Canada Kicks Ass
A basic living income ... could it wipe out poverty?

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andyt @ Thu Sep 16, 2010 11:09 am

Khar Khar:



I can definitely see why you went that way, but most of the reason I brought that up was to demonstrate limited barriers to entry for the dude making the fries. I am sure franchises make a lot of money off their employees (and I'm sure they see decent returns even after the initial payment to become part of the franchise), but can get away with charging so little because there's so few barriers to entry and many alternatives to those with low skill sets, meaning replacing them is rather easy, as is training the replacement. There is not the same level of competition to retain those employees, no matter how proficient at making french fries, to someone in a job requiring a certification of some sort. In addition, because they produce so little comparatively, even with current margins employers can easily rationalize paying them less. In essence, because anyone can produce fries, it makes it harder for those doing it to manage to get higher wages without using the skill sets they get from the minimum wage job to try and transfer up. But that's just for that example, perhaps poorly chosen -- it was meant to respond to the general idea of minimum wage workers being blamed for costing too much, and I just wanted to point out the ever present possibility. There are a few companies out there stuff with vice presidents and such where such lines could easily make sense as well.


I do see you as the educator in the above, and quite frankly pointing out the obvious.

We have competition for low sill jobs because we allow so many immigrants in. Creates an underclass that produces all sorts of social problems that cost us all money. Instead of a few making high profits off low paid workers, and all of us picking up the tab on that, I would rather reduce those profits a bit and charge all of us for a bit more for fries. We can afford it. In return, a large number of people get to live fulfilling lives and we pay less for healthcare and the legal system. Seems like a bargain to me.

   



BartSimpson @ Thu Sep 16, 2010 11:12 am

andyt andyt:
That's what we've already got in Vancouver - both parents working two or three jobs each.


So that is an example of how Utopian ideas have unexpected real world effects.

Women entered the work force during and after World War Two and the increase in productivity helped the economic surges of the latter half of the 20th century.

Ah, but they also doubled the available supply of labor which worked to reduce the cost of labor.

The net effect of women liberating themselves and joining the workforce?

The effective income a man used to obtain on the job now takes a man and a woman to obtain.

See, the cost of labor effectively dropped by 50% when the labor supply doubled.

Now you need two people to obtain the same purchasing power that one person used to be able to obtain.

   



andyt @ Thu Sep 16, 2010 11:16 am

BartSimpson BartSimpson:
andyt andyt:
That's what we've already got in Vancouver - both parents working two or three jobs each.


So that is an example of how Utopian ideas have unexpected real world effects.

Women entered the work force during and after World War Two and the increase in productivity helped the economic surges of the latter half of the 20th century.

Ah, but they also doubled the available supply of labor which worked to reduce the cost of labor.

The net effect of women liberating themselves and joining the workforce?

The effective income a man used to obtain on the job now takes a man and a woman to obtain.

See, the cost of labor effectively dropped by 50% when the labor supply doubled.

Now you need two people to obtain the same purchasing power that one person used to be able to obtain.


actually that all worked fine till we started sending all the jobs to Asia, and importing all those Asians to fill jobs here. A boon to the guys at the top, while the middle class runs frantically to stay in place, with more and more dropping off the end to wind up in working poverty.

   



BartSimpson @ Thu Sep 16, 2010 11:31 am

andyt andyt:
actually that all worked fine till we started sending all the jobs to Asia, and importing all those Asians to fill jobs here. A boon to the guys at the top, while the middle class runs frantically to stay in place, with more and more dropping off the end to wind up in working poverty.


Nope. Housing prices soared in the 1960's into the 1990's as dual incomes allowed families to pay more for homes.

So when incomes increased prices and inflation erased those gains to bring back income and price equilibrium.

Raising the minimum wage to $100 per hour would be rapidly nullified by price hikes and inflation.

Your "living wage" would also be rapidly nullified by price hikes and inflation no matter how you slice it and it would also be nullified on a national level by a correspondingly higher level of unemployment as entry level and low skilled jobs were erased by your wage scheme.

Your heart is in the right place. R=UP

It's just that the world does not work that way. Not even in Cuba.

   



andyt @ Thu Sep 16, 2010 11:36 am

BartSimpson BartSimpson:
andyt andyt:
actually that all worked fine till we started sending all the jobs to Asia, and importing all those Asians to fill jobs here. A boon to the guys at the top, while the middle class runs frantically to stay in place, with more and more dropping off the end to wind up in working poverty.


Nope. Housing prices soared in the 1960's into the 1990's as dual incomes allowed families to pay more for homes.

So when incomes increased prices and inflation erased those gains to bring back income and price equilibrium.

Raising the minimum wage to $100 per hour would be rapidly nullified by price hikes and inflation.

Your "living wage" would also be rapidly nullified by price hikes and inflation no matter how you slice it and it would also be nullified on a national level by a correspondingly higher level of unemployment as entry level and low skilled jobs were erased by your wage scheme.

Your heart is in the right place. R=UP

It's just that the world does not work that way. Not even in Cuba.


In Vancouver at at least, the big boom in housing prices came with the Chinese - first from HK, then the mainland.

The world did work that way, it can do it again. We don't all have to drink the neo-con coolaid. Note how Canada does very well already having less inequality than the US. The Scandinavian countries do very well having even less. It's a matter of degree - nobody is talking about Cuba.

As for my heart - I'm actually coming from self-interest. What's ususally called enlightened self-interest, but I see more as just big picture self-interest. I know what kind of society I want to live in, and I'd be willing to take a bit of a loss in relative living standard to do so. Plus, as the link in this post, and the one about the benefits of early childhood supports point out - there's actually a savings to be had in less social spending. Heck, even the Fraser Institute agrees with me on this - how much more neo-con can you get?

   



andyt @ Thu Sep 16, 2010 11:56 am

BartSimpson BartSimpson:


Your heart is in the right place. R=UP



I think I read that you put three kids that are not your own thru college. So right back at ya.

What I don't understand is how then you support a system that would make that necessary. It's seems a bit of the Lord taketh away and giveth a bit back, when it seems possible to me at least that he could just giveth in the first place.

Rich relations may give a crust of bread and such.
You can help yourself, but don't take too much.
God bless the child that's got his own.

   



QBall @ Thu Sep 16, 2010 12:18 pm

$1:
While it lasted, about one-third of Dauphin's 10,000 poor residents got monthly cheques to boost their incomes.


So I guess my first question would be did the other 2/3 of Dauphin's citizens know that this was going on? Did they know that 1/3 of them was getting free money and what were their reactions? The problem with a guaranteed income like this on a macro level is that it promotes laziness, resentment and, in some cases, hyperinflation.
It couldn't even work as a supplement. For instance say the poverty line is $24,000 and the goverment declares that anyone who makes less than that would receive a cheque for the difference between what they make and $24,000. This will cause many of these people to quit their jobs and work in the underground economy since they would receive $24,000 from the goverment and everything they would earn under the table is gravy. The jobs they just quit no one would want because who wants to work a Mcjob for less than $24,000 when the government will give you that for nothing. Therefore those employers would now have to increase the wage offered for those jobs substantially in order to attract any employees. These new costs have to be passed on to the consumer hence big time inflation. Plus let's say these jobs that were being done for $20,000 per year were now being offered for $30,000 to attract employees. People performing jobs at $30,000 previously, which would theoretically should have greater responsibility/educational requirements for higher pay would either be leaving these jobs in oder to make the same money with a job with less responsibility or demanding higher wages from their own employer. That little slippery slope would continue to resonate.
So let's you say you guaranteed everyone in the country that they would be receiving a cheque for the government for $2,000 every month ON TOP of whatever they earned (guaranteeing everyone receives $24,000). This would cause disposable income to increase, causing an increase in demand for products which would cause rapid inflation, if not hyperinflation, thus increasing the poverty line. Never mind the number of bogus refugee claimants desperate to get into the country to take advantage of the free money would skyrocket (imagine dozens of MV Sun Sea vessels showing up at our shores every week). Sorry but this concept is a socialist pipe dream that does not work.

   



andyt @ Thu Sep 16, 2010 12:37 pm

QBall QBall:
$1:
While it lasted, about one-third of Dauphin's 10,000 poor residents got monthly cheques to boost their incomes.


So I guess my first question would be did the other 2/3 of Dauphin's citizens know that this was going on? Did they know that 1/3 of them was getting free money and what were their reactions? The problem with a guaranteed income like this on a macro level is that it promotes laziness, resentment and, in some cases, hyperinflation.
It couldn't even work as a supplement. For instance say the poverty line is $24,000 and the goverment declares that anyone who makes less than that would receive a cheque for the difference between what they make and $24,000. This will cause many of these people to quit their jobs and work in the underground economy since they would receive $24,000 from the goverment and everything they would earn under the table is gravy. The jobs they just quit no one would want because who wants to work a Mcjob for less than $24,000 when the government will give you that for nothing. Therefore those employers would now have to increase the wage offered for those jobs substantially in order to attract any employees. These new costs have to be passed on to the consumer hence big time inflation. Plus let's say these jobs that were being done for $20,000 per year were now being offered for $30,000 to attract employees. People performing jobs at $30,000 previously, which would theoretically should have greater responsibility/educational requirements for higher pay would either be leaving these jobs in oder to make the same money with a job with less responsibility or demanding higher wages from their own employer. That little slippery slope would continue to resonate.
So let's you say you guaranteed everyone in the country that they would be receiving a cheque for the government for $2,000 every month ON TOP of whatever they earned (guaranteeing everyone receives $24,000). This would cause disposable income to increase, causing an increase in demand for products which would cause rapid inflation, if not hyperinflation, thus increasing the poverty line. Never mind the number of bogus refugee claimants desperate to get into the country to take advantage of the free money would skyrocket (imagine dozens of MV Sun Sea vessels showing up at our shores every week). Sorry but this concept is a socialist pipe dream that does not work.


Absolutely not fair. I'm not promoting govt topping up people's wages - don't want the govt to subisidize business, next thing you know, the wages slip into poverty again but the govt is paying while the businesses reap the profits. I introduced this article to show the effects of lifting people out of poverty - it actually saves the country money in healthcare and law enforcement. How to get there is the rub, but I'm sure a way can be found.

   



BartSimpson @ Thu Sep 16, 2010 1:38 pm

andyt andyt:
I think I read that you put three kids that are not your own thru college. So right back at ya.

What I don't understand is how then you support a system that would make that necessary. It's seems a bit of the Lord taketh away and giveth a bit back, when it seems possible to me at least that he could just giveth in the first place.


The Lord did give. And as stewards of what we've been provided we sowed and some day we shall reap.

The difference between our points of view is that I want to do things of my own free will and I'm willing to do more than the government (via taxes) expects me to do. Most people outside of the USA expect their governments (via taxes) to do all of these things for them while asking nothing else of themselves.

To quote a liberal:

"Ask not what your country can do for you, as what you can do for your country."

   



andyt @ Thu Sep 16, 2010 1:42 pm

BartSimpson BartSimpson:
andyt andyt:
I think I read that you put three kids that are not your own thru college. So right back at ya.

What I don't understand is how then you support a system that would make that necessary. It's seems a bit of the Lord taketh away and giveth a bit back, when it seems possible to me at least that he could just giveth in the first place.


The Lord did give. And as stewards of what we've been provided we sowed and some day we shall reap.

The difference between our points of view is that I want to do things of my own free will and I'm willing to do more than the government (via taxes) expects me to do. Most people outside of the USA expect their governments (via taxes) to do all of these things for them while asking nothing else of themselves.

To quote a liberal:

"Ask not what your country can do for you, as what you can do for your country."


Nice idea. Not so much put into practice tho.

   



Lemmy @ Thu Sep 16, 2010 1:44 pm

BartSimpson BartSimpson:
"Ask not what your country can do for you, as what you can do for your country."


Which, of course, is nonesense. Milton Friedman wrote:

"In a much quoted passage in his inaugural address, President Kennedy said, "Ask not what your country can do for you - ask what you can do for your country." Neither half of the statement expresses a relation between the citizen and his government that is worthy of the ideals of free men in a free society. The paternalistic "what your country can do for you" implies that government is the patron, the citizen the ward, a view that is at odds with the free man's belief in his own responsibility for his own destiny. The organismic, "what you can do for your 'country" implies the government is the master or the deity, the citizen, the servant or the votary.

To the free man, the country is the collection of individuals who compose it, not something over and above them. He is proud of a common heritage and loyal to common traditions. But he regards government as a means, an instrumentality, neither a grantor of favors and gifts, nor a master or god to be blindly worshipped and served. He recognizes no national goal except as it is the consensus of the goals that the citizens severally serve. He recognizes no national purpose except as it is the consensus of the purposes for which the citizens severally strive.

The free man will ask neither what his country can do for him nor what he can do for his country. He will ask rather "What can I and my compatriots do through government to help us discharge our individual responsibilities, to achieve our several goals and purposes, and above all, to protect our freedom?"

And he will accompany this question with another: How can we keep the government we create from becoming a Frankenstein that will destroy the very freedom we establish it to protect?

Freedom is a rare and delicate plant. Our minds tell us, and history confirms, that the great threat to freedom is the concentration of power. Government is necessary to preserve our freedom, it is an instrument through which we can exercise our freedom; yet by concentrating power in political hands, it is also a threat to freedom. Even though the men who wield this power initially be of good will and even though they be not corrupted by the power they exercise, the power will both attract and form men of a different stamp."

   



Khar @ Thu Sep 16, 2010 2:24 pm

andyt andyt:
I do see you as the educator in the above, and quite frankly pointing out the obvious.


Quick note since I'm passing by the computer, I would hope that this is fairly obvious since I simplified it down to the bare bones, as I've been told I get too technical in my posts (or use too many buzzwords). Thanks for reaffirming that, hopefully Bruce gets the point with lies therein as well upon reading, since it was initially for him.

   



BartSimpson @ Thu Sep 16, 2010 2:31 pm

Lemmy Lemmy:
BartSimpson BartSimpson:
"Ask not what your country can do for you, as what you can do for your country."


Which, of course, is nonesense. Milton Friedman wrote:

"In a much quoted passage in his inaugural address, President Kennedy said, "Ask not what your country can do for you - ask what you can do for your country." Neither half of the statement expresses a relation between the citizen and his government that is worthy of the ideals of free men in a free society. The paternalistic "what your country can do for you" implies that government is the patron, the citizen the ward, a view that is at odds with the free man's belief in his own responsibility for his own destiny. The organismic, "what you can do for your 'country" implies the government is the master or the deity, the citizen, the servant or the votary.

To the free man, the country is the collection of individuals who compose it, not something over and above them. He is proud of a common heritage and loyal to common traditions. But he regards government as a means, an instrumentality, neither a grantor of favors and gifts, nor a master or god to be blindly worshipped and served. He recognizes no national goal except as it is the consensus of the goals that the citizens severally serve. He recognizes no national purpose except as it is the consensus of the purposes for which the citizens severally strive.

The free man will ask neither what his country can do for him nor what he can do for his country. He will ask rather "What can I and my compatriots do through government to help us discharge our individual responsibilities, to achieve our several goals and purposes, and above all, to protect our freedom?"

And he will accompany this question with another: How can we keep the government we create from becoming a Frankenstein that will destroy the very freedom we establish it to protect?

Freedom is a rare and delicate plant. Our minds tell us, and history confirms, that the great threat to freedom is the concentration of power. Government is necessary to preserve our freedom, it is an instrument through which we can exercise our freedom; yet by concentrating power in political hands, it is also a threat to freedom. Even though the men who wield this power initially be of good will and even though they be not corrupted by the power they exercise, the power will both attract and form men of a different stamp."


Friedman's assumption that (my country) = (my government) is wrong. My country exists regardless of what government we may have.

   



Lemmy @ Thu Sep 16, 2010 2:33 pm

BartSimpson BartSimpson:
Friedman's assumption that (my country) = (my government) is wrong. My country exists regardless of what government we may have.


That's not what Friedman is saying at all. He's saying exactly the opposite! He's saying that the purpose of government is to serve the people of that country, not the other way around. And I'm glad you retracted your comment about Friedman's ideas having anything to do with the financial meltdown of 2008. That meltdown came from the government's failure to enfore laws to protect individuals' freedom. Friedman regards the primary role of government to enfore those law.

   



BartSimpson @ Thu Sep 16, 2010 2:43 pm

And we're still back at the point that while a 'living wage' may be a well-intended idea, it is proven to be unworkable in the long term.

   



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