Why the minimum wage cannot help.

[Wildeson]

I know many rich places in Asia which have no minimum wage. For example, Hong Kong has a very successful economy due to its success in business. But, even if it has a rich economy, the gap between the rich and the poor is very wide. Many workers live in awfully bad conditions unlike the really rich. It's pretty unfair that many workers work for many hours a day but they only get so very little compared to some people whose work consists of liquidating jobs. I still believe managers and CEOs should get more than workers but workers should at least be given the right amount. I think there is a need to set at least a fair amount of minimum wage in order to insure some fairness and stop worker abuse. (Although, the minimum wage should only increase depending on the country's economic growth improving.) Plus, it's the most humane thing to do.

There are numerous countries ahead of Hong Kong that have minimum wage laws but have worse income inequalities.

That's because minimum wage laws do not really work in very poor countries like those in most of Africa because first of all, how would the not-so well-off companies pay to the expected amount to workers if they themselves don't have the money. They usually only work if the country is rich enough and if only greedy corporations are the ones who are mostly getting money. Minimum wages laws aren't really meant to improve economies or degrade them significantly; they're just meant to stop worker abuse, set the standard of payment for low-income jobs and at least promote some income fairness (and possibly reduce crime too). But you may ask me, then why do we still need them? A humane country, although already rich, doesn't abandon its worse-off citizens who are very much willing to work.

[New Genoa]

Mega-corporations are created by government special interests that grant them special privileges.

All monopolies are government created, they are simply not possible in a truly free market.

That's 100% correct; in a truly Free-Market Capitalist society, monopolies such as existent in the United States in the past century would not have existed nearly as long; most monopolies where actually created directly by the State, and the State still has a major hand in creating artificial Monopolies in the Market-place. Naturally, when a new market opens up, and one business enters and establishes a monopoly, more and more businesses will follow suite and attempt to gain access into the market, and some strong businesses will enter and survive the marketplace. Capitalism might not be friendly sometimes, but it does not naturally create so many monopolies; that requires State assistance.

Monopoly isn't the problem...it's oligopoly that's become the norm in the US more often than not, and too many people (both on the left and right) like to seemingly ignore this glaring fact.

[Lincoln Sydney]

Well, your arguement is slightly flawed as well. Also, the minimum wage removal may reduce the wage for the SHORT TERM, but because by then the economy will readjust, the wages will go back UP and become een higher. Also, about the price, yes, the demand generally decreases with price decreasing, and that is the usual case.

Actually all I can see is wages going down.

Cut wages ---> People can't afford products ---> Company cuts prices on basic needs (food/housing) ---> people can afford prices again ---> Greedy company cuts wages to beat the competition (workers can't leave because the other companies aren't hiring) ---> Other companies cut wages to level with the competition ---> People cant afford products

And the circle begins again. All that abolishing minimum wage would do is make the nation poorer and make unnecessary items (In the hunter/gatherer sense of the word) unaccessible to 90% of the population.

This is the most absurd thing I have heard.

[Neu Leonstein]

Joseph Schumeter, I take it. His arguments carry some merit; yet, so far as I can tell, he never argued that monopolies were inherently more efficient. He merely argued that monopolies which innovate will prosper, and those which don't won't (Also, he merely argued against the homogenous nature of perfectly competitive markets, without noting that such markets are few and far between, and are for the most part merely a theoretician's device).

He also wrote some stuff about "vision", as in the the subconscious way in which you see things and which colours your interpretation of everything you see (or read), and which you might want to have a look at.

Also, I disagree with his characterisations of IP law - there must be more checks and balances on IP law to prevent such wholesale abuse as is being committed by (to name just one) Monsanto. I understand the profit-motive approach to innovation which patent law embodies, and to an extent, I agree with it. But not the current system.

He didn't write about how things should be, he wrote about how things are. Which is why he concluded that corporates and their central planning would throttle the life out of the entrepreneurial process and they, together with their government backers and their sheep (the voters), would replace capitalism with socialism. Because let's face it: big corporations don't embody or particularly support capitalism. They are better off in a corporatist setting, or indeed as the extended arms of a social planner government.

[New Genoa]

Also, I disagree with his characterisations of IP law - there must be more checks and balances on IP law to prevent such wholesale abuse as is being committed by (to name just one) Monsanto. I understand the profit-motive approach to innovation which patent law embodies, and to an extent, I agree with it. But not the current system.

He didn't write about how things should be, he wrote about how things are. Which is why he concluded that corporates and their central planning would throttle the life out of the entrepreneurial process and they, together with their government backers and their sheep (the voters), would replace capitalism with socialism. Because let's face it: big corporations don't embody or particularly support capitalism. They are better off in a corporatist setting, or indeed as the extended arms of a social planner government.

Are you sure about that statement? I don't think corporations are particularly keen in handing over the means of production to their laborers...How exactly would worker cooperatives, for example, be beneficial to a corporatist agenda?

or are you using the standard non-capitalist implies socialist definition?

[New Chalcedon]

So the only way to get rid of one monopoly is by bringing a bigger company along, one that can soak those losses? No, thanks. I prefer that the Government do at least a few things to get things done. While the fact taht the government isn't profit-seeknig can hinder its efficiency, it at least keeps rapacity in check, unlike privately-held monopolies.

You ignored my second point. A bigger company is one way, another is through creating a better product that's either cheaper or more efficient, thus causing people to use it. And there are other ways.

The Supreme Court of the United States disagrees with you. All other things being equal, I'll take their appraisal of the situation, thanks.

Standard Oil had at least 137 competitors in 1911 around the time of the case. Kersoene had dropped from 30 cents a gallon in 1869 but had fallen to six cents by the time of the trial. Even if they were a "monopoly" how is falling prices bad? Or are you now going to argue that lower prices are predatory?

I suggest that you look up 'predatory pricing': it is temprorarily lowering prices to drive the competition out of business, thus increasing your market power and enabling you (once your competitors are gone) to jack the prices way up again. Also, you fail to address the grounds of the Court's decision.

Actually all I can see is wages going down.

Cut wages ---> People can't afford products ---> Company cuts prices on basic needs (food/housing) ---> people can afford prices again ---> Greedy company cuts wages to beat the competition (workers can't leave because the other companies aren't hiring) ---> Other companies cut wages to level with the competition ---> People cant afford products

And the circle begins again. All that abolishing minimum wage would do is make the nation poorer and make unnecessary items (In the hunter/gatherer sense of the word) unaccessible to 90% of the population.

This is the most absurd thing I have heard.

Actually, no it's not. I suggest that you refer to Henry Ford - who is, after all, only the most successful industrialist in history - for inspiration:

There is one rule for the industrialist and that is: Make the best quality of goods possible at the lowest cost possible, paying the highest wages possible.

Ford - as with every successful industrialist - realised that the path to success for any great corporation is to ensure that the great mass of people has enough wealth to be able to purchase your goods and/or services in large quantity. I also note that, despite paying absurdly high wages by the standards of his day, Ford quickly grew his company into a behemoth, one which left him with an estimated wealth (in 1999 dollars) of $188 billion. Likewise, Bill Gates doesn't employ many of his people at the lowest salary he can pay: he pays well, gets to pick good people, and Microsoft has become the biggest, most profitable IT company in the world.

Joseph Schumeter, I take it. His arguments carry some merit; yet, so far as I can tell, he never argued that monopolies were inherently more efficient. He merely argued that monopolies which innovate will prosper, and those which don't won't (Also, he merely argued against the homogenous nature of perfectly competitive markets, without noting that such markets are few and far between, and are for the most part merely a theoretician's device).

He also wrote some stuff about "vision", as in the the subconscious way in which you see things and which colours your interpretation of everything you see (or read), and which you might want to have a look at.

Also, I disagree with his characterisations of IP law - there must be more checks and balances on IP law to prevent such wholesale abuse as is being committed by (to name just one) Monsanto. I understand the profit-motive approach to innovation which patent law embodies, and to an extent, I agree with it. But not the current system.

He didn't write about how things should be, he wrote about how things are. Which is why he concluded that corporates and their central planning would throttle the life out of the entrepreneurial process and they, together with their government backers and their sheep (the voters), would replace capitalism with socialism. Because let's face it: big corporations don't embody or particularly support capitalism. They are better off in a corporatist setting, or indeed as the extended arms of a social planner government.

Fair enough on both counts.

[Neu Leonstein]

or are you using the standard non-capitalist implies socialist definition?

I'm not using a libertarian socialist definition (as put by a libertarian socialist), no. I am using the one where "representatives" of the labourers make the decisions, which in this case will be the elected officials working together with those representing the productive capacity of the economy, ie the leaders of the big conglomerates.

You've got to remember that the vast majority of socialist systems rely on the implied change in economic relations, not on any actual change. You still work, you just do it for "the cooperative" or some similar platitude rather than for "the capitalist". I'm not actually sure that libertarian socialism or syndicalism is actually any different, but that's beyond the topic at hand. But when such a system exists, then it is likely to be more effective in entrenching the position of those in the economy who are doing well, since no competitive force can be allowed: any attack on the economic wellbeing of a socialist enterprise must simultaneously be interpreted as a political or even physical attack on its stakeholders. There is no scope in a socialist system for competition as such.

[New Chalcedon]

or are you using the standard non-capitalist implies socialist definition?

I'm not using a libertarian socialist definition (as put by a libertarian socialist), no. I am using the one where "representatives" of the labourers make the decisions, which in this case will be the elected officials working together with those representing the productive capacity of the economy, ie the leaders of the big conglomerates.

You've got to remember that the vast majority of socialist systems rely on the implied change in economic relations, not on any actual change. You still work, you just do it for "the cooperative" or some similar platitude rather than for "the capitalist". I'm not actually sure that libertarian socialism or syndicalism is actually any different, but that's beyond the topic at hand. But when such a system exists, then it is likely to be more effective in entrenching the position of those in the economy who are doing well, since no competitive force can be allowed: any attack on the economic wellbeing of a socialist enterprise must simultaneously be interpreted as a political or even physical attack on its stakeholders. There is no scope in a socialist system for competition as such.

As I understand it, capitalism means that you work for your own benefit (in theory).

[Ad Nihilo]

or are you using the standard non-capitalist implies socialist definition?

I'm not using a libertarian socialist definition (as put by a libertarian socialist), no. I am using the one where "representatives" of the labourers make the decisions, which in this case will be the elected officials working together with those representing the productive capacity of the economy, ie the leaders of the big conglomerates.

You've got to remember that the vast majority of socialist systems rely on the implied change in economic relations, not on any actual change. You still work, you just do it for "the cooperative" or some similar platitude rather than for "the capitalist". I'm not actually sure that libertarian socialism or syndicalism is actually any different, but that's beyond the topic at hand. But when such a system exists, then it is likely to be more effective in entrenching the position of those in the economy who are doing well, since no competitive force can be allowed: any attack on the economic wellbeing of a socialist enterprise must simultaneously be interpreted as a political or even physical attack on its stakeholders. There is no scope in a socialist system for competition as such.

Uhm... I don't really understand what the second paragraph is supposed to mean.

http://en.wikipedia.org/wiki/John_Lewis_Partnership

Have a look at that. It competes quite well with other super-market chains, "cooperative" is anything but a platitude, and the political/democratic aspect of it relates to internal decisions and structures, not to how it relates to other chains in the market. An economy comprised of companies that would work almost entirely on this model would be essentially what syndicalism is about. Most if not all internal conflict of interests between workers and owners are resolved, and state regulation would provide the same sort of regulation as it does nowadays against collusion and oligopoly formation.

A left wing system is not necessarily one where markets are reigned in completely. It has a lot more to do with relationship of labour and capital ownership, than exchange - the traditional association between the left and central planning/dirigisme is a historical quirk, not a necessity. Indeed, the point is proven by the relative prevalence of the converse possibility: dirigisme in capitalist economies, like Japan, France (especially during de Gaul), etc.

[JJ Place]

That's 100% correct; in a truly Free-Market Capitalist society, monopolies such as existent in the United States in the past century would not have existed nearly as long; most monopolies where actually created directly by the State, and the State still has a major hand in creating artificial Monopolies in the Market-place. Naturally, when a new market opens up, and one business enters and establishes a monopoly, more and more businesses will follow suite and attempt to gain access into the market, and some strong businesses will enter and survive the marketplace. Capitalism might not be friendly sometimes, but it does not naturally create so many monopolies; that requires State assistance.

Monopoly isn't the problem...it's oligopoly that's become the norm in the US more often than not, and too many people (both on the left and right) like to seemingly ignore this glaring fact.

An overwhelming amount of business in the United States is considered 'Monopolistic Competition', a market situation in which is only second in competition to 'Perfect Competition'; Monopolies and Oligopolies continually are going down in markets, and turning into more competitive markets. Oligopoly is not necessarily a bad market, and sometimes virtually must exist if a product or service to to made; most businesses do not have either the have the capital, technology, labor, or want to take the risk into going into a business with multiple multi-national businesses that have been established for a number of decades or centuries; natural oligopolies are the same problem as monopolies; they aren't a problem at all.

[The Black Forrest]

Monopoly isn't the problem...it's oligopoly that's become the norm in the US more often than not, and too many people (both on the left and right) like to seemingly ignore this glaring fact.

An overwhelming amount of business in the United States is considered 'Monopolistic Competition', a market situation in which is only second in competition to 'Perfect Competition'; Monopolies and Oligopolies continually are going down in markets, and turning into more competitive markets. Oligopoly is not necessarily a bad market, and sometimes virtually must exist if a product or service to to made; most businesses do not have either the have the capital, technology, labor, or want to take the risk into going into a business with multiple multi-national businesses that have been established for a number of decades or centuries; natural oligopolies are the same problem as monopolies; they aren't a problem at all.

Monopolistic Competition? As in whom?

Perfect competition? That like a truly free market will never exist.