10 hour minimum wage and see what happens over the next 3-4 years.

    I personally think abou $12 would kinda be a good number. There are many rural manufactures in the South that pay about that. I want to keep those here.

    • Replies: @HT
  26. HT says:

    Raising the MW is just the Democrats repaying their third world voter base. They know it won’t help those people but they also know third world idiots will never figure that out.

    • Troll: Mulga Mumblebrain
  27. Mike Tre says:

    Mandatory minimum wage increases are a zero sum endeavor. Any cost that an employer has to incur is always passed along to the consumer, whether it’s labor, logistics, utilities, or material.
    Politicians love the issue because they can appear to care about the working class. News flash: they don’t.
    Big box and fast food chains absolutely love minimum wage increases. Corporations can temporarily take a loss when MW hikes are imposed, long enough to put their small business competition out of business, because small businesses have to raise their prices as soon as MW increases are required by law. Once mom and pop are gone, the big box raises its prices and continues to automate their operation, so they both create a local monopoly on goods and services while they screw their own work force in the process.
    And fast food jobs are not essential. The original burger stand operating model was never to give full time employment to illegal immigrants and pay their benefits. It was a family business that offered part time jobs to teenagers where they could learn basic marketplace skills.
    And the reason wages have not risen commensurate to costs is immigration. Labor has been a surplus since the 70’s and that’s exactly where the ruling class wants it.

    It’s funny, the time in the US when the working class benefited from the most prosperity was BEFORE minimum wage, Hart/Cellar, and corporate retail monopolies. Since those things, the working classes wages and quality of life have decreased.

    And here’s a simple Litmus test for any issue: If all the politicians and all the corporations are for it, then it is almost always a BAD thing for regular people.

  28. Increase of minimum wage will further devalue the dollar, resulting in increase of prices, increase of unemployment and introduction of inflationary cycle as it did happen under Carter.
    It will be “coup de Grace” for USA this time..

    • Replies: @bayviking
  29. onebornfree says: • Website
    @RoatanBill

    “No corporation ever pays a tax, regardless of the laws. As a middleman between the consumer and the gov’t tax collector, the corporation is an agent of the state to collect a tax from the consumer and then pass it on to the gov’t. The collected tax is hidden in the price of the product or service so the consumer is unaware of the stealth tax the corporations collect.”

    Furthermore, inflation itself is effectively another “hidden” tax, despite the fact that really, its in plain view [if one opens his/her eyes].

    Bottom line: brainwashing, indoctrination + sleight of hand still works very well on the masked masses demanding their $15 per hour slave wage. 🤣

    “There’s a sucker born every minute” P.T. Barnum

    Regards, onebornfree

    • Agree: RoatanBill
  30. @RoatanBill

    The first paragraph here should be a required preface to any discussion of corporate taxation. “Ah, but corporations are people, my friend.”

    Very well written comment, RotanBill. Bravo.

    • Thanks: RoatanBill
  31. HT says:
    @Anon

    Most young blacks are not worth $5 an hour so having a MW doesn’t help them while some workers who are productive are actually worth more than the MW. I would have no MW and let the market fall where it may.

    • Troll: Mulga Mumblebrain
  32. A question no one is asking is how a $15 minimum wage works post Covid19? Could financially hurting businesses handle it? I have my doubts. Also why 15 dollars? What makes it the sweet spot? Finally we boomers as teens worked the fast food joints. Now they tend to be manned by adults trying to make ends meet. Doesn’t seem like minimum wage is the real issue but inflated professional class costs? With licensing and regulations, they are difficult to outsource and increasingly mandatory to use. All forms of insurance comes to mind on being the perfect example of this, and boy does insurance costs trickle (more like rush) down. So why no talk on price freezing as a potential fix? Speaking of insurance, is it time to focus on a national healthcare? That would be a better relief to the fast food class than $15. Personally until homeopathy and natural health are welcomed to the table, I think no then I see the insurance bills. Utterly ridiculous.

    Disclaimer: I’m not advocating anything. Just questioning everything because I genuinely don’t get the fixation on $15 . I also consider the sources pushing it… the massively inflated professional class. They also tend to have nothing but contempt for the working class.

    • Replies: @Alden
  33. bayviking says:
    @Zarathustra

    Obviously, did not read or understand Galbraith’s article.

    • Replies: @Zarathustra
  34. onebornfree says: • Website

    Like father, like son, presumably. The authors father was apparently John Kenneth Galbraith, a famous “liberal” [i.e. Marxist] US economist who died in ’06:

    https://en.m.wikipedia.org/wiki/John_Kenneth_Galbraith

    “States have always needed intellectuals to con the public into believing that its rule is wise, good, and inevitable” Murray Rothbard

    And so it goes…

    “Regards”, onebornfree

  35. Realist says:

    Without in any way criticizing the competence of CBO’s budget analysts,…

    Why would one shy away from criticizing the CBO? Like all other government offices and organizations, they are totally incompetent.

  36. Realist says:
    @RoatanBill

    You do realize that all raising the minimum wage does is provide a temporary boost.

    But that is the case with any raise…government edict or not.

    • Replies: @RoatanBill
  37. augusto says:

    Of course not.
    The discourse of job reduction as due to Minimum wage hikes is proven to be a 1st class bullshit.
    It s one of the dearest usual suspects of the neoliberal waning gang of worshippers.
    The ex president of Brazil Lula da Silva did exactly that, a minimum wage raise policy for eight years, on a modest but cumulative, consecutive yearly basis. And the results were a solid and indisputable growth in the economy all over, from north to south.
    Everyone was happy, including the former neolibs of the 90ties and the big corporate bosses.
    One needs not be an economist to notice that the lower the previous regional income, the bigger would be the GNP and social gains.
    Imagine a ‘ spillover’ built up from under, or a spillunder factor.
    Ifigure that now, the excessive autonomy of the US 50 states governors… is a clear obstacle to this.

  38. Jiminy says:

    In a country that has known so much wealth, it’s criminal to not provide workers with a fair wage. One where they can prosper, have a family, save and live a contented lifestyle. What we are talking about are the future of a country. The lifeblood. Some now would say that the states has become a banana republic, but it’s certainly not as a result of high wages for the forgotten lower classes.
    Everyone, including the shop owners benefits. Ask yourself how many times do you see Bill Gates or some other wealthy baron down at your local 7/11. You don’t.
    It’s only logical that the more a worker earns, the more they have to spend. They shop more, and invariably the businesses employ more staff. I’ve never known of businesses to lay staff off in the good times. Sure, trickle down economies work-for the Bezos and Gates of the world. These men will be some of the most vocal opponents of increased wages.
    I can’t see the connection between immigration, and wage increases. If the employee isn’t a native of the country or they don’t have a working visa, then they can’t take jobs from locals. That should be enforced by a government body. And the offending businesses should be fined.
    Certainly a lot of these people work in menial positions, but not every body wants to set the world on fire. Simply finding contentment is a worthwhile reward.

  39. augusto says:
    @Just another serf

    So, lets build a society where, the most miserable workers are when this golden MACHINE reign arrives, in three decades, the better for the economy.
    My grandkid will try to learn Chinese. He must first buy a chinese teaching machine.
    His unfortunate sister will try to work in a passenger ship crew. Her risk is a machine will replace the hundred plus
    tasks she was trained for.
    The commentator may, 30 years on, of course have an ophtalmic problem or two. His ophtalmologist a must trust upon guy …? A shining brand new machine.
    And now his most prodigious conclusion:
    Since ordinary workers with a head, hands and feet will be ever fewer , fewer and the laws of the MARKET will make his children earn less and less, until the very glorious moment when everyone
    gets of course, ZERO.
    Because machines refuse to get paid.

    • Replies: @nsa
  40. Didn’t Seattle and a few other cities try this?

    Anyway, here’s a joke for you: “…….and the economist said, well of course you have to hold everything constant.”
    Thanks to (((Friedmann))) and the Chicago Shovelling Union of Hired Liars nobody believes anything economists say. Including other economists. Why would they? These clowns went around claiming pollution doesn’t exist. Externalities? Gone. Public cost. Fuck the air, the water and all life that depends on it.
    Clearly, no one in media has argued that billionaires need to return all the proceeds of the Corona Trough Feeding-SME Extinction Event. No. Billionaires Own the Media. So forget about the public interest.
    How about this? Businesses assume legal personhood so let’s subject ALL Businesses to Progressive Income Taxation and let the chips fall where they may. Now Microsoft pays 52% across the board as does Amazon and all the other Tech Scum including that mangina Cook and Cuckerberg. Oh, and let’s audit Congress, the Senate, the Pentagon, the Joint Chiefs and anyone I feel like cuz rules are rules right Fauci? Yeah, how about we send an army of auditors out there and let’s expose the last 50 years of complete and total corruption by the (((U.S. Establishment))).

    Soŕry, yeah $2/hr for the people at the bottom? Absolutely outrageous. The sky would fall.

  41. Charles says:

    I haven’t read every comment, nor the entire article, but just in case it hasn’t been said: part of the point of “minimum wage” jobs WAS – that is, used to be – to introduce teen-agers to the working world and let them understand what it meant to clock in, keep a schedule, take directions from a boss, et cetera. It was NEVER meant to be a way for a grown man to pay his family’s rent or mortgage.

    • Replies: @Alden
    , @onebornfree
  42. Why stop at $15?
    Raise it to $50
    No more poverty at all!

  43. Alfred says:

    Minimum wage is a red herring. They should stop the sickcare scam which absorbs 17% of the GDP – it is close to 9% in the rest of the OECD. There is no reason for people on low incomes to pay income taxes. As for social security, the beneficiaries are people who live long enough – not the poor.

    • Thanks: JackOH
    • Replies: @Mulga Mumblebrain
    , @JackOH
  44. Alden says:
    @anon

    Totally agree. I remember a few years ago Walmart had TV Ads with asian Pacific Islander and Hispanic heavily accented Walmart workers talking about how they “ gave back “ to the community by charity work including at homeless shelters and food banks. People just laughed at 19 hour a week $9.00 an hour workers having anything to give to anyone else.

    One thing the Friedman free market low wage school of economics never takes into account is the cost of getting to work. Or as I call it the Working Tax. Triple A claims 80 percent of all auto expenses is commuting to work. Monthly bus passes are $80-110 a month. Why work if you can either have a couple of welfare babies or live with a woman who has welfare babies and have a little more actually cash at the end of the month than if you were working

    Our electrical contracting business is doing just fine. Some of the guys and gals building the new SV Facebook data center are making as much as $23,000 a month. Not a typo, $23,00o a month. Of course that’s a lot of overtime. Facebook pays us, we pay the electricians, the electricians pay monstrous state federal and sales taxes and buy 2-3 million dollar 50 yr old frumpy suburban homes in need of repair and lots of Chinese crap from Amazon and thus Amazon needs more data centers.

    • Replies: @anon
  45. @Realist

    If raises are made organically as individual businesses decide that it’s time and the economy can afford it, then the impact is gradual. When the gov’t issues a fatwa and all employers of a certain category must jump so high according to some master plan invented by the premier criminals in the society, then there is a massive reaction all at once. That reaction almost guarantees that the benefit will be realized for a short duration as prices will rise quickly across the board.

    Any employee currently making the proposed minimum wage will immediately ask for a raise to keep him above the minimum once it’s implemented. That means all lower end wages also go up along with the target group. A current $15 employee may seek $18. The $18 employee knows he’s worth more than the previous $15 employee, so he asks for $20. …

    It starts a set of dominoes falling that ratchet up price inflation that in the long run benefits almost no one, except the Fed and Gov’t by getting people accustomed to higher prices all around. With the Fed digitally printing trillions, they have to mop up some of that in higher prices that everyone pays while their largess went to the top tier criminals in the society, namely the finance industries.

    • Replies: @Realist
    , @Alden
  46. Alden says:
    @Charles

    Exactly. But teens haven’t worked at minimum wage jobs for 50,40 years. And minimum wage wasn’t introduced for the benefit of teens . It was introduced in the 1930s as part of FDRs programs. Something like 30 cents an hour.

    But minimum wage is now paid to adults with kids. Minimum wage doesn’t rent the cheapest studio apartment plus car or bus fare to get to work in most cities. Move farther out and the minimum wage worker needs a functional reliable car to get to work. Live near convenient public transit and the shabby studio apartment costs more.

    Low wages equals high welfare costs for the taxpayers
    High wages equals low welfare costs for the taxpayers

    • Replies: @Mike Tre
    , @frontier
  47. Since there aren’t any jobs anymore, the point is moot.

  48. onebornfree says: • Website
    @Charles

    “..part of the point of “minimum wage” jobs WAS – that is, used to be – to introduce teen-agers to the working world and let them understand what it meant to clock in, keep a schedule, take directions from a boss, et cetera. ”

    Apparently you’ve been misinformed.

    The original purpose of the minimum wage was a deliberate attempt to render some people [eg mentally and physically handicapped, and “those who are helpless from cases irremediable” due to “old age, infirmity, disabling accident” and also those suffering from “congenital feebleness of body and charters, alcoholism, dissolute living…irretrievable criminals and tramps ” etc. ], unemployable , as part of a government -run eugenics [i.e. population reduction] program.

    See: “Minimum Wages Had a Eugenic Intent”
    https://www.aier.org/article/minimum-wages-had-a-eugenic-intent/

    Regards, onebornfree

  49. Realist says:
    @RoatanBill

    If raises are made organically as individual businesses decide that it’s time and the economy can afford it, then the impact is gradual. When the gov’t issues a fatwa and all employers of a certain category must jump so high according to some master plan invented by the premier criminals in the society, then there is a massive reaction all at once.

    True, all raises have a cumulative effect over time, raises for large groups by edict have a more urgent response.

  50. @bayviking

    It was years ago when I did watch Galbraight on television. He did have his own slot.
    But I do not remember much from it.
    I do consider what did happen under Carter administration, what is of the most significance, and that is terrible frightening to me.
    I think that should be frightening to everybody. Carter administration was the spark that ignited the idea for offshoring,which did destroy US industries. It seems to me that Biden wants to follow Carters pattern.

    And here is even the bigger problem. it looks like the gears in Biden’s brain do not mesh anymore.There are many broken teeth in that gearbox. Looks like God did not spare us from Camala presidency.
    (She is a kind of girl that would not know to whom she should listen.)

    Last time when Biden has spoken was really frightening to watch.
    Biden did walk to the speakers position before introduction. He had to be pulled back. After introduction he had to be nodded and pushed to speakers position. After finishing his short speech he did not know which way to exit and had to be pushed toward the exit.
    Mine take on all this is that Biden’s Brain now is only one percent functional, and 99% of it is already in the other world. (The dream world.)

    • Replies: @Alden
  51. @Thomasina

    I notice that the Federal Reserve is not mentioned once in this article. What is causing prices to increase in the first place, necessitating an increase in the minimum wage? Is it currency debasement?

    It is de facto currency debasement, through the ceaseless expansion of unfunded and unsecured private bank liabilities.

    Forensically, the source of the inflation is the double-counting-device and process by which the private nominal banking system accumulates new assets as reinsurance premiums but which are falsely-labelled as security for a nominal advance of credit.

    Virtually every nominal mortgage, for example, contains a clause to the effect:

    8.11 The Borrower agrees that neither the execution nor registration of this mortgage …will oblige the Lender to advance any…money hereunder but the advance of money from time to time will be in the sole discretion of the Lender.

    This provision allows the bank to charge-off the lead-underwriter’s [pretended-borrower’s] assets as an entry-fee for a wager to account for the bank’s otherwise unearned (unaccounted-for) gain (i.e., so that it does not have to pay-back the secured credit that it receives from the note-issuer / pretended-borrower / creditor-in-fact)].

    In plain English, and reduced to its essential and material elements, a typical nominal mortgage transaction is:

    “First, legally and unconditionally convey to us all of the assets (everything real or financial and specific to this nominal transaction), and then maybe we will agree that we owe you something in return, and maybe we won’t.”

    It is not about whether you subsequently win the wager or game-of-chance – it is about the bank doubling its accounting gains (untaxed-capital-gains) and real profits by putting the alleged transaction into the form of a wager. From there on it’s all about leverage leverage leverage.

    It is that ongoing process of double-counting and replacing / substitution of the new real asset so captured by the bank with a new unfunded and unsecured nominal deposit liability that we, the little people, experience as a relentless inflation of prices, and the ongoing coordination of various subsystems to conceal it and to deny it to us.

    Every net annual increase of the USD-equivalent of $10 trillion in aggregate private bank liabilities globally, represents about $30 billion a day ($30,000,000,000) of new unfunded liabilities and currency dilution / debasement.

    Whatever inherent or acquired capacity you may have to employ existing wealth and capital, or to create new wealth and capital, you have to go through the private banking system to use it, and that requires you to first unconditionally transfer ownership and possession of all of the assets to the asset-sink / bank, who then owns it all, and issues a new, and costless to produce, unsecured-deposit-liability into the economy.

    Hope it helps. Tim.

    • Replies: @Thomasina
  52. Well I have no idea about the truth here and neither does anyone… you have to pass a minimum wage rate hike to know what’s in it to paraphrase a great American political scumbag… But… say… isn’t the Washington Post… that defender of freedom and truth… owned by Amazon’s own Jeff Bezos? And does Bezos even want unions, another way of raising wages, in his sweatshops, I mean “Fufillment Centers”?

  53. Alden says:
    @Old and Grumpy

    The fast food class gets free health care through the free and very extensive county health systems. Those systems aren’t just the big county hospital required by state law in every county in the country. They comprise an entire system of clinics as well.

    When you read some idiot liberal be moaning the lack of health care for the working poor they are either ignorant or lying. The working poor have the very extensive available to everyone who walks in the door county health system. In every county in America per state law.

    Those wealthy Chinese woman who come to America to birth their anchor babies usually use the free county health systems. And why not use the free system instead of paying $15,000 for a birth and 24 hour stay for mom and baby plus another $8,000 for pregnancy care?

    Chinese multimillionaires, or just waded through the Rio Grande with nothing but the clothes they’re wearing, America is just a great big maternity hospital for the rest of the world.

    And the petty bourgeoisie 40-100K a year Americans pay for it.

  54. @Strike Three

    I did an analysis of real inflation comparing 1956 and 2016. I found that in 1956 the minimum wage was $1 an hour and the median annual income was $4,454. In 2016, the minimum wage was 7.25 and the median income was 31,099. A factor of about SEVEN TIMES.

    HOWEVER, I also found that in 1956 the average home cost $11,700 and average rent was $88 per month; In 2016 a home was $226,700 while rent was $1210. The cost of a house was almost 20 times as much; rent was almost 14 times as much;

    UPENN (undergrad engineering ) charged $800 in 1956 for Tuition. In 2016 it was $45,556. I found an average annual health care of $146 in 1956 and $10,739 in 2016. Education is up by a factor of almost 57; health care by almost 74 .

    Of course, some stuff like coffee is less than twice what it was then, gas was 9 times what it was then, etc.

    Overall, I found that expenses were over 20 times higher in 2016 than in 1956. So that means that an average worker in 1956 was making THREE TIMES AS MUCH IN REAL WAGES as a worker in 2016. That is why a postwar family could live a middle class life on one income; now it takes two people working overtime or going into debt and the quality of life is lower.

    I have not done a separate analysis for 1983 vs 2021; but I think the author is correct. In real wages, a 2020s minimum wage worker would need to make over $20 an hour to be equal to a 1950s worker minimum wage worker.

    https://archives.upenn.edu/exhibits/penn-history/tuition/tuition-1950-1959
    https://www.reference.com/history/much-did-things-cost-1956-1c8c29771bb78135#:~:text=The%20average%20cost%20of%20a,new%20car%20costed%20approximately%20%242%2C050.

    • Thanks: Mike Tre
  55. The official statistics for inflation are totally inaccurate. Since 1956, Wages are up more than 7 times, but expenses are up more than 20 times. No wonder minimum wage and even previously middle class people are in debt, on welfare, or both. In 1956 the minimum wage was $1 an hour. To keep pace, the minimum wage would need to be MORE than $20 an hour.

    Of course, the bloated US government IS one of the primary problems, so don’t expect them to fix any of the problems.

  56. wraith67 says:
    @Strike Three

    A Double Whopper w/out cheese (meal) is over $10 now.

    • Replies: @Mustapha Mond
  57. sally says:
    @Ron Unz

    The method not explained by the CBO’s analysis is stumping politicians to make min wage hikes sound good to the lowest paid .. but the problem is it takes two $s of income to pay for $1 of benefit when wages are increasing, while it takes $1 of net price reduction in goods and services to pay for the same $1 of net gain to the lowest paid.

    The answer to in-equality is to remove the monopoly powers which government has given its feudal corporate lords. No amount of wage increase can offset the buying power advantage of these monopoly powers produced by the congress from hot thin air and given to their favorite oligarch owned corporations.

    Let’s explore this a minute.. In the old days 1960s and earlier.. Americans would in their back yards, invent something that put a Monsanto type corporation completely out of a large market overnight, a market the Monsanto type had owned for years. Why, because the invention was nothing short of a revolution.

    Think about it in terms of the Buggy works business. Every where during the development of automobile, entrepreneurs were working to develop engines, car fames, and passenger comfort and to make these ideas into a engine powered horseless carriage. but each time an entrepreneur developed a great new idea the buggy works manufacturer would offer the entrepreneur large sums for the patent or copyright on the new invented horseless car technology. Buying the invention to use it was not what the Buggy works manufacturer wanted. The Buggy works never intended to make or sell horseless carriages with the technology it was buying, instead the buggy works wanted to stop all the back yard competition to its buggy works business. So the Buggy works industry bought the new patents and copyrights as soon as they came known, and added the cost of the patent or copyright purchase to the price of the horse drawn buggies.

    Their would have been no incentive for the horse drawn buggy industry to buy engine powered horseless buggies if the buggy works industry had to produce and sell horseless carriages with the inventions it purchased. But thanks to corrupt congress, the Buggy works did not need to produce one single horseless carriage to get a very high return on its pervasive investments in the patents and copyright monopolies that covered the engine powered horseless carriage industry. No sir, all the horse drawn carriage industry had to do was to use the patents and copyrights it already owned that protected the horse drawn carriage industry from competition, was to keep entrepreneurs from making better or cheaper horse drawn buggies, and to use those excess monopoly powered profits the law engineered into each sale of buggies to purchase and mothball the best inventions the engine powered horseless carriages entrepreneurs were working on.

    Hence the entire world was denied the Model T Ford. and the millions of jobs the engine powered vehicle would have created were restrained and consolidated into the few thousand jobs horseless carriage industry already had.

    You see congress supported the Horse drawn Carriages and gave to them a monopoly on their horse drawn carriages ( patent and copyright). Those patents and copyrights are monopolies created by congress which do two things at once for the protected horse drawn carriage industry.
    1st patents and copyrights present anyone else from producing horseless carriages so the price of the carriage stays un-competitively high (meaning monopoly powered excessive profits were going into the bank accounts of the horse drawn carriage manufacturers) and 2nd the excessive profits in the horse drawn carriage accounts were being used by the horse drawn carriage industry to buy up not the technology (the horse drawn carriage industry did not produce one horseless carriage) but instead to purchase the monopoly powers congress had inadvertently given to the engine powered entrepreneurs. These purchased monopoly powers (patents and copyrights) were saving the horseless drawn carriage from being made instinct by the engine powered carriage industry.

    In fact, because the horse drawn carriage people could buy the monopoly powers, it could prevent new inventions from ever being made into something useful. it could prevent competition of any and all types. if the patent and copyright laws had been then as today, Americans would still being riding in horse drawn carriage and would still be putting their horses in the stable to feed them.

    The patent and copyright powers which congress gave to the horse drawn carriage industry lasted then only 7 years, so after a short time, the technology of engine powered carriages won out.
    But Congress has now extended these time frame on patent and copyright monopoly power; they are enforceable now for ever .. or at least 100 years.. such would allow the buggy works industry to prevent all competition from whatever source. The fat cats in congress wrote into law patent and copyright terms and powers that are so broad and far reaching they give the owner of the patent or copyright complete control over his products and services. meaning no one can compete. It was these laws, that made it possible for
    the fat cat Oligarchs to take the American industrial might and move it lock stock and barrel to China and other cheap labor places.

    Competition prevention is the business of congress; just pay them enough and they will write more copyright and patent laws. but each time Congress increases the power or lengthens the time these copyright and patents can be enforced, it produces for the wage earner always rising market place prices. Hence the min wage has to be mandated by the government not so the wage earner can buy more, but so the monopoly protected industries can reduce the size of those it must employ, and so those who think they are benefiting by a higher wage, can pay more taxes to the governments that govern every aspect of their lives(sales taxes, income taxes and license taxes). In short, the min wage makes even worse off the wage earner than he was before prices were artificially raised by monopoly powers.

    the price for 16 ozs of butter went from $1 to $4 for 14 ounces. The wage earner got at $4 /hr raise but his cost of living went up $6 and his tax bill increased by $1. ..The wage earner now must choose between butter or something else.. when before he could buy all he needed.

    Monopoly powers are what keep wall street going. and what keep the average American Broke as hell. the few Americans with jobs will be just over broke, while the unemployed will be on government sponsored welfare which will by law be made to pass through the hands of the Oligarch who will take a % for his trouble. big time example is government subsidized housing, the government funds the oligarch, the oligarch builds and rents the houses, and the government pays the rent.

    Congress is your problem and rising prices is the result of competition that has been forced not to happen because of the monopoly powers (patents and copyrights) your government has given to those few who are already wealthy.

    • Replies: @Thomasina
  58. Mefobills says:
    @onebornfree

    Lolbertarians are always good for the LoL’s.

    Even when faced with overwhelming statistical evidence, they stick to their false narratives:

    Wages- The Core Issue:

    The core issue is simply this:

    do individuals desire that government dictates their own wages, or should that issue be solely between employer and employee?

    There are no two way relations between parties when it comes to money. Money settles transactions, or settles debts. The true nature of money is law, and hence it is a government fiat.

    One of the main reasons the market is malfunctioning is because the market thinks that capital and humans are fungible. So, what we see today is capital as money flying off-shore to places like China/Vietnam, etc. How is that off-shoring of critical industry working out, as American’s lose high production industrial jobs? Your ability to labor and create wealth is a function of something intangible, and that is the infrastructure, education, pubic health, and quality of industrial plant and equipment.

    The market and chamber of commerce types also think humans are fungible, and will import cheap labor.

    At the very beginning of the country, the founders had debates about “coolie labor” and instead decided on an economy type, where Americans were to be well paid, well fed, well clothed, well educated, and they were to work in Yankee workshops. These workshops used water wheels for power, and Yankees soon found they could out produce Coolies in quality and production.

    The Yankee workshop worked in tandem with the American System of Economy, where state credit channeled into public health, libraries, public schools, etc.

    Yankee workshop/American System/Industrial Capitalism is NOT FREE MARKET.

    The country began with “high tariffs” to then keep OUT Coolie labor produced goods, so that local industry could develop.

    Lolbertarians make fundamental mistakes about the fabric of reality. There are no two way relations between humans unless you are in a barter economy; in a monetized economy there is always a third party.

    Do you want that third party to be speculative finance capital (usurious), or do you want it to be structured to provide physical economy and good labor conditions/public health etc.

    High level industrial capitalist economies don’t need to import labor to keep wages down, they instead constantly improve the productivity of their industry/people and thus deliver low prices and quality of life.

    Lolbertarians would have us deracinate ourselves with foreign people, and lose our history, lose our livelihood, all because of some sort of sick adherence to a free market, when there is no such thing.

    This whole free market blabbering is regurgitation of an implanted memory, and is not American. The memory is implanted so citizens are disarmed, and then their pockets can be picked.

    • Agree: Alden
    • Replies: @Alden
    , @GeeBee
  59. Alden says:
    @Zarathustra

    Ahhh, Kennedy was heavily under the influence of strong painkillers amphetamines and steroids. Which he desperately needed for his Addison’s and osteoporosis caused rotting bones. Wilson was in a coma and his second wife Edith ran the country for 2 years. Edith had only been married to Wilson for a couple years when she had to take over. She wasn’t an experienced partner type politician’s wife like most presidents wives.

    There’s no reason a VP can’t assume the European style prime minister role. Better an elected prime advisor like Harris than Rockefeller Israeli puppet Kissinger types.

    Just my opinion.

    • Replies: @Zarathustra
  60. The minimum wage should be raised to $1,000,000,000 per hour.

  61. nsa says:
    @augusto

    “My grandkid will try to learn Chinese”
    Great idea! Every Wong and Wang household will need a white houseboy.

  62. Alden says:
    @RoatanBill

    I apologize for being a rich bitch snob. But that’s what I am. That’s the jumped up barely making it petty bourgeois crap. It’s the “ I’m the only occupation deserves a living wage” attitude that allows the billionaire capitalist pigs to employ thousands of full time workers who need welfare supplements to support food, shelter and the cars that get them to work.

    High wages equals low welfare costs thus easing the tax burden on the middle class.

    Low wages equals high welfare costs thus increasing the tax burden on the middle class.

    Charles Dickens wasn’t a Marxist. But he had a few things to say about the petty bourgeoisie supporting low wages. Something like cockroaches fighting for crumbs.

    • Replies: @RoatanBill
    , @Thomasina
    , @Biff
  63. @Alden

    Any gov’t program will be taken advantage of by anyone that can see a benefit to them. That also includes cutthroat employers that would rather have a yacht than their employees eating properly. Because welfare exists, the employers can offer lower wages and still find takers. Without the welfare, they would have to offer higher wages or their job needs go unfulfilled.

    Welfare for the working poor is what keeps them poor. Turn off the welfare and allow market forces to realign wages AND get the low skilled to realize that to get out of their situation, they have to become more valuable to an employer to get a higher wage. Welfare as the ultimate backstop allows some folks to fail relatively comfortably knowing they won’t starve. They then lack the incentive to improve their situation, just as the stimulus money is giving some people the incentive not to work.

    This topic can be viewed form multiple angles and to some extent all the opinions are right and wrong as there is no definitive answer to the problem. Reducing the number of variables in any problem usually leads to quicker solution. I’m suggesting to eliminate welfare via a transition in a given area to get rid of one very influential variable.

    Welfare was never intended to be a permanent subsidy more so to the employer than the employee. The employer gets multiple welfare benefits for the wages he doesn’t have to pay to multiple employees while each employee only gets one benefit. Welfare should exist only to get people back on their feet and productive, not as a life long crutch that the taxpayers support, in some cases for generations within a given family.

    • Replies: @Ron Unz
    , @Alden
  64. Alden says:
    @Mefobills

    As I recall, the well paid yankee farm girls who first worked in the Lowell mass textile mills were soon replaced by starving desperate immigrant German and Irish men. Who were expected to support kids and a home on the same wages paid to unmarried young women who lived in boarding houses.

    Of course both parents of the immigrant families worked in the mills while the kids took care of themselves as best they could. Contrary to the MEN OF UNZ fantasies that no married women in the history of the world ever worked outside the home until the feminazis demanded it in 1970. Or the Rockefeller and Ford Foundation puppets known as feminazis demanded it.

    This petty bourgeoisie kick the people on the rung below you crap is proof of idiocy

    • Replies: @Mefobills
  65. Ron Unz says:
    @RoatanBill

    Welfare for the working poor is what keeps them poor. Turn off the welfare and allow market forces to realign wages AND get the low skilled to realize that to get out of their situation, they have to become more valuable to an employer to get a higher wage. Welfare as the ultimate backstop allows some folks to fail relatively comfortably knowing they won’t starve. They then lack the incentive to improve their situation, just as the stimulus money is giving some people the incentive not to work.

    Presumably, your logic suggests that we should eliminate the Minimum Wage entirely. If we did, what do you think would be the political, economic, and social consequences for our society? Not in libertarian theory, but in actual practice.

    I’ve written quite a lot of articles on these sorts of issues, and you might really want to take a look at them:

    https://www.unz.com/runz/should-we-cut-the-minimum-wage/

    https://www.unz.com/runz/rightwingers-for-higher-wages/

    https://www.unz.com/runz/peter-thiel-the-weekly-standard-walmart-and-other-dog-biters/

    I’m actually the fellow who pretty much moved a bit hike in the MW to the center-stage of American politics back about six or seven years ago. Since I think you’re a rightwinger, you might want to know that along the way I won over lots of high-profile rightwingers such as Phyllis Schlafy, Bill O’Reilly, and the Daily Caller. Here’s a very long and supportive article that ran in the last.

    https://dailycaller.com/2014/01/10/12-an-hour-is-conservative-rocket-fuel-says-ron-unz/

    • Replies: @Thomasina
    , @Anon
    , @RoatanBill
  66. I’m all for raising it just for Walmart. Most of these garbage jobs are part time anyway so the employer can pass the Obamacare expenses on to the impoverished employee/slave laborer.

  67. Thomasina says:
    @Alden

    But, Alden, raising the minimum wage is just a band-aid approach. The worker wouldn’t need a raise if prices didn’t keep rising. WHY DO PRICES KEEP RISING? There is a reason!

    You’ve got to go to the source of the problem. What or who is responsible for the intentional and purposeful rise in prices? Think “Federal Reserve” in collusion with the government. They are debasing the currency.

    That’s right, the people who run things are doing this on purpose.

    For the life of me I cannot understand why people are pulling down statues and screaming about pronouns when they should be standing a million-strong out in front of the FEDERAL RESERVE and CONGRESS.

    Think about it.

    • Replies: @Mefobills
    , @GeeBee
  68. Alden says:
    @RoatanBill

    You might be wrong that welfare was never intended to be a permanent subsidy to the capitalist pigs to pay the wages of their workforce.

    Or perhaps welfare was intended to be a permanent subsidy to the capitalist pigs to pay the wages of their workforce.

    Think about that. Peel the onion See who benefits.

    OT. Because of the capitalist pig destruction of most construction unions, there are no decent carpenters left in America. They’re all self trained. They do their best to teach themselves but it just never equals the skills of a real 5 year apprentice ship trained carpenter.

    Capitalist pig destruction of construction unions with the applause of the petit bourgeoisie who didn’t realize that they would go under with the working class.

    Gotta do the monthly inspection of some roofs.

    • Replies: @RoatanBill
  69. A liveable wage, i.e. a wage rate of fifteen dollars per hour won’t break the economy but it will, of course, reduce the amount of money the greedy bastards would like to hoard away. The grifter class uses the taxpayer funded government to beat the very taxpayers who are paying for the unscrupulous rulers. In the end, both are the enemies of the masses!

    • Disagree: Corrupt
  70. Only comment I have to offer is noone should be stuck in a minimum-wage job, so all this talk about how it will help the poor is off the mark I think. If you have a career non-management, non-franchise owner fast-food job, likely the minimum wage could go to $1,000/hr and you will still be mired in poverty. Minimum wage jobs are temporary, entry-level, basic skill building jobs till you move on to something better.

    At least until such times we are all 100% expendable and happy to work for peanuts…

    There are so many more important economic issues we should be working on than this.

  71. @wraith67

    “A Double Whopper w/out cheese (meal) is over $10 now.”

    You’ve got to be shitting me. A family of four with healthy appetites would need to bring both wallets. Apparently it is the same for the movies. When a neighbor told me how much they spent going to see some Hollyweird dreck on the silver screen a while back, I was shocked. A large buttered popcorn and a drink are insanely dear. Take out a loan.

    I have not eaten junk food/fast food in almost 20 years, nor gone to restaurants or movies in nearly as many. The minimum wage workers in the back are not able to take sick time as they need the money and the job, so disease is spread as a result. A buddy of mine got severe Covid from eating at a local (nice) restaurant, as did his wife. Both down for three weeks, and he lost some sense of smell. During normal cold and flu season, it’s a crap shoot at best, health-wise. Nowadays? Very unwise.

    Home prepared meals are the only way to go for me and my wife. You know what is in there (only the best, real ingredients), you know who made it, and it won’t break the bank, especially if you buy in bulk and make a few meals out of it. No bullshit, just 100% quality. And no chance of disease.

    Of course, it’s not good for ‘the economy’, but hey, I don’t care. I’d rather be safer, healthier and wealthier. I also don’t own a television. Why pay for any of that crap? I guess I’m just not a good ‘consumer’……..

  72. Thomasina says:
    @Ron Unz

    I haven’t read your articles, but I will.

    Of course you won over high-profile rightwingers. I’d be surprised if you didn’t. Actually I wouldn’t even call them “rightwingers” because they’re from both the Right and the Left.

    These are the people who really benefit from an increase in the minimum wage as it then enables the rabble to continue to pay for their goods and services. Without a MW raise, the rabble starts to back off on consumption (out of necessity), which starts to hurt the corporate bottom line.

    These are the people who don’t mind inflation at all because they can easily stay ahead of it with their stock and bond portfolios and hire tax accountants.

    This elite group are the very people who are causing the inflation in the first place, cheering it on, which then necessitates them calling for a rise in the minimum wage. Of course, it’s all sold under the guise of being benevolent.

    So we have Galbraith calling for a raise in the minimum wage and we have Michael Hudson incessantly calling for a debt jubilee. Both of these solutions benefit the elite as they free up consumers to go spend again, which is really all they’re after. There is no way in Hell that they’d ever do something if it didn’t benefit them first.

    I implore you to look for the source of this problem. What is causing the inflation that then necessitates these so-called “solutions”, solutions that are only ever short-term remedies, at best?

    Use your high IQ and great analytical skills to write a piece on the source of this problem. The workers caught on the treadmill of despair would salute you for it.

    Follow the money.

    Thank you.

  73. Reaper says:
    @TG

    “Although a minimum wage could be useful, but not for commonly debated reasons: if the minimum wage is set to $15, then this eliminates the incentive for the rich to import workers to drive wages below this.”

    As you refer later: this tend to increase shadow economy/ illegal workforce.
    Also merits lost: the dull lazy “worker” ones get the same as guarantated/ enforced minimum, migrants included: legal or illegal.

    But businesses simply bring their production/ services elsewhere.
    Processors from Costa Rica, Toys from China, the call center/ costumer service in India, etc, etc…
    And then we not even talk about freelancers, or shady businesses.
    Off course the same companies prefer to sell where wages high:

    Something called globalization and free market.

    • Replies: @jsinton
  74. Anonymous[293] • Disclaimer says:

    Raising the minimum wage is nice and all, but what’s going to stop landlords from raising rent prices or food chains from raising prices for basic products? Does anyone have data on what happened to prices for rent, utilities, healthcare bills, food etc. in places like Seattle that have already embarked on wage increases? I mean, it’s the purchasing power that counts, right?

    • Agree: Thomasina
  75. GeeBee says:
    @Mefobills

    Well said, as usual. But I have a question for you, since you rightly bring up the subject of how free markets act against the fabric of a country (which is to say, its most precious resource, namely its own people).

    My question concerns a man and his economic principles whom you and I both admire. I speak of Michael Hudson. I have heard him describe himself as a ‘classical economist’, a school of economics championed by Adam Smith in his 1776 work The Wealth of Nations, and subsequently developed by John Stuart Mill, David Ricardo, Malthus etc. The Wikipedia entry for classical economics states that:

    The fundamental message in [Adam] Smith’s book was that the wealth of any nation was determined not by the gold in the monarch’s coffers, but by its national income. This income was in turn based on the labour of its inhabitants, organized efficiently by the division of labour and the use of accumulated capital, which became one of classical economics’ central concepts.

    All very well. Except that these people also believed in Free Trade and the influence of the market. Furthermore, they were to a man what we should today call ‘Classical Liberals’.

    We, of course, take issue with the deleterious nature of untrammelled Free Trade, we do not approve of allowing ‘the market’ to dictate economic policy, and we certainly do not find much to admire in the doctrines of Classical Liberalism.

    How, therefore, do we square our economic beliefs with those of Hudson? If anyone can throw light upon this seeming conundrum, I am sure that it is you.

    • Replies: @Mefobills
  76. Mefobills says:
    @Alden

    As I recall, the well paid yankee farm girls who first worked in the Lowell mass textile mills were soon replaced by starving desperate immigrant German and Irish men.

    The Irish actually had plenty of food, but the lower classes were living on potatoes due to debts to bank of england.

    Henry George went to Ireland to discover the truth. High value food, which could pay Irish debts was carted to ships, to then go to England/London; meanwhile Irish get to starve.

    With regards to the colonial experience, there were plenty of Malthusian American types about, who were happy to exploit labor and take sordid gain. They, I’m sure, would cover themselves in the free-market blanket, as a sop and cover for their takings.

    The American System of Economy evolved in Massachusetts BECAUSE there was not enough labor, nor was there enough gold/silver. So, they had to create their own money and be creative with what little labor they had. It was an accident at first, and then became indurated into policy, especially with Franklin’s Philadelphia Colony.

    In the late 1800’s it took Simon Patten to remind Americans again, what the colonials had created. Such is the constant propaganda attack from finance capital, that Americans had/have amnesia. I always view American history, as if it is a battleground between Industrial Capitalism and Finance Capital. Today, of course finance capital is ascendant, along with junk economists who are paid apologists, or dupes who are brainwashed true believers.

    ____________________________________

    https://michael-hudson.com/2011/10/simon-patten-on-public-infrastructure-and-economic-rent-capture/

    America differed from England, as did Germany and other countries confronting British industrial competition. Free-trade policy was not appropriate for conditions that called for steering economic evolution along the most productive lines. And what British economists treated as universal actually reflected its class structure, especially its hereditary groundrent stemming from the Norman invasion. Free-trade economists attributed America’s high wage levels to the nation’s vast backwoods of available land on which to settle as an alternative to working in factories. Like other protectionists, Patten found this explanation insufficient.

    American industrial labor had to be sufficiently productive to sustain higher living standards. This required investment in capital, which in turn required protective tariffs and public infrastructure investment. Patten recognized that rising productivity, public investment, and wage levels went together. That is what enabled well-fed, well-trained, and well-housed American labor to undersell “pauper labor.”

  77. @stevennonemaker88

    You did not need to go into so much trouble.
    You needed only to compare price of bread to minimum hourly wage for both years

  78. anon[122] • Disclaimer says:
    @Alden

    $23k a month amounts to $276k a year. I’m surprised someone making $276k a year can afford a 2-3 million dollar home, granted that homes in the Bay Area are super expensive. Facebook and all social media companies just need to go die, and take Google with them.

    There is of course another argument that opponents of raising minimum wage would put forth: that the employers would just pass on the added cost to the consumers by raising prices. My answer to that is: if it causes us all to consume less, that would be a good thing. Even our poor today have a house full of cheap junk that they buy from the Dollar store. How much more plastic do we need to toss into the ocean, poisoning the fish and all?

    Americans live a wasteful lifestyle. Most people live in the suburbs and have much bigger homes than our European and Asian counterparts. Bigger homes means more energy to heat/cool, more water, more places to store all your junk and furniture, so you can go out and buy more junk. This hyper consumption, materialistic lifestyle is turning us all into slaves of multinational corporations that sell us all this junk and bring in all the cheap immigrant workers so they can have even more customers.

    We all need to consume a lot less. The more we consume, the more power we give to Wall Street.

  79. Anon[283] • Disclaimer says:
    @Ron Unz

    Ron,
    I like your ideas, but the one problem with your minimum wage argument is that it will likely lead to a series of cascading events that will lead to severe social issues for Americans.

    One of the economic reforms of the 90s that has maintained to this day is the fact that almost all welfare recipients, unless disabled, must find work in order to remain on welfare for any lengthy duration of time. It varies by state, but you would usually need a job to remain on welfare. This happened because we were seeing unhealthy levels of welfare dependence, spending some $2 trillion on welfare(not Medicaid or SS) a year.

    It is true that 98% of people will benefit from a minimum wage, but 2% of those workers, some 500k, will become unemployed, probably unemployable in the sense of not being able to hold a job for any meaningful duration of time.
    Those individuals will need to find a job or they will lose their welfare permanently, now losing all semblance of a social safety net, with no possible way to earn an income.

    Now, there are two possibilities that can possibly occur.

    [MORE]

    First, we don’t reform the social services net, and those 500k workers get “iced” out for a long period of time. Given that they have no way of fending for themselves, then we suddenly have 500k people possibly turning to the underground economy, or turning toward crime. Given that the US spends some $300 billion on crime prevention a year, with the annual amount of murders being 15k, this seems a dangerous situation to keep those workers out of work. For instance, imagine if 150k Blacks in America suddenly became unable to earn a lawful living in America, what would the implications be? Our current crime rate already hallows out our urban cities, with raising the doubling or even tripling the crime rate would annihilate this country.

    Second, we reform welfare so that long term dependents are still enrolled in the welfare system. That would destroy the country since we would just be telling a massive fraction of low-wage workers, not unseriously, that not working would lead to better life outcomes than working. After all, the dismal low earnings of Latinos and Blacks will simply cause a large chunk of them rationally to just stop working under such a scenario.

    Now, the minimum wage works well if it is removing the lower wage incentives that welfare gives for business, and which is why it worked in California, since equilibrium wages were driven down by taxpayer subsidization. But, it only works to the extent that that loss in wages exist. otherwise it is a massive negative issue for America. After all, if CA set the wages too high, then people will just leave to find work elsewhere if they get priced out. But for the rest of the country, I don’t think this proposition works very well if you have nowhere to go to find a job.

    After all, isn’t California pretty much ejecting its poor population out with large home prices to other states, and importing rich folks, something not sustainable in the long run.

    TLDR: minimum wage will help 98% of people, but the negative social consequences of the 2% may outweigh the benefits. Minimum wage helps when there are other states to travel to for work, in the event of high unemployment. A nation wide minimum will need to be indexed to the cost of living + the wage lowering effects of welfare for a specific location.

  80. A deal of waffle that could be replaced by one sentence-‘Parasite greed is unbounded, and is worsened by their genocidal hatred of others’. That is the essence of capitalism-the lust to harm others.

  81. @Carlton Meyer

    Any business that can only operate by paying its wage slaves starvation wages is an abomination.

  82. @Ron Unz

    Nothing is so permanent as a temporary government program.
    Milton Friedman

    As they say, the proof is in the pudding. After many decades of gov’t support has the poverty problem been solved or just plastered over? Has welfare produced the positive conditions that led to its demise because it’s no longer needed or has the welfare state grown over the years? Has the Minimum Wage provided the support to the market that allow people to no longer require it?

    Welfare and Minimum Wage do not solve the problem. The problem stems from people making poor life choices in not getting an education, not investing in themselves in acquiring employable skills or in some cases a genetic inferiority that make people worthless to even the US military that has an IQ cut off below which they won’t even accept a volunteer. Those with physical infirmities are a separate category.

    Gov’t programs are always and everywhere an attempt at a fix to a problem it helped foster or entirely create.

    Why are kids coming out of the public (gov’t) school that can’t read, write or do simple arithmetic? Why is college touted as the only way to rise when a country like Germany uses a tough love approach to direct a portion of their population into the trades as opposed to higher education because they are honest about the difference in skills and intelligence levels people have. There’s no serious effort to feature the trades as an alternative route to success in the US. Why are the baby factories given support time and time again while the fathers largely get off to expand the problem of single parent households? Where is the accountability?

    You are correct that I would eliminate welfare and the minimum wage by shrinking them over time while emphasizing corrective action to produce productive people who won’t need them. The emphasis is totally misplaced in the US and as such will never actually solve the problem. That the political class wants to throw money at the problem is a given while they appear to have humanitarian instincts to the voters. That’s called pandering and is a sure way to get the votes from the people on the programs so as to become a self fulfilling prophesy.

    • Replies: @Mike Tre
  83. @jsinton

    Your ‘ordinary America’ clearly does not include wage slaves. They are the class enemy, after all, of even the smallest ‘small business’ exploiter.

  84. @Alden

    I thought I made it clear that welfare for the working poor was designed to benefit the employers far more than the employees, at public expense. It’s a lot like Wall St or the banking segment that keeps the profits but offloads the losses onto the taxpayer.

    See my reply to Ron Unz.

    • Agree: Realist
  85. Corrupt says:

    The push for a national minimum wage is nothing more than the democrats trying to stop the flood of companies leaving blue states for more affordable and competitive red states. This is similar to the dems protecting their uncompetitive union lackeys (the ones that give them campaign contributions) by passing prevailing wage laws. Without prevailing wage laws, most unionized companies would be out of business.

    • Replies: @Alden
  86. @Ron Unz

    The under-lying issue here isn’t the plain and fairly obvious facts exposed (thank you) by Galbraith and earlier by Unz but the collaboration between the hired liars at the CBO and the hired liars of mainstream media to maintain an ongoing — for over a century — systemic situation in which plain facts, if published at all, are relegated to “marginalized” venues while the mainstream media propaganda Mighty Wurlitzer blasts out toxic deceit on all its monopoly channels. An interesting question is, how many still believe it? And how many ever did?

  87. @Alden

    Good opinion.
    But here is problem.
    Those were times when US was highly respected. So decisions were easy.
    Today times are challenging and chaotic. Wrong decisions are dicey with with tremendous consequences.
    Biden’s brain function is erotic, and also erratic and Camala has a brain of little girl.
    There is no doubt that they do have around enough smart people, but with various opinions.
    But they, Biden and Camala are final deciders. So what if they take a wrong advise?

  88. Mike Tre says:
    @Alden

    “Low wages equals high welfare costs for the taxpayers
    High wages equals low welfare costs for the taxpayers ”

    You keep saying this. Please explain. Because “welfare” costs to the taxpayers high or low, is not binary. Your statement comes across as magical thinking. You understand that unfettered immigration creates a labor surplus that suppresses wages, right? You understand that outsourcing manufacturing overseas creates an even larger labor surplus, right? You understand that “free trade” (and global capitalism in general) allows foreign importers to manipulate trade deals to their own benefit, right?

    And address this point: an employer that is forced by law to raise wages must then also rage the costs of his product or service. The gain in wages is cancelled out by the increase in cost of goods and services.

    • Agree: frontier, Thomasina, Corrupt
    • Replies: @Alden
    , @Eugene Norman
  89. frontier says:
    @Ron Unz

    These are all fair points, especially the fact that welfare is never considered by the proponents of min wage increases. If we really look into that fact, we find out that welfare for working people is nothing other than a subsidy for their employers. Just another absurdity – the government subsidizes employers through welfare and, at the same, time desubsidizes them by forcing them to pay higher wages… This lunacy results in zero effect from min wage hikes.

    The most serious problem of min wage mandates is that they divert from, and mask, the underlying problems of the economy. The elites get employers and employees to fight each other for nothing and this shamanistic ritual is repeated every few years, never solving anything. A much better approach would be to stop lying about inflation…

    Galbraith: “The real world is shot through with high unemployment in low-wage regions and fuller employment in high-wage regions

    Yeah, and the reason for that is not min wage. If one can’t point out the reason, he is clueless about econ.

    Galbraith: …and it is also a fact, looking around the world, that more egalitarian regions have lower unemployment, generally, than less egalitarian regions.”

    Egalitarian… like a Gulag? Always full employment there…. it’s a miracle.

    Galbraith: “A second problem is that few if any studies can fairly assess the effect of a large increase in the minimum wage … it is very low and applies to a very small and marginalized fraction of the working population.”

    So, we need a large increase to see a small effect.. Well, let’s make it $100 per hour and fix all problems, big and small, complete with good ole egalitarianism? Right? Why do we have to go through this idiocy every other year? To pay high salaries to the illiterate econ establishment who argue about it?

  90. jsinton says:
    @Reaper

    I knew a shirt factory in the Philippines some 40 years ago. They produced Arrow and Van Heusen shirts to sell in the US for about 10 cents a shirt. What a racket.

  91. Mefobills says:
    @Thomasina

    You’ve got to go to the source of the problem. What or who is responsible for the intentional and purposeful rise in prices? Think “Federal Reserve” in collusion with the government. They are debasing the currency.

    It would be easy enough to have a producing economy, low prices, full employment and no minimum wage.

    Wages would be high as labor would be well trained and in demand.

    Germany did it with their national socialist economy, which in turn was the child of the American System of Economy (industrial capitalism).

    It is also “technically” easy to erase public and private debts. Politically, not so much — technically, easy.

    The Fed is a corporate money trust, in collusion with the corporatocracy, which is running the government.

  92. Mike Tre says:
    @RoatanBill

    The problem I’ve noticed with the minimum wage proponents here is they are looking at the issue as binary. The concept of minimum wage is merely a symptom of much bigger problem. Increasing MW is like applying a band aid to a sucking chest wound. Immigration, outsourcing, finance capitalism, free trade, quotas, market manipulation, welfare entitlements, hell even fuel tax, etc, etc, all drastically affect the elasticity of a dollar more than MW.

    Our economy should be stabilized by manufacturing and industry, and should be protected by our government’s trade policy. Our economy should not be held together by the fucking fast food industry and big box retail (where the absolute lowest common denominator go for careers where they have no real skills [push the flashing button, Pablo!] and the customer service is on par with an arms dealing street vendor in Mogadishu. THESE people deserve $15 dollars an hour? I don’t think so.) while we import tariff free and low quality goods manufactured in places where “employees” work for pennies a day.

    • Replies: @RoatanBill
    , @frontier
  93. frontier says:
    @Alden

    Low wages equals high welfare costs for the taxpayers High wages equals low welfare costs for the taxpayers

    Nonsense. That would be true only at near full employment in both cases… that’s the point of the article, as bad as it is, you didn’t bother to look at it, before virtue-signaling at other’s expense.

    Here is the truth, instead of mandating min wage, mandate max rate of corporate profits, say 8%. After that, 80% tax, pre-divident. It’s as much a non-market solution as min wage mandates… but the former will actually work.

  94. Mefobills says:
    @GeeBee

    How, therefore, do we square our economic beliefs with those of Hudson? If anyone can throw light upon this seeming conundrum, I am sure that it is you.

    It is best to start at the bulls-eye and then radiate out, then you can determine where Michael goes wrong.

    1) There is always hierarchy
    2) Money’s true nature is law
    3) Fiscal policy and Monetary Policy are flip sides of the same coin
    4) Fiscal and Monetary policy (along with law) are control mechanisms.

    You can derive pretty much any output you want by pulling the levers of the control mechanism. So, free trade is a canard, especially when there are control levers pulled by invisible actors.

    How do you staff your hierarchy to pull the control levers properly?

    All of the answers were mostly in place in NSDAP economy and government. Major Clifford Hughes Douglas begged Hitler to listen to him, and to evolve NSDAP economy further to include Douglas social credit. At that point, had Hitler done what Douglas desired, then the final evolution of industrial economy would have been in place.

    The final evolution is not communism as Hudson avers, but national socialism/industrial capital + gap spending per Douglas.

    I would also add in a fourth branch of government, the monetary authority, which examines debt instruments, is the headwaters for money creation, and also has the power to erase debts under legal advisement from government..

    Hudson cannot go there, probably because of his Bolshevik ties through his father. I don’t blame the child for the father; Hudson has done us a signal service by his life’s work. I’m not an enemy of the good.

    So, listen to Michael as he is throwing darts AROUND the bulls-eye, which is pretty good in today’s clown world.

    The other clowns are not even hitting the dart board.

    • Replies: @GeeBee
  95. @Mike Tre

    For well over 25 years, I’ve tried finding an honest engine for growth in the US and could never locate one. When finance replaced manufacturing and the country was convinced we could have a consumer economy, I knew the slide to oblivion had begun. There’s no such thing as a consumer economy and I don’t care how many economists say otherwise.

    The banks flooded the streets with credit cards and loans became the way to get whatever you wanted now and pay forever to the crooks in finance that create currency out of thin air. What a system.

    You’re correct. The structural problems are so large and the population so ignorant of what’s been happening for decades that I see no possibility for any real change for the better happening voluntarily. Change will happen when TSHTF in the not too distant future.

    Given that the dollar purchases less and less every year, the lowest paid workers should be able to survive on their wages and therefore their wages should go up commensurate with the cost of living. I just don’t think a blanket minimum wage is the way to do it. I would prefer the gov’t target employers of gov’t assistance recipients and get them to increase their salaries as a spot treatment to either get marginal businesses to flounder if they can’t afford a minimal living wage or step up and provide that wage. Having the public provide the subsidy that the employers should be paying as wages hasn’t worked and never will work because human nature will always game any system that exists that allows for offloading liabilities.

    • Replies: @Alden
  96. Marckus says:

    When wages go up the costing model used by the Corporation to price their goods and services is automatically adjusted. That means the price of product increases to reflect the increased labour cost of production.

    If there is a middle man the price increases further as he will keep his margins consistent. If the middle man also pays people the new minimum wages then double whammy. Ultimately the consumer picks up the tab !

    With prices up applicable sales tax also increases so Government revenue increases. A lot of this increased revenue will end up as “Grants” to foreign Dictators and their cronies.

    All things being equal it is a general fact that the man earning more does not spend less or the same and bank the wage increase. Rather he spends more. There are people who get enormous bonuses who blow the whole thing on consumer goods they do not need. They remain just as broke as before, waiting for the next raise so they can indulge in the same foolish spending habits again.

    The whole thing is a massive shell game but now we come to the amusing part.
    -A business owner with 500 illegal immigrants lined up outside his door will not pay minimum wage. If Pedro , Fung, Singh, Abdul and Mbongo are going to do the job for $5 per hour the man hoping for $15 an hour will die of despair.
    -Employers with a pool of slave labour can afford to be abusive in every way as they have a pool of cheap labour hungry for ANY wage.
    -With this Corona virus lockdown just exactly which businesses are able to reopen never mind double their wage expense ?
    -The people now earning LESS than minimum wage are living frugally so they can remit billions back to their home country. Even with the miserable wages they get now can we assume they are in fact overpaid ??

    The whole game is one where everyone has their hands in everyone else’s pockets. Raising the minimum wage in my opinion is just increasing the skim for all the players.

    • Agree: Thomasina
  97. frontier says:
    @Mike Tre

    The concept of minimum wage is merely a symptom of much bigger problem. Increasing MW is like applying a band aid to a sucking chest wound. Immigration, outsourcing, finance capitalism, free trade, quotas, market manipulation, welfare entitlements, hell even fuel tax, etc, etc, all drastically affect the elasticity of a dollar more than MW.

    True, another serious problem is, at present, after the lockdowns, many small businesses are teetering at the brink of bankruptcy and a higher min wage mandate is going to push them over the edge. Considering the vast amount of printed dollars spent on welfare, a higher mandate is clearly a ploy to kill even more small businesses and redistribute their customers and profits to the ruling multinationals.

    • Agree: Mike Tre
    • Replies: @Thomasina
  98. The same clowns who think that the demand curve slopes downward for every commodity other than labor also think that the U.S. can print USD without end, i.e. Modern Monetary Theory.

  99. Exile says:

    America has a profound misallocation of wealth in FIRE, Silicon Valley, Amazon, big box retail & the Davos set in general that can’t be addressed without major structural changes in many more things than the minimum wage.

    That said, a minimum wage increase would be an immediate benefit with all sorts of knock-on effects that can’t easily be quantified as net-negative or positive.

    In present circumstances with so much wealth concentrated in a tiny percentage of people who certainly don’t use it all for the public good, to cynically understate things, anything that puts more money in the hands of actual working class Whites is good for working class Whites – and I’m not here to worry about anyone else.

    If Jeff Bezos and the meat-packing slavelords etc… are going to go broke tomorrow paying their workers a mere $15/hour, the problem is in the system, not the wage rate.

    • Replies: @Alden
  100. I went to school with Galbraith–back then we called him “Jamie”.

    He is still ignoring key facts that contradict his leftist ideology.

    There are two main threats to low wage workers today–

    –Illegal aliens

    –Robots/software

    Jamie thinks if he ignores them, they will just go away–typical of his “magical thinking”.

    They won’t go away.

    Increasing the minimum wage is subsidizing robot manufacturers, you know, the filty rich capitalist owners that Jamie says he hates.

  101. @bayviking

    The same thing happened in Austfailia. The Economics faculties were purged, Political Economy in particular being targeted. Leading lights like Ted Wheelwright were isolated, and his prescient outline of how neo-liberalism would fail, enrich the parasites, gradually immiserate the rest and leave the country in the hands of the financial blood-suckers, were derided. Now we have the lowest share of GNP going to labour for many decades, no wage growth for several years, the labour force casualised and stripped of all rights, inequality ever growing, and private debt the second highest in the world. EXACTLY as the parasites always have and always will desire.The Great Culling of the ‘Useless Classes’ comes next-or perhaps it has already started.

  102. @Alfred

    You forgot to mention that for that licensed blood-sucking, the US gets Third World healthcare for the bulk of its people.But the medical-industrial-Congressional complex bloodsuckers grow fat, like ticks on a wallaby. Evil does not do it justice.

  103. @Carlton Meyer

    The example I always go to are farm-workers. Mexicans are imported to pick lettuce etc . The cost of manually processing each lettuce is well below 2 cents a head . In return, society is burdened with the welfare, education and medical costs of the immigrants and their families. Twenty years ago I saw some clown on CSPAN trying to explain why saving 2 cents a head was worth the social cost, the only callers defending this idiocy were heavily accented.
    Jobs Americans won’t do, is Jobs Americans won’t do at wages you think you are entitled to pay.
    Anybody who has ever watched Mike Lowe knows this.

    • Replies: @Bill Jones
  104. @Bill Jones

    The always excellent James Corbett looks at
    “The dark history of the minimum wage”:
    https://www.corbettreport.com/minimumwage/

    The almost as excellent John Williams in his Shadowstat site, among other things, takes the commonly reported economic numbers and strips out the political fudges and lies that have been implemented since the Carter Regime.
    The picture presented is very different from that shown by the MSN.
    Sadly it’s a subscription site but there’s a bunch of freebies such as this primer
    http://www.shadowstats.com/article/employment
    and these charts,
    http://www.shadowstats.com/alternate_data/inflation-charts

    • Thanks: stevennonemaker88
    • Replies: @Thomasina
  105. The $15 minimum wage argument is all political theater. as if these corrupt blood suckers cared about anyone but their self. If they did there would be no Corona19, there would be no 911, etc. Right now inflation is skyrocketing. Have you been to the market lately?

    • Replies: @Alden
  106. Rush Limbaugh did die this morning.I used to love listening him on long trips.

  107. Thomasina says:
    @frontier

    Yes, Amazon has made an absolute fortune during this lockdown. The big corporations are getting rid of their competition.

    It’s the same with government regulations. Big corporations love it when the government introduces them (and they often call for them) because they know their smaller competitors don’t have the money to comply or an army of lawyers to defend themselves when some regulator goes after them. It’s another way of getting rid of the competition.

    A raise in the minimum wage is another nail in the coffin. Soon we’ll all be buying from the company store.

    Globalization, monopolization, incineration.

    • Agree: frontier
  108. Thomasina says:
    @Bill Jones

    Thanks for the Corbett link. Yes, inflation has been under-reported for years. Shadowstats does good work in this regard.

    The government has a very convenient way of coming up with their inflation numbers. If inflation was calculated the way it used to be done, we’d all be screaming.

    Another example of where the government is lying – on purpose.

  109. @stevennonemaker88

    I did a very similar analysis several years ago and had pretty similar results.

    It’s not so much about one-liners like ‘a living wage’ as it is about complete political capture-they all work for BigX and AIPAC-that has rendered the West largely foreign countries to what they were just before Reagan Khomeined his way into office.

    Yeah, that’s right, I used the Ayatollah like a cheap verb and kicked him to the curb.

    • Replies: @stevennonemaker88
  110. @Mulga Mumblebrain

    Canada was right behind Australia and literally sold the real estate of the country off to money launderer and the CCP.
    Everyone is now a debt slave for housing while the economy follows the American model by money printing and near 0% rates.
    The implosion is somewhere ahead in the fog for all the Anglosphere. Maybe Germany, Russia et al will drag the failed EU into the BRI and they can recover while the U.S. tears itself apart or starts a war.

  111. @anon

    I used to be a Milton Friedman devotee who believed that there should not be a minimum wage, that the market should decide. I have since done a 180 and realized how much that scumbag and his (((Chicago gang of thugs)))

    I hereby raise your minimum wage to $150/hr. Your employer won’t mind.

    • Replies: @Alden
    , @Alden
  112. James K. Galbraith holds the Lloyd M. Bentsen Jr. Chair in Government and Business Relations, University of Texas at Austin

    This “chair”, along with the name Galbraith, reek of the Great Society. How’d that turn out?

  113. Biff says:
    @Alden

    High wages equals low welfare costs thus easing the tax burden on the middle class.

    Low wages equals high welfare costs thus increasing the tax burden on the middle class.

    For every dollar the tax payer pays into the welfare system the government pays out about three cents in entitlements. The tax burden is government – not poor people.

    • Replies: @Alden
  114. The fact that we even still have to argue about this shows what an absolute failure of a system this is, and is why USA is a 3rd world shithole, and a joke of a country that everyone laughs at. Anyone that can argue with a strait face that raising the minimum wage would raise costs is admitting that capitalism is a failure and a lie that is designed exclusively for the enrichment of capitalists only.

    You’ll never hear these idiots say the same about executives or shareholders extracting absolutely insane amounts of money from businesses. Every argument they make is already happening anyway with the low minimum wage. Prices go up constantly, why is that if the minimum wage hasn’t moved? Speculation, shareholder dividends, and executives pillaging the working class is why.

    Currently about 47 percent of workers make less than $15 an hour. Thats half the goddamn country. Its not just teenagers or “low IQ immigrants”. 80 % of people live paycheck to paycheck and survive only by going deeper into debt.

    Pizza delivery man, 89, gets $12,000 tip – what’s wrong with this story?
    https://www.theguardian.com/us-news/2020/sep/28/pizza-delivery-man-89-derlin-newey-12000-tip-tiktok

    In a non-failed-state minimum wage should be at least $20 an hour. You can’t afford to actually live anywhere that I know of on less than that. Government could give tax breaks or subsidize any small business it may hurt, just like they do for oil giants, Amazon or Wal-mart now. Minimum wage is a big part of what made the middle class in this country. Created a booming economy, and probably prevented a revolution from taking place. FDR understood this.

    Failed state Mad Max shit coming up!

    https://www.oregonlive.com/portland/2021/02/portland-police-guard-dumpster-face-off-with-residents-trying-to-get-discarded-food-from-fred-meyer.html

    https://gizmodo.com/texas-mayor-announces-resignation-after-unhinged-facebo-1846285536

    • Agree: Alden
    • Replies: @Alden
  115. central says:

    Real wage growth for the vast majority of Americans has not risen a dime from the late 1970’s. The consumer, credit driven economy you see today is proof enough. Inflation is the stealth tax of choice that keeps the common folk down.

    Additionally, US regime supplied statistical, mathematical models are constantly changed to reflect a false reality of wealth for the lower classes. Try shadowstats for a glimpse of the truth. Wolfstreet also has good economic data the MSM will not touch.

  116. Thomasina says:
    @Timothy Madden

    Tim – thank you so much for your informative reply. The bankers control it all, don’t they? I was shocked to find out that when we deposit money in a bank, that money is no longer our money, but the bank’s money. Apparently they have borrowed it from us and it is now their money!

    And most people still believe that banks loan out the money we deposit at the bank, but that’s not true. They just have the borrower sign a promissory note and then conjure the loan money out of thin air, just an entry on a ledger.

    What a racket! The central banks are colluding together now, and the banks too. They have blown a massive worldwide bubble which they can either inflate or, when we least expect it, deflate. There is too much power in their hands.

    Thanks, Tim.

    • Replies: @Timothy Madden
  117. Alden says:
    @Biff

    Whatever , however , whoever, gets the money, the middle class supports the minimum wage and less than minimum wage workers on welfare class.

  118. Alden says:
    @Reg Cæsar

    The 120 year old family company of which I am a part owner often pays our employees $150 an hour. The companies we work for can afford it. And can’t function without our skilled employees. We’ve managed to survive120 years and will ride the Green energy boom as we rode the building boom. And our guys and gals will ride the boom along with us.

  119. Alden says:
    @the grand wazoo

    Yes I have. Everything is going up. Gas hit $3.99 in California last time I filled up. Try driving to a minimum wage job work paying $3.99 a gallon for gas.

  120. Alden says:
    @Exile

    Meat packers. For a long time the slaughter houses in Omaha, Iowa the Dakotas were unionized family living wage operations. The owners closed down the plants and laid off the workers.

    A year later the plants re opened with low wage immigrants, some like the Vietnamese legal, some like the Hispanics illegal. Of course the schools were burdened with a flood of non English speaking kids. And landlords who rented 2 bedroom apartments for 4 or 5 occupants found 15 crowded in.

    And as soon as the immigrant slaves arrived, Hispanic Vietnamese Somalian African Legal Aid Foundations set up offices in town to sue the schools for bi lingual education, sue landlords to force them to accept overcrowding, open translator social worker offices to take the plant’s wretched refuse to the county welfare office.

    And the funding for those legal aid and welfare assistance organizations traced right back to the corporations that owned the plants., I wonder why those corporations created those legal aid foundations. Can anyone think why?

    Idiot Econ 101 claims that when wages go down prices will go down. But although wages went from maybe $18 an hour to then state minimum
    $5 an hour, the price of the meat processed in those plants. kept rising.

    I still occasionally glanced at National Review while this was going on. On one page there’d be an article arguing to abolish the minimum wage and let the ridiculous free market decide. As if a bus load of primitive Central Americans or Africans even knew where they were.

    And a few pages later on there’d be an article about how dare all these low wage illegals apply for welfare.

    Econ 101 never thinks of landlords, car dealers Drs dentists veterinarians, retail and online stores hotels entertainment venues ski resorts that need well paid tenants and customers with secure jobs.

    Not every small medium business person is hard scrabble barely making it who can only survive with cheap labor. Businesses need customers who can pay for the product or service., when everyone is minimum wage, the town turns into Detroit, Flint Michigan or Gary Indiana.

    • Thanks: Thomasina
  121. GeeBee says:
    @Mefobills

    I’ve got it. Thanks. And your dartboard analogy is inspired. I’d also failed to bear in mind Hudson’s background. I recall listening to him once and the interviewer introduced him as ‘a Marxist economist’. The first thing he said was ‘I’m a classical economist’ (drawing a distinction between that and Marxist economics). So I wouldn’t be surprised if, politically, he’s slightly conflicted. I’ve often suspected he harbours Marxist sympathies, which is so crazy I find it hard to believe a man of his insight and perspicuity goes there. But there he was in that interview immediately stamping out any such notion.

    Anyhow, I knew you’d nail it! Thanks again.

    • Replies: @Mefobills
  122. Alden says:
    @Mike Tre

    Wages, including yours and mine have been stagnant since about 1975. Yet although wages are at 1975 levels, the cost of goods and services are at 2021 levels, even though employers are paying 1975 wages.

    The company of which I an a part owner pays our workers about $1.000 a day. They make about $20,000 a month. The company we work for pays us and we pay our employees.

    You lower middle class proles think every small medium business is a restaurant, convenience store, small retail operation that can’t survive unless the employees are all on welfare.

    High wages equals low welfare
    Low wages equals high welfare

    • Replies: @Mike Tre
  123. GeeBee says:
    @Thomasina

    For the life of me I cannot understand why people are pulling down statues and screaming about pronouns when they should be standing a million-strong out in front of the FEDERAL RESERVE and CONGRESS.

    This is an absolutely key point – although I strongly suspect that you already know full well the answer to your essentially rhetorical question! Put in strictly Orwellian terms, the Pigs have decreed that gender-specific pronouns and statues of White men are the ‘two legs’; ‘black lives’, wimminz issues and trannies are the ‘four legs’. When of course, it ought to be all the tens of millions of the exploited who are the ‘four legs’ and the Fed plus Congress (and the MSM, the MIC, Big Pharma and even the schools and universities) who are the ‘two legs’.

    In other words (and to quote from the Book of Psalms) ‘All we like sheep’ etc., etc…

  124. Alden says:
    @Corrupt

    There already is a federal minimum wage. It was established in the 1930s, about 85 years ago.

    There’s a federal base. I think it’s around $7.75 an hour. Then the individual states add to the federal minimum wage. I think California is up to $12.00. Other states have just the federal base. Most add to the federal base. You can check if you want. The liberals just want to increase the existing federal base.

    Small businesses thrive on high wages for everybody including those the lower middle class considers unskilled. Because small businesses need customers who can buy their product.

  125. JackOH says:
    @Alfred

    Alfred, journos don’t have the editorial latitude or technical background to blow the lid off America’s iniquitous health care mess. The relevant academic literature is too compromised at multiple levels, massively inept, and just plain wrong. No one wants to concede that schemes such as group health, Medicare, etc, are meant to serve political ends, and not some general idea of good health for Americans.

    America’s excess costs and dismal performance protect autonomy of practice, practitioner prestige, huge revenues, etc. That last item–huge revenues–draws from whatever would have gone to labor or capital.

    Mine is a beaten-up Rust Belt area, but we have pretty new hospitals and clinics built at enormous expense, and almost no one questions whether there’s a connection between declining local industry and a thriving health care sector.

    FWIW-the Covid-19 death rate in one major county here exceeds 2000/million, which, if that county were an independent nation, would have it as a world leader in Covid-19 fatalities.

  126. Mefobills says:
    @GeeBee

    The first thing he said was ‘I’m a classical economist’

    Hudson may not even know what he is.

    His branch of economics resurrects the language of the classical economists, especially with respect towards rents, and unearned income. Hudson doesn’t use the language of usury, of which rents and unearned income is a sub-branch.

    Hudson’s brand of economics is classical economics along with updates, which include teaching on balance of flows, and especially balance of flows including debt instruments.

    I would call it Updated Classical Economics.

    The closest analog to Hudson in the modern era is, to my mind, Hjalmar Schacht. The two men are probably also the greatest economists of the era as well.

    Both men have/had a high moral instinct, and were outraged by what they saw. In the case of Schact it was the hyperinflation, and in Hudson’s case it was the debt peonage extraction from the third world.

    Both men are unorthodox economists not trained conventionally, but mostly self taught. Both are self taught from observation from within their perch of the banking system.

    Both men observed the balance sheet, and understood it, and what the implications to economy meant. Hudson’s first job was a balance of payment specialist at Chase, and his job was to see how much rent extraction the third world could bear in payment to the finance class in wall street.

    Schacht cut his teeth in the banking system, rising up to prominence. Schacht’s method of economy was as a conductor, using the phone, and ringing up people and telling them what to do or not. This gets back to my point about the money system being a control grid… Schacht called it the “magic of money.”

    If you put Hjalmar and Michael in a room together, they would immediately hit it off, and there was not too much daylight between them.

    To reiterate, Hudson has updated classical economics, and is not a free trader. You cannot use Hudson’s methods of balance sheet analysis, and balance of flows and be a free trader. Hudson takes pot shots at Ricardo especially, making fun of the corn laws and how they distorted British economy, even to the point of making England vulnerable for food. At some times, he calls Ricardo a banker-man, meaning Ricardo was a jewish agent. But, Hudson cannot go there, so you have to decode his language.

    Hudson was very much against the balance of flows difficulty that the “Harvard Boys” imposed on Russia in the 90’s, against the debt hook thrust into the mouth of the Greek people by the IMF, and against the debt mechanics thrust upon Latvia, which then forced their young people to leave.

    Using the new language of debt flows, where debt instruments ARE HELD TO ACCOUNT, within economic doctrine, then you cannot be a free trader.

    Hudson never defends free trade, only trade that is balanced. Schacht was faced with debt based unbalanced trade flows, which then caused the hyperinflation. Schacht was a mastermind who pre-dates Hudson, but saw the very same things, and came to similar conclusions. Schacht left behind his evidence in the form of a large economy and its advance, but did not write extensively on his observations, he was too busy.

    Hudson may not even be aware of Schacht, as our (((friends))) have so distorted NSDAP history, that investigation is the third rail. Hudson carefully avoids exposing the Jew as a malign actor in economic history, where the Jew uses rent extraction and usury to make sordid gain.

    For Hudson, there was practically no time lag between Chase-Manhattan, where he figured out balance sheet mechanics and rent extraction, and his writing of the book “Super Imperialism.”

    Only a first class mind can leap so fast and at such a young age. The rest of Hudson’s career was spent trying to understand what is going on, and to describe it, he had to resurrect the classical economists. Hudson has since extended classical economics into new realms, to include description of the ancient near east, and how debt was defined. The methods included looking clay tablets, most of which are ledgers for economy.

    Neo-Liberalism and Lolbertarianism are private banker constructs that leave out of account debt instruments, balance of flows, rents, unearned income, and usury. They pretend that money is a “neutral veil.” Of course neo-liberalism is predominantly Jewish because it is rent extraction. Hudson is not stupid and has noticed, but he is also smart enough to avoid the third rail, and to survive he paints with a broad brush. You don’t have to be a Jew to be a predator.

    Both Schacht and Hudson would have laughed ne0-liberals out of the room, as they knew better, and believed what their eyes told them. Schacht left behind evidence, but has been erased from history; Hudson has given us tools and methods which clearly define the economic world, even to the point where religion, especially Judeo-Christianity, will have to be rewritten.

    • Replies: @GeeBee
  127. Alden says:
    @redmudhooch

    I believe about half the population of California, highest population in the country, 55 electoral votes usually the 6th or 7th largest economy in the world is on welfare at any one time.

    That’s straight welfare; not retirement, disability, unemployment, years of living in student loans but straight welfare.

    And the net income of minimum wage minus commuting expenses and payroll deductions is often the same or even less than welfare and disability.

    Many community college students are only there to collect the non repayable Pell Grants to supplement their full time minimum wages. And the community colleges stopped teaching useful skills decades ago. Now it’s just 2 years of crapology courses for admission to 4 year colleges that teach no useful employable skills either.

    But the Pell grants make it possible to buy the car they need to get to work and keep a roof over their heads. Even if there’s no mortgage, landlords and homeowners need to pay property taxes , utilities, regular and the dreaded major maintenance.

    Econ 101 what a crock. Not every small medium business owner is a restaurant owner that shouldn’t have opened in the first place. And can’t survive without 80 hour a week $100 a week less than minimum wage illegal slaves. On a street where 7 out of 10 stores is a restaurant.

    • Thanks: Thomasina
  128. Alden says:
    @Reg Cæsar

    I hereby lower your wage or retirement income or whatever it is to $5 an hour for a 40 hour week or $10,400 a year $860 a month minus commuting expenses and payroll deductions comes to maybe $760 a month net pay. .

    I’m sure you can support a roof over your head and a car or $100 a month bus pass to get to work. $100 a month bus pass out of a maybe $760 a month take home is a lot. Leaves only $660 a month to live on.

    I’m sure you’ll get by.

    • Replies: @Thomasina
    , @Reg Cæsar
  129. Alden says:
    @RoatanBill

    Good luck “ getting” employers to raise wages. I’m sure a yearly letter from the State Labor Board will do it.

    In some states like California, the worst employers of 80 an hour $100 a week illegals are themselves immigrants. They bring the labor practices of Israel, Russia, Persia, Armenia Central America , Thailand and the Chinese diaspora with them

    San Francisco’s Richmond and Sunset districts.

    All the useful businesses like little hardware stores, shoe stores electronic sale and repair shops small furniture shops boutique women’s clothes even the big Walgreens &CVS that are general stores where you can pick up everything from cheap cookware to sweat and T shirts to tools and toys have been replaced by Chinese restaurants.

    The owners of those restaurants live nearby in row houses on top of a garage. Sometimes the garage doors are open. And passers by can see crates of live chickens being slaughtered, gutted plucked and cut up for the restaurants right on the garage floor. By skinny Chinese men working off their smugglers fee.

    Or pedestrians can hear the 15 or more sewing machines whirring as the under fed Chinese illegals work off the smugglers fee.

    According to a State Labor Board guy I know, the worst employers are immigrants themselves. There’s a dry cleaner near me where the sleeping bags come out at night and they cook on hot plates. These illegal workshops can often be detected by the smell of the garlic fish sauce they cook.

    The illegal garment factories closed down in Los Angeles when the county, not the state hired more inspectors. So they moved to nearby counties. An illegal garment factory can be set up anywhere. Just second hand industrial sewing machines, a chair for each one machine some industrial irons and a place to iron the pieces. The cutting is usually done in another illegal factory. All that needs is tables, scissors and pins. No need for chairs as garments are cut standing up.

    Factory in the garage biggest bedrooms and living room , triple bunks in the smaller bedrooms. And pots of rice and garlic fish sauce on the stove.

    Econ 101 It’s like religion, all theory and fantasy, not reality.

    • Thanks: Thomasina
    • Replies: @RoatanBill
    , @Justvisiting
  130. @Alden

    The problems with the illegals are a special case that isn’t properly covered under law since they aren’t supposed to exist. The only real solution is to drive them out, forcefully if necessary.

    Shutting down a sweatshop and letting the owners and employees just disappear into the community will, of course, do no good because, as you say, they’ll just start up again probably purchasing their confiscated equipment from the gov’t at auction. Wash, rinse, repeat. Deportations and the confiscation of everything they own should help pay to get rid of them and send a message that there’s a high price to pay for illegal activity.

    California’s laws and attitude support the continued importation of illegals. This is never going to end till the citizenry change their outlook and get tough on enforcing sane laws that have yet to be created. Bankruptcy for the state and cities might wake some people up. In New York, we referred to California as granola land – fruits, nuts and flakes. Every stupid idea usually comes out of California.

    • Agree: Thomasina
  131. @Alden

    Good post.

    In the real world immigrant families (legal and illegal) run businesses that violate every labor law known to man.

    Their children work–long hours–at no real wages–and that is how the small business survives.

    Academics like Galbraith have no clue how the real economy works.

  132. Thomasina says:
    @Alden

    Of course they can’t get by on what they’re earning. We already know that and sympathize with them.

    But your solution is to just keep increasing the minimum wage. What I and others are saying is we should STOP what is causing the price increases that keep necessitating a MW increase.

    I don’t hear you going after the incessant money printing that’s causing this inflation. Why is that? You appear to be a one-trick pony who is fixated on accepting the money printing as a given (yeah, that’s just fine), but then wanting to apply a band-aid every few years in the form of a MW increase.

    Get to the source.

    • Agree: stevennonemaker88
  133. GeeBee says:
    @Mefobills

    Hudson may not even know what he is.

    That’s exactly the impression I’d formed, but I was reluctant to state it in quite such stark terms. Hence my original question regarding him describing himself as a classical economist. I can see how the bare bones of economic theory pushed by Mills, Ricardo and Malthus, on the back of Adam Smith’s ground-breaking work, are susceptible to fine tuning, especially in light of the experience of where their ideas actually led. I am thinking of your description of Hudson having to assess the degree to which Third World extraction might be feasible, when a young man working for Chase. It must, as you say, have aroused great resentment in a man of morality. (By the way, just what is the mechanism by which the USA brings this extraction about? Forgive me if I’ve not been paying sufficient attention, but I am not an economist).

    Your analogy of Hudson and Schacht being birds of a feather is of course apt. They would surely have got on – but I suspect that you might very well be right when you suggest that Hudson might not even be familiar with Schacht. An extraordinary idea, but one that, in today’s world, would not entirely surprise me.

    Interestingly, when I wrote my 50k-word work on National Socialism three years ago, I mentioned Schacht only in passing (I gave rather more credit to Gustav Feder for the NSDAP’s economic miracle). If I’d had the benefit of your insights I should very much have increased his presence within the work (which I might very well update sometime). One of the things I did discover about him, however, was that at the Stalinist Russian ‘show trial’ in 1938 of Christian. G. Rakovsky (one of the founders of Soviet Bolshevism and a Trotsky intimate), Rakovsky stated that Hitler was at first funded by the international bankers, ‘through their agent Hjalmar Schacht’. This was done in order to control Stalin, who in 1922 had, against expectations, emerged triumphant in his struggle with their agent Trotsky for control of the Soviet Union. Commenting on this, Rakovsky said:

    ‘Hitler took over the privilege of manufacturing money, and not only physical moneys, but also financial ones. He took over the machinery of falsification and put it to work for the benefit of the people. Can you possibly imagine what would have come if this had infected a number of other states?’ (Henry Makow, “Hitler Did Not Want War,”

    While I can readily believe that Lev Bronstein (who is of course better known to fame as ‘Leon Trotsky) was an agent of the Rothschild banking syndicate, I struggle to imagine Schacht being in that role, even though he defended Jews and denounced the attempts to limit their power, and was also a friend of the Jewish Governor of the Bank of England Montagu Norman (who was so close to the Schacht family that he was godfather to one of Schacht’s grandchildren).

    Interesting ideas, certainly. And thanks again for your invaluable insights.

    • Replies: @Mefobills
  134. Mefobills says:
    @GeeBee

    Rakovsky stated that Hitler was at first funded by the international bankers, ‘through their agent Hjalmar Schacht’.

    Thanks for the reply.

    I wouldn’t take Rakovsky too seriously. As Irving has said, the small funds that were given to the NSDAP party were to embarrass the Bruning government. Even Jacob Schiff admitted that his gift to the NSDAP party went unnoticed that he was a Jew.

    Schacht was in a pitched battle with the “international” during the hyperinflation, as the “shorts” were denominated in marks, but the loans to acquire shorts were backed by dollars, pounds and francs (mostly dollars to my understanding). Schacht also was a proud German whose family went back many generations in the Ditmarshen area between the Elbe and Eider rives, a land of free farmers. Schacht studied German Philology, then did his doctorate on English mercantilism, demonstrating how mercantilists were aware of how quantity of money theory worked, which the mercantilists exploited. Also, Hjalmar’s full name is Hjalmar Horace Greely Schacht, whose father was Horace Greely. Schacht = not a jew no matter how many claims you hear about his connection to other Jewish bankers including Montague Norman, and the fact that he tried learning Hebrew. Schacht damaged a lot of international Jews when he introduced the Rentenmark to stop the shorting mechanism, and then slammed banker heads against the wall when they defied his guidance.

    So, the hyperinflation was indeed an “international” crime, where hypothecators within the private banking cartel allowed new loans, to then create new marks, to then exploit the German people. German citizens then had to give up their real property as they were busted out in hyperinflation, and then Germans found themselves owned by a hostile and predatory (((minority))). Even as late as 1938, much of Germany was still owned and in Jewish hands.

    With regards to Feder, he was sidelined because he could not come up with a plan, even though he was given almost two years staring in 33. Schacht was more appealing to become head of Reichsbank to the industrialist and business interests.. In the end, Schacht, who was a gold man at first, learned that Feder was correct. Mefobills and Oeffabills are actually Feder money, and Schacht in his 1967 book admitted as much.

    Feder wanted Giro money, which is Gryo, or circulating existing money. If you go back and read my thread, I suggest that there should be a fourth branch of government – the monetary authority, which is the headwaters of all money creation. The new money is in the form of loans to government (sovereign loans are disappearing money paid back with taxes) and debt free, where the debt free is something like base-band power, it is available for the public to use. The debt free is permanent money and can only be drained from the money supply by taxes.

    Giro means it circulates when you loan out your savings to others, and then they pay you back. Private banks are stripped of hypothecation power, ergo something like a hyperinflation is impossible.

    So, Feder was actually very advanced, but it took Schacht to evolve Feder’s ideas, in the same way it took Hudson to evolve the classical economists.

    Feder was a green-backer, whose ideas originated from the Green-Back movement, which in turn was American System of Economy that had been resurrected by Lincoln.

    Here is a link making a plausible case of how NSDAP was funded in the beginning, and it was organic, not “international” money. NSDAP was a populist uprising, in the same way that populism is on the rise today.

    https://nationalvanguard.org/2018/05/funding-a-movement-german-big-business-and-the-rise-of-hitler/

    Hudson’s book super-imperialism describes the extraction mechanism.

    • Thanks: John Regan, Thomasina
    • Replies: @GeeBee
  135. @steinbergfeldwitzcohen

    haha nice play on words. The real inflation is absolutely insane! I’m glad i live in a “third world” country where taxes are lower and things are not quite so expensive.

  136. Tough Guy says:

    How many legs does a dog have if you call the tail “a leg?” Four. Calling a tail “a leg” doesn’t make it a leg. The one and only one true “minimum wage” is zero, i.e. the amount a person gets when no one will hire them because the government has passed a law mandating they be paid more than their labor is worth to anyone. Wishing it were otherwise doesn’t change the compelling logic. “Minimum wage” legislation, like its cousin the Davis-Bacon Act, has been used to intentionally discriminate against black people. In fact, supporters of eugenics a century ago supported such legislation to prevent those they deemed too deficient from getting a job. Increasing the legislated “minimum wage” involves trade-offs. It does hurt some of the very people it is intended to help. A wage is a price. Increase the price and you’ll get an increase in quantity supplied and a decreasing in quantity demanded. The overwhelming majority of Americans get paid far more than the legislated “minimum.” Anyone who has ever turned down a job evidences employers, i.e. demanders, do not have all the power in the labor market. There WILL be negative consequences of increasing the “minimum wage” for some low-skilled workers. People are free to assert those consequences are worth the benefits to those who are made better off. If I am a poor teenager living in a crime-infested community “minimum wage” legislation is going to increase the probability I’ll never get my foot on the first rung of the economic ladder.

  137. @Alden

    You seem to think the minimum wage is some kind of magic that makes employers pay workers more than their labor is worth. But the employer has the obvious alternative.

    Champions of minimum wage increases claim they won’t cost people jobs. If that is true, then why is the raise always so stingy? Only double? Why not triple, or quadruple?

    What is the average union wage in San Francisco? How about doubling it and making that the minimum wage? I bet the unions would have a different idea. The first minimum wages covered only women– enacted explicitly to protect family men’s wages. Male unions supported them. The League of Women Voters did not, and would not until they applied to both sexes.

    Immigrants should be held to a minimum wage that ensures they pay a medium level of federal income taxes. Plus a “Cadillac” health plan.

    The company of which I an a part owner pays our workers about $1.000 [sic] a day.

    How many have names like “LaQuisha”? (Even she wouldn’t work for a dollar a day.)

    • Replies: @Alden
    , @Alden
  138. While a doubling of the minimum wage may cause some temporary disruptions in jobs, as well as in supply and demand for certain goods and services, the long-term effect (a year or more) will be in wages and prices overall. For example, a stocking clerk at a grocery store may be getting $10 an hour now while a stonemason apprentice is getting $15 to start. You raise the store clerk to $15, the stonemason apprentice will automatically have to go up to $22. But what about the hamburger flipper who starts at $7.5. If he goes to $15, the store clerk has to go to $20 while the stonemason goes to $30. And I will have to go to around $100. I’d be darn if I will get left behind.

    • Replies: @Alden
    , @Eugene Norman
  139. Alden says:

    Politico site claims Biden informed Governors and Mayors that the federal minimum wage hike probably won’t happen. From the Saks Fifth Avenue catalog to Home Depot to the gas station supermarket and 99 cent store, every time I see a price sign there’s an increase. So we can look forward to a replay of the Carter years. Wage freeze and high inflation.

    Econ 101 triumphs again.

  140. Alden says:
    @Reg Cæsar

    All I know is that we pay $1,000 a day and are doing better than we have in the last 100 years. And due to massive lobbying and internet growth, we’ll ride the next boom. Salesforce afforded us easily. Facebook’s paying us right now. When the data centers are moved to places like Beaverton Oregon and Colorado we’ll be awarded the contracts. Lots of attorneys charge $1,000 an hour. Surgeons charge even more. Hospitals charge $6, ,000 an hour for the use of an operating room.

    Econ 101 doesn’t apply to thriving businesses, just barely making it service industries that shouldn’t have started in the first place. 7 restaurants in an 8 store mini mall they can’t all survive even paying a dollar an hour. Especially when there’s a food mini mall every other block.

    Doesn’t Econ 1o1 advocate letting losing businesses fail instead of propping them up with immigrant on welfare cheap labor?

    I’m beginning to see why Marx and Engels despised the lower middle class. Concentrate on kicking the workers below you off the ladder because you can’t climb the ladder yourself.

  141. Alden says:
    @gleongelpi

    Apprentice stone masons make about $30,000 -40,000 a year depending on location according to salaryexpert.com and several other salary comparison sites. And somehow the masonry companies manage to survive. Vons/Pavilions, Ralph’s, Safeway and other unionized supermarkets pay high wages and manage to survive.

  142. Alden says:
    @Reg Cæsar

    Comma,,period or no punctuation, $1000 is still a thousand. And it’s a good family living wage in Silicon Valley Bay Area. May seem a lot in Hillbilly Holler and the Mobile Alabama ghetto, but in the Bay Area where the Internet moguls live in 20 million dollar homes and make billions a year it’s not that much

    I did a lot of baby sitting starting at age 12 almost every Friday and Saturday night and even on Sunday or Saturday during the day. It was in the olden day’s the MEN Of UNZ think we’re destroyed by the feminazis instead of the Rockefeller and Ford Foundations and the wage freeze and price inflation.

    Anyway, wives didn’t work. They had plenty of time to arrange active social lives and the husbands made enough money to support club memberships entertaining parties and evenings out.

    I generally baby sat 14-18 hours a weekend. The year I began my baby sitting career, there was a strike of nurses aides at one of the hospitals. The papers were full of these evil selfish women abandoning their patients. The papers also were aghast at the wage they demanded Their hourly wage was in the papers too.

    The aides made minimum wage and wanted a slight increase, much less than a dollar. I was shocked to discover my hourly wage as a 12 year old baby sitter was 3 times the hourly wage of adult women, most with kids caring for hospital patients. I made about the same in 13 hours a weekend babysitting , mostly watching TV or reading as the nurses aides did in 40 minimum hours on their feet caring for patients.

    The free market where workers and employers negotiate on equal terms about wages doesn’t exist and never existed. The endless supply of cheap labor from Europe ended because of:

    1 1925 immigration restriction
    2 enforcement of immigration laws
    3 WW2
    4 occupation of E Europe by Russia after WW2
    5 socialism in W Europe after WW2

    That gave the American middle and working class just about 25 years of prosperity for all workers. By 1975 wage freeze combined with 10 percent and more inflation, workforce doubled by the entrance of married women and unlimited immigration ended the 1950-1975 middle and working class prosperity.

    Welfare unemployment and disability. pay as much maybe a bit more or less than minimum wage before bus fare or driving to work.
    So why should anyone work at minimum wage when they don’t have to? Then there’s the fact that if federal minimum wage had risen naturally with inflation over the last 50 years it would be about $20.00 an hour

    The weirdest thing about the race to the bottom Econ 101 idiots is that they only think of some barely making it business that can only survive by paying the lowest wage and is on the verge of bankruptcy anyway.

    What about landlords who need well paid tenants? And owners of residential and commercial real estate? Home sellers? If wages keep going down, pretty soon there’ll be no one to buy that house you paid $200,000 for. Auto industry and car dealers clothing stores Home Depot and hard ware stores.

    The low wage Econ 1o1 fools want a world where everyone lives in the projects or section 8 and shops at Walmart and thrift shops with EBT cards.

    As far as marketable skills goes, between government affirmative action and the capitalist pig importation of skilled and unskilled labor from every non White country in the world whatever education and skills an Econ 101 White man has, he can’t use them.

  143. @Mike Tre

    And address this point: an employer that is forced by law to raise wages must then also rage the costs of his product or service. The gain in wages is cancelled out by the increase in cost of goods and services

    .

    This would only be true if labour were the only cost to businesses and everybody was on min wage. Business have multiple costs. Wages are one cost. Rent is another. The cost of heating is another. Loan repayments are another. Transport costs are another. Sometimes monetary fluctuations are a hit on profit for larger transnational companies. This is just to pick a few variable costs that businesses deal with all the time without raising their prices, if they can.

    Minimum wage workers are 1.9% of the US economy. Even for small businesses labour costs are rarely the majority of their outgoings. On average labor costs are 25% but most of those workers are not minimum wage. A 10% increase in minimum wage in the US isn’t going to see an increase of 10% in an iPhone.

    • Replies: @Justvisiting
  144. @gleongelpi

    For example, a stocking clerk at a grocery store may be getting $10 an hour now while a stonemason apprentice is getting $15 to start. You raise the store clerk to $15, the stonemason apprentice will automatically have to go up to $22. But what about the hamburger flipper who starts at $7.5. If he goes to $15, the store clerk has to go to $20 while the stonemason goes to $30. And I will have to go to around $100. I’d be darn if I will get left behind.

    Your employer or client isn’t going to give you $100 just because the minimum wage has increased. The stonemason isn’t going to get a raise either. He might ask but he won’t get it.

    Something like this did happen when there were national wage agreements agreed with unions and most industry, yes even in the US. No reason now.

  145. GeeBee says:
    @Mefobills

    Most informative. Many thanks. I wasn’t suggesting that Schacht was Jewish by the way, just that he wasn’t totally against them. The same can be said for Hitler and most of the leading members of NSDAP (but try telling that to any Jew or any MSM outlet). I recall reading that ‘Hjalmar’ was a Dutch name, and that he had close Dutch family (at least one grandparent if I recall), and it was felt he ought to have at least one given name that was Dutch. (‘Dutch’ is actually just a corruption of ‘Deutsch’, i.e. German. The Dutch people, ethnically, are part of the Germanic tribal structure, if one can think of it like that).

    I read Hudson’s recent piece on ‘Changes in Superimperialism’ here on Unz a week or so ago, and was astonished at some of the things he said. Not least that the IMF (a USA-controlled organisation, just like the World Bank) made their loans to struggling Third World nations conditional upon implementing labour policies that were specifically intended to drive down wages and conditions, as well as to prohibit Trades Unions, in order to make their products more ‘marketable’. I am no communist, but that sort of thing makes my blood boil.

    Also, that thing about insisting on debts being repaid, which of course justifies the whole raison d’être of the IMF in the first place. As Hudson described the USA’s stance on it: ‘ “Of course you can pay: simply destroy your economy and let us take you over, and sell out all of your industry and raw materials out to us, and that will enable you to pay.” That’s what the American demanded. It’s what the creditor demand has always been. Essentially you have to be willing to destroy your economy in order to pay your debts.’

    Good ol’ US of A my foot. And his other analyses, of how the USA destroyed first Germany and Japan, and then identified England as being the sole remaining competitor, and thus the third target for destruction. Why is this sort of thing not generally known? We both know the answer of course. But imagine if every British man and woman knew how things stood. If every German of Japanese knew. The world would change for the better overnight, as the USA’s evil hegemony would come under immediate censure.

    On another thread – https://www.unz.com/pescobar/russia-holds-the-key-to-german-sovereignty/ – I posted this morning the revelations of General Gerd-Helmut Komossa (former head of West Germany’s Military Intelligence) in his memoirs The German Card, demonstrating Germany’s true status in the world today. See my comment number 135 on that thread.

    Anyhow, thanks again. All good stuff.

  146. Mefobills says:

    “Of course you can pay: simply destroy your economy and let us take you over, and sell out all of your industry and raw materials out to us, and that will enable you to pay.” That’s what the American demanded. It’s what the creditor demand has always been. Essentially you have to be willing to destroy your economy in order to pay your debts.’

    That is the nub of it.

    It can be reduced further to a four word term: “Swaps of unlike kinds.”

    Swaps of unlike kinds are usury. If you elect a government, or have a third party (like religion) intercede on your behalf, and they cannot understand swaps of unlike kinds, said government or religion is illegitimate. The intercession is between two parties, when two parties are in conflict.

    Swaps of unlike kinds are like the butcher putting his thumb on the scale. You are swapping money for a false weight.

    A debt that is taken out in, say, dollar terms, can be paid back in something other than dollars. That is a swap. The agents of mammon, work out usurious schemes, where the swap benefits themselves. The housing bubble foisted on Americans is a case in point. During the 2008 collapse, homes were foreclosed to pay off debts. In this case the debt instrument was mortgages and rehypothecations, such as mortgage backed securities. A mortgage was “paid off” by foreclosing on a fixed asset. The fixed asset (house) was then turned into a rental revenue stream. The rental stream was used to pay off the MBS. Finance usurers engaged in additional swaps of unlike kinds by using QE (Quantitive Easing) for Cash for Trash, where MBS were bought at face value.

    In general, usury is part of a Creditor dynamic, but Hudson explains how the U.S. became a debtor usurer with TBill/Petrodollar/Floating Exchange rate system after 1973. Our (((friends))) are usurers as part of their tribal evolutionary methods.

    The proper way to look at usury is as a power relation, where one party is intent on stealing life energy and wealth from another party. That power relation can be two way (creditor is over debtor), or it can be three way, where the third party intercessor does a rake -off, or creates scenarios for rake-off.

    None of this stuff is taught in economics curriculum. NSDAP economists “felt it and knew it – because it had become personal and existential” – they had been victims of a concerted usury attack by the “international.”

    By 1912, a finance parasite had implanted itself, and was running America’s brain. The parasite has only dug in deeper. Hudson’s book, “Killing the host” is a treatise on usury, even if he doesn’t use the term.

    I keep mentioning this question, “How do your organize, educate, and staff your civilizational hierarchy?” It is the most important question nobody is asking.

    If you examine Schacht’s methods closely, you will discover he was intent on using Germany’s productive powers, to then pay off the excess demands of the usurers, to then avoid war.

    Even Schacht’s BIS gambit was intended on protecting Germans by creating channels for paying off usurious debts short of war.

    • Replies: @Mefobills
  147. Mefobills says:
    @Mefobills

    Addendum:

    You can use usury framework for thinking on most issues.

    For example, I’m freezing my butt off here in Texas because the regulators looked the other way. The last freeze in 2011 (I think), the regulators “suggested” that the gas well-heads and other infrastructure (valves, etc.) be insulated, to then make sure there is uninterrupted gas flow.

    (Sidebar – What if grants of money were made available for freeze proofing? What would have been the outcome?)

    In this case the swap of unlike kinds would have a temporal dimension. If I don’t spend money now on doing the right thing by freeze proofing, then the future can pay, while I take benefit in the now.

    The same is the case in Japan’s Fukushima nuclear disaster, where the diesel back-up generators were not elevated above Tsunami flood plane. I don’t spend in the now, and let the future pay. Usury is then taken as an externality, where the environment and the future is made to pay.

    Fascism was an attempt to overturn the big bang event of 1694 (BOE inception) where our ((friends)) installed finance capitalism into the British body politic, which in turn is usury writ large. A fascist “third party” intercedes not for usury and rake-offs, but to protect the general welfare.

    • Replies: @GeeBee
  148. GeeBee says:
    @Mefobills

    Utterly fascinating. (I am replying here to both of your recent posts, numbers 147 & 8). I cannot quite grasp some of your finer points (I need to spend an hour with an ice pack on my head first!) but I get the gist of what appears to be a method of swindling (usury) that few are able to understand – even those in government. I ask myself, in light of this, and from what you have made clear, if, for example, that homely daughter of a Lincolnshire grocer who rose to become the UK’s first female Prime Minister, can really have understood what it was she was doing when she privatised (which is, of course, to say ‘financialised’) much of ‘the commons’ in Britain and allowed the ‘de-regulation of financial services’ (which is surely code for lending at exorbitant rates of interest to fuel a housing price boom’).

    Could she have been ‘advised’ (tricked) into taking these courses of action by certain leading members of her Cabinet? Sir Keith Joseph; Nigel Lawson; David Young; Malcolm Rifkind; Michael Howard; Leon Britten? Every one of these men were bereft of a prepuce! (My first wife was one of Leon Brittan’s team of secretaries as it happens). Or did a cruel monster lurk deep inside that exterior so redolent of a lower-middle-class schoolmistress? I always supported the Conservatives as a young man, and was very pro-Thatcher. Now I wonder just what she was up to.

    I did very much grasp, at the time, that if you suddenly allow a couple to borrow five times their joint earnings in order to get a mortgage, when hitherto they were only offered two and a half times the principal earner’s salary, that what was sure to happen was that house prices would double. And that is exactly what did happen. I also grasped that, attendant upon this, it would have the result of locking out a very large amount of the spending power available to each couple, paying as they were a far larger proportion of their monthly income on ‘servicing’ their mortgage. Thus, the general economy would suffer from this across the board diminution of ‘discretionary spending’, while the finance industry would reap a tremendous harvest, most of which, as you rightly say, was an exercise in syphoning off the industry of the productive sector. Or, in fact, usury.

    As for the notion of what you refer to as ‘swaps of unlike kinds’ having ‘a temporal dimension’, I was interested in your analogy where: ‘if I don’t spend money now on doing the right thing by freeze proofing, then the future can pay, while I take benefit in the now.’ This is one of those things (I can’t remember the name) which involve costs being offloaded onto the consumer by a producer. For example, when an industry allows itself to pollute a river or indeed the air, rather than pay the costs required to clean up the production sufficiently. Or when a pharmaceutical company launches a new drug without first carrying out necessary (and expensive) testing These costs are, in effect, being passed on to the people (and not always solely to those who buy the company’s products). What are these costs called? There was a piece about it here on Unz a few months ago. I cannot recall.

    Anyhow, you really ought to write a book on these subjects. Your wisdom and expertise is needed, by both ‘the people’ and those rare souls in politics who actually retain a vestige of integrity.

    Thanks once again.

    • Replies: @Mefobills
    , @Mefobills
  149. @Eugene Norman

    Agree that minimum wages will not translate into a significant increase in prices–but the reason why is much more complex than a simple calculation of labor cost as a percentage of total cost.

    Many businesses in today’s world make decisions on whether to hire more people or go with robots or software that can do some or all of the job. Small marginal businesses also have illegal aliens as options.

    At the margin, an increase in .gov mandated wages pushes the decision towards mechanization.

    Robots don’t require health insurance, unemployment insurance, social security and medicare taxes (employer paid portion). Robots don’t sue for racial discrimination or wrongful discharges. Robots don’t steal from the employer….etc….etc….etc.

    Humans are _expensive_ to hire. Anything that makes them more expensive just means that less of them will be hired (or more of them fired).

    Galbraith lives in a world of Unicorns and Tooth Fairies–as do most of the “expert” economists teaching at universities these days.

    • Replies: @Eugene Norman
  150. @Thomasina

    Hi, and thanks! Sorry for the delay in responding.

    I certainly agree with your general conclusions regarding the evils of the system, but it is also important to consider the means by which that evil is achieved in practice.

    The following brief intro is from Mortgage Payment Abatement Advisory, and which is also covered in A General Theory of Financial Relativity, from

    http://werex.org/mortgage-payment-abatement-advisory/
    http://werex.org/a-general-theory-of-financial-relativity/

    The most important thing is to analyze the transactions forensically, and with due regard for procedure or order-of-events, to then decide on the most appropriate label to apply to it, instead of taking the labels as accurate, and then trying to make the reality fit the labels.

    Not money-lenders

    Banks are not what you think they are. They are not money-lenders – they are credit-reinsurers and they are asset-sinks. When you sign and deliver a promissory note and mortgage you are underwriting and advancing real-estate-secured-credit to the bank. The bank strips-off the financial and real-estate security as a premium for itself, and then returns or reinsures unsecured-credit back to you as an unsecured-deposit-liability / credit that does not cost the bank anything material to produce.

    The money / credit for the alleged or pretended loan does not even exist unless and until you underwrite it by accepting the liability for it by agreeing that you owe it, normally under the promissory note that is secured by the mortgage.

    You then have to add or issue the same amount again in the form of a signed check / cheque (drawn on the bank) to the seller of the real estate, who has to endorse it / co-sign it and deliver it back to the bank as a ratification of what would otherwise be the recoverable-loss of their property and legal-title to the bank in exchange for an unsecured deposit credit. Then the bank agrees that it owes the principal amount (selling price) to the seller instead of to you.

    The nominal mortgage is a combination bill of sale that transfers all right, title, and interest in the property to the bank, plus an embedded repurchase option that allows you to buy the property back from the bank by paying it all of the money required under all of the securities. When a bank forecloses it is not foreclosing on the house, because it already owns the house. The foreclosure is of the repurchase option – sometimes referred to as a right of redemption.

    The banker arrives at the transaction with metaphoric empty pockets, and leaves with all of the financial securities from the pre-qualified lead-underwriter / pretended-borrower in one hand, and the legal-title to the real-estate property (and endorsed check) from the seller in the other.

    From the nominal bankers’ perspective there is only one material reality, and that is that real equity / secured assets come in, and only unsecured liabilities go out. They are asset-sinks and they are unsecured-liability-kiters.

    So when you write:

    They just have the borrower sign a promissory note and then conjure the loan money out of thin air, just an entry on a ledger.

    you are not wrong in the sense that the result is certainly “as if” the bank were conjuring the loan money out of thin air, but in terms of the forensics and the procedures, the bank is in fact obtaining secured credit from the note-issuer, and then issuing back or reinsuring an equal or lesser amount of unfunded and unsecured credit in the form of a deposit-account-credit.

    In practice, nominal banking is 2% money-lending, and 98% credit-reinsurance.

    • Thanks: Thomasina
    • Replies: @Eugene Norman
  151. @Justvisiting

    By increase in prices–but the reason why is much more complex than a simple calculation of labor cost as a percentage of total cost.

    Many businesses in today’s world make decisions on whether to hire more people or go with robots or software that can do some or all of the job. Small marginal businesses also have illegal aliens as options.

    At the margin, an increase in .gov mandated wages pushes the decision towards mechanization.

    Naw. Small businesses aren’t going outlay thousands or hundreds of thousands of pounds on automated waitresses. Prices won’t go up because there aren’t that many minimum wage workers.

  152. @Timothy Madden

    the bank is in fact obtaining secured credit from the note-issuer, and then issuing back or reinsuring an equal or lesser amount of unfunded and unsecured credit in the form of a deposit-account-credit.

    What do you mean by note issuer? The borrower? Why not use clearer language.

  153. Mefobills says:
    @GeeBee

    You pretty much get it.

    With regards to Maggie, Hudson refers to her as TINA. There Is No Alternative.

    When in fact, there are plenty of alternatives. Google keywords using Hudson, TINA, and Thatcher, and maybe some interesting stuff might come up.

    Usually, when somebody in a meeting, or to begin a conversation, immediately lays out the parameters – like there is no alternative to privatizing, then you know you are about to be conned.

    They lay out markers, and you cannot go beyond. It’s a neat psychological trick.

    I’ve been thinking about a book, but the time is not right at the moment. I am grappling with how to make the knowledge accessible for the everyman. No icepicks.

    In fact, the banter here helps me with my thoughts. Thanks!

  154. Mefobills says:
    @GeeBee

    What are these costs called?

    Sorry I missed this in the reply. They are called externalities.

    It means that the price system does not reflect full cost as it is not priced. The price is born outside of the system, by the future or by others.

    For example, off loading plastic trash from the first world to the third world, pollutes “over there” so over there bears the costs in reduced standard of living and lower life expectancy. Life expectancy and plastic polluted oceans are not priced in the cost of goods. The only thing that matters is a low money price, right?

    Finance capitalism attempts to monetize everything and turn everything into a money price, but at the same time engages in externalities. Externalities are a form of usury. FC also pretends that humans work for the economy, rather than vice versa.

    To do usury requires a con. Clown world is the end result of a long con. The con is out in the open, and spoken in narratives. For example, Lolbertarians are mostly brainwashed, and you have seen how fervently they believe in their narratives.

    I was forced to learn economics when my company (the first semiconductor company to be admitted) went to China. We were engaging in wage arbitrage (cheaper Chinese labor), but didn’t know what we were doing, as the cost of business was actually high due to polluted air (carbon acidification of the water and chemicals was a problem), and training Chinese labor was difficult.

    Unfortunately, everything I feared turned out to be correct. Economics is actually not a dismal science, it is a control system with predictable outputs. The control levers are hidden, which is why the outputs appear unpredictable. As you surmised, there are levers being pulled to then effect a rake off of the producing sectors.

    • Agree: Lurker
    • Replies: @GeeBee
  155. GeeBee says:
    @Mefobills

    Externalities! Of course. And boy, are they a source of usury! Covid-1984 vaccines anyone?

    Regarding your book, I can only say that I relish the prospect of you getting it ‘out there’. In the meantime, keep up the good work!

  156. Mike Tre says:
    @Alden

    This is entire reply is nonsense and you didn’t answer my question or address my point. So you were born into the family business and really have no idea what it takes to start or maintain a business, you just write checks. Is your last name Pritzker? Keep repeating that little ditty, it’s like a rain dance for out of touch yuppies.

  157. Factorize says:

    Who wants a low wage economy? Why allow a niche for such an economy to endure? Such an economic environment results in a politically unstable society with large scale social problems. Proactively create the labor economy that you want and then let workers adjust to it. Here adjust to it would mean accepting higher wages and better working conditions, while avoiding low productivity/low pay mass labor. Industrial policy can work to the benefit of workers.

    Yet, California with all of its technomight has been unable to develop agricultural technology that could replace many of its agricultural jobs that offer a minimal wage for hard farm labor. However, such a future seems inevitable over the medium term in any event as demographic transition to below replacement fertility has already occurred in many nations south of the border. Why not formalize this in an economic policy that is better for workers and creates better social outcomes?

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