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Cheap at Half the Price

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It’s Friday and time for some hot, fresh, Free Market porn from Merrill Matthews, the Principled Ph.D.

This week he has an immodest proposal, hubba-hubba!

The story so far – Poor people on food stamps are having a hard time finding jobs at the current minimum wage. Worse, dirty old lefties want to raise the minimum wage, which will make life even worse for poor people (shut up, it just will). Help us Free Market Matthews!

Let me propose a different option: Instead of doubling the minimum wage, how about letting low-skilled food stamp recipients work for half the minimum wage?

Yes, lefties. Why won’t you let people on food stamps work for $4 an hour? You’re so mean!

What if an employer who hired a low-skilled worker on food stamps were able to pay that individual, say, $4 an hour for a set period of time, say, six months. After that the employee would be bumped up to the company’s entry-level wage.

Say, how about you go fuck yourself?

That option would allow the employee to get some on-the-job training, and the employer would have some time to see if the employee was a good fit.

Uh-huh, of course. And if after the Friedman Unit the employer decided the the employee was not a good fit, out into the streets with him, the no good moocher!

It’s not a new idea.

Neither is tarring and feathering miscreants. Perhaps you should shut up about ideas that aren’t new.

Some people have proposed allowing employers to pay young workers just entering the workforce something less than the minimum wage as a way to encourage more youth hiring.

Some people have proposed building tumbrils and using them to ferry corporatists pigs and their lackeys to the nearest guillotine. Perhaps you should shut up about that, also.

The price of their labor is the only thing low- or no-skilled workers have to bargain with. Allow those unemployed food stamp recipients to work for less than the minimum wage, at least for a short time, and maybe they will be able to get a job—and a future.

I say we allow people who are on food stamps and those who are receiving less than the minimum wage due to wage theft to have a private word with M n’ M. I bet they’d prefer that to being “allowed” to experience even more exploitation.

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  • And to add to the hilarity, it’s Doctor Merrill Matthews. I was brought up to regard insistence upon the honorific by persons outside the medical profession as a telling signifier of intellectual insecurity.

    • Monty

      In this case, a PhD who doesn’t understand the meaning of ‘minimum’…

    • DrS

      I think you’re really missing out by not applying that same standard to medical doctors who insist on same.

    • MgM63

      Ph.D.=Phony doctor

  • ChrisTS

    Christ, what an asshole.

    • N__B

      There are some people – Martin Shkreli also comes to mind – who would causes Jesus to say “Me, what an asshole.”

      • ChrisTS

        Heh.

        I think something is ‘wrong’ with Shkreli. Sociopath?

        • N__B

          He went to my high school*. Nuff said.

          *Twenty years after me, luckily. If I’d had to listen to him in class, I might be in Attica right now.

        • trollhattan

          Yes, sociopath, which in the case of a CEO is filed under “F” for feature, not bug.

          Shkreli is what James O’Keefe would be if he had money. Aspirational douchery.

        • cpinva

          yeah, he has that look on his face that gives you the idea that he’s not taking it all in.

          • Malaclypse

            You know, that securities fraud investigation took months, probably years, all with his knowledge. He turned himself into the most hated person on the planet while knowing he was gonna be indicted.

            That’s some weapons-grade stupid, that is.

            • N__B

              It’s a fine line between stupider and stupidest.

            • Lee Rudolph

              In for a penny, in for a pound.

            • GFW

              Something like the death wish – at some level he wants to be stopped … or he really is that stupid.

        • MAJeff

          I think something is ‘wrong’ with Shkreli. Sociopath?

          Sociopath? Hedge fund dude? They’re kind of indistinguishable.

    • The dumb cluck. Most people on SNAP are working.

      http://www.hungercoalition.org/food-stamp-myths

  • Lee Rudolph

    Some people have proposed building tumbrils and using them to ferry corporatists pigs and their lackeys to the nearest guillotine.

    Tumbrils? Feh. I propose building Elon Musk’s Hyperloop. He can even have one of the first rides himself!!!

    • dmsilev

      I assume he’d be given a ride in the special tube, the one which dead-ends on a 45 degree upslope facing towards the Pacific, and a really fast-acting airlock at the end to ensure efficient transfer of the passenger to a free-space ballistic trajectory?

  • medrawt

    I wonder what percentage of people on foodstamps Matthews thinks are working, and I wonder how much lower that is than the actual percentage.

    • trollhattan

      All the percentage points, katie.

      There’s a peculiar mindset that believes assistance of any kind is literally paying people to not work. End the payments and they immediately have and keep jobs. e.g., if we didn’t have that generous unemployment check representing a quarter of our previous takehome pay by gum, we’d be working right away!

      PhD., eh? Is there a recall program, like for exploding airbags?

  • j_doc

    The price of their labor is the only thing low- or no-skilled workers have to bargain with.

    This may be the most disturbing thing I’ve read on the internet this week. “Society”? Bah. There is no “we” in “Thunderdome”!

    Mr. Matthews’ ilk would do well to recall that the pitchfork cuts both ways.

    • AlanInSF

      I say, just keep things the way they are, where employers won’t train people if they have to pay them, and then constantly whine about not being able to get trained workers.

  • bekabot

    “Aww, why should we fight, when there’s room for both sides!! Here’s how it’ll work — we’ll vastly increase the number of low-wage workers and we’ll make ’em lower-wage than ever and you’ll subsidize…us!! Imagine how fair and balanced!! Revel in the symmetry!! It could be bee-yoo-tee-ful, I swear; just try it and see!!”

    • DrDick

      I want to know which matchbox cover he got his Ph.D. off of.

      • wjts

        Me, too. I’ve been trying (and failing) to draw that fucking pirate for years.

        • Malaclypse

          You should have gone with the turtle.

  • So- he thinks Walmart should be allowed to pay their workers half minimum wage, because the workers get food stamps because they don’t make enough money to buy food?

    Big brain ya got there, mister.

    • AlanInSF

      Under his plan, Walmart workers wouldn’t even be able to buy busfare to get to the food stamp office.

  • AdamPShort

    If we set the minimum wage by hiring everyone willing and able to work at some reserve wage, we would not have to listen to this bullcrap. There would be other bullcrap, of course, the bullcrap of the Dr. Merrill Matthews’ of the world will always be with us, as cheeses taught us. But this particular bullcrap would be gone.

  • howard

    you know, if only there were actually some evidence that raising the minimum wage hurts poor people, it’s not that i’m opposed to counter-intuitive outcomes.

    it’s just that there is no evidence, the evidence is that boosting the minimum wage is a good thing.

    • Just_Dropping_By

      I guess if you choose to simply ignore the existence of studies that find disemployment effects of minimum wage increases (see, e.g., http://www-rohan.sdsu.edu/~jsabia/docs/Sabia_Burkhauser_Hansen_ILLR2012.pdf ; http://econweb.ucsd.edu/~mwither/pdfs/Effects%20of%20Min%20Wage%20on%20Wages%20Employment%20and%20Earnings.pdf), then sure, there’s “no evidence” that raising the minimum wage “hurts poor people.”

      • DrDick

        Which of course completely ignores the reality that they do not harm employment. (And I even know how to use links!)

      • See you that one and raise you

        There’s a nice critique of the study you offered on page ten. Yes, one can find a whole bunch of “evidence” if you mean papers that have flaws and don’t necessarily prove what they claim to prove.

        https://cepr.net/documents/publications/min-wage-2013-02.pdf

      • AdamPShort

        Oh good, a Card/Krueger Gish Gallop. haven’t had one of those in a while.

      • howard

        i’ve been beaten to the punch, so let’s just add in: the maximum case against the minimum wage is that you can, if you squint sometimes in the right light, some minor impacts.

        but against that is a lot of entirely intuitive evidence, such as that the increase in wage levels promotes employee stability and therefore reduces overall expenses.

        so as i said, there is no “evidence,” in the sense that the preponderance of the studies do not show minimum wage increases hurting the poor. squinting sometimes in the right light doesn’t count….

      • trollhattan

        “Disemployment.” I’m imagining the term emanating from somebody’s mom’s basement back in the ’90s. Good times.

      • Origami Isopod
  • Gwen

    There’s two kinds of people making minimum wage:

    * People who are worth more than the minimum wage, but who don’t have the market power to demand more.

    * People who probably shouldn’t be working under any circumstances.

    Besides, this argument ignores the fact that there is this thing called the underground economy; the demand for sub-par wage workers is surely measurable.

    Why is it that all of these “abolish the minimum wage so everyone can work” arguments usually fail to mention or count the existence of actually-existing below-minimum workers?

  • Gwen

    Um…

    “Some people have proposed allowing employers to pay young workers just entering the workforce something less than the minimum wage as a way to encourage more youth hiring.”

    This already exists.

    It’s called the Youth Minimum Wage, and it is currently set to $4.25 per hour.

    http://www.dol.gov/whd/regs/compliance/whdfs32.pdf

    • Yes, but they want to define “young workers” as “below 65”.

      • LosGatosCA

        Yes, but they want to define “young workers” as “below 65”. everyone.

        • leftwingfox

          “That’s Young Mr. Grace?”

          “Yes, Old Mr. Grace doesn’t get out much anymore.”

  • kped

    You know…I don’t think low skilled people ever won a single bargain before minimum wage came in. It certainly never lifted them out of poverty. But I don’t have a PhD, so maybe i’m wrong.

  • twbb

    “That option would allow the employee to get some on-the-job training, and the employer would have some time to see if the employee was a good fit.”

    The premise is the kind of jobs that people would be desperate enough to take at $4 an hour are the ones that require 6 months of training?

    • Randy

      Beat me to it.

      There may be some thought here that the “training” they receive is “training to get their lazy asses to work every day,” but I think most people can learn that in a day or two.

    • Warren Terra

      I’d hope jobs that require extensive training would pay more than the minimum wage …

      Although almost certainly what this fellow means by job training is not instruction in how to perform any tasks, but rather he is suggesting they have no experience in behaving like a proper employee – showing up to work on time, acting subservient, etcetera.

      Still, I’d bet this fellow has no interest in funding the child care or mass transit services necessary for many people receiving benefits to hold down a job at any (low) wage.

      • LosGatosCA

        Like law school?

    • gmack

      I’m guessing that Herr Professor Doktor Matthews (is that honorific sufficient?) is operating on the assumption, rather common among capitalist lackeys people who write about “welfare recipients,” that unemployed people on food stamps lack even the most basic skills, like time discipline, the ability to dress appropriately, etc.

  • Gwen

    “What if an employer who hired a low-skilled worker on food stamps were able to pay that individual, say, $4 an hour for a set period of time, say, six months. After that the employee would be bumped up to the company’s entry-level wage.”

    Better idea entirely… why not subsidize employers to hire these people at the full minimum wage, but the employers don’t get a subsidy unless they make every reasonable effort (basically, don’t fire the employees without cause) to keep these people employed?

    The obvious problem with the Good Doctor’s advice is that employers will just fire people before they become expensive. And by expensive I mean, still below subsistence wages.

    • N__B

      Your better idea seems to me to be halfway towards a guaranteed minimum income. Which is okay with me, since I like the idea of a guaranteed minimum income, even if it’s a political non-starter in this country at this time.

    • In the recent SOTU, Obama mentioned wage insurance as one of his policy goals. A program like that works by subsidizing (part of) the gap between a worker’s previous wage and a new one. I need to spend some time researching it, but my first instinct is that it might put downward pressure on wages, even if it does help reduce long-term unemployment.

  • Gwen

    But anyway, I read the full article, and I cannot help but offer my own modest proposal:

    Burn down capitalism and string economics professors up by their entrails.

    I’d write a white paper but unfortunately I don’t have a Ph.D.

    • J. Otto Pohl

      I have a PhD and I can write one for $4 an hour.

      • Gregor Sansa

        I think we should take up a collection to take Jotto up on this. I’ll pitch in 20 cents a page, up to 20 pages, if enough other bids come in to bring the total up to $20 or more. I’m totally serious. And I doubt I’m a whole lot richer (in cash and income, at least) than Jotto is.

        • Ahuitzotl

          I’ll pitch in $10 happily

      • ChrisTS

        Hah! I’ll do it for $2 an hour!

        • brownian

          I bid three hundred quatloos on the newcomer.

          Wait—I finally get economics now!

        • Warren Terra

          What’s that in Bitcoin?

        • Hogan

          But you’ll have to be trained for six months.

          • LosGatosCA

            Or re-trained in 9 months.

          • Malaclypse

            And fired and replaced on the 183rd day.

          • N__B

            And wear an orange smock.

            • Lee Rudolph

              The orange schmuck retired in October.

  • carolannie

    I for the life of me cannot figure out what this PhD is talking about. If poor people are having a hard time finding jobs, does this really mean they are unskilled? Gratuitous assumption! And working at a job that requires high skills for 6 months for OJT sort of means…if they were unskilled to start off with, they won’t have enough skills to end up with to do a skilled job. In fact, this PhD is arguing that the “unskilled poor” remain unskilled for an endless loop of what is basically slavery by any other name. Work for 6 months at some low skill job, get paid nothing, get fired the minute you might make more, and then go to another low skill job…Hey, wait, he isn’t even talking about the unskilled working at highly skilled jobs!

    I suppose they could learn coding.

    • N__B

      Poor people are having a hard time finding work. So we’ll make sure that they can find jobs that don’t pay enough to live on, then we’ll kick them off all public assistance because they have jobs, then they starve and get their LOSER genes out of the pool.

      Win, win, win.

    • Headline I saw on Hacker News today: “Appalachian miners learning to code”. I groaned audibly on seeing it. The reader response was pretty negative, too. These stories are self-parodying, to the point that I’m expecting someone to combine it with a New York Times headline generator to produce “In Code Schools, More Former Undertakers” and the like.

      • MartinAlexander

        That story is pretty interesting. So far I believe they have trained 10 but have got thousands of applications. You pair that with the fact that the USDE is opening up federal funding to coding boot camps and I grantee you’ll be seeing a,huge proliferation of them…all to support the supposed lack of computer programmers. Stack on top of that the usage of H1B visas and the wages are really going to drop out of then coding market in the US.

    • Brownian

      I for the life of me cannot figure out what this PhD is talking about. If poor people are having a hard time finding jobs, does this really mean they are unskilled?

      It’s a laughable assumption on its face. Even supply and demand reduced to its simplest doesn’t suggest that a loaf of bread ceases to be nourishing just because there’s oversupply or underdemand. There may be too many welders in a given market for the number of welding jobs available, but un(der)employed welders don’t cease to have welding skills simply because they don’t have jobs.

      I’ve two friends with PhDs and tenure-track positions: one spent a decade as a post-doc, the other got a TT position within months of his thesis defense. The first went to prestigious institutions all over the western hemisphere; the second did his bachelor’s, master’s, and PhD at the same institution (he was aware of this limitation and made up for it by churning out a lot of publications.) They’re both passionate, hard-working, and talented researchers. It really boiled down to their respective fields and the economic situation upon graduation.

  • Aside from the fact that working in low-wage jobs mostly trains you to work low-wage jobs, the hidden deception here is the idea that unemployment is a result of too few workers with necessary skills (structural unemployment). But the Great Recession caused unemployment due to lack of demand for labor, and a lot of the long-term unemployment that came out of the Great Recession was among older, more experienced workers.

    These are workers whose resume will not be boosted by working at Mickey D’s for a year or two. They are being shut out of reentering the workforce because of discrimination against older workers and against the long-term unemployed, as well as the negative effects of long-term unemployment like health problems and substance abuse issues.

    • Randy

      These are workers whose resume will not be boosted by working at Mickey D’s for a year or two.

      This is something the happy talk, “there are plenty of jobs out there if you just knew where to look,” people fail to understand. If you have a marketable skill set, but end up spending more than a few months at a crap job, employers are going to conclude that there is something wrong with you that does not relate to your skills. People need more than just the right training to find a job. If you have a degree in computer science, but you’ve spent too much time asking people if they want to super size that order, you are not likely to be going anywhere.

  • The Pale Scot

    Interesting….

    Why does he think EBT recipients aren’t working and don’t have skills?

    Florida is filled with 50+ers that were laid off years ago and never got back to where they were before the Bush era started.

  • DrDick

    I have a free market solution for him! Why don’t we let him work for $2.50/hour (which would be far more than he has earned through his efforts) and he can try to live on that and SNAP.

  • Warren Terra

    This proposal has a tempting whiff of oppression to it, but has Dr. Matthews considered the true delights available if we were to bring back the antebellum charms of Debt Peonage?

  • twbb

    “Most economists believe that many of the poor can’t find a job because the minimum wage has priced them out of the market.”

    Isn’t that a lie?

    http://www.latimes.com/business/hiltzik/la-fi-mh-does-increasing-the-minimum-wage-20150922-column.html
    http://www.epi.org/minimum-wage-statement/

  • Hogan

    So Old Economy Steve finally finished grad school?

    • N__B

      He was distracted by marrying Old Economy Adam.

      • Lee Rudolph

        When Adam dug and Steve span, who was then the gentleman?

        • Hogan

          Eve. Duh.

        • Ahuitzotl

          Kyrie Eleison, Kyrie Eleison

  • liberalrob

    And employers may be reluctant to take a chance on them at the current federal minimum wage of $7.25 an hour.

    This is the basis of his entire logical edifice: Employers would be hiring all those low-skilled people on food stamps if only they didn’t have to be paid so much.

    It’s not that there are no jobs. Unpossible! You’re just not looking at it like the Good Doctor! Supply-side economics says that if you increase the supply of potential labor by making it cheaper to buy, more jobs will magically appear! Here’s how it works (very scientifical!):

    Business owners spend X on staffing.
    Workers cost Y each (say), so if N is the number of workers, X = N * Y.
    So therefore, given X is static, if you decrease Y then N must go up. If you cut Y in half, N must double! The equation must balance! That’s how math works!

    See? So simple! Silly libtards!

  • guthrie

    The UK seems to be ahead of you again; we have programs under the evil tories whereby youths with or without degrees have to work for well under the minimum wage in order to get their benefits or other money, basically acting as cheap labour for large corporations.

  • LosGatosCA

    You had me at:

    Say, how about you go fuck yourself?

    Meaning him of course.

  • Witt

    Glad to see this post. The linked article is all the more infuriating because there is a program that helps people on food stamps to build skills. It’s called SNAP Employment & Training.

    Washington state is a national leader in using SNAP E&T funds to help people on food stamps build skills and get decent, family-wage jobs.

    Sadly, many other states barely use the SNAP E&T funds (which is ridiculous given that they get a 50% federal reimbursement for program costs!).

    Congress woke up to this in the Farm Bill they passed in January 2014. It included $200 million for 10 states to run pilot programs experiment with good models for SNAP E&T, plus money for an independent evaluation.

    And the federal Food & Nutrition Service, which runs SNAP E&T, has contracted with Seattle Jobs Initiative to become a “Center of Excellence” that mentors other states on how to replicate Washington state’s success with SNAP E&T.

    Bottom line: There is a policy solution. And it’s not cutting the minimum wage. But we all knew that.

  • I thought there weren’t any jobs available because Obama screwed up the economy?

    Damn it’s hard to keep up sometimes.

  • Bitter Scribe

    Just once I’d like one of these assholes to be honest and say, “We want to pay practically nothing because we can find people hungry and desperate enough to work for it, and we want to spend as little money on labor as possible.” I get greed (aka “good business principles”), but it’s the I’m-only-looking-out-for-their-interests stuff that I find so insufferable.

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