It's not dirty pool at all. It's just a reductio ad absurdum argument, which is totally valid and rational.

The study hardly rebuts the argument, since there are too many other factors involved besides minimum wage increases.

As of last year, the US was facing a shortfall of over 3million (gah! I can't find the link - it might have been an internal memo) jobs in engineering/math/science/technology. How about we fix the education system and society issues that are guiding fewer people to these STEM jobs?

While not exactly the same, heavily unionized (and demanding higher pay than the company thinks the labor is worth) areas are evidence that paying above what a person is worth is detrimental to unemployment. Michigan and the Rust Belt can attest to that.

If you can't tell me why none of those channels is valid, and firing people is the only option, then you have no argument.

My argument applies. The claim, supposedly supported by this study, is that increases in minimum wage do not affect unemployment rates

Incorrect. The claim, supported by this study, is that minimum wage increases have not affected unemployment rates.

And I'm calling a foul on that, because it takes us out of things that are at least notionally connected to the economy we live in. Engaging with that argument allows you to take shots at unprovable theoretical problems at the outer reaches of the debate instead of the debate we're actually having about potentially raising the minimum wage to $10 or $15.

But since you won't relent, and I'm feeling generous with my time in the holiday season, I'll bite.

A $100/hr minimum wage sounds unthinkable, and we couldn't just jack up the minimum wage to $100 and expect things to go smoothly -- economies don't like short, sharp shocks. But it's not like people would stop working and producing goods if we phased one in over time. What would happen is prices would go up to adjust to the fact that labor costs more.

A HA!

But, of course, your consumers are most often someone else's employees, so the extra money they're getting would make them able to pay the higher prices you're now demanding as a business owner. The entire wage scale would shift upwards, and everyone who's working would be fine. Non-workers would have to have their "wages" (retirement income or safety net spending) increased in proportion to the amount of the minimum wage increase, but that's not hard to do in a hypothetical where it's possible to multiply the minimum wage ten-fold -- I just assume the same can opener you did when you created the mythical scenario, and we're done.

See why it's not helpful to have economic debates this far outside the bounds of our current economic realities?

For example, if we imagine something like 2-4% of workers are actually employed at minimum wage, and then we say that raising it has a 1% increase of unemployment for those workers, then this is only .02-.04% of the employment total. It's quite possible that measurement methods won't show this affect and conclude there is "no correlation", when in fact there is one

And I'm calling a foul on that, because it takes us out of things that are at least notionally connected to the economy we live in. Engaging with that argument allows you to take shots at unprovable theoretical problems at the outer reaches of the debate instead of the debate we're actually having about potentially raising the minimum wage to $10 or $15.

Actually, I think this is a *very* helpful conversation. Your argument is that a big jump would merely cause inflation, and nothing would be materially affected in the long term. This is true, assuming that money supply is not fixed. If there was a fixed quantity of money, or if a "hard" (commodity) currency is used, then this can not occur. Of course, a reasonable man might ask, "why bother then"?

One way to assess the threat of inflation posed by a minimum wage hike is to estimate directly how much it could raise businesses’ costs. This would give us a sense of what the potential impact of a minimum wage hike would be on prices, assuming businesses would pass these costs onto their consumers. Of course, there are other ways firms can adjust, aside from raising prices. For example, employers may experience some labor-cost savings as their higher wages lower turnover rates and motivate greater worker productivity. But for the sake of simplicity, let’s assume that firms pass the entire cost increase from a minimum wage hike to consumers.

Past research on how business costs rise with minimum wage hikes indicates that a 10-percent minimum wage hike can be expected to produce a cost increase for the average business of less than one-tenth of one percent of their sales revenue. This cost figure includes three components. First, mandated raises: the raises employers must give their workers to meet the new wage floor. Second, “ripple-effect” raises: the raises employers give some workers to put their pay rates a bit above the new minimum in order to preserve the same wage hierarchy before and after minimum wage hike. And third, the higher payroll taxes employers must pay on their now-larger wage bill. If the average businesses wanted to completely cover the cost increase from a 10-percent minimum wage hike through higher prices, they would need to raise their prices by less than 0.1 percent.[1] A price increase of this size amounts to marking up a $100 price tag to $100.10.

COLA increases are much, much smaller than 10 percent. The average rate of annual inflation, as measured by the Bureau of Labor Statistics’ Consumer Price Index for Urban Consumers, averaged 2.6 percent over the last two decades (1991-2011). The average business therefore could easily cover the cost increase from a typical COLA by raising prices less than 0.03 percent.[2] This amounts a price tag of $100 going up by less than three pennies. Price increases this small would have a negligible impact on a 2.6 percent average inflation rate.

This basic conclusion is supported by a 2008 study that reviewed the economic studies on the impact of minimum wage hikes on prices and inflation.[3] The estimates from these studies cover a relatively wide range, suggesting that a 10-percent increase in the minimum causes overall prices to rise somewhere between 0.2 percent and 2.16 percent, with most estimates falling below 0.4 percent. These estimates are larger, but in the range of how much businesses’ costs increase as discussed above. Even the higher estimate of a 0.4 percent rise in price level with a 10 percent minimum wage hike suggests that a typical COLA adjustment to the minimum wage rate would only push up the price level by 0.1 percent.[4] Recall that this amounts to adding just one dime to a $100 price tag.

With respect to this:



I grant you that this is possible, so let's see some real numbers, not hand-waving. The fact that something could happen in the world of made-up numbers doesn't win against the actual results of actual states that have actually increased their minimum wage.

The burden of proof, therefore, is on those like you and Tim who insist, despite our real-world experience, that unemployment will skyrocket if we raise the minimum wage. The fact that the best you can do is cite American Samoa as an example speaks volumes.

I have never asserted that unemployment will skyrocket.

The hell you didn't. The American Samoa example that served as your opening statement in this thread was a cherry-picked data point that had the obvious flaw of occurring in a territory with a very unique labor situation during a global economic crisis. You called it a "tragedy." You fucking used the word "holocaust." Don't try to back away from it as if you weren't predicting doom and gloom.

I believe it completely repudiates the claim that these laws have no affect on unemployment.

When you take into account that there is no discernible correlation between increased minimum wage and increased unemployment...

At least in the US. I've got no idea whether that's one of those weird UK/US differences.

Washington state judge excludes airport from SeaTac's $15 minimum wage

Washington state judge excludes airport from SeaTac's $15 minimum wage

May be a moot point though, since both the new Seattle mayor and the new socialist council member are pushing hard for $15 too.

I wonder how long until Sawant really ticks off the businesses in Seattle. She already urged Boeing workers to take over the factories shutdown the company (which would be great for wages).