A World Wide minimum wage?

this is an idea i had recently, and I was prompted to write this after seeing on the front page today-
www.abovetopsecret.com... about the wealth distribution.

So my idea to help fix the world, is to implement a Mandatory worldwide minimum wage, a wage which would be equal in every country. For example, a woman in Indonesia making minimum wage would make the same amount of money as an american person working in mcdonalds.

As we all know, CEO's in America make the most, proportionally to their workers, than in any other country. When the US started to really send jobs oversea's the CEO stood to make EVEN MORE! All of this money would have gone to middle class workers in the US but instead it goes to a select few individuals who not NEED it. This is the problem with the country/world today. The select few think they have the right to make a gross amount of money, while hurting millions of people. So what would a mandatory minimum wage do for the world?

well for starters, it would make it cost prohibitive to outsource most if not all jobs. while IT jobs would still be able to outsourced, manufacturing would be highly unusual to see outsourced.

It would provide a minimum livable basis for more people through-out the world and would help curb corporate greed.

For this to work we would also have to make a worldwide trade agreement, where only countries that implement this policy would work/trade together, making it very pointless to not implement such a policy.

Of course, many countries, 2nd and 3rd world would have to reorganize their monetary system so that it didnt throw its economy off balance to much. Im not very knowledgeable in economics so Im sure what exactly they would have to do.

Sorry this isn't as organized as I would like, but i wanted to get this idea out here for people to see and think about.

Let me know what you think? Im very curious to see what input the rest of ATS has.

I would like to see this make front page as I feel its a very important issue with very deep ramifications for 99% of the world.

Poor people in third world would be initially very happy. Leaders and business owners would not allow it though. Both for personal rea$ons and for fear of massive unemployment.
And in the rich(er) West it would hurt consumers due to sharp rise in prices (which is probably also good) ,doubt that it would be accepted with grace by people who want to have diversity of cheap products.
And most importantly - average wage in West is very high wage in poor countries. Raising it to Western level would automatically mean raising wages in other sectors and it would crash economy. And if you lower average minimal wage to Western worker without artificially lowering costs associated with being alive you would get lots of suddenly very very poor man who will not be able to keep their current lifestyle.
So - tough situation.

I think we should get rid of money and live like the insects. They are so free.

reply to post by ZeroKnowledge


yes it would raise the price of imports,, but thats the whole point, to make manufacturing in your own country more worthwhile.

and i understand how an american minimum wage could go a long way in a 3rd world country, this is why I said you would have to reogranize your economy and money system for it work.

reply to post by Tormentations


i think thats a very bad idea. I know a lot of people ignorantly think money is evil, but its not. Money makes life so much easier. this way you dont have argue about what a fair trade is, and secondly, you can accept it, save it, build it up, and use it as you see fit. money is not evil, only some of the ppl who use it

I'm for it.

Lets put forward a proposition for the UN.

reply to post by VonDoomen

Great idea, I also thought of this very same idea. The problem of incorporating such a system, is the corporations, would fight against it. This system would bring about a unified price system on income, and outsourcing, and the world market would stabilize, to where everything would become affordable for all, and everyone would be able to pursue life, liberty, and the pursuit of happiness. Many wealthy people and nations, would not want this to take place, due to their wealth would become non existent, to the point, that all would live equally, and be equal in their status. This would be the best possible solution in the world. This would also bring about a Star Trek type scenario, where everyone would be capable of pursuing their best choices, to make their lives better, for their selves and everyone else. This would bring about the betterment of mankind for all. Utopia. Just a dream., but a great one. Keep the great ideas flowing.

This is one of those ideas that, on paper, sounds great. It would be nice if the world operated that way and everyone could be guaranteed a sustainable income. But the world doesn’t work that way.

Labor is, like any other commodity, based upon supply and demand. It is also based upon local conditions which are not applicable in all areas.

For example, let’s take nation “X” that has a highly-educated, sophisticated and mobile population. Demographics show that it is middle aged and relatively wealthy; everyone has a a car, DVD player, cell phone, etc. Almost everyone is a doctor. Nobody wants to be a garbage man. Nation “A” must therefore pay it’s sanitation workers a premium to get enough labor. The market will determine that rate that is attractive enough to maintain a stable pool of garbage men.

Now you have nation “Y”. It has a large population of young, uneducated people. Most of the population is qualified to pick up garbage but physicians are rare. Trying to employ all those persons is impossible because everyone can pick up garbage. You don’t need 10 garbage men for every doctor. You can’t pay those people at the same rate as in nation “X” because the supply is too great.

Another way of thinking about it is this: ice in the desert is valuable – in the arctic it is worthless. Labor operates upon those same principles. You cannot equalize it worldwide; just as you cannot sell ice in the Sahara for the same price as you sell it in Siberia.

It's a very interesting idea with strong pros and cons. It would help revitalize developed-world manufacturing, which I think is necessary. On the other hand, because of rapidly shifting exchange rates, I'm not sure how it would be practically enforced without a degree of globally centralized control that I would find alarming.

enforcing it would require a one world government.
no thanks.
Ill take a bunch of smaller Kleptocracys over one big one.

reply to post by DucTape


Not if you had read my post.

In it I said we need to have a treaty where we would only trade with countries that uphold this principle.

The rich would still be rich, although their growth would be slower, due to the fact their wealth isn't piggybacked off slavery. so idk why you could argue against this.

reply to post by passenger


I understand what your saying, with supply and demand. but in my model, not everyone in those countries would get jobs still. they wouldnt hire 10 garbage men for 1 doctor. However, it would get the ball rolling on creating family lines which can escape the basic poverty line in their respective countries. It would also start turning these little country from exporters to little self contained economies that produce for themselves.

But yes it would require a fundamental shift in our way of thinking, basically outlawing slavery, which i know would be an uphill battle.

reply to post by silent thunder


I think they should institute some form of a global currency.

How this would work is, every country in the trade agreement keeps their respective currency, and also accepts this world currency.

or maybe every country in the trade group would keep their own currency, and on top of that, have an individualized world currency.


I will profess, I am not an economics major by any means, just throwing ideas out there to see what people think or would recommend

This would not solve the problems we face, only curb them for some for a period of time.

1) Wages aren't the only factor in shipping jobs overseas. For instance, there are very few US Flag ships. Almost all of the cruise ships we use (even Disney) aren't even US flag due to the cost and the over-abundance of regulations and requirements.

The same is true for manufactoring. We have chemical safety code, proper gear, unions, building codes, taxes, land cost, insurance requirements, etc, etc, etc.

Even if wages are compensated for, that would be simply one issue of many.

2) This would inflate to hyperinflate economies, which would be nice while things are on the rise, but after that initial period it would be just about the same as the money would change only in relative buying power.

This, for the most part, would most likely end up with the same conditions of poverty with a different valuation on the money.

3) It would be advantageous for 3rd world nations NOT to sign this treaty as business would then go to them.

That would create failure before anything else.

4) It's a nice thought, but not practical when it comes right down to it.

Peace
KJ

reply to post by KrazyJethro


3) It would be advantageous for 3rd world nations NOT to sign this treaty as business would then go to them.

which is why I would argue that only countries that sign onto this would trade with each other.

Either way, I think its a noble fight as its the fight against slavery and a fight FOR the middle class

My idea to add to this was enforcing a global rule that the richest could be no more than 3 times wealthy than the poorest. There's going to be a global government of some sorts whether you like it or not.

My question is where would you set the floor at. The amount of money somebody needs to live in Manhattan is far greater than the amount of money somebody needs to live in the countryside of Ecuador.

If you set the floor so the average Manhattanite can afford the basics, you would effectively force every employer in every developing nation to lay off their workforce. If you set the floor to the amount needed for people in developing countries to afford the basics, the minimum wage law would not have much teeth.

If it was tied into the cost of living in each country then it would be a great idea.

Otherwise it wouldn't work, here's why:

How could a cleaner in a restaurant in Mombasa expect to receive the same wage as a cleaner in London, when the cleaner in London gets paid more than the restaurant MAKES gross in a day?

BUT, if there was a global index which calculated minimum pay rates required around the world and converted them into each currency in all UN member states, then implemented laws demanding employers adhere to it, it may work.

However I fear that in the countries where this is needed the most, such laws would be disregarded entirely anyway so the entire idea might be pointless.

Hearts in the right place though!

Good idea.

But you better make it a minimum living wage, or they'd lock in a minimum that's below poverty level.

Additionally, you need a ceiling, as well as a floor. A maximum yearly wage or income is necessary, too.

And a wealth cap: cap wealth at 1 billion USD, no one has any legitimate need that can't be met with that kind of wealth, and no one has a right to demand more.

Originally posted by VonDoomen
which is why I would argue that only countries that sign onto this would trade with each other.

Either way, I think its a noble fight as its the fight against slavery and a fight FOR the middle class

That will never happen. Noble intentions are normally ignored for pragmatic reasons. Maybe next time you will respond to all my points (which were still just a very small sampling of the issues involved).

I prefer to deal in the real world.

reply to post by KrazyJethro


I didnt respond to your other points b/c as I said, Im not an economist and do not know enough to argue about inflation and what not, and do it intelligently, thats why I stuck to what I felt confident about arguing about.

And I do live and deal with the real world, modern day slavery is a real world issue in case you havent noticed