> Today, you’re either above the API or below the API. You either tell robots what to do, or are told by robots what to do.
It seems like we're returning to a state of inequality seen for most of history, and the second half of the 20th Century was just a historical anomaly. See PG's essay: http://www.paulgraham.com/re.html
> Which in turn means the variation in the amount of wealth people can create has not only been increasing, but accelerating. The unusual conditions that prevailed in the mid 20th century masked this underlying trend.
Inequality is actually continuing to shrink, but it's being redistributed in a way that makes it keenly visible, because the "new losers" are typically the people who held control of the discourse before.
Over 500M people have been lifted into the middle-class in China alone, with similar stories in India, Eastern Europe, and parts of Africa and the Middle East. It's just that this rise has largely come at the expense of the American middle class, which was the prime audience and prime producer of media for most of the late 20th century. So if you look only at the universe of people who were given a voice in the late 20th century, things are much worse than they were. If you look at the universe of all humans (or the small subset of Americans who work in industries benefitting from globalization), things are much better, both in terms of output and in inequality.
Interesting. But it's due to statements like "you’re either above the API or below the API" that I unfortunately can't get through many ribbonfarm articles. I mean, it's clearly not true that "everyone works for an algorithm" (take architects as a trivial example). I keep having to force myself find a strong-man interpretation of all the half-baked ideas, which makes it exhausting to get through without becoming a bit annoyed.
One difference is the old inequality meant the poor people lived short miserable lives, starving to death or dying from disease.
Today's inequality means poor people have a climate controlled place to live, regular food, decent healthcare, the ability to travel across the nation if not the world, see and communicate around the world in a moments notice, easy access to knowledge at their fingertips that spans all human civilization, endless amounts of entertainment, and freedom to live as they please.
It's unclear to me why this kind of inequality is a bad thing, or how it is comparable to inequality in the past.
My office is based on a very uninspiring,private road,which among others,has a police station,UPS, post office, a couple of construction companies,music studio,law firm, recycling centre, furniture company and BMW centre. The road looks like crap,zero glamour.. There's a little cabin in the middle of the road- that's where the owner of the street is based.It looks like a cabin of a ticket inspector,while in fact it's the home for nearly 20 companies the guy has.The only clue is plenty of luxurious cars parked outside. 100 meters further,anothet shabby office,which turns out is the home of a nearly £30Million company,again the only clue are very expensive cars outside the office.Next to our office,is so called dark kitchen,which makes food for multiple restaurants listed on Deliveroo. Since they moved in, the road is always packed with mainly asian guys on scooters collectind meals for delivering.They all look overworked,tired and simply miserable. Makes such a contrast when you see all those Ferraris parked on the opposite side of the road...
You are describing an authentic dystopia. Technology promise was to work for humans. Now we are working for algorithms that push us to our human limits. It needs to change as it is nos sustainable in the long term. It just produces big profits in the short term. And, that is why is so difficult to stop.
Yeah. Promises that "The future is going to be amazing" has been used time and time again throughout history to get people to accept going through troughs (of sorrows), waiting for futures that never come (or come only after they've entered retirement age). Can't believe we're falling for it again.
Those Asian guys on scooters save all of their money, then perhaps use that money to start a small shop or restaurant, then they buy some real estate, then in less than a generation their kids end up at Harvard.
Look at the Vietnamese immigrant story in the United States after the Vietnam war.
> Vietnamese overall have higher incomes compared to the total foreign- and native-born populations. In 2017, households headed by a Vietnamese immigrant had a median income of approximately $63,200, compared to $56,700 and $60,800 for all immigrant and U.S.-born households, respectively.
Further, in 2017, some 11 percent of Vietnamese families were living in poverty, a lower rate than for immigrant families overall (14 percent).
Perhaps we should ask why there are so many “overworked and simply miserable” Asians compared to “native” born people who are more content to be underworked and living on the public dole, relatively speaking. The ability to work very hard and ultimately create a better life is at the heart of the immigrant experience. Rather than viewing that scene as a dystopia, we should view it as inspiring. Anyone with a work ethic and could also one day own a fancy car. It happens literally every day and at least in the US, the data supports it. Look at the success of the Vietnamese in the US compared to the success of other demographics. To top it off, in the US at least, most Vietnamese arrived with nothing, not even more than a few words of English and they turned it into a success story — and they did it without whining about politics or “inequality;” they just worked their asses off without complaint. They look “overworked, tired, and simply miserable,” because they are — but they understand that nobody owes them anything; if they are to be successful, they have to earn it with their own sweat and sacrifice.
Some see misery, others see possibility. These guys on scooters don’t see themselves as victims like the more “enlightened” among us would suggest they are.
While it's depressing, what alternative is there? No expensive cars for anyone? Should entire industries of engineers and designers making these artful creations be put out of business because you and I (and most of the people working on them) won't be able to afford one ourselves?
Income disparity is natural. Regulation to prevent people from exploiting the system into higher income is good, but we'll never be able to make it so that the delivery driver and the corporate executive have the same standard of living, unless that standard is consuming gruel in a formless concrete cube somewhere.
Tech companies are allowing people to make money where before they couldn't. I was poor once. It would have been freaking awesome to be able to deliver some food or drive someone somewhere to make a couple of bucks, the alternative was sitting around making zero bucks. This sentiment is shared with nearly every Uber driver I speak to about it. They are happy for the opportunity to make money in their spare time.
Technology enabled this and it's a good thing. People who say otherwise probably have never been poor and bereft of any option to make money.
If you're poor and desperate, you're probably also agreeing to devalue your own time. If you feel that netting $3/hr is a good deal, because it's better than $0, that's one thing - but you're also enabling this thing to be generalized to others.
This is rampant in the creative world. Hungry and desperate musicians racing to the bottom, because getting paid _anything_ over nothing is "better". What happens is that they're devaluing the whole industry, and suddenly "paid in exposure" is a thing.
I understand that being poor can be hard, and short-term fixes can be tempting; But people need to see the whole picture.
This is a good take, for sure. The problem comes in when people start to look at these gig-economy roles as though they're "jobs", when they're not - they're a new thing occupying a new niche, and while you can cobble them together to make job-like money, it's not at all the same thing, and it probably wouldn't work if you tried to make it like a job.
Food delivery isn't creating a "vast digital underclass."
Companies like GrubHub pay their delivery drivers the way you'd expect them to be paid and local pizza places and chinese restaurants have been profitably doing food delivery for decades.
There are certainly good examples of technology disrupting the current labor market in ways that take advantage of people, but DoorDash being shitty isn't really one of them.
There is more to this than just economics. I worked as a delivery driver for a pizza place while at uni. I loved it, the driving was fun, but more than that I loved the shop.
The kitchen and wait staff were great fun. We worked in the kitchen in dead spots, we knew that business, we were actually employees.
Now I look at uber eats drivers and see people who are disenfranchised. The flexibility inherent in these models doesn't just create financial insecurity, it also creates social insecurity.
Paying the going rate is one thing, but shoving business expenses (fully or partially) on your "contractor" is another thing - and also a central point in the new "side hustle" economy.
Every time I see a hit piece on "big tech" from an established journalism entity like a newspaper or magazine I just consider who used to be the main ad-delivery mechanism and who the main one is now.
I think part of the friction is the "disruption" part; a lot of the tech culture is exclaiming how they are going to change the world and show off their responsibility by only buying desks made out of reclaimed plastic or whatever, so when such "socially-conscious" companies actually end up not disrupting shit and instead do business as usual it irritates people to call them out on their hypocrisy.
True, there have been crappy pizza delivery jobs for long, long time now. It's likely an industry worth billions of dollars, and has been for decades as you state.
But, to my knowledge, no one has gone after Pizza Hut and the like for creating that underclass. (If people have gone after them then I was honestly unaware of it.)
There's a huge qualitative difference between individual local restaurants having delivery drivers working cheap and a quasi-monopolist doing the same thing.
The exact same issue is happening in Barcelona with Glovo, Deliveroo, etc. Workers are not protected by labor rights, because they are employed as freelancers. They are working for these gig-companies effectively like delivery personnel since before this loophole existed. But they lose protections like unemployment, against being fired at will, payed vacations, minimum wage, wage rigging.
Recently a "Glover" was killed in a traffic accident. The company is not even bound to give them a life insurance, like regular companies that employ delivery personnel.
The most annoying part of everything changing so fast is how hard and slow it is to analyze, make sense of, and actually get to the bottom of things and what should be done about them. Like, even if we do figure out if Uber etc is good for the people in a utilitarian sense, then the next thing will come and make it our sense-making apparatuses all haywire again, getting us back to square one.
I thought this was going to be about how the tech industry is dumbing down interfaces and creating a class of people who don't know how to use a URL or a file. Hopefully someone will write that article soon.
I'd like something to point to next time I have to explain the difference between a domain name and a search query.
> The Tech Industry Is Building a Vast Digital Underclass
It'd change this title to "capitalism is building a vast digital underclass". Decisions are carried out by algorithms, but made by people. All "the tech industry" is doing is optimizing capitalism with new methodologies, but at the end of the day it's the same incentives that build the systems in the first place.
This has been studied and known for a while: economists have speculated that capitalism would invariable result in a vast underclass with concentration of capital in a small portion of the population.
Let's not blame this or focus exclusively on the tech industry: the current wave of hate towards tech isn't but the realization that tech companies are businesses too, and so will do what they need to do to grow the business as much as possible and extract capital for the gain of their investors.
Rent-seeking Capital is building the Vast Digital Underclass not "The Tech Industry".
What new tech did Uber/Uber-Eats, Doordash, Task-Rabbit create? They used Venture Capital to centralize industries which previously had distributed ownership/profits amongst small businesses, leveraging cheap capital to undercut their competition.
Then when you consider Walmart replacing small shops, or McDonalds replacing burger joints, you realize the problem is unregulated Capitalism, not "The Tech Industry".
This article is just a thin veil around advocacy for an $15 minimum wage, which is typical nonsense peddled by well-meaning people that simply don't understand economics well enough to be writing for a prestigious paper.
I understand the sentiment, but the problem is that a rising minimum wage is guaranteed to result in rising prices for staple products, while the majority of the people purchasing them aren't earning any more.
Facile example: as a middle class guy, I can pay $5 for a box of blueberries and just have them in the house. $10 pushes it to be a treat that I would buy ten times less often. $20 makes it a luxury I buy once a year at most.
If we increase the minimum wage, and fight for people working illegally under the table for less than the minimum (which has to be part of the plan if you intend to have any honesty in your approach), the result is necessarily that the price of blueberries will rise. If this pushes the cost of blueberries to the point where normal people won't buy them anymore, the business model becomes unsustainable.
As the wage rises, during the process, we'll see worker conditions deteriorate, an increased turn to illegal labour (and a commensurate demand for illegal immigrants to do it, which furthers that problem), and eventually either farms folding, changing crops to something more profitable, or perhaps subsidies coming in. Of course, we should have learned from corn what happens when we oversubsidize crops; at the very least price discovery is somewhat removed from the market and so things are priced cheaply that shouldn't be, people overconsume while tax dollars make up the difference, etc. One can probably argue that staple crops (wheat, etc) should be subsidized, but blueberries aren't quite as critical, are they?
To make an example more germane to this particular issue: if the minimum wage increases and all of the people involved in the chain leading to these food delivery drivers costs too much, when the potential consumer sees that ordering food is simply too expensive for them, they'll just give up. Entire industries that function because intelligent people have carefully budgeted around wages and expenses to eke out a living will be negatively impacted, and parts of them will fail.
And yet, we'll survive it. But let's not kid ourselves: the standard of living for the poor isn't going to get any better by changing this number. Instead, what happens is that the middle class effectively earns less (try calculating your salary as a function of the minimum wage - if you made 3x before, maybe you make 2.5x now; if you made 1.25x before, maybe you make 1x now....) while the rich don't even notice the change. For brief periods of time while the market settles, those at the minimum wage line will have an advantage, but once the price of goods and services finishes rising to compensate, it's back to square one. The purchasing power of the dollar simply drops to match.
The math works out fine if you think about it. Here's an example.
The costs to make a burger at McDonald's include property taxes/rent, food costs, utilities, other things, and labor. Labor is only one part of it. If a burger costs $1, and labor is 50% (very generous estimate), and minimum wage doubles, the burger now costs $1.50. Now at the end of a 4 hour shift the employee now has, say minimum wage rose from $7 to $14, $56 instead of $28. If they were going to spend that all on burgers, they used to be able to buy 28/1=28 burgers, while now they can buy 56/1.5=37 burgers.
So even with extreme examples, the minimum wage worker comes out ahead here. People who made more before can buy a bit less now but it's not as drastic as it's made out to be.
You might want to double-check your perspective here - a lot of these assumptions are overstated or just incorrect, and the effect of raising wages is well studied, no need for guesswork.
> as a middle class guy, I can pay $5 for a box of blueberries and just have them in the house. $10 pushes it to be a treat that I would buy ten times less often. $20 makes it a luxury I buy once a year at most
I planted a row of blueberry bushes 10 years ago. I now have essentially infinite blueberries when they are in season. I invite all friends, coworkers, and neighbors to come and take as much as they want each year. Most of them gift me things they grow or make in return at various times.
Blueberries are highly seasonal and perishable. It's not surprising at all that they cost a lot for fresh not frozen at the supermarket.
Fortunately blueberries are close to being a weed and require virtually no care to flourish.
As the price and demand increases more will be planted in backyards.
well-meaning people that simply don't understand economics
More like 'have surprising insights and arguments about economics that I don't wish to engage with.' I have really had it with people who know a little bit of economics lecturing everyone else, it's like listening to someone dismissing calculus because they only know about arithmetic.
> Facile example: as a middle class guy, I can pay $5 for a box of blueberries and just have them in the house. $10 pushes it to be a treat that I would buy ten times less often. $20 makes it a luxury I buy once a year at most.
Minimum wage is $7.25 so $15 would double the wage cost worst case. The price raising to $10 due to that makes two incorrect assumptions: 100% of the cost is labor and blueberry price is determined by the supply side cost. There is no world that doubling the minimum wage result results in quadrupling the blueberries to $20 in your example.
In reality labor costs from the farm to the market are at most 10% (rice in 2018 was 3%) assuming no profit margin from there to purchasing from the store you could have at most a 5% increase in prices caused directly by this rise. And that assumes everyone is paid minimum wage. BTW a random search points to the average wage of a blueberry picker being $16 which is already over the $15 mark.
> fight for people working illegally under the table for less than the minimum (which has to be part of the plan if you intend to have any honesty in your approach)
I don't know why we have to mix the two, either can be done on their own.
> If this pushes the cost of blueberries to the point where normal people won't buy them anymore, the business model becomes unsustainable.
To reiterate the price of blueberries isn't based on their costs, it is based on how much people are willing to pay for blueberries.
> As the wage rises
You do realize that 75% of US workers make more than $15/hr right? And that the bottom 25% makes the smallest impact on the economy due to making the least right?
> And yet, we'll survive it. But let's not kid ourselves: the standard of living for the poor isn't going to get any better by changing this number.
Only in your weird economic world where you have decided that the cost of everything is decided purely on the minimum wage.
You are predicting the outcome that was the start of your argument. "If everything goes up because minimum wage goes up there is no point in raising the minimum wage" however you totally failed to make any effort to prove your point beyond if people make more things cost more. While true in an absolute sense it is not at all a 1:1 relationship that you have decided it is with no references.
> try calculating your salary as a function of the minimum wage - if you made 3x before, maybe you make 2.5x now; if you made 1.25x before, maybe you make 1x now....
So if we halved the minimum wage my cost of living will go down by half?
> For brief periods of time while the market settles, those at the minimum wage line will have an advantage, but once the price of goods and services finishes rising to compensate, it's back to square one.
You have put zero effort to show that this is a true statement yet you keep repeating it.
It's OK we'll get minimum guaranteed income as long as we don't question anything they want to do. No doubt they will be benevolent overseers, like great chairman Kim.
[+] [-] gringoDan|6 years ago|reply
> Today, you’re either above the API or below the API. You either tell robots what to do, or are told by robots what to do.
It seems like we're returning to a state of inequality seen for most of history, and the second half of the 20th Century was just a historical anomaly. See PG's essay: http://www.paulgraham.com/re.html
> Which in turn means the variation in the amount of wealth people can create has not only been increasing, but accelerating. The unusual conditions that prevailed in the mid 20th century masked this underlying trend.
[+] [-] nostrademons|6 years ago|reply
Globally, income inequality is at historic lows:
https://ourworldindata.org/global-economic-inequality
Over 500M people have been lifted into the middle-class in China alone, with similar stories in India, Eastern Europe, and parts of Africa and the Middle East. It's just that this rise has largely come at the expense of the American middle class, which was the prime audience and prime producer of media for most of the late 20th century. So if you look only at the universe of people who were given a voice in the late 20th century, things are much worse than they were. If you look at the universe of all humans (or the small subset of Americans who work in industries benefitting from globalization), things are much better, both in terms of output and in inequality.
[+] [-] tw1010|6 years ago|reply
[+] [-] Alex3917|6 years ago|reply
https://www.wired.com/2011/07/douglas-rushkoff/
[+] [-] yters|6 years ago|reply
Today's inequality means poor people have a climate controlled place to live, regular food, decent healthcare, the ability to travel across the nation if not the world, see and communicate around the world in a moments notice, easy access to knowledge at their fingertips that spans all human civilization, endless amounts of entertainment, and freedom to live as they please.
It's unclear to me why this kind of inequality is a bad thing, or how it is comparable to inequality in the past.
[+] [-] cosmodisk|6 years ago|reply
[+] [-] kartan|6 years ago|reply
[+] [-] tw1010|6 years ago|reply
[+] [-] briandear|6 years ago|reply
Look at the Vietnamese immigrant story in the United States after the Vietnam war.
https://money.cnn.com/2016/08/12/news/economy/thuan-pham-ref...
https://learningenglish.voanews.com/a/former-vietnamese-refu...
> Vietnamese overall have higher incomes compared to the total foreign- and native-born populations. In 2017, households headed by a Vietnamese immigrant had a median income of approximately $63,200, compared to $56,700 and $60,800 for all immigrant and U.S.-born households, respectively.
Further, in 2017, some 11 percent of Vietnamese families were living in poverty, a lower rate than for immigrant families overall (14 percent).
https://www.migrationpolicy.org/article/vietnamese-immigrant...
Perhaps we should ask why there are so many “overworked and simply miserable” Asians compared to “native” born people who are more content to be underworked and living on the public dole, relatively speaking. The ability to work very hard and ultimately create a better life is at the heart of the immigrant experience. Rather than viewing that scene as a dystopia, we should view it as inspiring. Anyone with a work ethic and could also one day own a fancy car. It happens literally every day and at least in the US, the data supports it. Look at the success of the Vietnamese in the US compared to the success of other demographics. To top it off, in the US at least, most Vietnamese arrived with nothing, not even more than a few words of English and they turned it into a success story — and they did it without whining about politics or “inequality;” they just worked their asses off without complaint. They look “overworked, tired, and simply miserable,” because they are — but they understand that nobody owes them anything; if they are to be successful, they have to earn it with their own sweat and sacrifice.
Some see misery, others see possibility. These guys on scooters don’t see themselves as victims like the more “enlightened” among us would suggest they are.
[+] [-] core-questions|6 years ago|reply
Income disparity is natural. Regulation to prevent people from exploiting the system into higher income is good, but we'll never be able to make it so that the delivery driver and the corporate executive have the same standard of living, unless that standard is consuming gruel in a formless concrete cube somewhere.
[+] [-] malvosenior|6 years ago|reply
Tech companies are allowing people to make money where before they couldn't. I was poor once. It would have been freaking awesome to be able to deliver some food or drive someone somewhere to make a couple of bucks, the alternative was sitting around making zero bucks. This sentiment is shared with nearly every Uber driver I speak to about it. They are happy for the opportunity to make money in their spare time.
Technology enabled this and it's a good thing. People who say otherwise probably have never been poor and bereft of any option to make money.
[+] [-] TrackerFF|6 years ago|reply
This is rampant in the creative world. Hungry and desperate musicians racing to the bottom, because getting paid _anything_ over nothing is "better". What happens is that they're devaluing the whole industry, and suddenly "paid in exposure" is a thing.
I understand that being poor can be hard, and short-term fixes can be tempting; But people need to see the whole picture.
[+] [-] core-questions|6 years ago|reply
[+] [-] RandallBrown|6 years ago|reply
Companies like GrubHub pay their delivery drivers the way you'd expect them to be paid and local pizza places and chinese restaurants have been profitably doing food delivery for decades.
There are certainly good examples of technology disrupting the current labor market in ways that take advantage of people, but DoorDash being shitty isn't really one of them.
[+] [-] healsjnr1|6 years ago|reply
The kitchen and wait staff were great fun. We worked in the kitchen in dead spots, we knew that business, we were actually employees.
Now I look at uber eats drivers and see people who are disenfranchised. The flexibility inherent in these models doesn't just create financial insecurity, it also creates social insecurity.
[+] [-] TrackerFF|6 years ago|reply
[+] [-] twalla|6 years ago|reply
[+] [-] tomatotomato37|6 years ago|reply
[+] [-] bilbo0s|6 years ago|reply
But, to my knowledge, no one has gone after Pizza Hut and the like for creating that underclass. (If people have gone after them then I was honestly unaware of it.)
[+] [-] anigbrowl|6 years ago|reply
[+] [-] the_gipsy|6 years ago|reply
Recently a "Glover" was killed in a traffic accident. The company is not even bound to give them a life insurance, like regular companies that employ delivery personnel.
[+] [-] jonhendry18|6 years ago|reply
[+] [-] tw1010|6 years ago|reply
[+] [-] foobarbecue|6 years ago|reply
I'd like something to point to next time I have to explain the difference between a domain name and a search query.
[+] [-] aylmao|6 years ago|reply
It'd change this title to "capitalism is building a vast digital underclass". Decisions are carried out by algorithms, but made by people. All "the tech industry" is doing is optimizing capitalism with new methodologies, but at the end of the day it's the same incentives that build the systems in the first place.
This has been studied and known for a while: economists have speculated that capitalism would invariable result in a vast underclass with concentration of capital in a small portion of the population.
Let's not blame this or focus exclusively on the tech industry: the current wave of hate towards tech isn't but the realization that tech companies are businesses too, and so will do what they need to do to grow the business as much as possible and extract capital for the gain of their investors.
[+] [-] tj-teej|6 years ago|reply
What new tech did Uber/Uber-Eats, Doordash, Task-Rabbit create? They used Venture Capital to centralize industries which previously had distributed ownership/profits amongst small businesses, leveraging cheap capital to undercut their competition.
Then when you consider Walmart replacing small shops, or McDonalds replacing burger joints, you realize the problem is unregulated Capitalism, not "The Tech Industry".
[+] [-] core-questions|6 years ago|reply
I understand the sentiment, but the problem is that a rising minimum wage is guaranteed to result in rising prices for staple products, while the majority of the people purchasing them aren't earning any more.
Facile example: as a middle class guy, I can pay $5 for a box of blueberries and just have them in the house. $10 pushes it to be a treat that I would buy ten times less often. $20 makes it a luxury I buy once a year at most.
If we increase the minimum wage, and fight for people working illegally under the table for less than the minimum (which has to be part of the plan if you intend to have any honesty in your approach), the result is necessarily that the price of blueberries will rise. If this pushes the cost of blueberries to the point where normal people won't buy them anymore, the business model becomes unsustainable.
As the wage rises, during the process, we'll see worker conditions deteriorate, an increased turn to illegal labour (and a commensurate demand for illegal immigrants to do it, which furthers that problem), and eventually either farms folding, changing crops to something more profitable, or perhaps subsidies coming in. Of course, we should have learned from corn what happens when we oversubsidize crops; at the very least price discovery is somewhat removed from the market and so things are priced cheaply that shouldn't be, people overconsume while tax dollars make up the difference, etc. One can probably argue that staple crops (wheat, etc) should be subsidized, but blueberries aren't quite as critical, are they?
To make an example more germane to this particular issue: if the minimum wage increases and all of the people involved in the chain leading to these food delivery drivers costs too much, when the potential consumer sees that ordering food is simply too expensive for them, they'll just give up. Entire industries that function because intelligent people have carefully budgeted around wages and expenses to eke out a living will be negatively impacted, and parts of them will fail.
And yet, we'll survive it. But let's not kid ourselves: the standard of living for the poor isn't going to get any better by changing this number. Instead, what happens is that the middle class effectively earns less (try calculating your salary as a function of the minimum wage - if you made 3x before, maybe you make 2.5x now; if you made 1.25x before, maybe you make 1x now....) while the rich don't even notice the change. For brief periods of time while the market settles, those at the minimum wage line will have an advantage, but once the price of goods and services finishes rising to compensate, it's back to square one. The purchasing power of the dollar simply drops to match.
[+] [-] jimmaswell|6 years ago|reply
The costs to make a burger at McDonald's include property taxes/rent, food costs, utilities, other things, and labor. Labor is only one part of it. If a burger costs $1, and labor is 50% (very generous estimate), and minimum wage doubles, the burger now costs $1.50. Now at the end of a 4 hour shift the employee now has, say minimum wage rose from $7 to $14, $56 instead of $28. If they were going to spend that all on burgers, they used to be able to buy 28/1=28 burgers, while now they can buy 56/1.5=37 burgers.
So even with extreme examples, the minimum wage worker comes out ahead here. People who made more before can buy a bit less now but it's not as drastic as it's made out to be.
Beyond this hypothetical, here's a study that says rising wages to $15 would only increase prices by 4%. https://www.marketwatch.com/story/raising-fast-food-hourly-w...
[+] [-] ricardobeat|6 years ago|reply
You might want to double-check your perspective here - a lot of these assumptions are overstated or just incorrect, and the effect of raising wages is well studied, no need for guesswork.
[+] [-] droithomme|6 years ago|reply
I planted a row of blueberry bushes 10 years ago. I now have essentially infinite blueberries when they are in season. I invite all friends, coworkers, and neighbors to come and take as much as they want each year. Most of them gift me things they grow or make in return at various times.
Blueberries are highly seasonal and perishable. It's not surprising at all that they cost a lot for fresh not frozen at the supermarket.
Fortunately blueberries are close to being a weed and require virtually no care to flourish.
As the price and demand increases more will be planted in backyards.
[+] [-] swiley|6 years ago|reply
[+] [-] anigbrowl|6 years ago|reply
More like 'have surprising insights and arguments about economics that I don't wish to engage with.' I have really had it with people who know a little bit of economics lecturing everyone else, it's like listening to someone dismissing calculus because they only know about arithmetic.
[+] [-] syn0byte|6 years ago|reply
Work conditions become crap? GOOD. Can't run a business without slaves in shanties tough shit. Free market right?
Product quality goes to shit because you can't afford decent employees in reasonable working conditions? GOOD. The free market in action!
Are you afraid of a free market?
[+] [-] Guvante|6 years ago|reply
Minimum wage is $7.25 so $15 would double the wage cost worst case. The price raising to $10 due to that makes two incorrect assumptions: 100% of the cost is labor and blueberry price is determined by the supply side cost. There is no world that doubling the minimum wage result results in quadrupling the blueberries to $20 in your example.
In reality labor costs from the farm to the market are at most 10% (rice in 2018 was 3%) assuming no profit margin from there to purchasing from the store you could have at most a 5% increase in prices caused directly by this rise. And that assumes everyone is paid minimum wage. BTW a random search points to the average wage of a blueberry picker being $16 which is already over the $15 mark.
> fight for people working illegally under the table for less than the minimum (which has to be part of the plan if you intend to have any honesty in your approach)
I don't know why we have to mix the two, either can be done on their own.
> If this pushes the cost of blueberries to the point where normal people won't buy them anymore, the business model becomes unsustainable.
To reiterate the price of blueberries isn't based on their costs, it is based on how much people are willing to pay for blueberries.
> As the wage rises
You do realize that 75% of US workers make more than $15/hr right? And that the bottom 25% makes the smallest impact on the economy due to making the least right?
> And yet, we'll survive it. But let's not kid ourselves: the standard of living for the poor isn't going to get any better by changing this number.
Only in your weird economic world where you have decided that the cost of everything is decided purely on the minimum wage.
You are predicting the outcome that was the start of your argument. "If everything goes up because minimum wage goes up there is no point in raising the minimum wage" however you totally failed to make any effort to prove your point beyond if people make more things cost more. While true in an absolute sense it is not at all a 1:1 relationship that you have decided it is with no references.
> try calculating your salary as a function of the minimum wage - if you made 3x before, maybe you make 2.5x now; if you made 1.25x before, maybe you make 1x now....
So if we halved the minimum wage my cost of living will go down by half?
> For brief periods of time while the market settles, those at the minimum wage line will have an advantage, but once the price of goods and services finishes rising to compensate, it's back to square one.
You have put zero effort to show that this is a true statement yet you keep repeating it.
[+] [-] droithomme|6 years ago|reply