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Did Minimum Wage Increases Really Kill 200K Jobs? Nope


Did Minimum Wage Increases Really Kill 200K Jobs? Nope.

Jared Bernstein

A number of folks have asked me about this article claiming that recent minimum wage increases may have “killed as many as 200,000 jobs.” In fact, based on a balanced look at the underlying data, the article could also just as easily have argued that these increases did not kill 200,000 jobs. Let me explain.


If an employer cannot pay a living wage, let the employer do the work. Economic models have become Procrustean Beds, killers of people, and alternative outlooks on reality. People should be able to arrange how they lead their lives without the contraint of these artificial monsters. Politics trumps economics, politics determines the economy, not the other way round.


During Slavery years 100 percent of slaves had jobs. Even the children were "gainfully employed" and that "owner class" were sure making a lot of gains off that labor. I guess this proves wages themself are a job killer.


Right on brother! I'd recco your comment 10 times if I could.

Jared Bernstein, who is a Ph.D. in social welfare (whatever the fuck that is) from Columbia University isn't an economist, though he plays one in administrations and in columns. Dr. Bernstein was VP Joseph Biden's chief economist and as far as one can tell had exactly zero effect on promoting policies to directly help the working class, elderly and poor. His only claim to respectability is his friendship with a real economist, Dean Baker of cepr.net.

Dr. Bernstein is perhaps most well known for his full-throated support for backdoor Social Security benefit cuts using the chained CPI to calculate cost of living adjustments. The most despicable aspect of his advocating benefit cuts was that it was all horse trading for him without a whit of concern for the elderly people affected by those cuts. He argued that the SS benefit cuts were coming anyway and the Obama Administration might as well get something in return for them.

Last, everyone should know that Dr. Bernstein was previously and is now at www.cbpp.org. This nominally progressive think tank that includes Robert Greenstein, Dr. Bernstein and at one time Henry Aaron. They all supported Social Security benefit cuts.

I would just like to echo waltd0411's comment and second that Dr. Bernstein's type of tripe belongs at Huffpo and not on a supposedly progressive, non-profit website.


It certainly possible. The Incan Empire had a system with no wages or money.

That said the point of labor and a wage is not so that certain people could be made rich. It is not so that the investor class can make a return on their investment. it is not so that unemployment levels could be kept high or low. Ultimately these are all created data points used to justify what is in fact an artificla system.

It is so people can EARN what is needed to live with dignity iside of a society. If a system can not do that than what is its purpose?

7.25 an hour does not allow that nor does a wage that is even lower.


No. Your entire respose is just describing the system as currently designed. It does not have to be that way. It was designed in such a fashion to ensure one group of people remained at the apex of pwoer. Nothing more.

All you are doing is defining Capitalism and how the so called "free market" is supposed to work. Big deal .It is a created system. It like arguing of the need for nine innings 3 strikes and 4 walks to a person who is talking about a hockey game.


Republican arguments are obtuse (Walt). Yes indeed.

It's relevant to learn that Bernstein supported the Social Security benefit cuts (Stewart).

But the "complex dynamic" (Walt) is only relatively complex.

Contrary to what Suspira says, paying minimum wage across the board has been, via faulty Republican logic, employed so that "certain people could be made rich."

But let's move along to another elephant in the room...the big one.

"Walmart spends a sizable portion of its profits—$6.6 billion in 2013—on share repurchases that benefit an increasingly narrow group of owners and executives." Catherine Ruetschlin, Amy Traub June 2014 http://www.demos.org/publication/higher-wage-possible-walmart-2014-update

Looking at the set of all deleterious buy-backs across the land and the significant stock owners...we translate the "narrow group" as the top 5%.

"Walmart employs 825,000 workers who earn less than $25,000 per year, wages that leave many of the company’s workers and their families below the poverty line. Redirecting current investment in share repurchases toward human capital could mean a raise of $5.13 per hour for this low wage workforce. The results would be a significant raise in living standards for hundreds of thousands of households and an increase in US sales growth for the company."


Exactly. We have mountains of evidence that the "free market" is anything but. A favorite trope of neoliberals, corporate capitalists, etc is that "small business" is the bedrock of America. Meanwhile these same protagonists do everything in their power to crush small business. A good treatment from some time ago is JK Galbraith's Economics And the Public Purpose.

In the manner and style of Chomsky and Hermann, Galbraith explained how two separate economies have evolved. Those of great size, wealth, and power who are able to "control" the externalities they are subject to. This is the "planning model" or the "planning economy." Their size and consequent influence allows them to control those factors that affect their profitability and continued growth. Everyone else, including small business and the lone or individual entrepreneur are subject to, beyond their control, the formalized or unspoken climate created by those in the planning economy. Or, in other words, all those not part of the "planning model" are the ones who are subject to the "free market." The economic survival of great masses of wage slaves, or the small business person or lone entrepreneur is dependent in large part on the willingness for self-exploitation.

The only true purpose of this discussion of minimum wage is to deflect attention away from the fundamental injustices of unregulated capitalism.


Yes, the actual dynamics are obfuscated. But until we can explain them to followers of the deficit hawks, the latter will prevail. Just the tangents here in these comments demonstrate IMO how far we are from this goal.

I'm reluctant to mention both my fav economists in one comment. But I'll mention one. Really don't think Jack Rasmus has any idea how to promote his break-downs. The titles look like specialized treatment of specialized topics...had to go back to "page 4" to find a title the generally curious might want to click [at least PRN should feature at the top of their archive more palatable titles of his].

"How the Rich Get Richer in America" 4/25/15

up to date archive


Precisely. These champions of the "Free market" are seriously deluded and repeate the same talking points over and over, As example the claim that "A wage is money paid to have something done you do not want to do yourself" I mean duh?

That is JUST the perspective of the person with MONEY.

The Waltons do not want to do the work of stocking shelves or standing on their feet for 10 hours a day as even bathroom breals monitored so they pay someone else to do it. WHY would a person WANT to do that? WHY would a person WANT to clean another persons toilet.

It to earn enough MONEY to get enough to eat or pay rent or afford an education. If they had that MONEY they would not do that job so in order for this stupid system to work a large group of people have to be kept impoverished and desperate for an income.

There another meme these chapions of the "free market" and its legions of "econonomists" advance as well and it the same one the poster throws out there. That being the suggestion that the economy a natural thing having no "purpose".
The economy is a creation of human society and can be shaped for whatever purpose the society and those in power deem is required.

In the case of Capitalism , that form of economy has been developed to keep one small group wielding all the power and acquiring the bulk of a societies wealth as others work on their behalf. It to keep the dominator model intact.


It's not deflection in my mind. In Bernstein's I can't say. Below are more thoughts re the Walt/beantime exchange.

It's sort of like gnosticism. There are the general doctrines, but then there are the more "correct" and enlightened refinements.

At the bottom Republicans actually believe social outlays are too extravagant, and that government is binding free enterprise. They believe if the world could see the thought-dreams of our captains of industry, they'd STILL want to emulate America (especially in that case). Then you have liberals who are aware that corporate welfare in America isn't about making "things" and more projects. They believe China and Russia are winning hearts and minds...with industry and projects (at least some jobs). Then there are the ecologically minded. Personally, I tend to say forget the Google cars, and let's go with moderate industries that employ. The cotton industry for example (without slave labor & without ground water...I know, bad history)...from plants to gins to garments. Medical marijuana (we could even export that commodity).

But now contrast this article from Counterpunch with the spot on Democracy Now.

"The IMF Changes its Rules to Isolate China and Russia"

Ecuador opens Chinese owned copper mine

There are principles we need to talk about and get squared away. Whether it's arbitrary or not, the system doesn't just exist in minds. It's not artificial...to the extent that the players play by its rules. The powers that be accept huge multinational industrial employers as natural; they're locked into an old mode of thinking and refuse to entertain the logic of local production, which is superior in terms of its carbon footprint. They refuse to think in terms of returning to smaller farms and organic farms. In the name of big biz which is supposed to be free [enterprise] they actually are embracing what amount to totalitarian approaches everywhere you turn. They refuse to think in terms of renovation and repair. They refuse to think in terms of HUMANE care for the sick...turning even this endeavor into a low-staffed, high profit phenomenon. Even in software, they conceive that armies of ill-paid customer service reps are "normal" (and the "work" normal too) as opposed to logical software. The same for the armies that sell items like Enron's electricity futures. They refuse to think in terms of participatory economics.


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If a large or small business can't pay a given region's basic living wage for necessities like food, shelter, clothing and healthcare they should be encouraged to leave the aforementioned region. And, go where they promise to create 2 million low paying, shit jobs like Gov. Perry ( R ) Texas, bragged about .The theory of what is a living wage should start with the likes of Mr. Bernstein, Mr. Krugman and any other deadbeat academic shill living on $15.00 an hour/ 40 per week in NYC for 12 months; with no ( absolutely ) help from Mommy, Daddy, the State of New York or the Feds. Then, these tenured chumps and their lackey friends can tell us how that's working out for them. They can keep a journal about what rent, utilities, taxes, healthcare, food, transportation, fees, et al cost. And, then tell us all about their fat savings account, 401K and the 10 days they spent in Europe, on vacation, studying the correct preparation of freshly shot rabbit ( Country French ) in Provence. Or, they can pen an editorial, to be published in the Sunday NY Times, about the true meaning and implications of the old phrase, " Eat the Rich ".