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The main thing hurting the poor as well as the middle class in the Bay Area are housing costs.
Add more to the housing supply, and the cost of living will come down.
Or... reduce the number of people scrambling for what is already an overbuilt infrastructure.
Reduce the number a lot and all sorts of things begin to be more appealing again.
Or... reduce the number of people scrambling for what is already an overbuilt infrastructure.
Reduce the number a lot and all sorts of things begin to be more appealing again.
Oh please, these "overbuilt and overpopulated" arguments are tiresome . Better infrastructure could be built, but NIMBYs prevent it from happening, often using the environmentalist smokescreen.
As the article mentioned, SJ and SF both have minimum wages at ~$10 per hour already, which is higher than the state & federal minimums.
I am also sympathetic to the high cost of living in the Bay Area...but raising the minimum wage is a band aid solution that does nothing to solve the underlying economic problems of:
---A work force that does not have the qualifications for better paying jobs. We've known our education sucks for like 30 years now, despite spending as much or more as other developed countries do, with poor results.
--A health care system that also costs a lot but delivers mediocre/poor outcomes...be it government or privately funded...the costs have been escalating for at least 40 years now.
--Locally, we have unnecessarily high real estate prices due in part to rules & regulations put in place by NIMBYs who don't want any more development.
Of course, fixing all of these problems takes more time, energy, and creativity....so instead we go for the superficial solution that looks easy but accomplishes little and might actually be harmful.
First of all, framing opposition or criticism of rasing the minimum wage because it doesn't solve a lot of major economic problems is similar to criticizing an elephant because he can't fly. C'mon now.
But if it helps lower income workers pay their bills, put more money into the economy, make up for some of the great income inequality (it's lagged behind the CPI), it is worth considering.
As the article mentioned, SJ and SF both have minimum wages at ~$10 per hour already, which is higher than the state & federal minimums.
I am also sympathetic to the high cost of living in the Bay Area...but raising the minimum wage is a band aid solution that does nothing to solve the underlying economic problems of:
---A work force that does not have the qualifications for better paying jobs. We've known our education sucks for like 30 years now, despite spending as much or more as other developed countries do, with poor results.
--A health care system that also costs a lot but delivers mediocre/poor outcomes...be it government or privately funded...the costs have been escalating for at least 40 years now.
--Locally, we have unnecessarily high real estate prices due in part to rules & regulations put in place by NIMBYs who don't want any more development.
Of course, fixing all of these problems takes more time, energy, and creativity....so instead we go for the superficial solution that looks easy but accomplishes little and might actually be harmful.
Education doesn't really relate to the minimum wage issue. If the work force all got BA's and advanced degrees, a) there might not be enough high-end jobs to absorb them, and b) someone would still have to wait tables, wash dishes, and clean hotel rooms. What should those people be paid? The question remains, even if you educate much of the local work force.
Real estate issues do figure in, because that's mainly what's driving the need for higher wages. In Marin, there's an apartment complex that the local town bought together with an affordable-living charitable foundation, in order to provide affordable housing to people like teachers and firefighters who otherwise couldn't afford to live in the community. Maybe something like that could be part of a Bay Area-wide solution.
In Santa Fe, NM, a $10 minimum wage was instituted a couple of years ago. Some businesses closed, but the hotels certainly didn't, and they employ a lot of minimum wage people. Of the businesses I was familiar with that closed, I'd have to say they were poorly managed. With better management, they could have drawn in more clientele, and would have had enough income to pay their workers. Some people run businesses almost more as a hobby, or to serve other purposes (to have a free gathering place after hours, is a popular use in Santa Fe), and they end up closing, whether it's due to rents going up, or the minimum wage going up.
A minimum wage jump up to $20 seems a bit extreme, though.
A minimum wage jump up to $20 seems a bit extreme, though.
I don't think anyone is advocating that...sounds like a set up for a slippery slope argument. If the federal minimum wage had kept up with inflation over the last 40 years, it would be $10.67. Currently it's $7.25 as a floor; 19 states have raised it higher than that.
... but to what end?
So that the same basic issue can show up 50 years later in the new clothes of 50 or 100 million new people?
Look deeper. Look past the symptoms.
Try to solve the actual problem
There is nothing deeper in it and there is no permanent solution.
Most cities must do developments time to time forever. If we solve the problems now, then more problems will come up later. But that is natural, city development is an organic continuous process. We cant just stop, and we cant just expect to have an ultimate fix that will last forever. But that also doesn't mean that we don't have apply any fixes again. Do you go to supermarket? Do you think you could do a good shopping now (buy everything) and then never again for the rest of your life? No you have to keep doing it, just like city infrastructure development.
For the housing prices there would be things to do but all are opposed by someone. I think we discussed it many times. The UGB also has to be extended time to time. The Oregon metro authority who sets the UGB there says on their website that they expand the boundary time to time. Here in the bay area it is the plan to not expand it ever again. Somehow the nature around SV is more appreciated than the nature around other cities, I think without much real basis. Plus the foreign investors who buy homes here could be forced out of the market by local regulations. They don't live in the local community, only their money is here invested in housing. That would also help pushing home prices down. So the home prices are high for several reasons (nonresident investors in housing, NIMBYs in inner city, environmentalist UGB...). If we fix any of these it would help in housing affordability. Don't fall for the fallacy of the single cause.
First of all, framing opposition or criticism of rasing the minimum wage because it doesn't solve a lot of major economic problems is similar to criticizing an elephant because he can't fly. C'mon now.
I don't think so. Raising the minimum wage is a feel good 'solution' that acts as a distraction from solving the real economic problems that have been festering for decades
Quote:
Originally Posted by silverkris
But if it helps lower income workers pay their bills, put more money into the economy, make up for some of the great income inequality (it's lagged behind the CPI), it is worth considering.
It probably won't do that. Just look at any of the countries with high minimum wages. Business models that depend on low wages just tend to disappear. There was recently a thread in Australia about the higher cost of living there...much of it housing related, but it was also mentioned restaurants there were much more expensive than the U.S...most likely because of higher minimum wages there....Some people who lived in both places they ate out a lot less in Australia because of the higher prices...That's what happens when minimum wage goes up....the people who manage to stay employed get a pay boost....but efficiency gains and lost demand mean that others won't be employed at all. And those who remain employed end up paying more for quite a few everyday goods and services.
I remember reading another thread on CD about how they don't have home delivery of pizza Norway. It's very expensive there because of the high minimum wages...which kills demand (and employment).
Education doesn't really relate to the minimum wage issue. If the work force all got BA's and advanced degrees, a) there might not be enough high-end jobs to absorb them, and b) someone would still have to wait tables, wash dishes, and clean hotel rooms. What should those people be paid? The question remains, even if you educate much of the local work force.
That's true, but only to a point. The fact of the matter is we have a lot of people in the U.S. who aren't qualified for the more scientific type jobs that are out there. If we had more people who were qualified for those kinds of jobs, we wouldn't need to import people do to them. At the margins, a more qualified workforce means you have fewer people competing for low wage jobs, which tends to raise wages. I do agree there are a lot of people who have bachelor's degrees that aren't worth anything (economically speaking). I'm thinking of those with liberal arts degrees waiting tables. I have a liberal arts degree myself yet I hold a job that doesn't require a B.A. We need more people to study the difficult stuff.
Quote:
Originally Posted by Ruth4Truth
Real estate issues do figure in, because that's mainly what's driving the need for higher wages. In Marin, there's an apartment complex that the local town bought together with an affordable-living charitable foundation, in order to provide affordable housing to people like teachers and firefighters who otherwise couldn't afford to live in the community. Maybe something like that could be part of a Bay Area-wide solution.
If you increase the supply of reel estate, the costs are held in check....reducing the need for any special programs. Yes, I realize that's difficult to do when you have limited land area, but the Bay Area doesn't try very hard.
Quote:
Originally Posted by Ruth4Truth
In Santa Fe, NM, a $10 minimum wage was instituted a couple of years ago. Some businesses closed, but the hotels certainly didn't, and they employ a lot of minimum wage people. Of the businesses I was familiar with that closed, I'd have to say they were poorly managed. With better management, they could have drawn in more clientele, and would have had enough income to pay their workers. Some people run businesses almost more as a hobby, or to serve other purposes (to have a free gathering place after hours, is a popular use in Santa Fe), and they end up closing, whether it's due to rents going up, or the minimum wage going up.
A minimum wage jump up to $20 seems a bit extreme, though.
I do agree that a modest increase in the minimum wage can help people at the bottom...but I think it's pretty marginal. I think the emphasis should be put on looking for ways to limit the cost of living for necessities instead. We need to find ways to increase the housing stock so that supply and demand are in balance so that prices don't skyrocket. We need to find ways to hold the line on healthcare costs so that we aren't bankrupted by them (either as individuals or taxpayers). Same thing goes for education costs. Much more progress could be made if we focused on these things rather than just raising the minimum wage.
... but to what end?
So that the same basic issue can show up 50 years later in the new clothes of 50 or 100 million new people?
Look deeper. Look past the symptoms.
Try to solve the actual problem
I think buenos covered it in his first paragraph quite well.
I would add that 0 population growth or shrinking populations bring their own problems that the no growthers refuse to recognize. Much of the economic troubles in the developed countries, Europe and Japan, in particular is related to decades of low birth rates....too many old people collecting Social Security and not enough paying the taxes to support the old people on Social Security.
Life is full of difficult and unavoidable trade offs.
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. Better infrastructure could be built, but NIMBYs prevent it from happening, often using the environmentalist smokescreen.
