Obamacare: Not enough doctors in CA to meet demand

[_cinepro]

I'm confused why you would want the medical establishment to stop the changes. The AMA has done a good job of keeping the upper tier of the medical profession a closed shop. I'm not sure that is in the best interests of the public.

I was only pointing out that (according to the article), we might see the "medical establishment" (i.e. the AMA) resisting change in this area. I wasn't supporting this resistance.

[_Quasimodo]

I'm confused why you would want the medical establishment to stop the changes. The AMA has done a good job of keeping the upper tier of the medical profession a closed shop. I'm not sure that is in the best interests of the public.

I was only pointing out that (according to the article), we might see the "medical establishment" (i.e. the AMA) resisting change in this area. I wasn't supporting this resistance.

Thanks, I understand.

The AMA has always resisted change. It's in their nature. Despite this, nurse practitioners and physician assistants have become a growing presence in medical practises. It just makes economic sense.

The AMA will have to come to grips with the new realities or fade away.

[_EAllusion]

But it isn't a "fact" at all. You're now propagating Right Wing myth.

Good lord. The % of college tuition a Pell Grant covers doesn't at all address the point I was making unless you think I was asserting that college tuition are calibrated to Pell Grants, which I was not. I am asserting the availability of such funding increases demand, which increases tuition costs given constrictions on supply. This is a different sort of assertion that cannot be refuted by pointing out other factors also are responsible for increases in tuition. How has college tuition changed since the introduction of Pell Grants and various other programs such as low-interest loans that make funding available for tuition? I think you know the answer to that, and you can't refute the notion they are a contributing factor simply by pointing out that it is not a one-to-one correlation. College tuition clearly is increasing in a way that captures that excess funding. If you were interested in refuting the idea that all of college tuition raises can be explained in terms of Pell Grants, good job. Unfortunately, that would be a staw man, so not so good of a job.

[_EAllusion]

But I guess all this means nothing. After all, I haven't provided any survey data from a majority of economists, so this all must be a bunch of bunk. Your baseless speculation about what "could" happen if minimum wages increased, is clearly more credible than anything I've provided.

But there is no credible evidence to suggest companies will stop hiring if they have to pay a fairer wage. That's just idiotic. Anyone running a company is going to need employees because employees produce the goods and services that provide them with profit.

That sufficiently high min wages will cause unemployment is basic dogma in economics. And here I thought you were interested in what the vast majority of economists think, even if you have a hard time not misrepresenting that. You seem to have confused this point with the assertion that a particular raise in the wage law will raise unemployment. As I explained in my post, which you missed, is that this is only if it is sufficiently elevated over the market value of labor. The reason that particular raises in the min wage did not have this affect on most areas of labor outside of migrant farming is because the min wage is sufficiently low. But that has other deleterious effects I pointed out. The unemployment can be relieved theoretically by inflationary action, but that washes out the value of the increased wages. By all means, find me an economist who doesn't think raising the min wage to $50 an hour will cause unemployment if you disagree with me.

When the wage laws are closer to the laws in question, the businesses that won't hire to pay a higher wage are those that cannot afford it. Those that can will pay and that will change the competitive balance. Why do you think Wal*Mart lobbies for increased min wages? You are aware that many jobs are well above min-wage, right? Why do you think they pay more when the law doesn't require them to? Why do you think the businesses that do pay min wage do so? It's simply not the case that every single business can take a quick spike in their labor costs. The possible effects on labor and its value all depend on the relationship between the wage law and what market prices would dictate. I argued that too high or too low is bad and that its hard to consistently get it just right in a fluctuating environment across a variety of fields and areas. To wit, if you think the wage is significantly too low, then the law is probably depressing aggregate wages.

[_EAllusion]

there is no reason to think McDonalds (for example) will close shop because their workers have to be paid $9, or even $20 for that matter. They will still sell their Big Macs because there is a demand, and that demand provides them with profit.

This was particularly awesome. All McDonald's restaurants can significantly increase - in some areas near triple - their frontline labor costs and be do fine because either 1) the demand for BigMacs so intense that people will huge prices for them (which makes one wonder they that's not what they are charging now) or 2) McDonald's profit margins are so obscenely good that they can eat a massive hit in labor costs no probs or 3) McDonald's has drastic inefficiencies in other areas they've neglected for some odd reason that can be fixed to absorb sky-rocking labor costs.

Economics, folks. Makes fast-food seem like a pretty sweet investment.

[_Quasimodo]

Economics, folks. Makes fast-food seem like a pretty sweet investment.

A very good thing to invest in and a very good thing in which to own a franchise. Not so hot to eat, though.

[_Kevin Graham]

That sufficiently high min wages will cause unemployment is basic dogma in economics.

Well sure, if you define "sufficiently" as a rate so high that it forces a company to pay more in expenses than it receives in revenue. But this is an understatement since the company would most likely go out of business. A fast food restaurant couldn't stay in business if it had to pay all employees $50 per hour. Because without employees, you have no business to operate. But the issue at hand is a modest bump in pay that is actually lower than the 40% increase between 2007 and 2010.

But the demand for food won't change. If one food company goes out of business then those "would be" customers will have to go buy food elsewhere, which means other companies will need more employees to accommodate their increased demand. So overall employment doesn't actually decrease on a national level, it just fluctuates on the local levels.

And here I thought you were interested in what the vast majority of economists think, even if you have a hard time not misrepresenting that.

I haven't misrepresented the majority of economists on any point, and you know that.

You seem to have confused this point with the assertion that a particular raise in the wage law will raise unemployment. As I explained in my post, which you missed, is that this is only if it is sufficiently elevated over the market value of labor.

So what is the "market value of labor" for a fast food worker? The minimum wage is the starting point in many areas for new hires. McDonalds averages $7.66 per burger flipper/cashier. Are you saying that if the minimum wage goes beyond that rate, it will result in unemployment? Because that 40% bump in pay jumped well over the market value of fast food labor back in 2010, and none of these catastrophic predictions about unemployment and skyrocketing prices came to fruition.

The reason that particular raises in the min wage did not have this affect on most areas of labor outside of migrant farming is because the min wage is sufficiently low.

Even farm workers can make well above minimum wage.

The unemployment can be relieved theoretically by inflationary action, but that washes out the value of the increased wages. By all means, find me an economist who doesn't think raising the min wage to $50 an hour will cause unemployment if you disagree with me.

I don't disagree with that. I disagree that raising the minimum wage to $10 is going to cause unemployment or increased prices. There is no evidence to support it.

When the wage laws are closer to the laws in question, the businesses that won't hire to pay a higher wage are those that cannot afford it. Those that can will pay and that will change the competitive balance. Why do you think Wal*Mart lobbies for increased min wages?

I'm not sure that they are. I know the CEO made a public statement to that effect, but it is also true that they hired Lee Culpepper, a lobbyist who has lobbied against the minimum wage. It could be the case that the CEO was just trying to help their public image by sounding caring about their employees, or it could be that they are just hoping to further destroy their competition. Though given their success in that, I doubt they really need an increase in minimum wage to help them.

You are aware that many jobs are well above min-wage, right? Why do you think they pay more when the law doesn't require them to? Why do you think the businesses that do pay min wage do so?

We've already covered this in the past in our debates concerning unions. We're on the same page here. Yes, I'm aware that employees have negotiating power concerning their wages. Yes, I understand there is a market value for labor in most industries. However, we're talking about the 2% of Americans who are making minimum wage and cannot survive off that alone.

It's simply not the case that every single business can take a quick spike in their labor costs. The possible effects on labor and its value all depend on the relationship between the wage law and what market prices would dictate. I argued that too high or too low is bad and that its hard to consistently get it just right in a fluctuating environment across a variety of fields and areas. To wit, if you think the wage is significantly too low, then the law is probably depressing aggregate wages.

This is very much like the Laffer curve. There is a "sweet spot" somewhere in the middle, but my argument isn't that every company can afford to pay employees an unlimited amount of money as it is legislated by congress. I'm saying that the modest proposal by Obama, and allowing the minimum wage to rise with inflation, is hardly going to result in the things you're suggesting. Even if it goes above the market value of labor, because in many areas the minimum wage IS the market value of labor.

But why is the market value of labor for fast food crew members around $7.60 an hour? It always seems to be just a tad higher than the minimum wage. It is unusual for companies to keep low skilled employees at the rock bottom minimum wage rate beyond a six month period. Almost every company offers potential raises and incentives. So the minimum wage serves a starting benchmark for companies to work with. If they couldn't afford to pay them more, then they wouldn't. But obviously they can because no matter how the minimum wage increases, companies continue to pay more based on experience and performance.

This was particularly awesome. All McDonald's restaurants can significantly increase - in some areas near triple - their frontline labor costs and be do fine because either 1) the demand for BigMacs so intense that people will huge prices for them (which makes one wonder they that's not what they are charging now)

The prices won't necessarily have to go up and the reason they don't go up now is because prices are regulated by market competition. There is just way too much competition in the fast food industry right now. Selling a Quarter Pounder for $5 isn't a smart idea when your primary competition across the street is selling the Whopper for $3. But because the minimum wage is universal, it applies to all companies and so there is no competitive edge to be had and no reason to risk losing demand by tinkering with the pricing. The only people who get hurt really are the share holders. Boo hoo.

McDonald's profit margins are so obscenely good that they can eat a massive hit in labor costs no probs or 3) McDonald's has drastic inefficiencies in other areas they've neglected for some odd reason that can be fixed to absorb sky-rocking labor costs.

We don't have their profit spreadsheets in front of us, but their profit margins hover around 20%. Their average burger flipper makes more than the minimum wage already, so we're really talking about less than a 20% bump in pay for their general crew staff (excluding leadership positions).

[_cinepro]

But the demand for food won't change. If one food company goes out of business then those "would be" customers will have to go buy food elsewhere, which means other companies will need more employees to accommodate their increased demand. So overall employment doesn't actually decrease on a national level, it just fluctuates on the local levels.

Eating at a restaurant isn't the only option for food though. When Subway has their $2 sandwiches in December, I eat there almost every day. When they don't, I bring my lunch from home.

So what is the "market value of labor" for a fast food worker? The minimum wage is the starting point in many areas for new hires. McDonalds averages $7.66 per burger flipper/cashier. Are you saying that if the minimum wage goes beyond that rate, it will result in unemployment? Because that 40% bump in pay jumped well over the market value of fast food labor back in 2010, and none of these catastrophic predictions about unemployment and skyrocketing prices came to fruition.

You should send an email to the Employment Policy Institute and let them know, because you know way more than they do about this.

Why is teen unemployment rising?

High minimum wage rates lead to unemployment for teens. One of the prime reasons for this drastic employment drought is the mandated wage hikes that policymakers have forced on small businesses. Economic research has shown time and again that increasing the minimum wage destroys jobs for low-skilled workers while doing little to address poverty.

High minimum wage rates price teens out of jobs. When the minimum wage gets boosted, employers frequently cut down on hiring teens who typically fill lower-priority positions. Nearly half of all minimum wage earners are teenagers or young people still living with their parents. Most of the work still gets done, but customers may get stuck standing in longer lines, and teens suffer because they’ve been priced out of the opportunity to work.

Employers are unable to afford hire more unskilled and inexperienced workers when the minimum wage increases. Ironically, one of the stated goals of the Fair Labor Standards Act (FLSA) is to “protect the educational opportunities of minors.” However, as labor becomes more expensive for small businesses, managers can afford to hire fewer workers — and that leaves unskilled teens and minorities out of luck.

Teen unemployment is three times the national unemployment rate. The percentage of teens classified as “unemployed” — those who are actively seeking a job but can’t get one — is more than three times the national unemployment rate, according to the most recent Department of Labor statistics.

http://epionline.org/teen/

If they're too conservative for you, how about the National Bureau of Economic Research?

We review the burgeoning literature on the employment effects of minimum wages - in the United States and other countries - that was spurred by the new minimum wage research beginning in the early 1990s. Our review indicates that there is a wide range of existing estimates and, accordingly, a lack of consensus about the overall effects on low-wage employment of an increase in the minimum wage. However, the oft-stated assertion that recent research fails to support the traditional view that the minimum wage reduces the employment of low-wage workers is clearly incorrect. A sizable majority of the studies surveyed in this monograph give a relatively consistent (although not always statistically significant) indication of negative employment effects of minimum wages. In addition, among the papers we view as providing the most credible evidence, almost all point to negative employment effects, both for the United States as well as for many other countries. Two other important conclusions emerge from our review. First, we see very few - if any - studies that provide convincing evidence of positive employment effects of minimum wages, especially from those studies that focus on the broader groups (rather than a narrow industry) for which the competitive model predicts disemployment effects. Second, the studies that focus on the least-skilled groups provide relatively overwhelming evidence of stronger disemployment effects for these groups.

http://www.nber.org/papers/w12663

(emphasis added)

[_EAllusion]

I was referring to a hypothetical $20 min wage in the McDonald's example, not a $9 min wage.

[_Kevin Graham]

Eating at a restaurant isn't the only option for food though. When Subway has their $2 sandwiches in December, I eat there almost every day. When they don't, I bring my lunch from home.

Which means buying more food from the grocery store. What's the difference? Both need employees to sell their food.

You should send an email to the Employment Policy Institute and let them know, because you know way more than they do about this.

Notice that this article addresses the drop in "teen" employment rates. Not that overall employment had any change. This only means employers began hiring older adults instead of teenagers, which makes perfect sense given the increased pay rate would increase the number of interested adults. I don't see many teenagers at fast food places anymore. But does that mean no one is working the register or the grill? No, it just means employers are now more selective in who they hire. At a flippin $3.35 an hour, I worked at McDonalds back in 1987 as my first job. Virtually everyone I worked with was a teenager. Why? Because only high school kids would work at such a low rate of pay.

Look, you folks are the ones who need to demonstrate a clear case proving the minimum wage causes unemployment. The fact is this used to be the conventional wisdom among economists until more recent evidence has pretty much made it a moot point. According to the wiki:

"Until the 1990s, economists generally agreed that raising the minimum wage reduced employment. This consensus was weakened when some well-publicized empirical studies showed the opposite, although others confirmed the original view. Today's consensus, if one exists, is that increasing the minimum wage has, at worst, minor negative effects." ( "A Blunt Instrument; The Minimum Wage," The Economist, October 28, 2006)