I hear this argument all the time when discussing Minimum Wage laws: “How is a person supposed to survive, making X dollars an hour?” The answer, of course is, you’re not. The idea that every single job should pay enough to support a person and his whole family, is ludicrous. Think about the last time you paid someone to do a job for you; a plumber, landscaper, painter, or whatever. Did you come to an agreement on the price based on how much money the worker needed in order to pay his bills, or did you pay him or her based on the job performed?
Some jobs pay more than others because they are simply more valuable to the person who is paying. As consumers, we love choices. We sometimes choose to buy lesser quality goods to save a little money. Sometimes, we choose more expensive goods because we find them to be worth the money. But somehow, this gets lost on those who think even the simplest jobs that require no skills at all, should have some minimum price arbitrarily set by the government. (more…)
The case against job automation never made any sense to me, and it’s always made by people who are afraid their skills will become irrelevant, as machines and software are built that can perform jobs better and faster than any human can.
I can’t think of a more selfish act than being against economic progress so that one can continue to get paid to do a job less efficiently than it could otherwise be performed by someone else–or something else. Somehow, those against job automation are never as eager to discuss progress made in the past that has undoubtedly had a positive impact on society, despite the same kind of fear-mongering they participate in today.
Inventing better and faster ways to do things allows us to spend less time focusing on some jobs and leaves us with more time to dedicate to others that cannot be automated. (more…)
The first amendment is the most well-known of all constitutional amendments. It states that the government cannot punish you for what you say, even if what you say is reprehensible.
Everyone claims to support freedom of speech, and they understand that supporting someone’s right to say what they want to say is not the same as agreeing with whatever is being said. I don’t think many Americans would support the idea that we should put in jail those who say racist things, because they understand that even jerks should have the freedom to say what they want, in a free society.
What I don’t understand is why it is so hard for many to apply the same logic to other areas. As a libertarian, I support the rights of everyone to deny service or employment to anyone, for whatever reason, even if I completely disagree with the reason, or find it reprehensible. (more…)
Ponzi schemes are named after Charles Ponzi, a con man who came to the U.S. from Italy in 1903 with just $2.51 in his pocket. By 1920 Ponzi had made millions by convincing people to invest money in his company. He promised–and for over a year, delivered–50% profit in 45 days, or 100% profit in 90 days.
He claimed the profit was coming from the buying of discounted postal reply coupons, which it took a while for many to realize, didn’t make him enough money to be able to offer such returns. In reality, what he was doing was paying previous investors with the money received from new investors.
Ponzi Schemes work as long as new investors continue to join the scheme. Consider the example below, of a scheme that offers 50% returns. To simplify, we’ll assume only one person joins the scheme per day, and that each member is promised 50% profit the very next day: (more…)
One of my favorite things about writing, is trying to come up with different ways to take a complex issue and simplify it for others to understand. I find the Minimum Wage to be one of the most frustrating topics in politics, because the most basic and important law of Economic Science–the law of Supply and Demand–already tells us exactly why setting a minimum price on labor is a bad idea.
But Economics isn’t as interesting to most as it is to me, so I wanted to come up with an example to illustrate the unintended consequences of minimum wage laws, without having to talk about supply and demand. I thought it’d be worthwhile to take a look at what the consequences would be if we were to apply minimum price laws to something we’re all familiar with.
Applying the Minimum Wage to Cars
Imagine being told that you aren’t allowed to sell your car for less than $3,000, and say you have an old car that isn’t worth more than $2,000. Would you say you would have a hard time selling it? Your $2,000 car would have to compete with nicer cars that are worth $3,000. Why would anyone buy your car for $3,000 when they can buy a car that is actually worth that much? (more…)
It seems like the more complex a political issue is, the more it gets over-simplified by the Left, who have become experts at turning everything into a black-and-white situation. Whenever they present their solution to the public, they always start with the false premise that their solution works. Rather than make the debate about which policies would actually solve the problem, they would like everyone to come to the quick conclusion that if you are opposed to their solution, you must be against any solution, and you just don’t care about the people they are trying to “help.”
If you believe minimum wage laws hurt the poor, you must hate the poor. If you don’t believe it is the government’s job to take taxpayer money and pay for everyone’s birth control pills, you must hate women. If you don’t like Affirmative Action laws, you must hate minorities. If you don’t believe in giving citizenship to illegal immigrants, you must hate immigrants. If you believe we should ID people who vote, you must be against minorities voting. If you don’t like gun control laws, you must not care about the children. If you don’t like Obama, you must be racist. (more…)
Film executive and producer Harvy Weinstein, has plans to make an anti-gun movie and take aim at the NRA. This is the same Harvy Weinstein that has produced a number of violent movies featuring the very guns that he believes “we don’t need in this country.”
This shouldn’t surprise anyone. The vast majority of Hollywood is liberal. Rather than focus on what they do best, making movies, many in Hollywood use their unique position to promote the democrats’ political agenda.
Matt Damon is known for being a huge supporter of the public school system, yet sends his kids to private school. “Ultimately we don’t have a choice,” he said. I think Mr. Damon lacks understanding of the word choice. He has the ultimate choice. He can send his kids wherever he wants, private or public. On the other hand, parents who are not fortunate enough to have Matt Damon’s income, really don’t have a choice because Damon and the unions he supports, oppose vouchers, which would actually allow those parents to pick where their kids go to school. (more…)
It’s one of the latest democratic talking points. Obama and the democrats are hoping to benefit in the 2014 elections, by bringing to the public’s awareness, the gap that exists between the income of the wealthy and that of the poor and middle class.
But why is “income inequality” even a problem? Is their ideal society one of income equality? I hope not. Income inequality is a feature of a free society, not a drawback. The fact that any man in the United States, even those born poor, have the opportunity to become richer than others, is what incentivizes them to take risks, and start businesses that provide the rest of us with the products and jobs that we need. It’s this promise that you can become rich if you can find a way to provide enough people with something that they need or want, that sparks innovation. It’s what provided the incentive for people like Steve Jobs, Bill Gates, and many others that have changed the world for the better. (more…)
Minimum wage laws are one of the best examples of the negative unintended consequences that often result from good-intention laws that end up hurting the very people they are meant to help. For those who lack the most basic understanding of economics, it may seem like common sense. If there are people who don’t make enough money, why not just pass a law requiring that they be paid more?
Labor as a good
The problem with this approach becomes obvious once we start thinking of labor as just another good that is sold on the market. When we work for an employer we are essentially selling that employer a service. Economic laws apply to this good just as well as they apply to goods like milk, meat, etc, and yet many would agree that there is no need for government intervention when it comes to the price of these other goods. (more…)
College tuition costs have been skyrocketing and the more they go up, the more the government tries to help make college more affordable. Americans owe $1 trillion in student loans, even more than they owe in credit card debt. The federal government has been involved in student loans since 1958, either by guaranteeing loans made by private banks or by giving out loans themselves. Tuition rates have been increasing at about twice the rate of inflation, and still, proponents of federal student loans have yet to connect the dots.
Their intentions are good, but the government’s involvement is precisely what has resulted in the rise of tuition costs. Why do schools continue to increase their prices every year? Because they can. The government gives the schools whatever money they ask for, because “we must help everyone get a college degree.” If the government were to give everyone money to buy computers, the price of computers would also skyrocket.