Finland is considering a universal basic minimum income.

[JumpyTheFrog]

Finland is thinking about scrapping most aid programs (including unemployment, food stamps, etc - not sure about health care stuff) and instead sending a money check of about 800 Euros to every adult citizen every month, regardless of income. They think this will save greatly on administrative costs.

[Valley Girl]

What happens when that is no longer considered sufficient? Will they revive the aid programs and increase taxes accordingly?

[foxbridgeacademy]

That couldn't possibly be enough.  $875 in US Dollars?  For unemployment, food stamps, utils. They'll be looking at a lot of newly homeless people.  Do you have a link to an article where it's discussed?  

 

When DH was laid off back in 2009 we had $1200 per month in unemp., $450 for food, $30 for phone, and about $50 for gas (he was in school they had a gas stipend) per month. Also $500 per season for heat and we still struggled so badly that we had to borrow money from my mom every month just to pay bills.

[Laura Corin]

That couldn't possibly be enough.  $875 in US Dollars?  For unemployment, food stamps, utils. They'll be looking at a lot of newly homeless people.  Do you have a link to an article where it's discussed?  

 

When DH was laid off back in 2009 we had $1200 per month in unemp., $450 for food, $30 for phone, and about $50 for gas (he was in school they had a gas stipend) per month. Also $500 per season for heat and we still struggled so badly that we had to borrow money from my mom every month just to pay bills.

 

It's per adult, so USD875 x 2 = 1750.  You had about the same, but maybe costs are lower.

[Bluegoat]

There are a lot of good reasons to consider this, or a guaranteed basic income - it was part of the Green platform in our (Canada's) last election, and the Liberal party picked it up as well IIRC though people don't seem to be talking about it much. 

 

I'm not understanding why people think raises in living cost would be more of an issue than with other kinds of benefits.  Just like, say, welfare payments will go up as COL increases and minimum wage, so would the basic income amount.

 

 

[8circles]

I am intrigued by this idea and am excited to see what comes of it.

[vonfirmath]

What happens when that is no longer considered sufficient? Will they revive the aid programs and increase taxes accordingly?

 

Agreed. I think this will just increase the cost of living.

[Mimm]

I agree that seems like not enough money, but I have absolutely no knowledge about what things cost in Finland. You said most aid programs. What about housing for people who would otherwise be homeless? It does seem like it would make more sense to scale it so that poorer people were helped more. Like if you are making a decent income, your government income is only meant to cover health care costs, but if you are in a lower income bracket, it's also meant to help with food and in an even lower income bracket, you get enough to help with rent... Or something like that.

Edited December 10, 2015 by Mimm

[Bluegoat]

It's per adult, so USD875 x 2 = 1750.  You had about the same, but maybe costs are lower.

 

Some may be, but there may still be supplements for people who can't work, or the elderly, and so on.  I don't think those details have been released yet.

 

The thing with this type of program is it isn't meant to be something just for people with no work - if you get a job, you still get the basic amount.  So - someone could take a job with lower pay, or work part time, and have a better standard of living than they would on just social welfare (which itself would be better than the low paying or part time job.)

[Alessandra]

That is fascinating.

[Dmmetler]

I could see that really changing the face of "welfare". After all, if everyone gets it, it no longer should hold a stigma, right? I could also see this being a big help to college students, at least in covering day to day living expenses while in school and not needing to try to juggle a job (or, at least, not juggle a job other than an on-campus work-study type position).

 

 

[prairiewindmomma]

There is some precedent with the child allowances in Denmark and elsewhere.

[mom31257]

I could see employers here in the US trying to justify cutting hours and wages since people are getting money from the government. 

[goldberry]

I could see employers here in the US trying to justify cutting hours and wages since people are getting money from the government. 

 

OMG that is exactly what would happen!

 

Sort of related, when the government loaned all that money to the banks during the mortgage crisis, and it didn't end up like they thought it would (surprise!), I wish instead they would have bypassed the banks and dealt directly with consumers.  It would have made such a difference. It was okay to give it to banks, but not individuals  

[Audrey]

Switzerland has been discussing this type of thing for a while, as well.

http://www.bbc.com/news/business-25415501(from 2013)

 

​

Other counties are discussing it, as noted here:

https://en.wikipedia.org/wiki/Basic_income

​

[SKL]

I'd have to know the whole tax system before I could say whether this would work.

 

As a single mom with two kids, would I get half as much as a couple with no kids?  Or are there other benefits for kids (of working parents) that would balance it out?  Or are they hoping you won't have so many kids because the cost isn't subsidized?

 

Basically I'd be very cautious about this since it would probably mean a huge tax hike for anyone with an income above bare necessities.  Those people would probably end up way worse off, despite the "everyone gets the same" aspect.  While some may say "that's fair," it would lead to loss of jobs and small-business profits in a capitalist society.

 

I do like the fact that they don't phase it out at higher incomes, like the US does.

[Ravin]

I'd have to know the whole tax system before I could say whether this would work.

 

As a single mom with two kids, would I get half as much as a couple with no kids? Or are there other benefits for kids (of working parents) that would balance it out? Or are they hoping you won't have so many kids because the cost isn't subsidized?

 

Basically I'd be very cautious about this since it would probably mean a huge tax hike for anyone with an income above bare necessities. Those people would probably end up way worse off, despite the "everyone gets the same" aspect. While some may say "that's fair," it would lead to loss of jobs and small-business profits in a capitalist society.

 

I do like the fact that they don't phase it out at higher incomes, like the US does.

There is a child credit given to parents in many European countries. It both help keeps children out of poverty and gives incentive to combat low birth rates.

[SparklyUnicorn]

Interesting idea, but wouldn't this possibly devalue that amount of money if everyone has it?

 

(I don't know, economics is not my strong suit.)

 

 

[regentrude]

I grew up in a country where such a  system was de facto instated. People nominally had jobs, but your income did not really depend on whether your worked hard at your job or spent your time playing cards; nobody could get fired, there was no merit pay, and having a higher education was not monetarily rewarded. Basically, everybody got pretty much the same, and there was no incentive to put in any extra effort.

 

This did not work out so well. So, excuse me if I am skeptical that this is such a good idea.

Edited December 10, 2015 by regentrude

[SparklyUnicorn]

I grew up in a country where such a  system was de facto instated. People nominally had jobs, but your income did not really depend on whether your worked hard at your job or spent your time playing cards; nobody could get fired, there was no merit pay, and having a higher education was not monetarily rewarded. Basically, everybody got pretty much the same, and there was no incentive to put in any extra effort.

 

This did not work out so well. So, excuse me if I am skeptical that this is such a good idea.

 

Although the Finland idea is not quite the same.  For example, was there any way in East Germany to earn more money?  If not, then yeah what is the incentive.  And perhaps the Finnish amount is still low enough to not be too attractive to decide to not bother working at all.  No clue what cost of living is there, but that amount would be very hard to live on here.

[SKL]

Although the Finland idea is not quite the same.  For example, was there any way in East Germany to earn more money?  If not, then yeah what is the incentive.  And perhaps the Finnish amount is still low enough to not be too attractive to decide to not bother working at all.  No clue what cost of living is there, but that amount would be very hard to live on here.

 

It would also depend on what other supports there are for low-income families.  Housing, childcare, medical etc. - is it all covered for low-income folks?  If so, then yeah, that would be enough, and it would take more than a little incentive to get many people to get out of bed and off to work in the morning.

 

On the positive side, unlike in the US right now, there would not be a disincentive to go to work.  Here, there is an in-between range where you end up with less resources if you go to work.  We need to fix that.

 

Edited December 10, 2015 by SKL

[Word Nerd]

http://www.theguardian.com/commentisfree/2015/dec/10/finland-universal-basic-income-ubi-social-security

[JumpyTheFrog]

It would also depend on what other supports there are for low-income families.  Housing, childcare, medical etc. - is it all covered for low-income folks?  If so, then yeah, that would be enough, and it would take more than a little incentive to get many people to get out of bed and off to work in the morning.

 

On the positive side, unlike in the US right now, there would not be a disincentive to go to work.  Here, there is an in-between range where you end up with less resources if you go to work.  We need to fix that.

 

I don't know what they are going to do about medical. It sounds like the basic income is supposed to replace just about every other program out there. Unfortunately, calculations suggestion it will use up their entire national budget, I guess without covering roads and other expenses.

[SparklyUnicorn]

What Word Nerd posted basically says they aren't going to be doing this.

 

Anyhow, what is the political bend of TheGuardian?  I looked it up, but I am not sure of the meaning within the context of British politics.  I'm just curious.  Anyone here know?

 

 

[Laura Corin]

What Word Nerd posted basically says they aren't going to be doing this.

 

Anyhow, what is the political bend of TheGuardian?  I looked it up, but I am not sure of the meaning within the context of British politics.  I'm just curious.  Anyone here know?

 

The Guardian is left-leaning.  It traditionally has supported the Labour Party, but doesn't do so unconditionally.  In general, it's more likely to support the idea of higher taxes and higher benefits (very broad generalisation).

 

ETA: because all of UK politics is pretty much to the left of the US, then Labour (and the Guardian) will be a bit to the left of Obama, I would say.

Edited December 10, 2015 by Laura Corin

[MFG]

Is it similar to what George McGovern proposed for the US in 1972?

 

McGovern ran on a platform that advocated withdrawal from the Vietnam War in exchange for the return of American prisoners of war[178] and amnesty for draft evaders who had left the country.[179] McGovern's platform also included an across-the-board, 37-percent reduction in defense spending over three years.[180] He proposed a "demogrant" program that would give a $1,000 payment to every citizen in America.[181] Based around existing ideas such as the negative income tax and intended to replace the welfare bureaucracy and complicated maze of existing public-assistance programs, it nonetheless garnered considerable derision as a poorly thought-out "liberal giveaway" and was dropped from the platform in August.[162][181][182][nb 12]

https://en.m.wikipedia.org/wiki/George_McGovern#1972_presidential_campaign

[SKL]

Yeah, it's one thing to promise during one's campaign, quite another to come up with a plan that will actually work without causing more problems than it fixes.

[happypamama]

My confusion with it is that if you are well off, or at least comfortable, you don't currently get any government aid. But in this scenario, you'd get some money anyway. And if you're currently poor, you might be getting far more than that in aid, especially for aid that is dependent upon family size (I mean, if my DH lost his job, we'd get a lot more in food stamps for our family of seven than we would if we just had one or two children), so you'd actually lose if they went to a guaranteed minimum income and no other aid. I'm not sure what that would fix.

[frogger]

I think that it is an interesting idea but of course, the devil is in the details and I have very little knowledge of the Finnish budget. When I say interesting, that means I just think it's interesting not that I'd advocate it.

 

Some thoughts:

 

If they have universal health coverage already then health care doesn't need to be factored in. American budgets are very misconstrued by our enforced monopolized over regulated health care system which is of course going to make us think Finnish health care budgets are similar, which they probably aren't.

 

 

Inflation- this shouldn't occur unless the Finnish government is tempted to print money to meet their obligations. If they are using tax money to make these pay outs than for every dollar paid out there will be a dollar taken in through taxes, in theory.

 

This shouldn't affect incentives to work as much as straight out socialism because you are given a very basic (poverty level) income but allowed to make more. Our current system does have breaks in the income mobility curve where if you make more privately you actually will end up with less since the benefits taken away are greater than your increase in private pay. For some very forward looking people this may not stop them from pursuing advancement but imagine yourself single and looking at your quickly growing children in the here and now. Yes, that is not the way to provide good incentives. A pay out that everyone gets on the other hand would not disappear when you suddenly had a chance at a better job.

 

It would seem that it would be more difficult to scam a more streamlined system. Anyone who does illicit work that the government doesn't know about in America both doesn't pay taxes and can sign up for all sorts of benefits. I can also see how admin costs could potentially be lot less than the crazy mix of state and federal programs that exist in America and it is difficult in the craziness to even know where all the money goes.

 

Potentially, this could be offset by taxes. A middle class person would pay more taxes to make up for the benefit but it would equal out so they didn't really have to pay more. A wealthy person would of course be paying way more than they took in to pay for those receiving benefits with little to no taxes but they are already doing that.

 

As mentioned the number of children one has affects your taxes in America and the amounts of benefits you get and you don't get that under this system.

 

 

 

Really it is an interesting concept but the number crunching before the proposal would be immense.

 

I don't see this in theory being much different than the earned income tax credit where you get back more than you actually paid in.

Edited December 10, 2015 by frogger

[Bluegoat]

http://www.theguardian.com/commentisfree/2015/dec/10/finland-universal-basic-income-ubi-social-security

I'm not sure I'm on board with all of his assumptions.  His example of how there were still single parents who stayed out of work in the UK when their benefits had a similar structure, but the number in work went up when it became a requirement..  He thinks this shows not requiring people to look for work is bad. I think he has perhaps missed the point - is it bad if single parents (or non-single ones) come to the conclusion that that they are needed at home?  I's add another question - is it bad if a parent with a child who needs someone at home, or a person caring for an elderly parent, or a student, has to go and find paid employment rather than doing what is fairly important unpaid work?

[Laura Corin]

As far as I recall, if you have a child under 5 in the UK, you are not chivvied to find work by the benefits system. There are also payments at low levels for family members caring for disabled and elderly people.

 

Students have low interest loans to support them, or free grants if they are from low income families.

Edited December 10, 2015 by Laura Corin

[Anne in CA]

I can see how it would save a lot of administrative time. Of course the people of Finland may be responsible enough to buy groceries with money that are not food stamps, and make responsible financial decisions. If so, cutting out the administration is genious. It could never work is the US, but we are so much bigger than Finland that there is no comparison at all anyway. My question is... what will all the displaced administrators do to support themselves, lol.

[Audrey]

There is a child credit given to parents in many European countries. It both help keeps children out of poverty and gives incentive to combat low birth rates.

 

We have that here in Canada.  There is also a GST credit for lower income families.  Both of these come in the form of payments to the household tax filer who claims them.  The 'baby bonus' comes monthly; the GST credit, quarterly.

[Audrey]

As far as I recall, if you have a child under 5 in the UK, you are not chivvied to find work by the benefits system. There are also payments at low levels for family members caring for disabled and elderly people.

 

Students have low interest loans to support them, or free grants if they are from low income families.

 

To the bolded: same here.  Parents with young children get an exemption from being work expectant.  There are limits on how long you can use exemptions, though.

[Bluegoat]

As far as I recall, if you have a child under 5 in the UK, you are not chivvied to find work by the benefits system. There are also payments at low levels for family members caring for disabled and elderly people.

 

Students have low interest loans to support them, or free grants if they are from low income families.

 

The Guardian article seemed to suggest this had changed, at least for a period of time - or perhaps only for parents with older kids?

[Audrey]

I can see how it would save a lot of administrative time. Of course the people of Finland may be responsible enough to buy groceries with money that are not food stamps, and make responsible financial decisions. If so, cutting out the administration is genious. It could never work is the US, but we are so much bigger than Finland that there is no comparison at all anyway. My question is... what will all the displaced administrators do to support themselves, lol.

 

Here, there are no "food stamps" or money attached to specific spending.  Assistance is a single cheque and you spend it as you need.  There is help available to show people how to budget and sometimes, certain people may be eligible to have the assistance office pay certain bills (like rent, for example, if they qualify and are in govt housing). The idea is that people are allowed their dignity and that the govt doesn't micromanage them or attach shaming practices to assistance. 

[Laura Corin]

The Guardian article seemed to suggest this had changed, at least for a period of time - or perhaps only for parents with older kids?

Yes, parents of school aged children are expected to seek work.

[Audrey]

All in all, I find the idea of a guaranteed minimum income very interesting.  I'm not sure how it would all parse out financially, but that is what govt. committees do when researching and drafting such revolutionary proposals.  I am not surprised that Finland would take on this idea.  I spent most of a year there (a long time ago) and it fits with the ethos I remember (quite fondly) of the country and its people. 

[Bluegoat]

Here, there are no "food stamps" or money attached to specific spending.  Assistance is a single cheque and you spend it as you need.  There is help available to show people how to budget and sometimes, certain people may be eligible to have the assistance office pay certain bills (like rent, for example, if they qualify and are in govt housing). The idea is that people are allowed their dignity and that the govt doesn't micromanage them or attach shaming practices to assistance. 

There is some sort of assistance here that are only for food - I saw it used when I worked as a grocery clerk.  But it wasn't very common, and I think it may have been a sort of emergency assistance.

 

In general, I find the idea of food stamps pretty sanctimonious.

[Laura Corin]

Here, there are no "food stamps" or money attached to specific spending.  Assistance is a single cheque and you spend it as you need.  There is help available to show people how to budget and sometimes, certain people may be eligible to have the assistance office pay certain bills (like rent, for example, if they qualify and are in govt housing). The idea is that people are allowed their dignity and that the govt doesn't micromanage them or attach shaming practices to assistance. 

 

The UK hands out money too.  There are food banks, but those are charitable institutions on top of benefits; they are usually for people who are waiting for their first benefit cheque or have a similar crisis.  Housing benefit is sometimes paid directly to the landlord, I think, but otherwise the money is deposited in the recipient's bank account.

 

The bureaucracy that would be avoided would be considerable, if Finland's system is anything like the UK's.  If you are out of work then you need to go and make a claim at the Job Centre Plus, fill in a bunch of forms, provide bank statements etc. if you are applying for means tested benefits, then return every two weeks to declare which jobs you have applied for and what other actions you have taken to find work.  A lot of it is just ticking boxes (in general no one contacts the employers to ensure that you have actually made the applications).  What would happen to all the thousands of people who administer the programmes though?  Would they be found other jobs?

Edited December 11, 2015 by Laura Corin

[TammyS]

Hm.  I can imagine groups of 4 young adults deciding that it makes a lot more sense to share a house and not work at all than to pursue work, ever.  So that drops a certain number of people out of the labor force, driving up labor prices.  I can also imagine people refusing to work for minimum wage, because they've got $800/mth coming, so why bother.  So, employers HAVE to pay more.  Some won't be able to make it work, so those businesses will close.  There goes those taxes.  The ones who can make it work will have to raise prices to make it happen, and then we all pay more, which means we get less, which means business will suffer, some will scale back and employ less people, some will go away altogether and there goes those taxes.

 

I'm just not seeing it work.

[Laura Corin]

 I can also imagine people refusing to work for minimum wage, because they've got $800/mth coming, so why bother.  So, employers HAVE to pay more.  

 

I don't quite see this one.  If you already have a bare income coming in, then you are able to take a minimum wage job without stress - the government is effectively subsidising the company's wage bill.  Why would it push wages up?

 

The UK has a system of tax credits that give extra income to people who earn very little per hour.  One of the criticisms of the programme is that it subsidises the companies, which then make profits at the tax-payer's expense.

[Bluegoat]

Hm.  I can imagine groups of 4 young adults deciding that it makes a lot more sense to share a house and not work at all than to pursue work, ever.  So that drops a certain number of people out of the labor force, driving up labor prices.  I can also imagine people refusing to work for minimum wage, because they've got $800/mth coming, so why bother.  So, employers HAVE to pay more.  Some won't be able to make it work, so those businesses will close.  There goes those taxes.  The ones who can make it work will have to raise prices to make it happen, and then we all pay more, which means we get less, which means business will suffer, some will scale back and employ less people, some will go away altogether and there goes those taxes.

 

I'm just not seeing it work.

Many people don't want to take minimum wage jobs because they will be worse off than if they just used social assistance.  Under this scheme, people could take those jobs and still have an ok standard of living.   (Minimum wage in Finland IIRC is much closer to a living wage than it is here.)  It also might make a significant difference to people who want to stay home with kids or less-abled family members.  Generally, unpaid work in the community is undervalued by decision makers, because it is given no monetary figure - well, maybe this is one way to give it a price.

 

I can see downsides to this,but I think it is interesting in light of changes in the workforce as manufacturing type jobs and some labour jobs and even some skilled trades have become a less important part of the workforce.  Those were jobs that were great for people who did not want professional or highly technical work, or indoor office type work, for any reason - their own ability, or other family commitments, or whatever.  Those people now tend to be stuck in service type jobs, which often have really crappy pay. 

 

If it is inevitable that machines will make many jobs redundant, what do we do with the people they put out of work?  They aren't all going to become engineers, (even if we needed so many engineers.)  Isn't the point of using machines to do hard work more easily supposed to be to free up people from that work? 

 

While a few young people might choose to band together and live of the basic income (and do what - maybe something useful? - I think many doing so for long would be unlikely.  It would tend to work against too many other things most people want, like family life.

[ChocolateReignRemix]

I don't quite see this one. If you already have a bare income coming in, then you are able to take a minimum wage job without stress - the government is effectively subsidising the company's wage bill. Why would it push wages up?

 

The UK has a system of tax credits that give extra income to people who earn very little per hour. One of the criticisms of the programme is that it subsidises the companies, which then make profits at the tax-payer's expense.

Correct, and that is part of the theory behind a guaranteed minimum. It allows those right on the line to accept a low paying or temp job that could lead into something better and still be able to afford the basics.

 

I am also cringing a bit at the above about how those in the U.S. need benefits via food stamps to protect themselves from poor decisions. *sigh*

Edited December 11, 2015 by ChocolateReignRemix

[Bluegoat]

The UK hands out money too.  There are food banks, but those are charitable institutions on top of benefits; they are usually for people who are waiting for their first benefit cheque or have a similar crisis.  Housing benefit is sometimes paid directly to the landlord, I think, but otherwise the money is deposited in the recipient's bank account.

 

The bureaucracy that would be avoided would be considerable, if Finland's system is anything like the UK's.  If you are out of work then you need to go and make a claim at the Job Centre Plus, fill in a bunch of forms, provide bank statements etc. if you are applying for means tested benefits, then return every two weeks to declare which jobs you have applied for and what other actions you have taken to find work.  A lot of it is just ticking boxes (in general no one contacts the employers to ensure that you have actually made the applications).  What would happen to all the thousands of people who administer the programmes though?  Would they be found other jobs?

 

I've heard a lot of horror stories about the job search requirements in the UK.  People getting cut off when they shouldn't, having to apply for many jobs that could never work just to meet the requirements, and so on.

[Audrey]

I can see the value in that having the minimum opens up the possibility of lower paying, entry level jobs for those on assistance. Where before, that wage would have counted against their assistance eligibility, under guaranteed minimum, it would not.  This would, in effect, make many jobs that are currently unattractive (part-time, minimum wage, entry level, etc) much more attractive to a broader variety of people.  It would benefit those employers who have a glut of those types of jobs wanting.  It's especially a win-win for employers facing labour shortages and for smaller and less profitable business who can't afford to pay above minimum wage. 

 

Of course, there are always the pessimists who will assume everyone on assistance doesn't want anything to do with work.  :glare:   But that attitude is not borne out by statistics. 

[Audrey]

Correct, and that is part of the theory behind a guaranteed minimum. It allows those right on the line to accept a low paying or temp job that could lead into something better and still be able to afford the basics.

 

I am also cringing a bit above about how those in the U.S. need benefits via food stamps to protect themselves from poor decisions. *sigh*

 

Ah yes... shaming and criminalizing the less fortunate.  It's like a sport for some.  :glare:

[Bluegoat]

I don't know if this is an issue in Finland, but something else that might make a difference here is with temporary types of work.  It can be hard tofill temporary positions, or find seasonal workers, because of the difficulty involved with maintaining an income.  No one wants to take a job that they know is temporary, and then suddenly be stuck having to reapply for benefits and have to wait for a period with no money.  If they have a family it would likely be entirely irresponsible.

[frogger]

 

The UK has a system of tax credits that give extra income to people who earn very little per hour. One of the criticisms of the programme is that it subsidises the companies, which then make profits at the tax-payer's expense.

Not saying you are arguing this, I realize you were just mentioning an argument.

 

At one time people exchanged labor for money. It was exchanged for the market rate. For example, if it really is only worth $50 a day for me to hire a nanny than why would I pay more? At some point I would just stay home and take care of my children myself. If what a company is paying exceeds what an employee's specific labor is worth then why would they be hired?

 

Now days people don't think of it as two responsible parties making a trade but rather some kind of adoption where the company is responsible to take care of their employee like they are some kind of child. I don't see that this is very productive especially since many people cannot contribute enough value to make it beneficial to the company to hire them. Should they be forced to hire people who make them lose money and then care for them as a child?

 

The only reason my little brother with Down Syndrome is working is probably because of tax credits the state gives companies who hire those with disabilities. Honestly, you could say the companies are subsidizing the state because they are keeping many people from being entirely dependent on the state for care.

 

I would like to see minimum wage disappear entirely as it keeps people from working. In my brother's case the state subsidizes his pay but how many people do not have the ability to give that much value to a company and yet don't have someone to pay the company to hire them? They are basically out of luck. I would much rather see earned income credits from the government or other ways of providing basic income like the one we are discussing than putting in place a price floor that prices out of existence all jobs that are of less value than the current minimum wage.

Edited December 11, 2015 by frogger

[ChocolateReignRemix]

Not saying you are arguing this, I realize you were just mentioning an argument.

 

At one time people exchanged labor for money. It was exchanged for the market rate. For example, if it really is only worth $50 a day for me to hire a nanny than why would I pay more? At some point I would just stay home and take care of my children myself. If what a company is paying exceeds what an employee's specific labor is worth then why would they be hired?

 

Now days people don't think of it as two responsible parties making a trade but rather some kind of adoption where the company is responsible to take care of their employee like they are some kind of child. I don't see that this is very productive especially since many people cannot contribute enough value to make it beneficial to the company to hire them. Should they be forced to hire people who make them lose money and then care for them as a child?

 

The only reason my little brother with Down Syndrome is working is probably because of tax credits the state gives companies who hire those with disabilities. Honestly, you could say the companies are subsidizing the state because they are keeping many people from being entirely dependent on the state for care.

 

I would like to see minimum wage disappear entirely as it keeps people from working. In my brother's case the state subsidizes his pay but how many people do not have the ability to give that much value to a company and yet don't have someone to pay the company to hire them? They are basically out of luck. I would much rather see earned income credits from the government or other ways of providing basic income like the one we are discussing than putting in place a price floor that prices out of existence all jobs that are of less value than the current minimum wage.

 

That was never really true and our labor markets have never worked that efficiently.  When the steel mills or coal mines were the only options and workers needed to eat to survive, they were forced to accept what was available.  This belief that there is an equal balance between employers and employees in all labor sectors is fiction.  It holds true for some, but certainly not all.