Posts tagged with: economics

fight forRobert Reich seems to be a smart man. He served under three presidents, and now is Chancellor’s Professor of Public Policy at the Goldman School of Public Policy at the University of California, Berkeley. His video (below) says raising the minimum wage is the right thing to do. Unfortunately, he gets it all wrong.

Donald Boudreaux of the Cato Institute notes a couple of errors in Reich’s thinking. First,

Ignoring supply-and-demand analysis (which depicts the correct common-sense understanding that the higher the minimum wage, the lower is the quantity of unskilled workers that firms can profitably employ), Reich asserts that a higher minimum wage enables workers to spend more money on consumer goods which, in turn, prompts employers to hire more workers.  Reich apparently believes that his ability to describe and draw such a “virtuous circle” of increased spending and hiring is reason enough to dismiss the concerns of “scare-mongers” (his term) who worry that raising the price of unskilled labor makes such labor less attractive to employers.

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Blog author: jsunde
Wednesday, May 6, 2015
By

00979473.JPGI recently gave a hearty cheer for bringing back childhood chores, which are shockingly absent in a majority of today’s homes. The same appears to be the case with summer work for teenagers, which is increasingly avoided due to sports activities, cushy internships, video games, clubs and camps, and, in many cases, a lack of employment prospects altogether.

In an article for the Wall Street Journal, Dave Shiflett explores the implications of this development, recalling the “grit and glory of traditional summer work, which taught generations of teenagers important lessons about life, labor and even their place in the universe.”

Whether it was newspaper delivery, construction, factory work, fast food, or manual labor on the farm or the railroad, such jobs have introduced countless kids to responsibility, creativity, and service, helping connect the dots between God-given gifts and the broader social order. (more…)

factory-workers1When faced with work that feels more like drudgery and toil than collaborative creative service, we are often encouraged to inject our situation with meaning, rather than recognize the inherent value and purpose in the work itself.

In Economic Shalom, Acton’s Reformed primer on faith, work, and economics, John Bolt reminds us that, when enduring through these seasons, we mustn’t get too concerned about temporal circumstances or humanistic notions of meaning and destiny. “As we contemplate our calling, we will not simply consider the current job market,” he writes, “but ask ourselves first-order questions about who we are, why we are here, how God has gifted us, and how we can best serve his purposes.”

This involves reexamining what our work actually is and who it ultimately serves. But it also involves fully understanding God’s design for humanity in the broader created order. As we harness the gifts and resources that God has given us, it is crucial that we understand the source and aims of our toil, and the obligation and responsibility that comes with our authority. (more…)

debt-collection-final-noticeFor decades The Episcopal Church (ECUSA) has faced declining membership (in 1966, the ECUSA had 3,647,297 members; by 2013, the membership was 1,866,758, a decline of 49 percent.) But even when people are leaving the pews someone still has to pay for those pews, as well as the other overhead costs that come with running a large organization. Not surprising, the denomination has sought ways to bring in additional revenue.

Currently, the ECUSA has two primary sources of income. According to its latest audited financial statements for the calendar year 2013, it received a little over $27 million from its member dioceses, and it received half as much again, or $13.8 million, from the federal government.

As A.S. Haley notes, the money ECUSA received from the federal government was in connection with the services provided by Episcopal Migration Ministries, which assists the State Department in relocating refugees throughout the United States. That is certainly noble and necessary work, and the denomination should be commended for providing a valuable service to a vulnerable community.

But as Haley points out, the records show the ECUSA also makes a lot of money as a debt collector:

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closedSeattle has now mandated an increase in minimum wage. The economic ramifications are being felt, especially throughout the restaurant industry.

Several Seattle restaurants have done away with tipping, but are adding a mandatory service charge on a customer’s bill.

Restaurants often operate on thin margins, so higher wages quickly impact profitability. As opposed to tips, a service charge becomes part of the restaurant’s overall revenue. The restaurateurs say the service charge component will be used exclusively for employee wages, benefits and payroll expenses.

While this may solve the economic issue for some restaurants, the mandatory minimum wage increase is causing others to simply close their doors. (more…)

Rescuers pulling smuggling victims from the Mediterranean Sea

Rescuers pulling smuggling victims from the Mediterranean Sea

It’s not easy to make a living in Libya, one of the world’s poorest nations. However, Libya has one thing going for it: its proximity to Europe. This is making smugglers rich.

Quentin Sommerville of the BBC reports his interaction with one of the smugglers.

People smugglers don’t take too kindly to enquiries about their business but, after weeks of searching, one agreed to speak to me if he could remain anonymous.

He’s grown rich out of the trade.

“The amount of money is phenomenal,” he said. (more…)

woman-waitressDo you remember trying to find that first job? You’d be told you needed experience by an would-be employer, but no one would hire you so you could get the experience. Finally, a burger joint or a summer ice cream shop or a retailer would give you a chance, usually beginning at minimum wage.

At AEI, Mark J. Perry looks at the world of the minimum wage worker. Here are a few facts:

  • While teens are the ones who typically earn minimum wage, they don’t stay there for long. In 2014, 85 percent of working teens earned above minimum wage.
  • If a worker does not have a high school diploma, the chances that he/she will earn minimum wage are higher. The more educated a person is, the more he/she will earn.
  • Being married typically means a person will earn more.
  • Part-time workers are much more likely to earn minimum wage than full-time employees.

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Both my parents grew up in Detroit, and my childhood was filled with great trips to visit family for holidays and in the summer. The downtown Hudson’s store was always a destination. One of my aunts worked there, and it was the place to shop. Our trips always included a stop for a Sander’s hot fudge ice cream puff as well. My sisters and I played endless games on the stoop of my grandmother’s home, and a few miles away, rode bikes up and done sidewalks neighborhood sidewalks with our cousins.

That Detroit doesn’t exist anymore. What was once a thriving and beautiful Midwestern city is now a place struggling to remake itself. Harry Veryser, economist and professor at University of Detroit Mercy, has a few ideas as to how Detroit just might make a comeback, and why it ended up the way it is now.

 

80s fashionI grew up in a very small town. Our fashion purchases were limited to the dry goods store (yes, it still went by that name) which carried things like Buster Brown shoes and sensible sweaters, or the grain elevator, where you could buy durable overalls for farm work.

As someone who eagerly awaited Seventeen magazine every month and witnessed the birth of MTV, you can imagine my fashion dilemma. The closest mall was 70 miles away. I needed Calvin Klein jeans, Candies heels and Esprit tops like, now.

Steven Quartz, a philosopher and neuroscientist at Caltech, along with Anette Asp, a political scientist and neuromarketer, feel for me. In The Atlantic, Bourree Lam talked with the two about the connection between “cool” and capitalism. Quartz and Asp, believe, in as sense, that capitalism created “cool.” First, though, Quartz says there are four myths linked to capitalism (or what some would call “consumerism”) that their research shows to be false:

First, that it doesn’t make us happy. Second, that it relies on instilling false needs in us because it’s contrary to our real nature. Third, that it erodes public life.  Fourth, that it’s primarily about “stuff.”

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Andy Warhol

Andy Warhol

AEI’s Arthur Brooks offers up an interesting take on solutions to poverty. He thinks the key lies in “boring things,” and his inspiration is artist Andy Warhol.

I often ask people in my business — public policy — where they get their inspiration. Liberals often point to John F. Kennedy. Conservatives usually cite Ronald Reagan. Personally, I prefer the artist Andy Warhol, who famously declared, “I like boring things.” He was referring to art, of course. But the sentiment provides solid public policy guidance as well.

Warhol’s work exalted the everyday “boring” items that display the transcendental beauty of life itself. The canonical example is his famous paintings of Campbell Soup cans. Some people sneered, but those willing to look closely could see what he was doing.

Warhol’s critical insight is usually lost on most of the world.

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