Seattle Becomes First American City With Absolutely No Fucking Problems At all

jerry55 said:
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Fucks Given: 0

The US was built by immigrants from all over the world who decided to lift THEMSELVES out of poverty by doing two things:

1. Delaying Consumption In Order To Amass Capital
2. Investing Their Capital Into Securing A Means Of Production

That's how you get out of poverty, and there is no other way. No fucking wage in the world will lift a person out of poverty if they aren't willing or able to do those two things.
 


teatree said:
And productivity is not just a function of the cost of labour - it's also a function of the cost of capital. It's a function of cost basically, and cost includes expenditure of capital in your business. You can only replace your staff with machines if the machines cost less, and the cost is still a consideration.
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You and I may be speaking around each other rather than actually disagreeing. Here was my point:

Suppose I'm an employer and have two options in front of me...

Option #1 - I can hire a laborer for $30,000/year who will generate $40,000/year in productivity.

Option #2 - I can invest $50,000 in a machine that will deliver $25,000/year in productivity.

The first option requires spending $300,000 over 10 years. The net productivity of this option over that period is $100,000 (i.e. $10k/year).

The second option, with its upfront investment of $50,000, will deliver a net productivity of $200,000 over the same period.

My point was that cost of labor vs cost of capital isn't the only factor in determining where to allocate resources. Employers' main goal is to maximize productivity. To your point, employers want to squeeze as much productivity as possible out of every dollar spent - i.e. they want to minimize their costs.

Unless I've missed something, you and I are probably in agreement on this small point.


teatree said:
As for labour - it can and is restricted by immigration policies. If you look at the late 19th century when there was widespread deflation - that was due to there being no restrictions on the flow of labour around the world. Passports didn't exist then.

Immigration policy is all about restrictions in the supply of labour.
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To be sure, there are other things besides minimum wage laws that influence the supply of labor. Besides immigration laws, laws related to licensure and age - e.g. employers cannot hire 10-year-olds - further reduce the labor pool.

My statement...

"There are only minimum wage laws that prevent employers from hiring laborers and simultaneously prevent laborers who offer less productivity than the prevailing minimum wage from finding jobs."

... was meant to shine a light on minimum wage laws as a major obstacle for employers who want to hire people and those who want jobs but offer little in the way of productivity.

Technically, the big obstacle to both groups is the state since it is the one passing and enforcing laws.
 
IceToEskimos said:
Fucks Given: 0

The US was built by immigrants from all over the world who decided to lift THEMSELVES out of poverty by doing two things:

1. Delaying Consumption In Order To Amass Capital
2. Investing Their Capital Into Securing A Means Of Production

That's how you get out of poverty, and there is no other way. No fucking wage in the world will lift a person out of poverty if they aren't willing or able to do those two things.
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Thank you... :bowdown: There is hope...
 
JakeStratham said:
You and I may be speaking around each other rather than actually disagreeing. Here was my point:

Suppose I'm an employer and have two options in front of me...

Option #1 - I can hire a laborer for $30,000/year who will generate $40,000/year in productivity.

Option #2 - I can invest $50,000 in a machine that will deliver $25,000/year in productivity.

The first option requires spending $300,000 over 10 years. The net productivity of this option over that period is $100,000 (i.e. $10k/year).

The second option, with its upfront investment of $50,000, will deliver a net productivity of $200,000 over the same period.

My point was that cost of labor vs cost of capital isn't the only factor in determining where to allocate resources. Employers' main goal is to maximize productivity. To your point, employers want to squeeze as much productivity as possible out of every dollar spent - i.e. they want to minimize their costs.

Unless I've missed something, you and I are probably in agreement on this small point.
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You are not factoring in depreciation (depreciation is over seven years because that's usually when machines have to be replaced) and maintenance, and the cost of capital (you've factored in a zero interest rate because that is what it is now - but it wasn't always thus and won't be in the future).

Of those the cost of capital is the most important. My original post was triggered by someone posting about how McDonalds is trying to replace staff with machines. McDonalds has a debt-to-equity ratio of 0.86. That's high. Average for restaurants is 0.4

They can only afford to replace humans with machines because the cost of borrowing is so low.

Zero interest rates are an aberration, it's the first time we've seen this in 500 years. But many businesses are operating as though this is the norm. It's not. The average throughout history has been 4%.

Businesses are being subsidized by an unprecedented transfer of wealth from savers, that is being enforced by the state. And that is having negative effects on the ability of labour to win wages - because businesses make the argument that you do - the cost of capital is essentially free, so why do I need to pay workers? But capital is only free because the state has interfered, and pressure is building for the state to interfere on the other side to balance things out. Balance will come one way or another - either the state raises minimum wages, or raises interest rates (or rather doesn't hold interest rates artificially down). Choose your poison. From the point of view of McDonalds and co the minimum wage rise is less onerous than an interest rate rise.
 
IceToEskimos said:
Fucks Given: 0

The US was built by immigrants from all over the world who decided to lift THEMSELVES out of poverty by doing two things:

1. Delaying Consumption In Order To Amass Capital
2. Investing Their Capital Into Securing A Means Of Production

That's how you get out of poverty, and there is no other way. No fucking wage in the world will lift a person out of poverty if they aren't willing or able to do those two things.
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Agreed.
Let's not forget that poverty is often a savings choice.

Someone making minimum wage might make around $2k a month, so come payday they're looking to spend this amount.

Let's say their wage gets bumped to $3-4k month. Many of them won't actually use this "raise" (let's ignore economic factors for now) for savings and to benefit their future.
 
teatree said:
You are not factoring in depreciation.
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There are many things I did not factor in, just as I ignored laws concerning immigration, licensure, and age. Depreciation and interest rates are but two among them.

I didn't neglect taking them into account out of ignorance. I have a background in corporate finance. It was my attempt to simplify the point I was making.
 
Fatbat said:
Might be a bit premature.

Couple other things to note, Seattle already has a $9.32 minimum wage. One would expect that would go up over the course of 7 years, though not likely to $15. Nevertheless, will be interesting to see if there is an influx of people into the city looking for work and what impact that alone will have on housing availability and cost.

That Sawant chick is completely nuts.
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^ This.

WA state has been raising the min wage higher than most other areas for a long time now. Yes, this is the largest % increase yet but I don't think there is going to be any drastic effects as some are predicting here. It's not like min wage jumps to $15 instantly.

I doubt there will be much of an exodus to downtown for work as the time/cost getting in there likely won't be made up with the small increase in wage (mass transit blows in Seattle).

However, the boundary to the North around Shoreline and the lower income areas to the South (White Center/Tukwila/Renton) will be interesting to watch. Almost nobody will be commuting from the West or the East that is for sure.

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IceToEskimos said:
I used to get down about this, thinking they were stupid.

Then I realized that they aren't neccessarily stupid, they just like getting elected and being in power, so they do whatever they need to do to make that happen.

That's when I realized they were essentially evil people who pretend to be doing a "service" for their neighbors in order to justify their ceaseless pursuit of unearned (read: bestowed by ballot) power over those same neighbors.
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I agree I would assume that lawmakers have a basic understanding of economics, however I doubt that many of the people who vote them into office do and as a result they have to appeal to the lowest deminator
 
Vadym said:
Logic is invalid. White people been running America for XXX years. It's fucked up as shit now.
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White people have been running America? White people created America and took it from a big chunk of largely uninhabited land to the largest economy in the world in less than 300 years.

Yea, shits a little messy right now, but based on the success of the last 150 years, old white guys know what they're doing.
 
One day the brutality of evolution will clean our country of the ilk that would crawl out of the gene pool to promote cheap tricks designed for suckers. Stupidity is meant to fall on hardship and die, this is and always has been the true nature of progress.


IceToEskimos said:
I was really hoping they'd get this done, because it's going to be hilarious on many, many, many levels.

$15 Minimum Wage Solves Every Problem In Seattle
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Price fixing of any product/service/market always ends in failure and in a shortage, price fixing of labor (via minimum wage) will only lead to a shortage of jobs. Businesses aren't a charity, if their labor costs double then they'll simply fire half of the staff and make them do twice as much work. At $15 an hour they probably won't have any problems finding people to work that hard either since the only other industries where a person with no skills can make that kind of money is in jobs requiring heavy manual labor. They already work 3 or 4 times as hard as any cashier or fry cook does so I don't think they'll have any problem working indoors instead of outdoors for the same pay.
 
ayzo said:
...if their labor costs double then they'll simply fire half of the staff and make them do twice as much work. At $15 an hour they probably won't have any problems finding people to work that hard either since the only other industries where a person with no skills can make that kind of money is in jobs requiring heavy manual labor. They already work 3 or 4 times as hard as any cashier or fry cook does so I don't think they'll have any problem working indoors instead of outdoors for the same pay.
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Cool story bro!

Meanwhile, back in reality...
 
They are phasing it in so slowly that it probably wont have much effect due to inflation and other factors. It would be more interesting if it were done half now and half 3 years later.
 
IceToEskimos said:
What people like this woman will never understand is that the only thing keeping workers from taking ownership of the means of production in a capitalist system is their own "high" time preference for consumption.

If a bunch of factory workers wanted to pool all of their assets, purchase machinery and raw materials, secure a production facilty, hire administrative workers and a sales force, and open a plant, there is literally NOTHING stopping them.

They don't do it though, because they prefer to work and be paid on FRIDAY instead of waiting months or years to see if thier investment pays off. Their own unwillingness to assume risk and delay consumption is what prevents them from entering the ranks of capitalists.
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Ah sweet sweet Thatcherism is alive and well. Agree 100%
 
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