Arguments For The Low Skilled WorkerSubmitted by Treubig on Thu, 12/26/2013 - 06:55
Peter Schiff recently created a video asking people at Walmart to pay 15% higher prices to pay $15 per hour to Walmart's employees. Peter got many death threats and hate mail for this video and I would like to defend his position on minimum wage. Most people he asked wanted Walmart to pay their employees higher wages but would not agree to pay higher prices. There are three groups of people affected by the minimum wage. These three groups are the employees, the employers and the customers. Many of the Walmart customers shop at Walmart for the low prices because they have a low income themselves. The employer has to find a way to cover the cost of employing the people who work at their business. The employee has to worry about the rising cost of living.
When it comes to wages, I look at the source of the problem. In a healthy economy, A new product or service has a high cost. For example, I payed $800 for a new 32 inch LCD HDTV years ago when they were new. Now, I could buy the same TV for $200 or $300. In general, the prices of HDTV's have fallen over the years. If the cost of living had not increased, the cost of an HDTV would be even lower. For this example, lets assume there is no inflation and the cost of living is consistent. When the HDTV was new and the supply was low, the cost of these TV's were high. As more people bought the TV's and more were produced, the price has decreased. By the price of goods and services decreasing, our wealth is increased because our money can buy more. This same principle is applied to all products and services. Competition decreases prices of goods and increases the wealth for workers. Price controls for wages, like goods, never work because not one person is smart enough to know what price or wage is appropriate for every product or industry. Ask yourself if you can make a pencil. Not one person on earth today has made a pencil. The free market makes pencils.
If minimum wage is increased, non-essential jobs are eliminated. The cost of employing people has increased as well as the cost of living for those who still have a job. The cost of living always balances out with wages and usually the wages don't keep up with the cost of living for various reasons. The people who lose their jobs because of the minimum wage, are the people who it intended to help in the first place because wages are based on skill. For a low skilled individual, higher wages are a hurtle that one must overcome to even get a job. Ever wonder why we don't see full service gas stations or why we see self check-outs at the grocery store? These jobs were intended for kids or college students and not careers.
Why is the average age for a low skill job 35 years old? The answer to this question is pretty simple. Andrew Jackson, who led the charge to abolish the second central bank in America, once said that it is to be regretted that the rich and powerful often bend the acts of government to their selfish purposes. This is still true today. Government rules and regulation are often sold as in the public interest but are completely the opposite. For example, San Francisco now requires a dog walking license to receive money for walking a dog. A occupational license or regulation is often pushed by those in the industry to eliminate competition and create monopolies. This is how we got the Federal Reserve System. A monopoly is not just a big business, but a business with government protections. The Federal Reserve has a monopoly over money in the USA. Money cannot be fiat (fiat money is money declared by a government with no intrinsic value) because the creators of money cannot be trusted. Money is decided by you and me in a free market. Gold is referred to as money because of its history but money is whatever we deem valuable and easy to divide. The middle class is being eliminated by the fiat money. As I said earlier, people use the government to advance their own selfish purposes. The private control of money and government regulation is the reason for the increase of living and the loss of personal Liberty. When money is created and given to the banks, the banks loan it to the richest people and businesses who will return the largest profits for the banks. By the time the middle class and the poor get the new money, the value of the money has decreased and the cost of living has increased. This means that the wages are not the problem, the issuance of the money and the government regulation is the cause of less higher wage jobs, more debt and a higher cost of living. Profits are beneficial to an employee because it shows that the company is successful and can expand by buying capital goods and equipment.
Also take into consideration that many of our resources are wasted by the minimum wage. Instead of people doing these jobs, machines and equipment are their replacement. These are resources better used in other areas of our lives to do things that humans cannot do. Instead, they are used to bypass the regulations that have been set for humans. Since a certain class of people cannot get into a low skilled job to work their way up in the world, they must rely on welfare to survive. Minimum wage is the contributing factor to the increased welfare state in America.
The once middle class worker is now working for low wages at a low skill job. If you ask someone who works at Walmart, chances are they have a college degree. What we are seeing today is the middle class worker taking the jobs that kids or low skilled workers would take. Since the kids cannot get a job out of high school, they are sold that in this economy, you need a college education. Once they graduate from college with loads of debt, its off to Walmart or a low skilled job because there are no jobs in the field they got their degree. Thus, the debt based monetary system and over reaching government power has created the problem that the business man/woman is being blamed for.
Remember, inflation is the expansion of the money supply and deflation is a decrease of the money supply. Inflation destroys savings and increases debt because the purchasing power of the money decreases. Deflation destroys debtors and helps savers because the purchasing power of the money has increased. Deflation is only destructive when a nation is full of debt. Also, we have a right to the pursuit of happiness as written in the Declaration of Independence. Lets not confuse this with the right to happiness. We do not have a right to be happy, rather a right to pursue happiness even if we never achieve happiness. In our pursuit of happiness, I may want to take a entry level job at a wage lower than the minimum wage. According to the laws that contradict our rights, it would be illegal to do so. Take a look at this quote below. The quote is said to be one by Thomas Jefferson, but is not confirmed. Whether the quote is by Thomas Jefferson or not, the quote still has a valid meaning.
“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.” - Thomas Jefferson