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The crux of this article seems to be that some government regulation is necessary, that we must often make compromises with others, and that a minimum wage is supported by a group calling themselves "Smart Capitalists," thus indicating that not all capitalists are going to agree with the economic theories Ayn Rand promoted.
Personally, I'm inclined to believe that some regulation and compromise is necessary, but I disagree with the claim that a minimum wage is necessarily beneficial to all members of society. After all, even Bill Gates himself has said that raising the minimum wage destroys jobs:
http://cnsnews.com/news/article/susan-jo...
These "Smart Capitalists" seem to be "Secret Monopolists."
http://aynrandcontrahumannature.blogspot...
http://michaelprescott.freeservers.com/s...
http://www.amazon.com/Without-Prayer-Ran...
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Lauren Windsor: Interviewer for The Young Turks Under Current
Tal Zlotnitsky: Chairman & Co-CEO - iControl Universal Collaboration Solutions
Guy Saperstein: Investor
Dan Berger: Attorney & Partner - Berger & Montague
Leo Hindery: Managing Partner - Intermedia Partners/Philanthropist
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Lauren Windsor: Lauren Windsor with the Under Current Young Turks. You mentioned that it was more of a patriotic issue, but isn't it also just, on the basis of free market economics, more free market? I mean, you would have the argument of, you know, you shouldn't set regulations, set a price floor for labor, because it will cause jobs to go overseas. But they mean it's more free market in that you're taking all these people off of subsidies, corporate welfare. Which one is the...?
Tal Zlotnitsky: The role of government is not to set... is to set a foundation. Right? This is a foundational issue. And we know that Capitalism works best when everybody understands the rules of the road. What we've got over here right now is we've got certain sectors of the economy that are essentially privatizing profits, socializing costs, and that's not fair. It's not fair to other businesses that are not doing that either because the cost of our labor, I'm in the technology sector, I don't have anybody on my staff, down to the people on the phone, that make less than sixteen dollars an hour. And I couldn't possibly benefit from it, and that's not the reason I'm not doing it. I'm not doing it cuz' it's wrong. And there are certain sectors of the economy that are benefiting from opportunities that are afforded to them by, by frankly, their lobbying, and we are here to say it's wrong. It's not an issue of left or right, it's an issue of right. What's right and what's wrong.
Guy Saperstein: Can we afford it? We're talking about ten bucks an hour. We just spent a month in Australia, and before that we were in New Zealand. Those two countries have fifteen dollar an hour minimum wages. They're very prosperous. Their total wealth as a country is certainly not more than America. But they're prosperous and they got through the last, the Great Recession much more strongly than America did, despite their fifteen dollar an hour minimum wage. So that high minimum wage, much higher than anybody is proposing here today, has contributed to their economy, not undermined it.
Lauren Windsor: And Guy, did you see a McDonalds while you were in New Zealand?
Guy Saperstein: We did, yes.
Lauren Windsor: And were they, you know, boarded up and closed?
[all laugh]
Guy Saperstein: They were selling burgers.
Unknown (off camera): They were doing well.
Dan Berger: But the economic efficiency argument, which I think is what you addressed, okay, it...
Lauren Windsor: May I clarify that?
Dan Berger: Yes.
Lauren Windsor: For all the Ayn Rand and Milton Friedman junkies of the world, is it a greater sin to institute a price floor for labor, or to, you know, enable workers to get off, or corporations rather, to get off of the government [unintelligible]?
Dan Berger: It's the ladder because, because if you look at it from, and economists have looked at this for decades, the wages of low wage workers are artificially depressed. They're being subsidized. Their employers are being subsidized by the government, and that is artificially depressing wages. So if you want the market to be more efficient, there's no such thing as a perfectly efficient market, but if you wanted the market to be more efficient, you would end the subsidies and raise the minimum wage.
Leo Hindery: But if Ayn Rand was here, what she would look at is simply the comparison of CostCo to Walmart. CostCo, its employees receive no subsidy from the states in which its located because its wage, its minimum wage is twelve dollars. Yet we know that half of Walmart's employees receive some form of state assistance. And that is the single comparison that an Ayn Rand or a free marketeer would make, is company by company, exact same industry doing exactly the same thing, and one is subsidized by all of us, and the government indirectly, and one is not. That's not a free market.
In the interview, Dan Berger said we should end the subsidies and raise the minimum wage. But what if we end both subsidies AND the minimum wage? What kind of impact would that have?
I'm not sure how true this is, so take it with a grain of salt, but someone once told me that most of the products which are made in the United States are actually manufactured by prison inmates, as that's one of the few ways that manufacturers can get around the minimum wage laws. If that's true (and I don't know if it is), one could make the argument that a minimum wage contributes to the industrial prison complex by forcing manufacturers to utilize prison labor in order to maintain a profit, which means they need to have a steady supply of prisoners to do the work. Combine that with the institutionalized discrimination that is perpetrated against African Americans by our nation's police force in the form of disproportionate incarceration rates, and one could even take the argument a step further and say that a minimum wage reinforces what is essentially a form of modern slavery – i.e. black people are incarcerated at higher rates, and then forced to work for free as prison inmates. Modern slavery. Of course this entire line of reasoning hinges upon whether or not prison labor is actually used to circumvent minimum wage laws, which I have yet to confirm one way or another. This is all purely hypothetical.
However, I do know that Goodwill stores are permitted to circumvent minimum wage laws by hiring handicapped workers, many of whom are paid only a few cents an hour. I'm not sure how that plays into the rest of this, but you can watch a video about it here:
http://investigations.nbcnews.com/_news/...
Anyway, to get back to the discussion about the interview, Guy Saperstein mentioned how Australia and New Zealand have $15/hr minimum wages, but I have a hunch that both of those countries import a vast majority of their manufactured products from China, a country which has no minimum wage.
If we got rid of the minimum wage in America, I believe we could bring all those manufacturing jobs back here. Of course there's also the issue of pollution to consider, as the air in several parts of China is so bad that citizens are warned against going outside, and I've read reports saying that on days of really heavy smog, it even hurts to breath in Hong Kong.
http://green.blogs.nytimes.com/2010/01/1...
If we got rid of the minimum wage and brought industrial manufacturing back to the United States, would we also be back bringing those kinds of pollution levels with it? If so, perhaps it would be better to keep manufacturing over in China...
This is something I've thought a lot about, and really the only counter argument I've been able to come up with is that maybe China's horrible pollution is caused by bad government policies in addition to industrial manufacturing, and that we wouldn't have those same issues here because the American government isn't a one-party totalitarian regime like the Chinese government is.
One idea I had was that we could eliminate the minimum wage in one particular state (it would have to be a state with a seaport, meaning one of the 23 coastal states), and then bring industrial manufacturing back to that state and see how things pan out over a period of about five years or so. If it didn't work out well, then we could just undo it. But if it did work out, then the policies could be expanded to other states.
So yeah, there are a lot of factors to consider, and it's really not a simple issue.
Like I said though, that depends on whether or not China's pollution is being caused by industrial manufacturing alone, or if government policies somehow play a role.
If it can be empirically proven that China's severe pollution problems are caused entirely by bad government policies, and that a nation without such policies would be able to effectively mitigate the pollution from that kind of heavy industrialization, then there is a legitimate argument that we should bring that industrialization back to the United States. But it is dependent upon evidence which can prove what the actual source of the pollution is – government or industrialization?
Please understand I'm not trying to refute you here, nor am I trying to argue against what you're saying. I'm just trying to gather the necessary evidence to draw a realistic and rational conclusion based on tangible evidence rather than theoretical speculation.