Why the minimum wage results in immigration and multiculturalism

realitykeeper

From a business perspective, labour is a commodity with a price. Television sets are also commodities but unlike labour, television sets do not have a minimum price. But supposing they did. Lets say the EU decided to make European TV manufacturing lucrative in countries like Ireland, how high would the mandatory minimum retail price of a TV need to be in the EU? Lets say it would have to be 5000 euro. So, even though it would still be cheaper to make the TVs in China and ship them to Europe, the profit margin would now be so large, the cost difference would now be of minor concern and manufacturing TVs in the EU would make a lot more sense because even those TVs which do come from China would have to be sold at or above 5000 euro.

The problem of course is that far fewer TVs would be sold legally and the smuggling of China manufactured TVs direct to the EUs black market would skyrocket.

The minimum wage results in inward economic migration by means of the same dynamic outlined above. I am not saying this is a good or a bad thing, I am simply saying it is a fact. Employers are all in favour of migrants coming here to work just as consumers are all in favour of affordable TV sets. Am I wrong?

Peregrinus

realitykeeper wrote: »

. . . The minimum wage results in inward economic migration by means of the same dynamic outlined above. I am not saying this is a good or a bad thing, I am simply saying it is a fact. Employers are all in favour of migrants coming here to work just as consumers are all in favour of affordable TV sets. Am I wrong?

You're wrong if you think the problem is simply an artefact of legally mandated minimum wages. If wages are higher in Ireland than in Teapotistan, that creates an incentive for workers to migrate from Teapotistan to Ireland. This doesn't depend on why Irish wages are higher than Teapotistani wages. So abolishing minimum wage laws won't do much to solve your "problem"; you need to take action to force down Irish wages generally, towards Teapotistani levels.

I'd also point out that while employers tend to favour immigration, they don't (for obvious reasons) tend to favour minimum wage laws. The like immigration since it increases the pool of labour and keeps wages down. A minimum wage law frustrates that objective; it in fact means that the increased pool of labour won't result in a lowering of wages. Thus while employers might favour other measures that might tend to increase immigration, they won't favour a minimum wage law, since that deprives them of the benefits they might get from increased immigration.

realitykeeper

Peregrinus wrote: »

You're wrong if you think the problem is simply an artefact of legally mandated minimum wages. If wages are higher in Ireland than in Teapotistan, that creates an incentive for workers to migrate from Teapotistan to Ireland. This doesn't depend on why Irish wages are higher than Teapotistani wages. So abolishing minimum wage laws won't do much to solve your "problem"; you need to take action to force down Irish wages generally, towards Teapotistani levels.

I'd also point out that while employers tend to favour immigration, they don't (for obvious reasons) tend to favour minimum wage laws. The like immigration since it increases the pool of labour and keeps wages down. A minimum wage law frustrates that objective; it in fact means that the increased pool of labour won't result in a lowering of wages. Thus while employers might favour other measures that might tend to increase immigration, they won't favour a minimum wage law, since that deprives them of the benefits they might get from increased immigration.

Regarding your first paragraph, I did argue in previous posts the need for the Irish to pay themselves a lot less and this would have to start at the upper, middle and lower echelons of the civil service before abolishing the minimum wage and drastically reducing the dole.

Regarding the second paragraph, I did not say employers favoured the minimum wage, I said they favour cheap labour which immigration provides. At the end of the day, labour is a commodity and should be treated as such without market manipulations like minimum wages. If everything had a minimum price, everything would be expensive and Ireland would need to borrow heavily to pay everyone enough. Remember when everyone here were out-bidding each other on house prices while the Germans got rich? Putting up labour costs is only fueling debt, future inflation and undermining export sector.

Randle P. McMurphy

Wrong forum OP. Belongs in AH with the rest of the worker/union/dole bashing threads. You will get a much better repsonse. They are your type of people. They will love you in there.