[ExI] libertarians and inheritance
dan_ust at yahoo.com
Mon May 11 16:41:34 UTC 2009
--- On Mon, 5/11/09, BillK <pharos at gmail.com> wrote:
> On 5/11/09, dan_ustwrote:
> > * Also, there's the curious but usually
> unnoticed phenomenon of big firms
> > calling for regulations. Why is this? It
> seems to me this is often to create
> > regulatory hurdles that smaller competitors will find
> it harder to leap over.
> > E.g., recently in the US Walmart voiced its support
> for raising the minimum wage.
> > Does anyone honestly believe Walmart did so because it
> was feeling
> > particularly altruistic (even if altruistic with
> federal power)? No, it seems to
> > have been a good public relations move, but even more
> a great move to
> > shake off competition from smaller firms who will find
> it much more difficult
> > to pay their works more. In other words, Walmart
> is willing to harm itself --
> > absorbing higher wage money costs -- as along as this
> harm is much more
> > serious to its competition.
> Just a point of correction here, as somebody, it might have
> been you,
> :) has quoted this before.
> This comment is back to front. I doubt very much that
> Walmart is
> worried about smaller competitors. As you should know, the
> effect of a Walmart store arriving in town is to close down
> all the
> small shopkeepers.
> Walmart supports increasing the minimum wage because many
> of its
> customers are minimum wage earners, so they would have a
> little more
> money to spend in Walmart.
That might be their public relations or the belief of Walmart supporters -- and who truly can peer into their hearts to know for sure -- but it seems clear to me that this is a case of a firm supporter a policy change that will hurt its competitors. This doesn't just apply in places where Walmart already has a presence or just to mom and pops.
Also, it's merely a case of an established firm (or set of firms) pushing for regulations putatively for the public good but actually which strengthen the market position of that firm -- at both its competitors and the public's expense.
Finally, even were Walmart to believe raising the minimum wage would make its customers wealthier -- hence, able to buy more at Walmart -- this would have to come at someone else's expense, particularly of those whose marginal productivity was below the minimum wage. Over time, those people or people who enter the market at that lower level (viz., those wose marginal productivity is, again, below the minimum wage) would be unemployed. (Of course, it's quite possible execs at Walmart really don't understand the basic economics here. After all, most people seem to believe raising the price floor set on labor actually makes everyone better off.* I doubt this is true of Walmart execs -- as I doubt when any business pushes for something for the public good. And I feel the same way about politicians. So, unlike faux libertarians, I don't have any pretenses about businesses being for the free market. They are usually the ones calling the loudest for
regulations -- often eager to make sure such regulations are crafted in their favor.)
Don't you believe this is a case where the subject line should be altered?
* Of course, it makes some people better off, but always at the expense of others. Were this not so, why not set the minimum wage at, say, $500 an hour? Surely, a few people have a marginal productivity higher than this, but for the rest of us (including yours truly), this would be a definitely bump up. (And if this sort of logic works, why don't high-end retailers -- think of thecorner.com -- push for a $500 an hour minimum wage? Because at that level, the fallacy is readily apparent.)
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