Minimums of understanding
James Kwak writes Introductory economics can be more misleading than it is helpful (originally in Atlantic magazine). Tim Worstall responds with James Kwak sure doesn’t understand the economics of the minimum wage.
Peter Dorman explains Why you should never use a supply and demand diagram for labor markets.
Richard Wolff notes he thinks the debate is a distraction Beyond the minimum wage debate
Professor Wolff is right about the minimum wage debate being a distraction from America’s core economic (and political!) pathology. Right as far academic (academics’) distraction that is.
However the debate is very — maybe indispensably — useful for focusing the general public on the low, low pay of half the country. Not on the issue of fewer jobs lost-v-pay raise per se, which the professor notes — where, incidentally, academics never seem to take into account that fewer jobs at higher pay might be desirable.
The converse indispensable focus that the min wage issue brings to the public — very especially the Fight for 15 folks — is making much higher wages for everybody (not just min wagers) seem a much more realistic possibility — which, with the way people think, specifically the social way they think, makes going after the goal of reasonable wages and benefits something they actually might try for. If nobody is raising hopes (and hell) then everybody figures things are just the way things have to be.
Ultimately of course the goal has to be re-building US labor union density — but more about that later.
****************************
I always look at the irrational side of selling. When I was a NY Post paper boy I got a new route which had good potential for new customers. We delivered the paper for 45 cents a week, the news stand cost 60 cents; part of my route didn’t have news stands; we had an extra Bronx section.
Natural ploy: give a week free (cost me 30 cents a week). But, I knew that people wouldn’t want to “get involved” with some kid offering free papers at their front door. So I came up with “free coupons” which I had printed up (1400 for $9 I think). Different psychology: they opened the door, I popped the coupon in their hands, now they had money to spend and only one place to spend it. Ultimately added 35 to my 100 customers. Won the 1960 Thanksgiving Turkey contest.
Nothing could be simpler to understand and do than reset the American labor market (and political forum) by making union busting a felony at state level. Our most neglected (and maybe our most important — ask MLK) civil right has been left totally unprotected, since what once worked to protect labor (NLRA/NLRB) has withered to nothingness.
*******************************
But nobody makes a move because nobody else is making a move. Until somebody does, everyone will just figure that’s the way things have to be, I guess.
So, first I noted that 45% of the workforce earns less that $15/hr — same 45% lost 5% of their once 15% share of income. OTH, only 5% of number who voted in last governor’s race (in most of the dozen BALLOT INITIATIVE states) put the proposed law on the ballot — meaning only about 3% of all registered voters are needed to sign the initiative to put making union busting a felony on the ballot.
45% should be ready to line up around the block to sign anything that improve their lot — in their desperation. Matter of fact that would be the perfect demonstration: making up lines just to invite you to go to the front: perfect shill effect. I noticed when I was a street peddler, early 70s, that when one person made up their mind to buy, all of a sudden others did too.
All sounds perfectly workable if anyone ever tries it. I emailed the idea to 1100 California activists, unionists, legislators and journalists and others. Can’t be there to push it myself; wish I knew if anyone was pushing it. So easy, if only …
http://ontodayspage.blogspot.com/2017/07/california-shills-around-block.html
Another beef I have with the (progressive) academic treatment of the minimum wage is the lack of attention to the wheels-within-wheels aspect of raising labor’s price.
Lack of … ? Total ignoring of … Not some do, some don’t — meaning none appear to be thinking about it ever.
Double wages at super-efficient Walmart for instance and consumer prices only go up 7%.
Why don’t academic economists (not that there are non-academic economists I suppose) ever say anything out loud about what we might call the labor price “divisi-plication factor”?