Liberal snobs: Evolution, critical thinking, minimum wage and economics
I'm a member of the Schenectady Torch Club. The other night one of our members spoke about the conflict between Evolution and Intelligent Design. I'm about to criticize the liberal elite for their attitudes, but I should start by saying that I fully side with Evolution in this debate.
In defense of their position on this issue, liberals quickly accuse the other side of being uneducated, and in particular of lacking the ability to engage in "critical thinking," and of failing to understand what "science" is. Now I do wholeheartedly agree that the proponents of Intelligent Design are wrong, and that their approach is unscientific and weak in the area of critical thinking.
However, many of the proponents and believers of Intelligent Design and/or Creationism are educated. I might disagree with the way in which they were educated, but they attended lots of schools and many of them have advanced degrees. So it's not that they're uneducated, but that we disagree with that education.
The real stinker here is how educated liberals turn off their own critical thinking when it comes to other issues. Our entire country seems to have lost the ability to analyze the US role in world affairs. Our self-appointed position as world cop seems to be beyond question. My view on this was called "naive" by the highly educated editorial staff of our local newspaper, the Times Union (Albany, New York).
But my favorite liberal nonsense is the issue of minimum wage. I did a post criticizing minimum wage some time ago. That post attracted more comments than any other post on this blog, or any of my other blogs.
Minimum wage is an utterly bankrupt concept from any educated point of view. The arguments for it always fall back on the underlying premise of "because I say so." It is completely unscientific. When confronted with an opponent of minimum wage, the liberal response is either to call that person "heartless", or to attempt to educate the poor, uninformed person as to why minimum wage is the right thing to do.
The liberal supporter of minimum wage will call upon a variety of arguments: $5.15 an hour is not enough for a family of four; CEOs make too much money and it's not fair; 80% of the people support a higher minimum wage; and so on.
Let's start with debunking this nonsense. I agree that $5.15 an hour is not enough for a family of four. However, most minimum wage earners are not supporting a family of four on that minimum wage, and some that are get government benefits to supplement their income. Often the minimum wage earner is a young person who lives at home with his or her parents. When I was 18 I somehow managed to get by on the $2/hour I got working at a camp, and the $3 plus I got at Dairy Queen and Burger King. Despite the criminally low rate of pay, I kept going back to work alongside my fellow high school students. Obviously I didn't realize how badly I was being exploited by The Man.
As for CEO pay, I agree that many of them make too much money. I have no idea what this has to do with minimum wage. It has a lot more to do with corporate governance, but liberal elites hate "greedy" corporations and are uninterested in boring topics like governance unless it involves the government taking over corporations and creating a socialist utopia. My favorite response to the CEO argument is to ask if they mean Bill Gates. Gates never received much salary at Microsoft. He earned (note my use of that word) most of his wealth by owning stock in the company he created. As the company grew, the value of the company grew and so did his wealth. Instead of keeping all of this wealth to himself, he encouraged his employees early on to hold stock in the company. By this approach he has pretty clearly been the greatest employer in all of history. Anyone who worked at his company from the 1980s to the mid-90s and who held onto their job for a couple years and acquired stock along the way became a millionaire. Many are worth tens of millions. Quite a few are worth hundreds of millions and three or four are billionaires.
80% of people support a higher minimum wage. So what? The same liberals will snuff at the high percentage of people who don't believe in evolution. This argument is even dumberer than the rest.
The only scientific, or quasi-scientific, field that deals with issues like minimum wage is economics. At heart, economics supports free markets. That means the government should not intervene in things like setting a minimum wage. Some jobs do not create enough value to warrant high wages, so if you set a minimum wage those jobs will not exist. If you wonder why everything is made in China, it's because labor-intensive work gets done in places where labor is cheaper. Those items would still be made in China because few people here want to work for wages as low as that, but there are some jobs that might be done here if it weren't for the minimum wage.
In economics, government intervention is sometimes warranted when there are market failures, such as pollution, asymmetric information, and monopolies. Pollution involves externalities - when I burn gasoline I create pollution that affects me and others, but I only value the cost it imposes on me so those other costs are imposed on others. Gas taxes are an excellent way to address these externalities, dating back in economics to Professor AC Pigou in the 1920s or so.
Asymmetric information creates problems in insurance markets, where people who know they are prone to sickness are more eager to buy insurance (known as adverse selection) and people who have insurance are more likely to take risks (moral hazard). Adverse selection in particular leads many economists to support regulation of insurance markets, while co-pays and deductibles are attempts to deal with moral hazard.
Let's get back to minimum wage. Where's the market failure that requires government intervention? It isn't there. The best that the liberal elites can do when challenged on the economics of minimum wage is that it doesn't cause that much harm. It doesn't raise prices much. It doesn't destroy that many jobs. If that's all you've got, you're in trouble. The market's answer to your wage being too low is to get a better job. Maybe you have to improve your skills, get a better education, or choose a different field.
Most of all, the liberals cannot answer this fundamental question: How do you determine the correct level for minimum wage? There's no economic model to answer this question. When I confront liberals with this question they run. They divert. They cower in fear (okay, I'm exaggerating now). They have no answer.
If minimum wage is wonderful, and causes no harm, why not make it $50 per hour? Will the liberals concede that at some point a higher minimum wage can cause harm? These questions demonstrate where liberals have abandoned critical thinking.
You see, people advance critical thinking as an issue for addressing other people's positions. Liberals will never subject minimum wage, trade barriers, or union issues to critical thinking. Analysis of liberal economic views destroys them. Since they cherish their do-gooder fantasies about economic policy, they won't dare surrender them to the horrors of scientific reasoning.
Gee, that was fun. I wonder what liberal or conservative bugaboo I'll turn to next. I don't know the answer myself yet, but it's coming soon. :-)
In defense of their position on this issue, liberals quickly accuse the other side of being uneducated, and in particular of lacking the ability to engage in "critical thinking," and of failing to understand what "science" is. Now I do wholeheartedly agree that the proponents of Intelligent Design are wrong, and that their approach is unscientific and weak in the area of critical thinking.
However, many of the proponents and believers of Intelligent Design and/or Creationism are educated. I might disagree with the way in which they were educated, but they attended lots of schools and many of them have advanced degrees. So it's not that they're uneducated, but that we disagree with that education.
The real stinker here is how educated liberals turn off their own critical thinking when it comes to other issues. Our entire country seems to have lost the ability to analyze the US role in world affairs. Our self-appointed position as world cop seems to be beyond question. My view on this was called "naive" by the highly educated editorial staff of our local newspaper, the Times Union (Albany, New York).
But my favorite liberal nonsense is the issue of minimum wage. I did a post criticizing minimum wage some time ago. That post attracted more comments than any other post on this blog, or any of my other blogs.
Minimum wage is an utterly bankrupt concept from any educated point of view. The arguments for it always fall back on the underlying premise of "because I say so." It is completely unscientific. When confronted with an opponent of minimum wage, the liberal response is either to call that person "heartless", or to attempt to educate the poor, uninformed person as to why minimum wage is the right thing to do.
The liberal supporter of minimum wage will call upon a variety of arguments: $5.15 an hour is not enough for a family of four; CEOs make too much money and it's not fair; 80% of the people support a higher minimum wage; and so on.
Let's start with debunking this nonsense. I agree that $5.15 an hour is not enough for a family of four. However, most minimum wage earners are not supporting a family of four on that minimum wage, and some that are get government benefits to supplement their income. Often the minimum wage earner is a young person who lives at home with his or her parents. When I was 18 I somehow managed to get by on the $2/hour I got working at a camp, and the $3 plus I got at Dairy Queen and Burger King. Despite the criminally low rate of pay, I kept going back to work alongside my fellow high school students. Obviously I didn't realize how badly I was being exploited by The Man.
As for CEO pay, I agree that many of them make too much money. I have no idea what this has to do with minimum wage. It has a lot more to do with corporate governance, but liberal elites hate "greedy" corporations and are uninterested in boring topics like governance unless it involves the government taking over corporations and creating a socialist utopia. My favorite response to the CEO argument is to ask if they mean Bill Gates. Gates never received much salary at Microsoft. He earned (note my use of that word) most of his wealth by owning stock in the company he created. As the company grew, the value of the company grew and so did his wealth. Instead of keeping all of this wealth to himself, he encouraged his employees early on to hold stock in the company. By this approach he has pretty clearly been the greatest employer in all of history. Anyone who worked at his company from the 1980s to the mid-90s and who held onto their job for a couple years and acquired stock along the way became a millionaire. Many are worth tens of millions. Quite a few are worth hundreds of millions and three or four are billionaires.
80% of people support a higher minimum wage. So what? The same liberals will snuff at the high percentage of people who don't believe in evolution. This argument is even dumberer than the rest.
The only scientific, or quasi-scientific, field that deals with issues like minimum wage is economics. At heart, economics supports free markets. That means the government should not intervene in things like setting a minimum wage. Some jobs do not create enough value to warrant high wages, so if you set a minimum wage those jobs will not exist. If you wonder why everything is made in China, it's because labor-intensive work gets done in places where labor is cheaper. Those items would still be made in China because few people here want to work for wages as low as that, but there are some jobs that might be done here if it weren't for the minimum wage.
In economics, government intervention is sometimes warranted when there are market failures, such as pollution, asymmetric information, and monopolies. Pollution involves externalities - when I burn gasoline I create pollution that affects me and others, but I only value the cost it imposes on me so those other costs are imposed on others. Gas taxes are an excellent way to address these externalities, dating back in economics to Professor AC Pigou in the 1920s or so.
Asymmetric information creates problems in insurance markets, where people who know they are prone to sickness are more eager to buy insurance (known as adverse selection) and people who have insurance are more likely to take risks (moral hazard). Adverse selection in particular leads many economists to support regulation of insurance markets, while co-pays and deductibles are attempts to deal with moral hazard.
Let's get back to minimum wage. Where's the market failure that requires government intervention? It isn't there. The best that the liberal elites can do when challenged on the economics of minimum wage is that it doesn't cause that much harm. It doesn't raise prices much. It doesn't destroy that many jobs. If that's all you've got, you're in trouble. The market's answer to your wage being too low is to get a better job. Maybe you have to improve your skills, get a better education, or choose a different field.
Most of all, the liberals cannot answer this fundamental question: How do you determine the correct level for minimum wage? There's no economic model to answer this question. When I confront liberals with this question they run. They divert. They cower in fear (okay, I'm exaggerating now). They have no answer.
If minimum wage is wonderful, and causes no harm, why not make it $50 per hour? Will the liberals concede that at some point a higher minimum wage can cause harm? These questions demonstrate where liberals have abandoned critical thinking.
You see, people advance critical thinking as an issue for addressing other people's positions. Liberals will never subject minimum wage, trade barriers, or union issues to critical thinking. Analysis of liberal economic views destroys them. Since they cherish their do-gooder fantasies about economic policy, they won't dare surrender them to the horrors of scientific reasoning.
Gee, that was fun. I wonder what liberal or conservative bugaboo I'll turn to next. I don't know the answer myself yet, but it's coming soon. :-)
posted by Albany Lawyer at 8:05 AM
7 Comments:
Thank you for this post. I try to be a moderate, but I must confess, on the issue of the minimum wage, I lean toward the left. I like your "critical thinking" approach, and I'll be following your blog.
W,
Not every teen earning the minimum wage can use it for play money while living at home with mom and dad. What about our college-bound students who have to fund their education on the minimum wage? Fair compensation for all work is a basic human right. Or is that too evolved of a concept for the GOP?
Oh, I agree that there are plenty of hypocrites on both sides of the aisle. Both sides love to skew the numbers to prove a point. However, I do support a minimum wage raise.
The way that I look at it is that a family of four with both parents working for minimum wage should be above the poverty line in take home pay. If both parents work for minimum wage for 40 hours a week for 52 weeks, the bring in a Gross of $21,424. The Poverty line according to our government is $20,000 for that family of 4. Now if you take taxes out of their gross pay, the family is under the poverty level. That is how I see it.
I appreciate the comments above, but none of them answer the underlying question as to what level of minimum wage is optimal. GCL's notion that college-bound students will fund their education on the minimum wage is pure fantasy. College education is so expensive that minimum wage would have to be $20/hour or more to get even close. Note that GCL does not put a number on minimum wage. The "human rights" argument is utterly empty. Would GCL also guarantee minimum wage to all small business owners? Who would pay them if their business failed to earn enough? I do like the evolution reference though. Took me a minute to catch that.
Brent also has a simple answer related to the poverty level, but that doesn't really answer anything.
Another general flaw in a federal minimum wage, or even a state one, is the variations across areas. The economics of New York City and its surroundings are radically different from those of Buffalo, Rochester or Syracuse. The idea that there would be one minimum wage for all of these places is a lark. And of course the number is usually set by people from places like New York City and Washington DC who don't know or care about the impact of their do-gooding on struggling small businesses and non-profits in rural areas, just like they have no grasp of the damage Medicaid is doing to these same communities.
I was reading an article in the spring that said that in Germany the minimum wage is like $31.00/hour. Of course that is before their massive tax load to support the welfare-state. The result: 144,000 people fled Germany last year to look for greener pastures in neighboring countries, the UK, US and Canada. That's not counting the business's that fled too. There’s a similar article from the other day.
http://www.spiegel.de/international/
spiegel/0,1518,446045,00.html
That goes to show you who creates poverty, it's not the free market, but the government interventions in the economy that makes people poor. Bloated bureaucracies, deficit spending, borrowing, taxes and the inevitable constant inflation that ruins the buying power of your earnings will have you forever chasing after a living wage.
So who do the modern liberals call to fix the problem? The same clowns that cause the problem in the first place. Pure genius!
We should have minimum nutrition and excercise too. After all if we're going to take care of each other why should I pay for people who smoke and eat fried food ?
Minimum auto reliabilty would be great too. Before I bought my new Toyota I ran a 91 Chevy around. Mainly because I'm self-employed, meaning I bill out at $90 an hour and never see any of it, because I'm paying taxes, insurance and a host of other state mandated items. Keep up the good work Warren . . .
Fair compensation ? Haven't you READ his article ? Since liberals can't determin what the minimum wage should be, how can YOU determin what is a FAIR compensation ? You're a hypocrit.
Look, I'm a working poor too, but what I hate is the high levels of taxation I have to endure. If it was not of the socialist taxes, I could keep more of what I make and invest it in myself and over time pull my own weight into a better situation.
But the current levels of taxes keep the poor into poverty and the rich into riches.
Stop taxing and regulating the economy and people will do better.
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