“Technically, we could “solve” unemployment tomorrow by allowing every employer in the country to pay $2.50 an hour…”

...fucking spendthrift.  If $5 a day was good enough for that Great American Industrialist Henry Ford, then by God it should be good enough for the rest of us.  Just don’t touch Goldman Sachs…

So in the midst of a deflationary spiral, when the main problem is that people don’t have enough money to spend, he wants to cut people’s pay and give them even LESS money to stimulate the economy? Um, ok d00d.

$2.50 per hour?

Are you crazy?  These lowlife proles don’t deserve to live so good.

No, I say we reduce wages for the bottom 99% of Americans down to prison wages.  Let’s pay everybody except the richest 1% a whopping 10 cents an hour, and they’ll like it.  If they work really, really hard, we may allow them to make 15 cents an hour.  One day a month, that is.

I swear to God, if these people ever get their way completely, you’re gonna see the literal disembodied bloody heads of our corporate overlords being hung from telephone poles.  At some point, these fucks are gonna finally push the proles to the point where we break into full-blown anarchy and start burning their mansions in their gated communities to the ground, with the oligarchs and their families still inside being burned alive.

Fuck these people.

I really, really hate wankers like Charles Lane… why doesn’t he tell the WaPo to reduce his salary so they could hire a few more writers…. he doesn’t need more than $13,195 or $15,080 a year, does he.  (Those are the pretax salaries for 35 hours and 40 hours a week at $7.25 an hour, btw.)  Wouldn’t that be a great idea. And let’s cut back his benefits, too.  Spoiled, privileged Wanker.

PurpleGirl, Charles Lane is obviously a central figure in America’s prosperity — of course his salary shouldn’t be cut.  In fact, if anything, given the deep insight he has into America’s economic problems, his salary should be doubled… or tripled!...

At some point, these fucks are gonna finally push the proles to the point where we break into full-blown anarchy and start burning their mansions in their gated communities to the ground, with the oligarchs and their families still inside being burned alive.

I always thought this is why we had Social Security and Welfare and Medicaid.  You keep a social safety net so that the worst of us aren’t suffering.  They might not be happy, but they aren’t truly suffering.

Because the alternative is the Bastille.  The reason Karl Marx was “wrong” is because capitalism was muzzled and leashed with regulations.  Unfettered capitalism leads to monopoly and oligarchy. 

Bastille.  Guillotine.  Ramparts and barricades.  Just b/c it hasn’t happened here doesn’t mean it CAN’T. 

No wonder they try to demonize the French.

This idea has worked out brilliantly in the area where I used to live.  Over the last couple of decades, the high paying union jobs have disappeared for a variety of reasons, the major one being that local industry was bought by foreign companies.  The city invested in tourism.  They brag about all the new businesses and jobs they bring in.  Someone is making money but it sure isn’t the people who work at all these new jobs.  They are all minimum wage jobs in retail, waitressing and housekeeping in the hotels.  The result?  A shrinking tax base, soaring property taxes, drastically reduced city services (including police and fire protection). an increasing need for social services, and a school district that is collapsing.  The city is rapidly dividing into the wealthy who are snapping up all the prime real estate for development and vacation homes (while destroying all the low-cost housing), and the working poor who are living in increasingly slum-like conditions.

Bastille my ass.  Has nobody noticed that the increasing screws put to the middle and working classes since 1980 have been matched by expansion of federal and state felony laws, the vastly increased militarization of your police forces and expansion of their public order and SWAT units, and the systematic removals of restraint on their conduct?  Anybody??????

The problem with his whole argument is that minimum-wage jobs cannot be eliminated and thus are always going to be a structured part of our society.  By lowering the minimum-wage the companies that use them will continue to profit at the same rates and give the gains to it’s investors.  Which will do what for the economy?  Haven’t we seen this with grocery stores, Wal-mart, and countless businesses that have 10 to 50+ registers with no more than 20% open at even the busiest times?  The perception that they are there and can be used is there to keep scale in effect.  If you walked into a Wal-mart with 15 cashiers you would complain but with 40 checkouts and 15 open you grumble but stand there assuming sometime all are open.  So in an economy where corporations are trying to run their stores on skeleton crews how is 7.25 killing them?

Men like Lane like to make these arguments because its how he gets invited to corporate christmas parties and gets to stock up on gifts.  I’m sure as a columnist for a national news paper he is making close to six figures on a Bachelor’s in economics or journalism which is fairly spectacular in this economy.  Maybe he should be making the average wage of a teacher so he can understand the reduction of 2 dollars an hour (roughly 30% reduction in wage).

I also like his discussion of “teenagers and young adults” taking these 5.15 an hour jobs.  Teenagers except for those pesky 18-19 year olds are minors who by right shouldn’t have to take a position.  Spending money aside, if children need to bring money in to support the household then the early 20th century laws have failed us miserably and young adults need to make a living wage since they are adults and aren’t necessarily under the tutelage of a parent any longer.  So how is them at 18-19 working 60 hour weeks for 5.15 helping anybody? 

Bah, the classic small business owner example is so out of context.  If you’re employing 10 workers then your business is highly likely to be in the ~1 Million sales range which would mean the profits are at a minimum 250,000 dollars (figuring at a minuscule 25% profit) so giving another 10k towards the wages of the people who earn you that pay deserve it.

I’m sure that’s just a coincidence, seeker.

There’s a reason why this claptrap keeps on popping up every few years. It’s because our views on labor and the workforce are ass-backwards. Conservative and liberal alike, people do it in their own particular way. People think of labor as a supply-generated market instead of a demand-generated market, and that’s the problem.

What this theory states, that if you have a labor market at 2.50 an hour, or whatever it is, you’d make it economically worthwhile to open new businesses. It’s not. Current ones would be more profitable, and yes, you would eventually see wages drop even lower on existing jobs, but generally speaking, even your bottom tier worker is adding MUCH more value than that to the company per hour. (I’d argue a good janitor is probably responsible for a very high portion of your overall revenue. Think about it.)

Generally speaking, companies are not going to hire people to twiddle their thumbs at any price. If there’s no labor to be done, then no hiring is done. Period. (I don’t think this is morally right, or sustainable, either socially or economically, but that’s neither here nor there) Employment levels are directly linked to the amount of labor that needs to be performed. As productivity increases, you need less people to do the same amount of work. Thusly, people are laid off. A good portion of the current labor force contraction is actually the natural pulling of slack from the productivity boom of the first half of the decade.

Those jobs are never coming back.

Where liberals fall into this trap, is in the promotion of higher education as a cure for poverty. While it’s a great social good, it doesn’t do all that much to alter the labor market, and as such doesn’t do very much one way or the other for this sort of thing…well it does something. It lowers wages for specific fields. That’s why certain fields limit educational opportunities in those fields in order to keep wages artificially high.  (See, Doctors)

Erm…

Has anyone heard from seeker since they made that post?

Anyone?

And what’s with the goddamn helicopters??

I always thought this is why we had Social Security and Welfare and Medicaid.  You keep a social safety net so that the worst of us aren’t suffering.  They might not be happy, but they aren’t truly suffering.

Chomsky has said on quite a few occasions that the real reason for the New Deal was not so much to fix the economy, but to prevent the end of capitalism in the US once and for all.  FDR knew they had to give the proles something to keep them from rebelling completely, so he doled out just enough to keep people in check.  This is also why laws against union organizing and collective bargaining were relaxed so dramatically right around the same time - if you have these powerful extra-legal forces which people have more faith in than the government, pretty soon you have All Power To The Soviets.

Generally speaking, companies are not going to hire people to twiddle their thumbs at any price. If there’s no labor to be done, then no hiring is done. Period.

That’s not entirely true.  If companies could hire people for less money, they’d face lower costs and could conceivably offer their products for a lower price.  Lower price equals a greater quantity of products sold, even in a shitty economy.  Of course, Mr. Lane is vastly overstating just how much can be saved.  Most workers are not hired at minimum wage.

Lane sure doesn’t know much about economics—what he’s proposing is lowering wages, leading to demand collapse and catastrophic deflation—exactly as in Great Depression I.  People with large piles of capital, though, make out well in a deflationary environment, at least until the revolution breaks out.

Following Karmarkin’s point, actually, no. People aren’t stupid. Especially poor people aren’t stupid about things that make the difference between surviving and not surviving. So not only have pretty much all the studies that looked at minimum wage increases found no meaningful effect on the number of people employed (there’s a very meaningful effect on the income of the people who hold those jobs), but if employers started offering zillions of new jobs at $2.50 an hour, few if any of the currently-unemployed would be willing to take them. A job that won’t pay the rent or put food on the table (and probably isn’t in walking distance) just cuts into the time and energy an unemployed person has for trying to find a job that will do those things. Or for other survival strategies that don’t involve earning reported wages. It’s a net negative. And for that matter, employers know that—anyone offering $2.50 an hour would be expecting next to nothing from their employees in return, and probably hiring a lot of extra security into the bargain.

What’s sort of funny about this is that America does need pay cuts. We need them most obviously among the ostensible top echelons, who award themselves outsize amounts of money for doing such a great job running the nation’s businesses into the ground. But we also need a more general decrease in what companies pay to employ workers. Health care, unemployment insurance, pension benefits (such as they still are)—there’s a whole raft of charges that businesses pay based on the head count of how many people they employ. Not The total wage-and-salary bill, not how much business they do, but head count. If there’s a more effective way of discouraging companies from hiring workers, I don’t know what it is.

“Lane sure doesn’t know much about economics—what he’s proposing is lowering wages, leading to demand collapse and catastrophic deflation—exactly as in Great Depression I.”

Wingnuttia has convinced itself that FDR caused the Great Depression, instead of being elected to deal with it.  (The Republican “plan” at the time was pretending it would go away if we waited long enough).  This has lead them to believe that everything FDR and the Keynesians did or proposed was/is wrong.

It’s “faith”-based economics, instead of fact-based…

You first, Charles.

Please, lead the way by your deeds - words are so…without value.

I’m excited. Currently, I have to actually pay good money to have a woman come over and help me keep on top of keeping the house together. With this plan, I can enroll her in domestic servitude for pennies, make her live in the attic, and throw her out on the streets to become a prostitute if she displeases me in the least.

Hooray! A return to the Good Old Days at last!

Once again, The Onion has a story strangely close to something a right wing pundit would write:

http://www.theonion.com/content/news/industrial_revolution_provides

In my dream world, I’d like to see the wages of front line workers tied directly to the wages of the top brass, like “executive pay can’t be any more than 200x worker pay.”  Then the tide would have a direct financial incentive to raise everyone’s boat.

if employers started offering zillions of new jobs at $2.50 an hour, few if any of the currently-unemployed would be willing to take them. A job that won’t pay the rent or put food on the table (and probably isn’t in walking distance) just cuts into the time and energy an unemployed person has for trying to find a job that will do those things

It’s not just a matter of survival.  People’s skills and knowledge matter.  The more skills and knowledge you have, the more valuable your labor is, and why would you settle for less especially if you’ve spent money and years of your life building up your skill set?  It’s insulting to suggest that people should clamor to be paid a tiny fraction of what they’re worth.  Only the extremely desperate would volunteer for that, and we still (barely) have a safety net for people who have reason to be that desperate.

Agreed, bellacoker, except I’d think 20x would be enough…

bellacoker and weirdnoise, how does this sound:
If you are the head of a company that employs 100 people at the bottom rung, your take-home pay can be as much as 50% of what all of those people are paid, total (50x what each of them individually is paid).
If your company employs 2,000 people at the bottom, your top salary would be, say, 30% or what all of them make (600x what the entry-level workers get, but then it’s a bigger company).
If your company is a major multinational and you employ, say, half a million bottom-level workers, you only get something like half of one percent of the total bottom-level payroll, but that would still be an astronomical salary—so long as all of your entry-level workers gets paid a decent wage, even the ones in Bangladesh and Tannu Tuva.
The details we can work out to please ourselves, but the premise that we could literally rope the bosses and the workers together to ensure they really do all rise with the tide is an appealing one.

People think of labor as a supply-generated market instead of a demand-generated market, and that’s the problem.

And this is the problem—-not so much the people being wrong on that, but that it IS a demand-generated market, whereas that supply of people NEED to be fed and housed and so forth and so on.  And the thing that is required in exchange for these needs—-money—-is solidly tied to labor.

So we have, as labor-saving technology gets more efficient, more and more of the work gets done by the machines and the chemicals and the programming, and there are fewer production jobs for humans.  But meanwhile society continues to insist that you need to exchange money for products, and you need to work to earn money.

We’ve got an overclass of corporate and wealthy people who insist on being paid because they own the machines, the land, the infrastructure—-and they only return the money, the buying power, TO us if we give them something of value (our labor) in return for it.  But, thing is, they don’t always need our labor.  And we can’t, in our society, create new money. Even the government can’t create new money without risking destabilizing the currency.

At which point they are in a situation where they have something we need but need nothing from us.  At such a point, a decent entity would simply give it to us.  A selfish one would stand on “but you don’t DESERVE it!”  And a stupid one would say “if you worked, all your problems would be solved,” while arguing for such devaluation of labor that makes it impossible to use labor to solve said problems.

Fuck him with a snow shovel.

Oh no, it’s not the ridiculously inflated CEO salaries killing the US economy; it’s all those low-wage mooches who selfishly hope to make more per hour working than they would through collecting bottles from ditches and garbage cans.

Dr. Psycho:  I really like that we get to work the details out to please ourselves.

Nearly every place I’ve worked has figured out just how many jobs they can cut and just how much work they can pile on who’s left without a total breakdown. Cutting salaries only means the people still stuck putting up with those jobs will be paid exponentially less for the same work. The companies will not hire new workers to even out the workload because they really don’t care that you’re overburdened. They’ll just pocket the difference.

I’ve got a surgeon and a lawyer for a sister and brother in law, and despite a family of liberals, these two have become quite conservative as adults and tend to think like this guy.  They really believe that because poor people have color tv’s and cell phones that the minimum wage is obviously fine, and that anyone who wants to can “work their way up”. They think they deserve their $300,000/yr. salaries, and have their positions in life because they have worked hard for them- i.e.- they deserve them.  So anyone who isn’t making scads of money in a rewarding field is basically in a position of their own doing.  It’s just really really weird to have someone claim to be entitled to $500/hour by virtue of how awesome they are, and have that same person claim that another person is only entitled to $7/hour, so much less awesome is that person, and so little worth does that person’s life has.  As another example, my husband has been teaching for 7 years, won the “teacher of the year” award, and makes $9/ hour once he puts in the amount of time to do his job properly.  My own employment situation is laughably underpaid.  We have never been on a vacation- even a honeymoon, we never go out to eat, we’ve had the same cell phones and videogame system and television for several years, etc..  It’s crazy to me that conservative rich folks seem to think this is okay- that there are people out there who just don’t deserve those things in life.  People who should work 60-70 hours a week for their entire lives, merely to survive and get by, whereas the rich folks are so awesome and better than everyone that they get to have anything they want and a big pile of money to give to their kids so they can also have anything they want.  Aaaaarrggh!!!!!!

At $2.50/hour, a minimum wage worker pay check from ADP would cost the same as the wages paid to the worker for 10 hours.  That’s right.  ADP, the largest payroll service charges $25/check.  Tell me how it makes sense to pay less for a day’s labor than for the cost to cut the check.
You know what would really increase the number of jobs?  Making it easier to hire people without worrying about messing up the payroll taxes et al (and thereby performing a felony) so that small businesses can hire people without having to use services like ADP.

Also, here in New England (and in some other states), the hours and positions open to those under 18 are very restricted, even more so than the federal guidelines.  Obviously, CL has no clue as to even the Federal restrcitions.

“It’s just really really weird to have someone claim to be entitled to $500/hour by virtue of how awesome they are, and have that same person claim that another person is only entitled to $7/hour, so much less awesome is that person, and so little worth does that person’s life has.”

Do they really think some folks are only “entitled” to $7, or do they just recognize that employers are only willing to pay that much to some people?  It is absurd to believe that anyone is “entitled” to a certain salary.  And what is with the hatred expressed towards the children of rich folks.  Should those kids not be allowed to have anything but the minimum just because that’s all that some other people have?  Are you the one to decide what they get?  Should everyone be free except for the rich?

anoNY, call me a radical, but I do believe that a willingness to do an honest day’s work “entitles” one to a decent lifestyle where one does not need to worry about making your rent, being able to see the doctor, or where the next meal is going to come from.

I mean, my personal awesomeness (and foresight and parents who encouraged my efforts) does entitle me to a pretty decent amount of money, but that is all gravy, as far as I am concerned. A big problem is that the “base salary” people are confronted with don’t even allow people to get to the point pre-gravy part.

It starts to make you wonder why, if America is so rich, there is so much work put there that Americans can barely afford to pay decent salaries for.

“They think they deserve their $300,000/yr. salaries, and have their positions in life because they have worked hard for them- i.e.- they deserve them.”

This lack of empathy drives me crazy, but so does the absence of logic.  If everyone wanted to do what your relations do for a living the country could not function.  We need waitresses, for instance.  Do your brother and sister suggest that we don’t?  Given that we need people to do the work, isn’t it morally questionable to design it so that the people filling necessary occupations can’t afford to make rent while others are swimming in luxury?  We all benefit because of the work that everybody else is doing.  It isn’t asking so much that the work that has to be done come with a living wage.

We already have a class of people making 2.50/hour.  They’re called undocumented workers.  And you’ll hear this same ilk howling about how those folks are just ruinin’ Amurica!! with their acceptance of sub-standard wages. 

(Now, I agree that allowing substandard wages ruins the labor market…but I suppose I come to a very different conclusion then about what to do with illegal labor: pay it legal rates with required benefits, fer chrissakes.  That’ll make it a whole lot less appealing than making documented workers compete downward for the privilege of working for 2.50/hour.)

Do they really think some folks are only “entitled” to $7, or do they just recognize that employers are only willing to pay that much to some people?

I think it’s just a common fallacy among people with careers that required lots of school and hard academic work and student loans and such.  They rationalize that all this hard work and privation EARNED them their quarter million dollars a year (which is naive, but not entirely unreasonable).  And so therefore people who earn less money must not have had to work as hard for it, or must not be as skilled or talented or brilliant or whatever.  And people in menial jobs have those jobs for a reason, or my favorite, all unskilled and low-paid work must be easy.

This can be less dramatic, in the face of basically intelligent and good-hearted people (a simple tendency to see the world as a meritocracy and class as irrelevant), or it can blow up into some pretty severe entitlement and bigotry in someone who already tends toward those traits.

The job drag of payroll taxes could be eliminated in a revenue neutral way while making the tax burden more progressive by substituting a broad-based (goods and services) harmonized (federal&state;) consumption (sales) tax with exemptions for essentials (e.g., groceries).

That way, savers are rewarded, spenders pay and the burden falls more on those who spend more—the relatively well to do.

On the subject of essentials, I have long contended that the first political party here in Canada that includes sales tax exemption for feminine hygene products in the exempt category will win a lot of votes for that alone.  As a husband and a parent responsible for supporting 5 young women that there is a tax on menstruation (and for that matter contraceptives0 just kills me.

What a great idea!  Even though having a job will be completely meaningless, at least we can say that everyone has one.  People will have something to occupy their time during the day, so they’ll be too busy to complain that they can’t afford food, housing, and medical care.  This is the most brilliant idea I’ve heard since some Republican senators suggested that we cut all requirements and benefits from medical insurance so that everyone can afford a completely useless plan.  Hey, it won’t cover their health care needs, but at least it looks good on paper.

Oh dear. Everytime I see Charles Lane’s byline, I picture Peter Skaarsgard (“Shattered Glass”). He doesn’t deserve to be played by Peter.

With all this bleeding-heart liberal, we-feel-for-the-working-Joe/Jane crap going on here, Ayn Rand is turning in her grave. 

That’s good, but let’s give her some reasons to spin even faster: 
Really progressive income tax with a 90% top rate, French-style Universal Healthcare, a concerted effort to build more mass transit, a reduction in the Ministry of War’s budget to 1/10th what it is currently plus withdrawal from all wars currently being fought and a new Veterans Bill to educate returning vets to re-enter society, a minimum wage of $15/hour, at least 4-weeks of vacation per year, Universal access to higher learning, a 90% inheritance tax on everything over $500,000…

you just described Heaven!

Originally, (in Canada in the 1920s at least) the minimum wage was set to cover the living expenses of a single childless woman. A saleswoman’s expenses were calculated to be $12.56 a week (Assumed for example $20 to be spent on health care) and thus the wage was set to be slightly smaller: $12.50 a week. Did not include any savings.

http://www.lltjournal.ca/index.php/llt/article/viewFile/2488/2891

Minimum wages for men in the US were subject to the “freedom of contract” interpretation of the Constitution at that time, but some states found a loophole for women and children.

The job drag of payroll taxes could be eliminated in a revenue neutral way while making the tax burden more progressive by substituting a broad-based (goods and services) harmonized (federal&state;) consumption (sales) tax with exemptions for essentials (e.g., groceries).
That way, savers are rewarded, spenders pay and the burden falls more on those who spend more—the relatively well to do.

Dear God.  The burden of sales taxes fall primarily on the poor.  They have no choice but to spend every penny they earn.  Do you think billionaires spend even a fraction of their net worth?  Bill Gates will pay virtually nothing in taxes under your plan.  He currently pays virtually nothing in state taxes in Washington because… our entire tax system is based on extremely regressive sales and property taxes.  At least one of the Gateses (definitely Sr., but probably also Jr.) has practically begged the state legislature to tax him more.

Economics needs to be a required course for high school graduation.

So we have, as labor-saving technology gets more efficient, more and more of the work gets done by the machines and the chemicals and the programming, and there are fewer production jobs for humans.  But meanwhile society continues to insist that you need to exchange money for products, and you need to work to earn money.

We’ve got an overclass of corporate and wealthy people who insist on being paid because they own the machines, the land, the infrastructure—-and they only return the money, the buying power, TO us if we give them something of value (our labor) in return for it.  But, thing is, they don’t always need our labor.  And we can’t, in our society, create new money. Even the government can’t create new money without risking destabilizing the currency.

There’s so much wrong with this I’m not even sure to start.  All those new technologies that increase productivity and make workers “irrelevant” are the only reason why our standard of living is so high.  Yes, in the short run, when typesetters are made obsolete by modern computers and printers, there is short term pain, but in the long run we all benefit because people who once spent hours painstakingly setting type for publishing can be put to work doing something more worthwhile.

If humanity as a whole rejected more efficient ways of producing goods because of the fallacy that it leads to underemployment, we’d still be living in the Dark Ages.  I’m perfectly happy not slaving away on a farm for 14 hours a day.  Are you?

Keshmeshi:

That’s insofar as those productivity “improvements” aren’t simply due to outsourcing the low-productivity parts of the equation to low-wage countries or working people harder off the clock. The idea that people who used to run linotype machines or etch halftones or hand stampings from the press to the trimmer can now do something more worthwhile is a nice one in theory, but I’m not sure how well it works out in practice, because at this point the things that one might sanely consider “more worthwhile” don’t seem much in the way of actually having markets or funders.

I’m not sure how well it works out in practice, because at this point the things that one might sanely consider “more worthwhile” don’t seem much in the way of actually having markets or funders.

I agree with that, but I don’t agree that that has anything to do with new technology or the fact that rich people control the factors of production.  They’ve always controlled the factors of production.

The problem is that over the past 30 years our government has completely given up any pretense of setting straight the consequences of an unfettered free market:  all the wealth trickling to the top.  There are a number of things that can set that to rights, holding back productivity isn’t one of them.

DTG in STL: I swear to God, if these people ever get their way completely, you’re gonna see the literal disembodied bloody heads of our corporate overlords being hung from telephone poles.  At some point, these fucks are gonna finally push the proles to the point where we break into full-blown anarchy and start burning their mansions in their gated communities to the ground, with the oligarchs and their families still inside being burned alive.

This is such a tempting line of thought; I’ve certainly engaged in it myself. I know that nobody here is going to go starting a violent revolution, and this is all just blowing off steam.

That said, it’s important to remember that populist rage against our corporate overlords does not look like a democratic, multiethnic hippie collective. It looks like a bunch of armed and angry teabaggers. Revolutions seldom, if ever, turn out like you want them to. I remember (but cannot apparently now link to) someone being upset with the way Gaeta and Zarek’s little revolution turned out on BSG, and continued to hope for a “real workers’ uprising” or something like that, not understanding that the revolution bus had already putt-putted away, and their ideas were not aboard.

Things can get far, far worse. I try to remind myself of that when I begin to fantasize about heads placed on sticks as a warning to the next bunch of too-clever schmucks who want to be the smartest guys in the room.

I don’t see how Mr Lane’s idea would make any sense economically.  The previous $5.15/hour minimum wage had been bypassed by what I’d call the “economic minimum” wage, the minimum amount of money it took to get an employee to get out of bed and come to work.  Even in the relatively poor county in which I live, the traditional minimum wage employers—fast food restaurants and convenience stores—were starting people at around $7.00 an hour, because they just couldn’t hire anyone for $5.15.

The current $7.25 is right around the econimic minimum.  If it remains unchanged for a few years, the economic minimum will inflate itself above $7.25, and that number will become meaningless.

That way, savers are rewarded, spenders pay and the burden falls more on those who spend more—the relatively well to do.

What planet do you live on?

Sure, Bill Gates may spend more than the average plebe in terms of absolute dollars, but as a percentage of his income or assets, his spending isn’t a drop in the bucket compared to the spending of the average family trying to just get by.

The “relatively well to do” only spend more in terms of absolute dollars… not in terms of the percentage of their available dollars to spend.  Somebody making $10MM per year can live quite luxuriously while spending no more than 10% of their total annual income on goods and services.  Someone feeding a family of four on a $60,000 household income sure as hell isn’t gonna be able to meet their basic family needs on a $6,000 annual spending budget.

Keshmeshi:

One nitpick—money doesn’t necessarily flow to the top in a free market, but what we’ve had for the past generation-plus isn’t a free market at all, it’s a market rigged for the benefit of crony capitalists. In a truly free market, for example, there would be no talk about such heavy-handed government interventions as “tort reform”.

Paul wrote:

In a truly free market, for example, there would be no talk about such heavy-handed government interventions as “tort reform”.

And in a truly free market, there’d be no talk about requiring all businesses to offer health insurance, nor minimum wages legislation.

If raising the minimum wage doesn’t cut jobs, and it doesn’t, then why would reducing the minimum wage create jobs?

Lane is a moron, and the only thing you need to know about him is that he was Stephen “Fabulist” Glass’s editor at The New Republic.