Monday, September 26, 2005

The National Wage...

I want all of you to imagine this for a moment.

What if tommorrow morning, at 10:00 AM, the President called a press conference, and announced that in the interest of economic fairness, the Congress and Senate have passed the "National Wage" bill, and he is now going to sign it into law.

From now on, everyone from the CEO of GM, to the janitor at Burger King will make $75,000 per year. No one will make more, no one will make less. And all fortunes amassed by people like the Walton family, and the Hiltons, and even the Kennedys or Heinz-Kerrys will be confiscated, and applied to the national deficit.

What a wonderful world it would be, right?

I mean, there would be no more "Rich", or "Poor"...Only Americans. No more class envy. We would all be able to afford the same house, the same car, the same boat, land, TV, lifestyle.

Money would no longer be an issue, right?

Complete economic equality for all Americans.

Right??

WRONG.

I can think of no more horrible scenario for our country than that.

The first thing that would happen is that no school teacher, doctor, dentist, nurse, lawyer, bus driver, truck driver, newspaper reporter, secretary, company executive, garbage collector, septic tank pumper, tire changer, cashier, dog groomer, policeman, fireman, shoe salesman, construction worker, mechanic, personal assistant, housekeeper, fast food worker, ditch digger, etc, etc, etc...would show up to work tomorrow.

I know I wouldn't.
I would become a professional musician. (I mean, if I was guaranteed the same income as if I were still driving a truck, Whether there was a market for my music or not, this is a no-brainer.)

There would be no need for anyone to go to college anymore.
If you could make just as much money slinging a mop, then why become a brain surgeon?

For that matter, why even finish high School?

And God help you if you, for whatever reason, needed to see a doctor. There wouldn't be any.

There wouldn't be any lawyers, either.

By the same token, you wouldn't be able to get a job as a janitor, either. Businesses would no longer hire people who did not generate $75,000 per year. They just wouldn't do it.
And if they wanted a janitor, there would be 800,000 applicants to choose from.

They wouldn't hire truck drivers either.

They might hire one or two, and force them to do the work of eight or ten, until they quit to go look for a job as a video store clerk or something.

I mean, the money would be the same.

Why do the extra work?

And what would housing cost if every worker on a jobsite had to be paid $75,000 per year?

What would a car cost?

What would a hamburger cost?

Okay, now.
Consider this point. If it makes no sense to set a National Wage, or a Maximum Wage, then why does it make sense to set a Minimum Wage?
You are not helping the poor by raising the minimum wage, or even by HAVING a minimum wage, you are only depressing the buying power of whatever money they DO have.

Economic equality is an myth. It is an unattainable concept.

To pursue the goal of absolute economic equality in America would destroy our whole economy, and lower the standard of living to poverty levels nation wide, for everyone.

The only economic system that has ever been devised that leads to prosperity is Capitalism.
And for Capitalism to work, you must have rich, and poor, and everything in between.

It is the only way.
Like it or not.

36 comments:

Mark said...

What if? Well, things would change temporarily. And then the people who know how to manage their money would start amassing their fortunes once again, and the people who spend money foolishly would revert back to below poverty level.

On the plus side, only the people who want to genuinely help people would become doctors, teachers, pastors, etc.

Mark said...

In short, it wouldn't work. It is communism and communism only works when you refuse the people free exercise of rights.

tugboatcapn said...

That is exactly my point.

If you want Freedom, you have to have Capitalism, and with that comes Economic Inequality.

Freedom means the Freedom to make your own choices, and then subsequently to reap the benifits, or pay the price of those choices.

This is the only system that encourages personal prosperity and achievement.

Drlobojo said...

I lived in a society once which actually function this way. Except they made you go to work and assigned the kind of work you would do. They paid everybody at the same level, no matter what your job, the exact same wages. And every payday the equal wealth was re-distributed among the individuals in the group within 24 hours, using a system of 52 paste- boards with numbers and designs on them and two little cubes with spots on them.

Erudite Redneck said...

If this country's economy had ever -- ever -- operated as a purely capitalistic system, this eould be an appealing argument. But it has not ever. Why? Because capitalism, left alone, is merciless in its efficiency, and therefore cruel in its effects. This country is not just an economy. But it has one -- and it's mixed. Always has been.

--ER

Erudite Redneck said...

Herre is a thorough discussion of what a mixed economy is. All we do in this country is argue over whether it should be a little more capitalist or a little more socialist. Tug and friends opt for the former; ER and friends opt fof the latter. I don't really thing Tug wnats pure capitalism any more than I want pure socialism -- although espousing extremes IS sometimes how we find the mean.

http://en.wikipedia.org/wiki/Mixed_economy

--ER

Toad734 said...

Who said anything about paying everybody the same wage? We just want fair wages and we want to preserve the middle class. You know those people who used to be able buy a house on one income that carry the majority of the tax burden and are having their jobs replaced forcing them into a life of a Wal-Mart greeter.

I think what you are missing is that if minimum wage rose at the same rate as CEO pay since the early 80s that minimum wage would be over $20 an hour. Why, amidst all the white collar criminals and CEOs cooking their books and insider trading, taking even more money away from the middle class is it ok to allow their income to rise as workers wages have fallen even during a period of record productivity? Why? Because the CEOs are taking the money from the worker and paying themselves with it and since they are also responsible for moving our jobs to Mexico and China our workers are forced to bare this shift in wealth.

At some point the fast food and service industry will have to replace the auto industry as the new middle class because our economy will collapse without all the middle class consumers; therefore a raise in minimum wage will be required and it will mean that stock performance and corporate profits will suffer. So what; they have enough money.

You also have to understand that the real value of minimum wage has decreased dramatically since the late 60s and early 70s due to inflation.

The Republican Party baffles me in how they convince the poor to vote for the rich by saying if by chance one day you become rich; you wouldn't want to pay taxes to support your fellow poor people. It’s the biggest sham since the pyramid scheme.

Toad734 said...

Mark:

Do you really think that the poor people you see today started out with money and just spent it all on spinning rims? Do you really think that all these ex-slaves started out rich and their children squandered their fortunes?

No, in fact it is quite the opposite; a lot of the rich people have had money in their family for generations; money that was made on the backs of slaves.

Erudite Redneck said...

Amen, Toad.

Bruiser: You do more harm than good. Go away.

--ER

Mark said...

No Toad, I didn't say that. I didn't say that at all. Can you read?

Mark said...

Toad,

All poor people weren't slaves. All rich people weren't born into it.

Only irresponsible people would become poor again. Only people who are savvy money managers would become rich.

No one said anything about slaves.

Wait a minute. oops. Somebody did.
It was YOU!

If minimum wage was raised, prices would go up accordingly, to cover the cost of payroll. Consequently, wages would have to be raised again to make sure that everyone could affford the higher prices. Then the prices wopuld have to be raised again to cover the costs of payroll, and on and on and on...

Wages alone will never make someone rich, or solve the problem of poverty.

Work it out yourself. Use logic!

Erudite Redneck said...

Ah, but see, Mark, you assume that the cycle of rising wages and prices is a bad thing.

It. Is. Not.

It takes a little inflation to sustain growth. Every expert in the land says ZERO inflation is bad.

So, I say raise the dang wage. Let 'em raise prices. Good will still come of it!

--ER

tugboatcapn said...

But when we talk about raising the minimum wage, we aren't talking about raising wages across the board, we are just talking about raising the MINIMUM wage.

If we raised wages across the board whenever we raise the minimum wage, then raising wages would not provide any advantage for minimum wage workers.

This de-values the money earned by the middle class.

The prices go up for everyone.

And you are right, ER. I want there to be safety nets for the disadvantaged, but I believe that we over-do it in today's America.

There has to be a way to help the poor, without creating a generations long cycle of Government dependency, which leaves it's victims so helpless that they cannot even run from a natural disaster.

Erudite Redneck said...

Betrer to devalue the wages earned by the middle class by increasing the wages of the lower classes than by increasing the wages of the upper classes. Ow. There we are, again, at the brick wall between libs abd cons. :-)

--ER

tugboatcapn said...

Yep, there it is.

I do not view the rich as enemies, rather as the creators of jobs and economic activity.
When you discourage the creation and accumulation of wealth, you discourage the creation of jobs. And without the creation of jobs, all you do is create dependency.

Er, I personally know a man who started his career by borrowing money from his dad, (which his dad really did not have to lend him,) and bought one used dump truck when he was nineteen years old.
He now owns a trucking and asphault paving company which employs about 25 people.
He has a very big, very beautiful house, a whole bunch of land, and pretty much anything else he wants.
All of his children either work for him now, or have worked for him in the past, as have I.
He is the one who helped me get my Commercial Driver's License,(which he did not have to do,) without which, I could not make a living.
In a very real sense, I owe whatever success I have to him, even though I have worked extremely hard to get here.
He is not looking for a way to screw his employees. He is constantly looking for ways that he can pay his employees even MORE money than he pays them now, because he knows that a well paid worker is a productive and happy worker, and he does not have to train replacements for the people he has, if they stay with him. (And he has trained almost everyone who has ever worked for him.)
I do not work for him now, because I live in Florida, and he lives in North Carolina, however, I would do pretty much anything he asked me to do, (if he ever needed anything from me) because I think so highly of him.
He is "The Rich".
He did not get rich by exploiting poor people, but by creating opportunities for everyone he has ever interacted with professionally (me included.)
He got rich by working outside in the hot sun, HIMSELF, for DECADES.
He got rich by inspiring loyalty in his employees, and helping them to better themselves however he could.
I do not begrudge him one red cent that he has earned.
One of the most important things that he has done is that he provided an example to everyone who knows him, because ANYONE could do the exact same thing that he has done, and become just as rich as he is, and he will help you do it too, if he can.

Do not tell me that I cannot become rich.
Do not tell me that ANYONE cannot.
I've seen it done, up close and personal.

One other thing that I know for sure is, Nobody is EVER going to become rich by signing up for checks from the Government. All that those people can ever hope for is a meager subsistance, and they will never escape the trap of poverty as long as they rely on someone else to pull them out of it.
The rich are not keeping the poor down.
The rich are who is pulling the middle class up.

tugboatcapn said...

And I MEAN IT!
GET LOST, BRUISER!
Nobody cares what you have to say, and I will forever delete every word you type onto my comments page.
FOREVER.
You have not displayed enough sense to engage in our discussions, and I will not tolerate your rhetoric and bile.
GO AWAY.

Drlobojo said...

Actually looking a the deomgraphics of moving from one economic strata to another over a ten year period ending in ,I think, 1993; slightly more "middle class" went down to "Poor" than went up to "Upper". There was a lot of movement between catagories. Interestingly, I think I remember that the number of poor who got rich and the number of rich that got poor was about the same. Also it made the point that the poor in the main don't stay poor but for a few years at a time. There was a hard core "poor", but it wasn't as large as Lee Atwater painted it for us back in the 1980's with his "Welfare Queen" rhetoric.
I gleaned this from a series of articles about "class" statistics in the New York Times early in the Summer. Made interesting reading.

Drlobojo said...

One more thing: Re:
"One other thing that I know for sure is, Nobody is EVER going to become rich by signing up for checks from the Government."

I think that there is a whole lot of corporate "famers" out in the Central Valley of California and other places that have done just that. Some "checks" are just bigger than others.

Erudite Redneck said...

I do not begrudge the rich, especially the "rich" small-business employer you talked about, Tug. I DO begrudge anyone who says he did it ON HIS OWN.

Bullsnot. And if he's in the asphalt business, he's drawing plenty of "gubment" checks -- for work, yes, but they're still "gubment" checks. And I guarantee-damn your holy "free market" wouldn't have provided any of the dang roads he works on or that you drive on.

So, let me paraphrase something you said earlier. You said capitalism needs all income levels to succed, or something like that. A better way to put it is, in the United States, "Capitalism needs a little socialism to succeed."

--ER

Drlobojo said...

There is a general rule in pharmacology, that too much of pure anything is toxic.

Francis Lynn said...

"There wouldn't be any lawyers, either." - That alone makes the idea of a national wage seem interesting to me.

tugboatcapn said...

He doesn't pave for the Gub'ment, ER, he paves driveways, tennis courts and golf cart paths for the "Really Really Rich."

And he didn't do it all on his own, his brother and his dad helped him.

One of the purposes of Government is to provide infrastructure, and I have no problem with that.

ER, I have never said that we need PURE Capitalism, I just don't believe we need any more Socialism than we already have, We would most likely be better off if we didn't have quite so much...

carrier said...

You have a flair for stating the obvious, but I have never encountered an individual who believed that true economic equality could ever exist. You contend that we would all become worthless slobs wallowing in our new found wealth...I think you have too little faith in human beings.

Jobs would still need to be performed and services would still need to be provided. Do you think so little of your fellow man that you believe the machinery would be allowed to grind to a screeching halt?

Whipping up an impossible scenario to support the assertion that a minimum wage is only a crutch is just the old bait and switch routine. A basement payscale isn't going to cripple the economy so loosen up and toss these people a bone.

Don't be so damned concerned about the Paris Hiltons of the world having to cope with slimmer dividend checks. You gripe about having to help support the nonproductives who are too lazy to help themselves, yet you seem to have no problem at all with our fearless leader's attempts to make sure his crowd never need worry about the sturgeon eggs running low.

Toad734 said...

Mark:

Prices of goods wouldn't have to go up if the CEO's and corporate heads absorbed the rise in workers pay instead of passing it on to the consumers. The way it used to be.

In 1980 an average CEO made 42 times the amount of their employees; which is about the same as Japan today. By the year 200 CEOs made 531 times the amount of their average employee. So, with that decrease in workers wages did you see the cost of shoes, jeans and cars go down? NO !

So why would they go back up if we raised wages? It would just mean that a CEO instead of making 10 million per year he would only make 8 million per year. I think they can handle that, it's only a 20% decrease.

Toad734 said...

Tug

Yes raising minimum wage wouldn't help the middle class; that is why outsourcing is bad and we need to keep factory jobs here, secure from slave labor competition elsewhere.

Paris Hilton isn't going to give you or anybody else a job! Well, not that kind of job anyway.

Steve Jobs new Ipod is employing plenty of people in China where they are made, very few here.

tugboatcapn said...

Carrier, you assert that I have no faith in human beings, and then turn right around and assert that there are Americans who absolutely cannot look after themselves.
This is a paradox.
I believe in the power of the individual to excell, when given the proper motivation.
I believe that Government give-away programs only create dependency.

Toad, More foreign countries outsource to America than American companies outsource to other countries, so the U.S. has a net GAIN in jobs due to outsourcing.
If you would put down your Democrat Anti-Bush talking points bulletin and do some OBJECTIVE homework, if indeed you are capable of such a thing, then you would know this.

And if you mention Paris Hilton one more time, I will delete your comment.
I know that she is your poster child for the injustice of economic inequality, but it makes no difference to me whether she is rich or poor. Her being rich does not take money out of my pocket.

She is of absolutely no importance to me.

And the Ipod actually creates jobs for dock workers, forklift operators, recieving clerks, supervisors, truck drivers, re-packagers, more forklift operators, yard jockey drivers, shipping clerks, more truck drivers, more recieving clerks, more forklift drivers, assistant managers, more recieving clerks, shelf stockers, cashiers, and door greeters.
Do not tell me that just because something is not manufactured here means that it does not create jobs here.

Toad734 said...

IPod would create even more jobs if they were made here.

I find it very hard to believe that more companies "outsource" work to American than the other way around. Do European and Asian companies have plants and Factories here? Sure, but that isn't for cheap labor and it isn't "outsourcing". They are trying to avoid tariffs and are putting products in geographic locations that make sense to them logistically to be closer to their customer base. It's not like they closed a factory in Germany and moved it here. And usually what has happened is that a European or Asian company just buys a profitable operation already up and running in the US; they don't usually start from scratch.

But I am interested in seeing these statistics at their source.

It also may be a manipulated number like all of Bush's "job creation" numbers where a converse factory in NC closes where people were making middle class wages and then they all get a job in the service industry at the new Wal-Mart for minimum, or below minimum wage. No one cares if McDonalds is hiring.

So can I start using the Gastenau girls as my poster children for undeserving millionaires who don't work for their free money?

tugboatcapn said...

Nope. Not interested in them either.

Try using George Soros, or John F. Kerry, or Ted Kennedy.

Maybe Ipods would create even more jobs if they were manufacured here. Maybe if we repealed enough government regulations and confiscatory tax policies to make manufacturing Ipods here more profitable than making them overseas and shipping them here, they would stop building them there.

Cheap labor is not the only reason that companies outsource.

Oh, but wait...
That would eliminate jobs in the shipping industry, dock workers, longshoremen, ship crews...

What do you have against these people? You don't want them to make a living?

I lived about 15 miles from that Converse plant in NC you are talking about, and those great middle class wages you are refering to amounted to about $7.36 per hour for forty hours a week at the time the plant closed.
I refused a job there myself once, because it did not pay enough money.

Millions of people in NC did not starve to death in the streets because the textile industry relocated somewhere else. Most of the people who worked in textiles there are a whole lot better off now than they were when the mills were running, because they started business for themselves, or got jobs in GROWING, PROFITABLE industries.

By the way, do you know how the textile industry got to NC in the first place?

It moved there from the New England states in order to take advantage of the lower labor costs in the economically depressed post Civil War South.

But the last time I was up there, it looked to me like the New England states survived the changes that outsourcing brought about, and so will NC, and so will everywhere else that unprofitable businesses are allowed to leave from.

I know what I am talking about. I worked in a textile mill in NC for four years, and I know what that situation was like.
Believe me, keeping the textile industry alive in NC would not have done anyone any favors.

Toad734 said...

Those guys you mention all have jobs.

Some of the factory workers there made minimum wage but I knew people who worked there as I hauled for them when I was in trucking. The logistics and management people made more than the 7+ dollars you mentioned, not to mention the money I made from them as a truck broker as well as all the other vendors in the US that supplied them with materials and services.

As far as diversifying goes yes, NC was able to recover from the textile industry due mostly to their financial and their bio-research companies. SC was not so lucky, nor was Flint, MI, Gary, IN, Detroit, MI etc. And of course as technology progresses new industries will pop up and we can become just as dependent on those as we were with the industries that left. But imagine what NCs economy would be like if it still had the textile industry plus the others I mentioned?

Both Finance and bio-research are middle and upper-class industries; they are not jobs that have a lot of openings for poor people. So now the low wage jobs you are talking about are gone and these people look to welfare for help. What I am saying is that you can't bitch about someone not having a job and using welfare if you condone their jobs being moved over seas. Fact remains that you can live off of 7.36 an hour, especially in Lumberton, NC but without that job and any alternatives, such as textile mills, what are you to do, go get a college degree when you are 50 and never finished high school?

You can’t argue that the place where our economy needs help is in the lower-mid sector of the work force. Lower class wages are declining as is Middle class wages and their tax burden is increasing. There aren’t auto factories or anyone else for that matter, who has a shortage of low wage employees. Every McDonalds and Wal-Mart I have ever seen is fully staffed, I don’t see any manufacturing companies begging for employees. There are obviously not enough jobs for these people if they all decided to go to work tomorrow.

Oh and the guys at the dock make just enough money when they are loading containers out as they do when they are receiving containers in.

tugboatcapn said...

Toad, I would much rather someone take advantage of Government programs to get an education, or learn a new skill (and there are plenty of programs like that out there,) than to go on welfare and sit around.

And again, you are talking about people that I KNOW.
This isn't some abstract thing to me.

The refugees from the Lumberton Converse plant ARE BETTER OFF SINCE IT CLOSED.

That's a fact.

And it isn't because the Government took over their care and feeding.

The people that I am talking about did not move to Durham and Chapel Hill, and go into Bio-Research, they opened restaurants of their own, started trucking companies, car lots, logging businesses, chicken or hog farms, opened auto parts stores, started construction companies, or went to work for others who did.

Jobs were created all over the place.

Socialism doesn't work, Toad.

The only thing that works is Individualism, and Capitalism.

Anonymous said...

ok why are we all hating on the rich? they really only are creating jobs for all the middle and lower class. without the rich, there would be no minumum wage jobs. there wouldnt be jobs above minumum wage either. someone has to own the companies that employ everyone, and the reason they own the companies is because they worked hard to get there. Anyone can get rich if there willing to work hard enough for it. and thats the truth. we see poverty in america because people get sucked into a poor life, raised being poor and don't know any better. if they would just sacrifice a little of themselves to find a job, and then work hard at it. eventualy there situation will better.

studbronumba2 said...
This comment has been removed by a blog administrator.
Toad734 said...

RE: Tug

I agree, I would rather see that money go towards education, job placement and family planning as well. Trust me, I am not a huge fan of welfare, I just don't see why it's ok for someone like Converse or US Air or even Wal-Mart to get free welfare when they are either mismanaged by greedy corporate brass or moving jobs over seas. I would rather give free money to someone who was hungry than to some rich guy who is just going to squander it and do something illegal with it. Actually I would prefer neither.

However all you have to do is look at a place like Brazil and see where no welfare gets you. In Brazil there are not enough jobs for everyone to go around, as is the case with the US, so without housing and food from the government they have homeless kids wondering the streets robbing people with money and committing crimes. When rich corporations don't get their welfare checks they don't do that.

RE: Anonymous

8 of the richest 15 people in this country did nothing for their money nor do they create jobs for anyone except for Mexican gardeners and landscapers whom they pay $40 per day.

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tugboatcapn said...

You have GOT to be kidding me...

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