The reason many economists are unsure or against the minimum wage is not because they're some agents of bourgeoisie capitalists, but because arguments in favor of it tend to be moral, not economic.
It's pretty weak. The first two are very flimsy normative/moral arguments that, even if true, do not at all imply minimum wage is the solution over say, basic income, unionization, community-based mutual credit or a variety of other initiatives.
The third one is a can opener assumption. "Oh, minimum wage might work, but only in the case of Post-Keynesian full employment with buffer stocks of labor." You might as well speak of spherical cows in a vacuum. Followed by an unsourced claim about post-WWII prosperity being strictly due to Keynesian policies, when there's no consensus what factors exactly caused it.
> The reason many economists are unsure or against the minimum wage is not because they're some agents of bourgeoisie capitalists, but because arguments in favor of it tend to be moral, not economic.
All policy arguments are moral. Economics (to the extent it is a useful, predictive, empirical science) can tell you what outcomes to expect from what actions, but not tell which actions should be preferred, without first assuming some moral values.
(OTOH, some of what passes for economics is itself not a predictive, empirical science but a form of moral advocacy in itself; but in that sense, you can't distinguish "moral" from "economic".)
People who agree about objectives can still have (non-moral) policy arguments. That may be due to a misunderstanding or a lack of knowledge by some of the parties, or simply because society (and hence the economy as part of it) is an extremely complex dynamic system that we only understand in broad strokes. That's when the good kind of economics happens. (Unfortunately, most economics that you see in public is the bad kind perpetuated by "think tanks".)
All policy arguments are political, but not necessarily emanating from a moral philosophy. To the extent morality can be reduced to cause-effect propositions, it can also be subject to analysis.
> All policy arguments are political, but not necessarily emanating from a moral philosophy.
Insofar as they can be called arguments at all, they rest on moral -- or at least, "subjective value", which some would see "moral" as a subset of, with other subsets including "aesthetic" and probably some others; these distinctions are not well-defined and, ultimately, I don't think actually meaningful -- bases.
> To the extent morality can be reduced to cause-effect propositions, it can also be subject to analysis
To the extent something can be reduced to cause-effect proposition, it is a fact question, not a value question. Morality consists of the space of value questions. It may be necessary to answer a fact question to address a value question in a particular value framework, but ultimately a question that can be reduced to cause-effect propositions is not a moral question, but a fact question (which may also have utility in addressing a moral question.)
I agree that they should not tell what outcomes should be preferred, but they absolutely should tell what policies should be preferred in order to achieve a given outcome.
I'm not at all concerned about economists who are "for" or "against" the minimum wage. They can hold whatever opinions they want if they don't lie.
It's the economists who poorly design studies with the intent of demonstrating that it either causes prices to rise uncontrollably (which it doesn't), causes unemployment to rise (which it also doesn't) and who pointedly never, ever, ever look at the effect it has on profits (it is savage towards profits, which is why the marketing budgets for stuff like this gets approved: http://kron4.com/2014/07/18/new-sf-billboard-says-workers-wi...).
They all know where the money is in their profession: it's at ideological corporate think tanks. If you can tread the fine line between not lying and saying things which they really like you've got a good career ahead of you.
As it happens, 'moral' arguments that say that you shouldn't raise the minimum wage work better when you can claim that it will hurt the people it is designed to help. Those arguments fall flat on their face when it becomes apparent that raising the minimum wage just transfers profits into workers' pockets directly.
It sounds like you've dismissed any economist who doesn't agree with you.
You claim raising the minimum wage would never raise prices nor cause unemployment to rise. Ok, let's set it to $1000 a hr. Do you really think that would have no effect on either of those? Maybe there's some range on increase where the effects are offset by other effects but it's not lying to believe those effects will become real at some point.
It hits profits first and hardest. Raise it significantly and it also causes prices to rise. Raise it to stupendous levels (in the US probably > $40-50 hr) and it eventually causes unemployment.
Realistically speaking, though, most arguments are over minimum wage hikes that only affect profits and won't even have a minimal effect on prices. $10 -> $12 isn't even going to cause prices to rise, let alone have an effect on employment. It'll go straight from profits to paychecks.
I can think of only one instance where raising the minimum wage actually affected employment, actually, and that was because it was set at first world levels in a third world environment.
If something is going to have an effect on profits, you can bet on the fact that a company will fight against it, hard. Because SHOCKER the point of a business is to generate PROFITS.
I think you're wrong in thinking that businesses will just give up, and take lower profits. No. They're going to cut hours, fire anyone they can, etc. to maintain their existing profit levels.
If you have a laser like focus on maximizing profit (and supposedly most businesses do), you've already fired everybody you can and cut all the hours you're able to already.
But no, they don't just sit there and take it. They pile money into think tanks and advertising campaigns in order to try to sway public opinion (see above).
One of my favorite tactics is when they pretend that robots that do minimum wage jobs all cost $minimum wage + $1 and raising wages is simply going to make them all go out and buy those magical robots.
What else is there to say about the GP's blanket assertions of opinion being bought out by corporate think tanks and a link to an article about labor-related strife? It's a predetermined conclusion.
Raising the minimum wage WILL increase unemployment. That's Economics 101. Companies are going to find ways to fire people, or give them fewer hours. Raising the minimum wage to something like $15 would be ludicrous.
Econ 101 is "look at what happened in Australia". The commenter addresses that actually but his response is really lame. "Things are just different there". Uh huh.
Actually this is pretty much a model for what would happen to McDonalds in the US:
I don't wonder about the sincerity of most economists
I do wonder if there are selection pressures to becoming an economist that prevent a diversity of viewpoints on certain issues
sometimes those neatly line up with the bourgeoisie capitalists (who just coincidentally disproportionately have their names on university building and have levers on which university departments get generous funding)
Would you like a socialist society? Do you want a welfare state? I don't. Why shouldn't some people be able to afford luxuries like names on buildings?
Minimum wage has been around for a long time, and there are plenty of counter examples like restaurant workers and soldiers who could be studied who often get paid less than the minimum wage that has been around for decades.
You also cannot ignore that when the social safety net exceeds the value of working wages, particularly for women, there's a strong incentive to not work. Given the unavailability or high cost of health insurance, Medicaid makes that a no brainier for any woman with one or more children.
> You also cannot ignore that when the social safety net exceeds the value of working wages, particularly for women, there's a strong incentive to not work. Given the unavailability or high cost of health insurance, Medicaid makes that a no brainier for any woman with one or more children.
Which is why basic income, single-payer health insurance, and free college are such compelling ideas.
There is obviously an economic impact from not paying workers a living wage, irrespective of how certain arguments can be parsed. There is also obviously an economic cost associated with paying a living wage.
The alternatives to the minimum wage that you listed are pretty much variations on the mimimum wage in that they seek to achieve the same goals and also have attendant costs. They are, essentially, no more or less moral vs. economic in nature than is the minimum wage, though their invocation may be less charged at present.
The latter point is evidenced by your juxtaposition of the "moral" minimum wage with its presumably amoral (and thus economics-based) alternatives. But, in truth, if any of these have valid economic arguments, then so does the minimum wage.
For instance, here's a case for the minimum wage presented by an (otherwise very knowledgeable, I'll grant) Post-Keynesian economist: http://socialdemocracy21stcentury.blogspot.com/2013/02/the-e...
It's pretty weak. The first two are very flimsy normative/moral arguments that, even if true, do not at all imply minimum wage is the solution over say, basic income, unionization, community-based mutual credit or a variety of other initiatives.
The third one is a can opener assumption. "Oh, minimum wage might work, but only in the case of Post-Keynesian full employment with buffer stocks of labor." You might as well speak of spherical cows in a vacuum. Followed by an unsourced claim about post-WWII prosperity being strictly due to Keynesian policies, when there's no consensus what factors exactly caused it.