vulgar economics13 Feb 2006
Kay Brooks provides quite the revelation in the field of vulgar economics in her groundbreaking condemnation of the minimum wage:
Every time the minimum wage is raised this family of six with a median income is left with less buying power because employers raise the price of the goods and services we need to accommodate that raise.
Really? They’d raise prices? Just like, that, huh? Why didn’t they just do that now? I think Kay is on to something here.. why, without the minimum wage cost floor, they could simply raise prices and become MILLIONAIRES!!! I wonder why they don’t.. What? What’s that? Oh, sorry, my friend Common Sense wants to say something here. Yes, Common? What is it?
Common Sense dictates: It is because labor is not the only cost factor that dictates prices of goods.
Huh.. Really? I guess that makes a lot of .. sense. But don’t we live in a world with markets represented by straight, intersecting lines of supply and demand with only one factor affecting each? Don’t we live in a Micro-economics 101 textbook? Surely there’s not more than one variable in an economy as simple as that of the United States? Are you trying to tell me that there’s more to it?
Common Sense dictates: Contrary to popular belief, we do not live inside of an Micro-economics 101 textbook.
Fascinating.. But if that’s true, wouldn’t it be hard to pin down the effects of one small factor on a dynamic system based on a theoretical rule of thumb? Shouldn’t we instead take a longer look at the market, controlling for other forces at work, while reconciling our theories with empirical data to arrive at a more reasonable and solid conclusion? Wouldn’t it be difficult and take a lot of work, study, and peer review – culminating, in fact, in an entire field of science that we could call, oh, I don’t know: Economics?
Common Sense dictates: Yes.
I thought so. In fact, I even found a wealth of evidence from studies of past legislation that shows no conclusive detriment to the market, and they looked at a lot of stuff! In fact, I had to spend more than 5 minutes reading! Come to think of it, it sounds like Kay’s argument is a bunch of crap, doesn’t it?
Common Sense dictates: That would be rude. Besides, maybe she has more to say.
You’re right. Always the gentleman, sorry. Let’s see what else she has to say:
Wages need to be set by the free market. We’re not a socialist society–well, not quite anyway. If no one is willing to pay for the goods or services at that price the price needs to be changed–but not by the government. People who want to earn more money need to make themselves more valuable to their employers and their employer’s customers or find a different employer. You don’t encourage self-motivation and success by handing folks a paycheck you encourage dependency and a sense of entitlement.
Okay, so, it seems like here the second part of her argument is that the 12% of people living in poverty just aren’t working hard enough and that they should suck it up. Common Sense, anything to add?
Common Sense dictates: Now that’s pretty fucked up right there, dude.
(Note: The views contained herein are actually my own, and not those of hip-hop artist Common, whose likeness I have shamefully used for comic effect.)