sunset from behind the wire

sunset from behind the wire

Tuesday, August 4, 2015

Bread and Circus: Minimum Wage Increase

Are you not entertained?
The question before us is whether wages should bear a relationship to both relative value and productivity. For example, are the services offered by a physician equal to the that of the guy (illegal alien) who mows your lawn? Or are wages simply a function of politically motivated income redistribution? 

Are the Hollywood elite redistributing their wealth to the rest of the world? Is Rep. Nancy Pelosi? No, don't hold your breath. Income redistribution is always for "other people" when you're in a position of power - or in the case of Hollywood, where they buy clout.

So long as a minimum wage is a function of politics, does it matter how high it goes? (See: Atlas Shrugged by Ayn Rand) If candidate Hillary promises $15/hr, it's logical that candidate Bernie would offer $16/hr of other people's money in exchange for a vote from the proletariat. 

A Personal Study

LANDSCAPING: An interesting question would be where the natural break is on wages would be without a minimum wage. Let's go back to the illegal alien that mows my lawn and tends to my yard. I pay him $4.27/day (annualized income) to keep my yard looking good. The price is not based the national minimum wage, but on my personal perception of value -- and his. Am I a slave driver? No, he came to me about ten years ago, bid the job, and has been working at the same rate ever since. I don't anticipate increasing his pay. There are others who would work for the same rate. Market forces and relative value dictate the price. I could do the work myself, and have. But at that rate, I'm ok with having Julio manage that problem.

SWIMMING POOL: The same is true of the people who maintain my swimming pool. I pay the company an annualized rate of $2.63 per day to keep my swimming pool fresh and perfect. That includes the price of chemicals. They tried to up the rate and I simply told them that I'd find another pool maintenance company. The rate remained the same despite inflation. Market forces and relative value again dictate the rate as does my ability to pay. As with the landscape maintenance, I used to maintain the pool, but would rather pay somebody else $2.63 a day to do that for me. None of the pool maintenance people are illegal aliens.

Most of my "stuff" ends up being professionally maintained. I don't change the oil on my cars, though I do on my motorcycle. It's a matter of preference. However, the price that I pay is heavily dependent on the relative value to cost. If the landscaping professional decided to double the amount that I paid, I'd simply buy a mower and go back to doing it myself. The same is true with the swimming pool and changing the oil on my three trucks/car. Much can be said for "fast food" as well. I can make slow food myself if you double the price.

What happens to the people who make a living at those levels when the price goes up? They're out of luck, and can go on the dole and receive food stamps, which I clearly pay for with my 11% California State Tax and 34% Federal Tax rate (plus appropriate sales taxes and excise taxes, etc). 

All Minimum Wage rates don't mean the same thing across the nation. If you look at Southern California in the map below, $15/hr doesn't mean what it means in many other locations across the country.




10 comments:

  1. Casa De Wo:
    Landscaping - casual labor takes care of what has to be done.
    Pool - Filled it with dirt and rocks. Slight earthquake brought about a leak, so I cancelled the pool. Too damn much trouble.
    Other - I cut the yard - 2 acres plus; other work done by a hired guy. He also cuts the grass in the 6' deep ditch at the front of the property.

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    1. I realize that you cut the grass at the manse, careful not to injure any cicadas...

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  2. Wait! Are you serious that you pay your yard guy $4.27 a DAY. Okay - annualized. I get that, but how long does it take him to mow and do whatever else he does?

    I've been searching for someone to help me around our property (trimming some bushes, and such) and the going rate is $25.00 PER HOUR. Seriously. (Sorry for shouting.)

    I want your guy!

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    Replies
    1. He comes one or two days a week, mows, fertilizes, pulls weeds, trims trees and shrubs. It's a crew and they spend somewhere around 3-4 hours per week unless they're doing heavy tree trimming or adjusting sprinklers. Then it's longer. Which is why I pay them to do it rather than doing it myself. They buy and maintain their own equipment and haul away clippings that don't fit into the green waste container. They also blow and sweep the patios, driveway and sidewalk.

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    2. One of the reasons that the rates may not have been raised in 10+ years is that they like me. I give them each a case of beer at Christmas and give them advice about how to make their trucks more off-road capable.

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  3. You're about ballpark for 'contract' maintenance. It runs $150/mo back here...

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    Replies
    1. That's my sense. I pay $130/month for a quarter acre of landscaped city land.

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    2. Well, obviously I need to be looking at contract workers. They wouldn't even have to mow since I love to speed around on my tractors.

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  4. The actual global minimum wage is, and always has been, $0.00/hour. Minimum wage labor always reverts to this rate at some point or another. When Hillary and/or Bernie Sanders jack the minimum wage up, the employer of 10 minimum wage guys just became the employer of 7 minimum wage guys: the other three guys wind up making $0.00. Money doesn't grow on trees, but you can't make that argument with liberals. They think money comes from the money fairy, and if you wish really, REALLY hard.....

    ReplyDelete
    Replies
    1. It would be useful to have a leader who had at least at some time in his/her life had to run a business. Being a black community agitator is not a job. Neither is being a politician.

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