David Leyonhjelm watch...
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Xsess
Norm Smith Medallist
Of course it is.
Why else are manufacturing jobs going to China?
Whats the economic rationale of Australian companies outsourcing jobs to Indian call centres?
Why is it cheaper to holiday in Bali than our own backyard?
= low minimum wage
Xsess
Norm Smith Medallist
I half agree with this. To the extent of advocating a one term Labor government once a generation or so (just to keep the bastards honest)
In the race to the bottom everyone has a chance to be a winner, regardless of education/experience/training.
Xsess
Norm Smith Medallist
Nope ... and removing the minimum wage in Australia is unlikely to result in "sweat shops". With our relatively small population the law of supply would regulate wages. There would be an initial short term DROP in wages.. which would compel new business to emerge as their enterprises suddenly become economic. As these came online companies would be forced to compete for labour - and that would drive wages UP. Of course the spanner(s) in the above scenario is bipartisan "lets flood Australia with as many people as we possibly can" policies which is really about reversing wage demand... and of course you would also need a good watchdog to ensure no collusion to artificially keep wages low.
Xsess
Norm Smith Medallist
In the race to the bottom everyone loses. The great unwashed continue to vote for "enablers" parties who would provide "free stuff" to get elected (which is of course the fruits of someone elses labour). So taxes are forever ramped up against societies achievers which in turn restrictes their ability to provide the employement opportunities for others. Fewer jobs means more people reliant on "free stuff" and so societies spiral down continues.
Xsess
Norm Smith Medallist
Which would in turn provide downward pressure on wages and thus opportunities for other sharp enterprises to re-emerge - stimulating risk taking, enterprise, innovation and incentive. Productive qualities that an artificial wage mechanism deprives.
- Moderator
- #885
And causing workers in Australia to have to compete with the Chinese labor market, which they plainly cannot do.
How does this help the unskilled worker? Companies are going to continue to simply outsource labor to cheaper overseas markets, pegging the unskilled labor cost to the value of simply getting Chinese workers to do the job for them.
"It is a serious national evil that any class of His Majesty's subjects should receive less than a living wage in return for their utmost exertions. It was formerly supposed that the working of the laws of supply and demand would naturally regulate or eliminate that evil [...and...] ultimately produce a fair price. Where... you have a powerful organisation on both sides... there you have a healthy bargaining.... But where you have what we call sweated trades, you have no organisation, noparity of bargaining, the good employer is undercut by the bad, and the bad employer is undercut by the worst.... where those conditions prevail you have not a condition of progress, but a condition of progressive degeneration."
Winston Churchill MP, Trade Boards Bill,Hansard House of Commons (28 April 1909) vol 4, col 388
Xsess
Norm Smith Medallist
No they will be competing with all the world markets not just the Chinese (which we plainly can do). Churchill is right too without checks and balances the whole thing can go to s**t. I dont profess to know all the answers but it is also plainly clear that an artificial wage mechanism set too high does cost jobs and thats the worst possible outcome. In my mind industries need the opportunity to grow into their "niches", as an economy theres a point where employment prospects are maximised - and all Australians (unskilled or otherwise) prosper.
- Moderator
- #887
Yeah but the point stands. If an employer can simply outsource employment to China, then (barring State intervention) that is going to happen regardless of the minimum wage, pegging labor prices for unskilled work to a much lower ceiling.
There are checks and balances. On one hand you have wealthy corporate employers and their wielding of immense financial power lobbying conservative parties. On the other hand you have the workers ability to collectivize and form the labor movement and wield people power.
The current system sits in an equilibrium between the two.
There is considerable debate about the impact a minimum wage has on the employment figures. There is no debate that it does ensure a minimum standard of living for all employed people, and avoids things like sweat shops, and scenes from industrial England happening again.
There are better ways to create jobs (that carry less impact to the already poor) than removal of the minimum wage.
It's funny how we are the lowest taxed we've been in decades yet you seem to think that taxes are forever being ramped up. It's almost like what you are saying is in direction contradiction to reality?
- Banned
- #889
Leftists just don't get it.
Productivity is what drives wages up, we have lost our productivity to unions and regulations and the left still want more of both while demanding an even higher minimum wage. The minimum wage hurts the poor, they never get the first job and experience and are left sucking the teat of the taxpayer.
If the minimum wage is so good, why stop at $16? Why not $20? I mean, $20 is better right?
Arguments based on emotion and durrr evil corporations.
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What do leftists think of unpaid internships?
Danny Cullen
Club Legend
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Don't join.
- Oct 20, 2014
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Surely you must know when you are so wrong on an issue. Pay an Australian $23/hr minimum or pay an Asian $1 or $2/hr max. It is not a hard choice.
Xsess
Norm Smith Medallist
Disagree. There's a vanishing point where every single good or service becomes uneconomic due to the contribution of an overly high wages bill in the supply of the good or service. If wages are set above that vanishing point then eventually that industry will be outsourced to alternate competing economies wherever they are in the world. Unskilled high volume low margin enterprises are particualrly sensitive, and an artificially high minimum wage is a crucial factor in their viability.
- Moderator
- #896
Remove the minimum wage, and at what point does the employer start going back to sweatshops anyway?
When wages start to rise above $1 or $2 per hour, and it becomes cheaper to go to Asia.
Australian workers cant compete with cheap labor overseas, minimum wage or not.
What is that vanishing point bearing in mind that labor in Asia costs 50 cents an hour (or whatever it is)? Once the employer starts having to pay over that amount to his Australian workers.
Our labor market will set itself in competition with the Asian labor market. The instant it becomes profitable for an employer to outsource to Asia, they will do so. In other words, we have an external pressure that sets your vanishing point for you; the labor market of Australia is not a simple supply v demand mechanism that is isolated from external forces.
While you may very well have less people unemployed by removing the minimum wage, you will also have more people earning much less money and working longer hours in shitty jobs. As their wages increase, they lose those jobs by having them outsourced to cheaper labor markets elsewhere.
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Keep the minimum wage. Fine. However, eventually wages will have to be frozen for 5 or so years just so we can become competitive again.
I have a different approach to wages anyway. My belief is that there should not be a minimum wage or it should be a 30 to 40% lower. I would then force the private sector too pay a set percentage of revenue to its employees as bonuses, depending on the industry. This would have to be set by an independent body.
Xsess
Norm Smith Medallist
You're fixated on this asian sweatshop misnomer. Think about a humble cafe in Perth employing say.. 10 casual people. Owner has to pay penalty rates on Sunday but after crunching the numbers decides its not worth opening the doors. Ten people miss out on shifts, dont pay taxes and other businesses in the vicinity suffer because people dont like visiting a ghost town where nothing's open and you cant even get a coffee. The casual uni student, mum who's earning a few dollars on the side etc couldn't care less about the "imposition" of working on a Sunday - its just another day to them, but losing 50-odd shifts is a disaster. All because of an artificial bullshit one-size-fits-all wage mechanism. The jobs are there, the demand is there, the willingness to work is there but the economic rationale is gone.
Lose lose lose lose lose
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