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1 Rightwingconspirator  Oct 28, 2014 2:52:37pm

The title is not even sensible snark. “American Exceptionalism” like any other term is not best defined by its critics. It was never about a better minimum wage it refers to upward mobility above that tier. The author believes a strong economy comes from a higher minimum wage (by law or agreement). I find that to be an exaggerated expectation. It does helps the lowest tire of workers to be sure. But the national economy? Let’s not confuse what does what.

A strong economy comes from lots of above minimum wage jobs and growing GDP. Can you or the author show me the economic boom that was based largely on minimum wage gains? Was a good argument for auto unions in fact that they forced wages up well above minimum to middle class? That last boom, the dot com boom was not minimum wage jobs. It was skilled labor and a lot of demand for that exact kind of laborer. Coders, network guys, hardware techs etc.

Don’t get me wrong minimum wage should have been tied to the CPI from way back. But also let’s not forget inflation is not the issue, it’s so many older and or more capable workers that got laid off good jobs and wound up at the minimum wage tier. The minimum wage was and is not designed to address a problem for a tier or two up the economic ladder.

Take a look at the Wiki on employment in Denmark, and see where aprrallells to the US may or may not make sense.

Employment[edit]
Public sector employment (full-time and part-time) has been relatively steady at more than 800,000 a year this first decade, making up around 38% of total full-time (28% of full-time and part-time) employment,[31] whereas private sector employment has risen by over 300,000 since the 1990s to slightly over 2 million in 2007 (full-time and part-time).[32] With the information based partly on payments to the Arbejdsmarkedets Tillægspension pension fund of all employees and insured but unemployed members of an unemployment fund in Denmark, full-time employment is calculated at over 2.3 million persons in the third quarter of 2007. The increase in the fourth quarter of 2007 from a year ago in the number of employed persons was 1.0% and the amount of hours worked was 2.9% higher.[33]
The share of employees leaving jobs every year (for a new job, retirement or unemployment (unempl.:15% of job leavers)) in the private sector is around 30% (of 1.25 million), at more than 300,000 - a level also observed in the U.K. and U.S.- but much higher than in continental Europe, where the corresponding figure is around 10%, and in Sweden. This attrition can be very costly, with new and old employees requiring half a year to return to old productivity levels, but with attrition bringing the number of people that have to be fired down.[34] Productivity increased at an average of 2.3% a year in 2004, 2005 and 2006, recently being revised upward from an average of just 0.9% and previously with a too high employment level estimated.[35] The upward revision is good, because a high wage economy like Denmark’s with very few valuable natural resources needs to be highly productive, or efficient, and innovative to compete with other countries for a market share in the global economy. However, according to OECD, the distortions imposed by a combined marginal tax wedge of 70% (60% income tax plus 25% VAT, not counting elevated excise duties on certain goods) are hurting productivity and in turn the country’s competitiveness.[19]

2 Lumberhead  Oct 28, 2014 3:11:19pm

You mean fast food workers don’t have to be “losers”? They can lead productive lives and support themselves by doing an honest day’s work in an industry that people use and count on? Not possible - I thought they were only there to be ridiculed as lazy and demonized as greedy for wanting a living wage.

3 Lumberhead  Oct 28, 2014 6:17:16pm

re: #1 Rightwingconspirator

Here’s an article from Matt Yglesias at Vox arguing against matching Denmark’s wage rate for fast food workers:

Denmark fast food wages

Of course, not raising their wages to $20/hour doesn’t mean they shouldn’t and couldn’t be raised to something below that.

4 iossarian  Oct 29, 2014 7:04:31am

re: #3 Lumberhead

Here’s an article from Matt Yglesias at Vox arguing against matching Denmark’s wage rate for fast food workers:

Denmark fast food wages

Of course, not raising their wages to $20/hour doesn’t mean they shouldn’t and couldn’t be raised to something below that.

The argument Yglesias makes is that if you raise wages at McDonalds, some of them will be forced to close. This is pretty much trivially true.

The problem in the US is that people’s reaction to that statement is “oh, god, no, what if some fast food restaurants close - people will lose their jobs”. The point being that, in the US, everything starts from the premise that you have to have a job, or you’re toast.

In (continental) Europe, to put it in black and white terms (although the truth is, of course, shades of gray), the rules of the game are different. If you don’t have a job, you’re OK. And then you start looking for one, because in general you’ll be better off if you do get one. But this means that making a macro-economic decision on the minimum wage isn’t governed by a fundamental fear of localized job losses to the same extent.

I personally think there’s a lot of evidence that an economy in which there were fewer McDonalds franchises would be healthier in lots of ways, both literal and figurative. But because of our subsistence wage addiction, it’s harder to get there.


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