Honestly: the minimum wage does need to go up

[enders-shadow.livejournal.com]

This post got me thinking.

I am firmly in favor of:

A) A higher minimum wage in the whole US, and my home state of NY
B) Honesty in politics

While the OP I linked to is not exactly dishonest, it's not exactly honest either.
And this is not to put flak upon the poster there, but it's an example of political rhetoric that is used to leverage one side of a conversation, ignoring nuance.

the graphic in the linked to OP:

1) Doesn't seem to take into account state laws that raise min wage over fed laws
2) Doesn't take into account the vast difference in housing throughout a state

My objection is more with 2 than 1. 1 is easy to take care of, but 2 is not easy.

New York City is WAYYYY more expensive than Rochester or Buffalo, NY; or a large number of other places within the state I could name. Yet, this graphic gives us a number, presumably an average. But that average is way skewed. But how else should they do it? Give us on graphic for NYC and another for the rest of NY State? That wouldn't work either, because then you'd need to break it down for other cities and so on. So what do we do?

We must talk about things in the big picture without getting bogged down in details, otherwise we will have to talk for eons before we can understand what needs to be done. So while I agree that the min wage needs to go up, across the US, I have a problem with the info-graphics created to support that argument. They lack nuance, and as such, are deceiving. Even if they don't mean to be, and are honestly doing the best they can to compile and sort the data, the inevitability of misleading data is going to doom us all.

That said.
Happy saint patty's day.
Was I drunk when I wrote this? You decide.

Comments

[kylinrouge.livejournal.com]

Okay, so you have no idea what a feedback loop is, otherwise you would not use that term to describe the relationship between raising the minimum wage and prices.

[badlydrawnjeff.livejournal.com]

That may have been the wrong term to use - I'm not sure on a double check. But this is where it becomes circular - things cost too much, so we need to raise the minimum wage, which will then make things cost more, which means we need to raise the minimum wage so people can afford them, which means things will cost more, etc etc.

[kylinrouge.livejournal.com]

which will then make things cost more

A 1% increase of prices for a 15% increase in wage is not a feedback loop. I mean not even addressing the fact that due to the increased purchasing power, demand increases so more products are sold and no price increase may be necessary (hell they might even go down with enough demand), you're clearly getting diminishing returns here. Unless you draw a 1:1 correlation between wage increases and prices, you're increasing the minimum wage less and less and the increase in prices becomes negligible, hell going along this loop pretty much non-existent.

[badlydrawnjeff.livejournal.com]

Increased purchasing power means nothing when the prices have to increase to help cover the wage increase. There's no positive here.

[kylinrouge.livejournal.com]

Did you just ignore what I wrote?

YOU'RE GETTING DIMINISHING RETURNS WITH YOUR SO-CALLED "FEEDBACK LOOP"

Unless there's a 1:1 correlation, the price increase eventually fades to nothing! Your example doesn't work!

[badlydrawnjeff.livejournal.com]

Yeah, eventually, assuming the cycle is sustainable up to that point, which it isn't.

[kylinrouge.livejournal.com]

No, your cycle doesn't make any sense. It just assumes people get infinitely wealthy.

[badlydrawnjeff.livejournal.com]

Is there a finite amount of wealth?

[kylinrouge.livejournal.com]

I dunno, is there?

[badlydrawnjeff.livejournal.com]

Of course not.

[kylinrouge.livejournal.com]

Oh okay. Now that this random interlude is out of the lay, let me repeat that your cycle doesn't exist and doesn't make sense. A negative feedback loop dies down to nothing, by definition.

[mrbogey.livejournal.com]

'A 1% increase of prices for a 15% increase in wage is not a feedback loop.'

Actually it is. You're also neglecting an uneven draw across all prices and the effect it has.

Put this mental exercise in your head. If there's a 1% response to a 15% increase, then why not constantly increase the prices ever higher till infinity? If the loop can't catch up, we'll eventually hit a point where a can of coke costs $100 but we'll be earning $1,000,000 an hour. See, you know that's impossible. I know that's impossible. Yet you say it's possible on a micro scale but impossible on a macro scale (evolutionary implications aside...).

That 1% price boost on bigger ticket items will ultimately take away any gains. Cars, appliances, housing. Your gains are toast.

[kylinrouge.livejournal.com]

It's not a positive feedback loop, and if you're saying it's a negative feedback loop... then it's a problem that obviously solves itself.

If there's a 1% response to a 15% increase, then why not constantly increase the prices ever higher till infinity?

Because then people get infinitely wealthy. The salary increases are orders of magnitude higher than the price increases.

[mrbogey.livejournal.com]

B is greater than 0.

This is a positive feedback loop by DEFINITION!

[kylinrouge.livejournal.com]

It is if you assume prices somehow rise above the increase in wages, which makes no sense because labor costs are a fraction of the overall costs.

[mrbogey.livejournal.com]

So the issue here is that you just don't understand what a positive feedback loop is.

It's a simple formula. If the result of an action is greater than 0 and contributes to growth which causes further growth... it's a PFL.

[kylinrouge.livejournal.com]

So you're just ignoring the fact that this action has diminishing returns?