Totally false.
- Even if there are more people selling labour than buying it, the price of all labour will be lower resulting in lower prices for all goods, which means even with a lower wage, you’ll be able to buy enough to survive. Take India for example. Even if you earn less than a dollar a day, you can feed yourself 3 times a day. Is that possible in USA?
- The ratio of people selling the labour and people buying it can be pretty small even in a deregulated market. That’s when more people try to set up their own businesses (i.e. more competition). In fact taking off regulations make it much easier and less costly to set up a business. This is common sense. You won’t learn it anywhere.
- Talk about empirical data when you actually know how to analyse it. You can always give a word salad explanation and dumb people would still believe it.
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It may be possible to survive in India because food is cheaper, but surviving isn't thriving. I remember having a conversation with a member of the Indian Orthodox Church years ago, discussing educational resources on patristic tradition and Orthodox dogma, and they said they couldn't afford to purchase such literature because the cost of those resources was so large relative to the wages they receive there. So, that's another factor to consider.
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I can give you countless examples of people going from rags to riches without any of those resources. Two of the most prominent examples are:
These aren’t exceptions. There have been many such success stories, where a person went from rags to riches all by himself. There are others who have achieved this feat after generations as well. These incidents essentially prove that it’s not formal education or availability of money that’s keeping you from becoming rich. It’s more of a combination of talent and attitude. Moreover, we also see that providing formal education to children doesn’t give them any significant advantage. Most of what they do, like basic arithmetic, using mobile phones, reading, writing etc. are self learnt. They don’t learn anything special at schools that can provide them significant advantage. If at all, only the best quality education, like the ones you can acquire at elite institutions (that too if you’re intellectual enough), is beneficial. So, it’s better to try your luck at other jobs that don’t require as much skill. Your descendants can always afford quality education once you have enough money and a better perspective. I haven’t heard of a single story where a random person without merit, from an extremely low income family, was sent to Ivy League college and became rich all of a sudden. That simply doesn’t happen. But, you would certainly lose a talented person in the process, which is simply not worth it.
Considering all factors, merely surviving is enough, if you have the talent and right attitude.
Whenever the government forces the increase in minimum wages, the wages of all basic labour increases, which can result in two situations. The first would be that prices of all goods would increase (since the labour cost for all of them is more) and either the effect of wage increase would be nullified or local businesses would lose to imported products which would lead to unemployment (which is worse than poverty). The second would be that the businesses would have to shrink their workforce, which would also result in unemployment. Therefore it’s best to not regulate the market. At least those people would be able to survive and the talented ones would still be able to escape poverty.
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The main factor in going from rags to riches is not talent or effort but luck. That's why it's relatively rare.
And, I agree that minimum wage is a bad way to regulate markets. A much better approach is a high marginal income tax rate on top earners, which encourages employers and CEOs to raise wages rather than lining their own pockets as productivity increases and profits increase. All of the Nordic social democratic countries have no minimum wage, but have high wages without the negative consequences that come with minimum wage, because they utilize tax policy to ensure that wealth is more fairly distributed.
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Nope. It’s not luck. It’s talent. Talent is rare amongst poor, and for the sake of finding those out, you spend too much on social welfare, which is a misallocation. Those talented people come up on their own, without any help.
As far as tax is concerned, I favour extremely low tax rates (less than 5% for everyone), because government mostly uses those to pay off interest rates on debt and take more of it. It then either misallocates it or drives private sector out, creating unemployment. Liechtenstein has 1.2% income tax and is one of the richest countries. If you want unequal tax rates, you should be charging the rich at a lower rate. This incentivises people to move up the ranks (either get promoted or start your own business), hence encouraging them to work more (add more value to the society) and create more jobs. Higher marginal taxes deincentivise setting up businesses, which is why nobody wants to set up a business in nordic countries. Their stock markets are the worst performers and their government depends on capitalist countries for their earnings (their government holds shares of USA and emerging market based companies). If USA does that, most of the businesses will move away, creating mass unemployment and famines.
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The most talented musicians I know of are poor and have never "been discovered" because they don't have enough money to promote themselves. You, sir, are completely out of touch with reality. I'm going to stop responding to your comments now because I don't have time to waste on refuting such mind-numbingly incoherent nonsense.
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Oh really? Taste in Music is something that’s subjective. Nobody really cares about whether or not you adhere to the rules. People just follow whatever is trendy. For example, many rappers are richer than ‘discovered’ classical singers. Moreover, we don’t really need more musicians for survival. We’ll do just fine even without them. The only use case for music is that it’s leisure for some.
I was going to ask you to shut the fuck up anyways! It’s good that you did it yourself.
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The only talent you consider is the talent needed to be an entrepreneur, or to be an effective employee under dire circumstances. Even then, environmental circumstances are a factor, which is a form of luck. Simply by denying that someone who's born in some far off village with little connection to the outside world is quite less likely to rise to riches with their own company, regardless of the talents they may possess, you show how far removed from reality you are.
Also, the way you completely drive over people who do have other talents, but who lack the attributes that would allow them to transform these talents into economic success on their own, also shows cruelty, and a willingness to waste those talents because they're not compatible with your beautiful, perfect equation for human society.
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You seem to lack basic understanding and teamwork. If you’re unable to market your skills, you look for a person who can do so. Just consider the case of Steve Wozniak and Steve Jobs.
Under a socialist economy, less of those talented people are employed and the government fixes a price on the talent. For example, Taylor Swift may not even exist under a socialist government if the government decides that her talent isn’t worth it. It’s not the job of the government to decide that. It’s the job of people (i.e. the free market). The more people watch her and the more they’re willing to pay, the more she gets paid.
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Finding a person who can market one's skills still hinges on being able to successfully advertise oneself to such a person, filtering for people who are able to do so. Furthermore, not everyone is configured to fit the mode of operation required by the market: Some might have disabilities that introduce irregularities in their behaviour or schedule, others aren't able to deliver a steady stream of product, and then there are artists who simply never get the recognition they deserve in their lifetime (not uncommon).
There are also those who simply can't reasonably be expected to function under market conditions at any meaningful degree, and those who just don't have any of the talents the market is looking for. What's going to happen to them in that beautiful equation of yours? Charity will somehow rise to greatness and become a comprehensive solution? Can we have some sort of guarantee for that, or is that just some half hearted hope, the victims be damned if it doesn't work out?
Also, be aware that you're talking to a social democrat. I'm not advocating for some kind of central planning board based economy or whatever. I'm championing a mixed economy approach with regulations, public utilities, publicly financed education and generous welfare measures (e.g. universal healthcare, guaranteed housing, UBI, etc).
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“still hinges on being able to successfully advertise oneself”
Ever heard of friends and connections?
“mode of operation required by the market”
Everyone fits into factory work (manufacturing) and customer support.
“then there are artists who simply never get the recognition they deserve in their lifetime”
Nobody forced you to be an artist. Do what pays you better.
“those who just don't have any of the talents the market is looking for”
They work in factories, restaurants, logistics (delivery guys, drivers etc.). By the way, these jobs are driven away by social democrats in the name of oppression. If the people working there feel oppressed, they’re always free to leave. What’s the point of driving away those jobs. Most of the day to day goods are expensive because of the taxes and hyperinflation introduced by socialists or social democrats.
“be aware that you're talking to a social democrat.”
The economics is not much different. The level of central planning (socialism) is still too high to be sustainable for an environment that produces growth.
“I'm championing a mixed economy approach with regulations, public utilities, publicly financed education and generous welfare measures (e.g. universal healthcare, guaranteed housing, UBI, etc).”
These are nowhere close to being generous. In fact these things are terribly destructive for the economy. Not only are they extremely expensive and wasteful, but they also create shortages and random distribution. All of the meaningful and focused research in healthcare and other sciences comes from companies that understand their customers and what needs to be done. Most of the papers published by universities are nothing short of crap and have terrible amounts of left wing bias, to the point that some of the statistical ones are even false. It makes no sense to fund these things with public money. Companies are much more informed and efficient at investing than government. As far as housing is concerned, why should the government subsidise those companies that hire low skilled workers by bearing the cost of housing. If there was no free housing and regulations/taxes on builders and companies that hire low skilled workers, companies would be paying enough for their employees to survive (which requires them to live in a home). In fact, companies build housing themselves right next to the factory to save up on time. This can be seen with zowee in Shenzhen, where they have libertarian economic policies in place.
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Not all basic labour costs necessarily increase. It really depends on how dire the situation in the country is, which industries are affected how much, how great of an increase it is, and what other parameters the bill might bring with it.
Developed nations are probably those that have the hardest time competing with other countries wage-wise, so let's look at them: Most of their wages are already fairly high, even relatively speaking, which means that usually only a small portion is targeted by minimum wage proposals. Also, there is a great array of imported products, as well as products that are manufactured locally with some imported components.
The industries that are often underpaid are of the service kind, such as restaurant and hotel personnel, cashiers, cleaners or janitors, which produce something that can't really be imported all that well. There are also cases in other industries, of course, whereas agriculture might be one of the more difficult ones in that regard. Manufacturing, however, covers a wide array of jobs and wages, which means that a minimum wage increase would only affect a portion of it, depending on how dire the situation has grown in that sector for the country in question.
Understanding that labour costs are only a portion of the product, and that only a portion of most products's labour cost is tied to labour paid in wages below the (proposed) minimum wage in the country of sale, and the fact that more money in the pockets of labourers affected by the increase means more purchasing power in the populace, the effects are quite less simplistically negative than you're letting on.
At the end of the day, consider this: Earning $4000 a month is considered low in Switzerland, and anything below is viewed as outright abysmal. Sure, costs are also much higher, but at the end of the day, people have good purchasing power on average, and wages in the 5k-7k range aren't uncommon at all, and they're by far not the end of the rope.
If high wages and losing out to imports were such terrible problems, Switzerland would be an economic wasteland by now. Yet, you'll have a very hard time finding anyone who'd claim that the country is doing anything less than "fine" in the economic grand scheme of things.
You might want to have a look at this article, it has quite a bit to say about the minimum wage.
Here's an article having a bit of a look at a breakdown of hamburger costs in a minimum wage context. I suggest having a look for illustrative purposes.
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Switzerland does have a trash economy:
Get a reality check already.
When the waiters accept a job for a lesser pay, the price of food does go down, unless all of them agree to fix prices at the same time. If they do so, the clever ones reinvest it, creating more jobs.
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Oh! And I forgot mentioning that you do depend on the tech developed by capitalist nations. What has your in house contribution been so far? All of the advancements are coming from capitalist nations.
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