Swiss to vote on $25 an hour minimum wage
usatoday.com
usatoday.com
Maybe $25 is too high, but $7.25 is low.
The alternative is people working huge numbers of hours just to survive and having no time to improve their situation, becoming trapped in a cycle of endless low-end jobs and poverty. You can't actually upskill if you spend 12-16 hours a day working dead-end jobs.
Employers which are corporations in which you and me could be investors have no right to waste our money one some else. Their only responsibility is to deliver returns on our investments by hiring the cheapest possible labor while generating maximum possible value.
If there are poor people around us who need help, it is the responsibility of the society and not of corporations. I would help a poor kid get education by spending my money on him but I will not let a company I am invested in to waste my money on such kind of nonsense.
> The notion that the minimum wage is supposed to provide a living is a good way to remove young people from the job pool.
The minimum wage is supposed to provide a living period.
How can people be as selfish as you are is beyond me.There is enough wealth in this world to be shared so everybody can make a decent living,and it wont make whatever you think you are worth less valuable.
I don't have an opinion on the matter (not being a US citizen, I certainly don't know enough about the situation), but I think your insult is completely inappropriate.
Source please.
"How can people be as selfish as you are is beyond me.There is enough wealth in this world to be shared so everybody can make a decent living,and it wont make whatever you think you are worth less valuable."
Nice try on the appeal to emotion and shame, but the tactic is best left to talking heads on TV and not places where people actually care about this problem. I could respond with your utter indifference to the youth problem particularly it seems in minority communities whose starting businesses cannot afford $15/hr makes you a ..... well you get the idea. This is HN, not MSNBC.
This whole minimum wage foolishness is a cover for politicians that have failed our poor. We need to understand why adults cannot get jobs that employers when jobs go empty. We also need to look at our safety net and see how full of holes it is. Its time for looking at new way to elevate our at risk population (basic income is often discussed here) and education (vocational education to fill the infrastructure jobs that are long vacant and not outsourceble for example).
Maybe it's different where you are, but in the Kentucky area I see plenty of people in their 50s and 60s working in fast food, gas stations, and Wal-Marts. Have you really not seen this?
Further, your solution is basically going to get some of those people fired. How about treating the problem of why those people are working minimum wage jobs instead of glossing over it and making things worse.
I don't need to provide stats to prove that the sky is blue. Use your eyeballs and observe the world around you.
If this isn't happening, I'd think its more important to provide those basic amenities rather than raising the minimum wage.
The US in particular suffers under an entrenched and insidious myth that work is inherently virtuous and people who can't work deserve to starve. Reagan's imaginary legions of welfare queens have taken root in our national dialogue and made widespread, substantial improvements to public welfare virtually impossible. If you feel that progressives are grasping at straws, it's because that's all we have left.
It's not a popular opinion, I realize.
And before you start talking about "other people's money," I'm comfortably middle-class, and I would be delighted to pay an extra, say, 20% of my income in taxes if it meant that the sick or homeless or mentally ill people I see every day could get the care that they need.
You're proposing an economic transaction where X pays, Y benefits and your moral desires are fulfilled. I doubt X would have a problem with you donating 20% of your income to a charity of your choice, why do you have a problem with their yacht?
Exactly. Imposing a price floor on labor does nothing besides driving up unemployment.
I wish people would stop pushing for an increase in minimum wage. Fundamentally people are trying to subsist on low-skill jobs where the supply/demand realities aren't in their favor. That's the problem we need to address, either through a universal basic income (decreasing the supply of labor) or increased training.
A minimum wage just distorts markets and leaves nobody better off.
Do you have any evidence to back that up? I know it was orthodoxy like twenty to twenty-five years ago, but I remember there were plenty of other theories in my university days.
Pushing young people out of the job pool isn't such a bad thing if there's an educational alternative. Besides, people on lower incomes spend a larger proportion of their income, rather than saving.
Directly increase their disposable income with a minimum wage and I find it hard to believe there won't be an increase in spending in the economy - and that has its own multiplier effects.
Besides, even if what you say is true, then you could pragmatically combine policies for effect; an increase in minimum wage with say, government spending on education initiatives, or raising the mandated school leaving age.
There have been dozens of studies which show a positive correlation between minimum wage and unemployment. Here's just one: http://businessinnovation.berkeley.edu/williamsonseminar/rub...
> Pushing young people out of the job pool isn't such a bad thing if there's an educational alternative.
That might indeed be true, but the problem with a price floor is that you have no control over which workers are displaced. I actually think in many places employers would prefer to keep the teens who can, ex. carry more boxes per hour, than older and potentially more vulnerable workers.
Hence, the right solution is to attempt to shift the supply of minimum wages by ex. providing more support/incentives for college education.
> Directly increase their disposable income with a minimum wage and I find it hard to believe there won't be an increase in spending in the economy - and that has its own multiplier effects.
I'm actually not convinced of that. People living on minimum wage often have negative net worth and depend on credit for day-to-day expenses. Hence all that marginally increasing their wage will do is decrease their indebtedness, not increase their spending. Of course, a huge jump in the minimum wage would be enough to push every employed person into the middle class. But it would provide substantial incentives for automation and essentially eliminate low-skill jobs, creating mass unemployment.
Do you have any evidence to back that up? You seem to have a very narrow view of "education".
"Besides, people on lower incomes spend a larger proportion of their income, rather than saving."
I think you might want to look at actual statistics on savings in the USA today.
Uh, no. My state, Washington, has the highest minimum wage in the country and is doing better [1] than most states in the US in terms of job creation. I expect Seattle's recent move to a $15/hr minimum wage to improve the economy and the lives of low-wage workers there.
[1] http://www.bloomberg.com/news/2014-03-05/washington-shows-hi...
Perhaps the Washington economy has been growing which allows employers to both pay the higher minimum wage and continue hiring.
If you want to do these terrible comparisons, I'll give you Norway where there isn't any minimum wage yet the unemployment rate is far lower than in Washington (3% vs 6%).
How do they do this?
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_...
(Hint: roommates, cooking at home, long commutes or less desirable cities, giving up luxuries which are common in the US like a car.)
Note: don't say "cost of living". The numbers I cite adjust for that.
The crucial role of the extended family may be the hardest for modern Westerners to appreciate. It is not our feel-good notion of family. My brother in law has spent the last 15 years continuously working out of country as a truck driver in Singapore, living in a ramshackle shelter on construction sites while sending most of his earnings back to his wife and kids. This is a somewhat extreme case, but milder instances are commonplace. People often have to work away from their families for years at a time to make ends meet and accrue any sort of savings.
Then there is transportation. Every day you will see mothers on scooters carrying several toddlers who are certain to die in even minor accidents. Another common sight and a less egregious example would be pickup trucks with the backs piled full of day laborers, or commuters casually hanging off the back of high-speed songthaew busses. This is highly efficient in monetary terms, but the human cost is huge.
It's a complex issue that is not reducible to PPP numbers.
In any case, I'm glad we are agreed that unreal37 is incorrect, and it is possible to "live on" $1200/month. It's not anywhere near as nice as American poverty, but it's hardly clear that $7.25 is too low.
I'd propose an alternate direction for the discussion - if we believe the American poor are lacking in some necessary good or service, lets be specific and name it.
1. doing without 2. extended family help, 3. multiple low-paying jobs among family members, 4. subsistence agriculture, 5. family splitting, including emigration 6. informal economy, 7. corruption ('blat' in Russian). Core public services and government jobs pay poorly. But its also institutionalised in INGO's even though they pay very well comparatively. 8. crime.
Numbers 1-4 are classed by the troika as an 'informal welfare acheme.'
Poverty is a major problem in India. Close to 40% of all impoverished children in the world live in India. Hundreds of millions of Indians lack basic services such as electricity or a toilet in their homes. Hundreds of millions lack basic education. Not something we want to emulate.
It is much better in the major cities though where median PPP income is close to 7.5k USD.
The US has other cultural problems which make cost of living far higher than they have to be. For example many minimum wage jobs in the US "require" a car! Even if the job itself doesn't involve driving.
http://www.wolframalpha.com/input/?i=cost+of+living+switzerl...
This proposed Swiss minimum wage is therefore (roughly) equivalent to a minimum wage in the U.S. of $16.28 per hour (taxation differences and non living-expenses notwithstanding).
http://www.gfsbern.ch/DesktopModules/EasyDNNNews/DocumentDow... [german, pdf]
>However, 90% of Swiss workers earn well above the proposed minimum and are already among the highest paid in the world.
The US isn't a poor country either. In fact, Americans are also among the highest paid in the world [1]. It's just not evenly distributed.
[1] https://en.wikipedia.org/wiki/List_of_countries_by_average_w...
Imho lower salaries doesn't create more jobs it just creates more desperate people willing to work for lower salaries because of its downward loop.
I know this opinion is not popular in the states. But this has nothing to do with socialism. Socialism is about common ownership, common management. Minimum salaries is about raising the middle class.
What this is likely to do is to displace immigrants working illegally with citizens working legally.
Imagine what would happen to California unemployment if all the agribusinesses suddenly had to pay a real minimum wage. Illegal immigration would get almost completely displaced with actual citizens willing to do the work now that there was a reasonable wage behind it.
Even if there were illegal immigrants being displaced, where would the supply of legal labor come from, suddenly? Certainly not from the jobless. It's simply an illusion that people on a broad scale would choose unemployment because of low wages...
Also, the opinion about immigrants in Switzerland seems to be very complicated. People seem to both feel "We have to much immigration", but they don't want to get rid of the immigrants they know and depend on. For that matter, they think there are too many Germans in Switzerland, on the other hand their economy extremely depends on those immigrants.
The government will be hard pressed to find enough immigrants they can get rid of without serious consequences and even antagonizing those voters who voted for the restrictions in the first place.
I'm not an opponent of a sensible minimum wage legislation, but I'm not kidding myself over the consequences. In Switzerland I highly doubt if minimum wage is doing anything good...
The effect of raising minimum wage will highly depend on what level it is raised to and how strong the local economy is.
Just stating a data point and then offering a generic platitude (things depend on things) isn't making a substantive contribution.
Everything there is extremely expensive because of the higher salaries. Which would make it impossible to live there with a lower income.
Your statement: lower salaries doesn't create more jobs is false through my point of view. I live in Belgium and a lot of multinationals don't ever consider Belgium because of the high taxes (= which create higher salaries, but only the governement is taking the biggest portion). Our politicians try to compensate this by heavily subsidizing multinationals (which create 1000's of jobs in a snap, while heavily taxing the SMB's at the same time), which isn't the way to go.
PS. Switzerland tries to introduce immgration quotas, which would be illegal as member of the EU : http://goo.gl/xBmX12 (is an example of their protectionism)
PS 2. High taxes in Belgium isn't the only reason why multinations neglect us, but it's an important one :)
How does artificially increasing the price of something make the market more likely to clear?
This is not actually true. Companies only hire when then they have demand.
Everything is already expensive, so I would expect the ripple effects to be slight.
In the vote for "restrictions on EU immigrations" the swiss want to throw out immigrants. But not those they know personally. Or those on whom their economy depends. So basically the government has the choice between not implementing the proposal as intended, or to harm the economy badly. As far as I know, they haven't solved this Dilemma quite yet.
Maybe this "element of direct democracy" has less impact on the actual "democraticness" than some believe it has. At the very least it poses a serious risk for long term investors or entrepreneurs. Any harebrained idea that comes up in this process has a non-zero chance of being implemented just by the power of low participation or ambiguous opinions.
At best, governments already take the "pulse" of public and expert opinion when setting policy, making referendums futile or redundant.
So you're saying a referendum is futile because it forces the government to (preemptively) do what the people want? That's exactly it's purpose!
In any country with a practical, working, real-world democracy you can see the government mostly following opinion polls.
Finding out "what the people want" is extremely hard, at least if you aren't a populist politician or their adherents. The task doesn't get easier if you pose simple yes and no questions.
I think it is dangerous that people in western democracies increasingly equate referendums and votes with democracy, leaving out the conditions of the vote, the environment, the institutions and the state of the human rights.
This is an initiative, a referendum is something different.
> In cases where they don't, they seem to be quite problematical.
Not always, just in the recent years there have been some problematic votes which were accepted due to (IMO) fear generated by certain parties. There have been, however, also problematic initiatives/referendums where the people followed the governments opinion.
> At the very least it poses a serious risk for long term investors or entrepreneurs. Any harebrained idea that comes up in this process has a non-zero chance of being implemented just by the power of low participation or ambiguous opinions.
IMO you're a bit oversimplifying here. There are various hurdles to take when you want to vote on a certain thing. Whether things are accepted or declined depends on various things and can change because of some little thing in a week.
The serious risk blabla is always a thing which various parties bring up in various votes. It never has had a bit impact as of now.
In any other country laws are usually made by lobbyists. We have this problem here as well, but at least the public opinion is a bit harder to change in votes..
Isn't that a much bigger oversimplification, than just saying that entrepreneurs in Switzerland have seen serious risks in quite a few of these votes? Isn't it true that they fear for more of these bad ideas? Even if these ideas only have a slim chance of coming throuhg?
However there is an implicit minimum wage linked to welfare. Any wage must be above what welfare pays or people might not bother working at all.
Welfare is basic an implicit minimum wage.
Also i personally believe that markets can only regulate themselves if all players start with the same conditions. Which they do more likely in sweden as they do in the states (eg. education, healthcare, middle class, etc)
It's more of a catch-22. If you simplify 'welfare' to "If you're not above the poverty line, you're entitled to assistance", then a job which does not bring you above the poverty line is zero-sum - you're still entitled to assistance.
An example I see here quite often, is people who can only find part-time work, and still receive assistance. It's not unusual to find people in the position where they're working <20hrs/week, but do not want to work 20<n<30 hours a week because it'll interfere with their benefits.
This is not the "don't want to work" trope - they'd take 40/hrs week in a heartbeat. But if 20hrs/week + benefits is better than 25hrs/week sans benefits, who would realistically take more work for less pay?
So basically, that line is 100% standard economic thinking and therefore can be best understood and accepted by making the usual assumptions: humans as rational actors with perfect information and the cognitive ability to weight options, striving to maximize self interest.
https://en.wikipedia.org/wiki/Homo_economicus
If we're a a little more relaxed and maybe realistic with that assumption, we might find that it's a complex issue, with people's actions spanning a wide spectrum from "work? No thanks" to various levels of urgency, then desperation trying to find a new job and to make a living. Finally to people who'd be working hard even if unemployment benefits were 3x their wage, out of principle.
Point is, there are other factors to look at than the minimum wage alone.
This makes the de facto minimum wage something that is negotiated between the main unions and a few large employers' federations.
What the higher minimum wage will do is push either for automating or exporting lower wage tasks, which will reduce immigration (since those jobs are not really done by swiss citizens anyways), and there are surprisingly a lot of xenophobic people in Switzerland that are OK with this.
I worked for a year in Switzerland and I am telling you, you can barely live with that kind of money. Everything is so expensive over there at least Zurich.
So yes expect a Swiss Tourist coming in the US buying everything and have a lot of funs, but in Switzerland with that wage he won't be saving anything.
For example, food and health industry needs to be regulated. The incentives for self-regulation otherwise are so low, that lots of people die and suffer until the market reaches its supposed optimal equilibrium of high safety standards.
Antitrust regulation is an intervention in a free market, though one could argue that without antitrust regulation, there is no free market...