I'm from a school of economics that holds that no individual, nor any group of individuals possesses enough skill, foresight or the knowledge necessary to guide or centrally plan any economy. This is because economic behaviour is that behaviour which occurs amongst individuals seeking to maximise the satisfaction of their needs and desires ie profit (whether that be monetary, spiritual, ethical etc). For anyone or any group to lay claim to possessing the capacity to best provide a centrally planned market economy that would meet the needs of of all individuals is an absurdity. So it's not only a waste of time attempting to centrally plan, it's also a waste of money and resources. It's also known as the Government Cheese Fallacy ie:
We want people to work so they are happy, but fair remuneration also makes me happier than slavery. It's enough of a challenge to buy a house near a job that can afford the mortgage for the average Joe, and if we want to keep the bubble going then they at least need to be paid enough to afford the rent (Sure enough, NG makes up the shortfall). Now I agree some people are worth a pittance, but better for all that they have a job to keep them out of trouble and food in the fridge to avoid resorting to crime. I think minimum wage is last century thinking though. Maybe a maximum wage would be better, so that instead of some people getting overpaid there is in enough in the kitty for menial jobs to be plentiful (or reinvested in staff training or product R&D, or even philanthropy if feeling benevolent) instead of a handful of greedy pricks splurging on frivolous consumer excess or subverting the democratic process via political meddling. As true that some people are worth SFA, is that no-one is worth 20x more than the median wage (or 20x less). Assuming a median of $50000, this sets the range from $2500/year (or $1.30/hr full time) up to a cool million (or a little over $500/hr). If you need more than that, wtf are you wasting your money on? Want to have more commas in the account? Start a biz. The market needs competition and innovation more than anyone needs a new iphone. A maximum wage would level the playing field far more than a minimum wage. Source: http://www.abs.gov.au/ausstats/[email protected]/mf/6524.0.55.002?OpenDocument
Maximum wage would only succeed in sending the best and brightest overseas. We already have a bit of a brain drain going on in Australia, we don't want to make it worse. PS - I don't know what the solution is, but please keep looking
Instead of increasing minimum wages which would destroy jobs if the government wants to help low income earners and wage earners in general they could abolish income tax. This would increase people's after tax income which would amount to an effective pay increase. Then take axe to government spending drastically to balance the budget. Problem solved. Now where is my Nobel prize in economics?
Unemployed bloke across the road has store credit with us, in order to help pay off the bill he does odd jobs for us eg mow, clean the car, garden etc. Bloke: I'm gunna put my fees up to $25/hour Me: That's cool, I'll just put the cost of meals up for you in response In fact, you can put your price up to $1000/hour for all I care, I'll just raise the cost of food to match any increase in your hourly rate. Pffft damn folk economists, they wither when confronted with the truth.
So what are negatives to a maximum wage. E.g bank exec at 100 times average wage being limited to, say 20 times average?
LOL. As I understand it, the Netherlands has something like this in a sort of socialist come blase faire environment: secondhand knowledge from a professional who is at the top of the earning tree there. I asked him too few questions about the mechanisms and positives and negatives. He seemed very comfortable with his lifestyle and income though. p.s. blase faire is the version of laissez faire where no-one really cares about the outcomes anymore because the govt owns the lot.
You mean like capping the price we pay for any good? I guess that depends upon whether you believe that any one or any group of people possess the capacity to make that decision on behalf of countless others. Better yet, why don't you ask the citizens of the former Soviet Union?
