Tributes from Noah Smith (featured at DeLong’s place), Peter Dorman (Econospeak), and Jared Bernstein. If he really did commit suicide, one has to wonder why. I know Team Trump is out to destroy everything he and Obama did but he’d been only 60 when Biden becomes the next President.
Moses Herzog
Today I requested 2 books by Krueger from my local public library. One they already had, and one requested they obtain for the city library. They have been good about it in the past, and I have high hopes they will obtain a copy of “Myth and Measurement”. If we look at Mr. Krueger’s work, it’s very apparent he had vast vast reserves of and a large “cache” of empathy for his fellow man. Empathy is a great quality, and a quality in dire shortage in the current times. Empathy is not a weakness. Empathy is a human strength and can give us a great inner power to do great, and even sometimes, superhuman acts for others. Mr. Krueger was a such a man, who employed (no pun intended) his great intellectual gifts for the benefit of others less well-off than he was himself. I feel guilty I was not more conscious of his work until today (although of course I knew his name and his field). His wife and two children can take great solace in the fact Mr Krueger’s work will live on and that other great economists will take the strong foundation Mr. Krueger has built to benefit current and future societies. What better legacy can a man leave??
Barkley Rosser
Guess this might not get posted for awhile (happy vacation, Menzie), but I would like to note a couple of things to put this highly contentious debate into a bit of a broader perspective. Certainly since the influential study by Card and the now-late Alan Krueger of min wages in the fast food industry over 20 years ago, the debate over this has gone back and forth very vigorously with no definite resolution, some studies finding the traditional result pushed by Steve Kopits of higher min wages reducing employment while others finding them increasing employment, with both of these outcomes possible as they may each hold in different cases. (I am not going to weigh in on this particular round of debating over this particular case in New York City.)
I would like to add a point I only recently heard about relevant to this more generally. It came in a talk by Ben Zipperer of the Economic Policy Institute about a paper by him and some coauthors. They were looking at employment changes in total at the state level after states increased their minimum wages. They found a modest positive relation, but also recognized other studies found the opposite. But this is not the point I wish to emphasize.
Zipperer provided a rather neat argument about what is usually going on in these siituations. On the one hand indeed the traditional textbook argument that when min wages rise there is a tendency for fewer new jobs to be offered is generally true. However, the offset to this that is only rarely mentioned in these debates (although Card and Krueger did), and I have not seen it in in any of this discussion so far, is that workers tend to stay with their jobs much more due to greater work satisfaction, so that there is a decline in job losses. Either of these effects can dominate, and it is an empirical question which one does in any specific case.
pgl
“the offset to this that is only rarely mentioned in these debates (although Card and Krueger did), and I have not seen it in in any of this discussion so far, is that workers tend to stay with their jobs much more due to greater work satisfaction, so that there is a decline in job losses.”
Walter Wessel argued that labor supply depends on both wages and fringe benefits in a market clearing competitive model where a minimum wage is offset by lower fringe benefits. A neat argument for explaining why observed employment does not fall much. But toss in monopsony power with his argument is one gets a rise in labor supply from a higher minimum wage.
The Econ 101 model was always too incomplete to address real world labor markets.
pgl
Walter Wessels updated this 1980 paper with this 2001 paper:
Minimum wages and the Wessels effect in a monopsony model
“The Wessels model suggests that firms respond to increases in the minimum wage rate by decreasing the level of fringe benefits — an action which produces an inefficiency effect that lowers workers’ utility and the supply of labor. Standard models of monopsony, however, argue that wage floors prevent the exercise of market power and increase employment. I show that wage floors, even with fringe benefit curtailment, may increase employment by lowering the marginal expense of labor. Employee utility and employment will rise somewhat but not as much had the firm acted competitively in setting both wages and fringes.”
Steven Kopits
Barkley –
In this case, the interpretation is not even close. You can see the damage to the NY full service sector by visual inspection (see second graph, link below). The issue with minimum wage laws is that they are often not binding, or not very binding, depending on where they are set. Not a lot of people work at the Fed min wage level of $7.25. A whole of people work at $10 / hour. So setting the Federal min wage to $10 probably wouldn’t have a huge effect nationally.
However, once the minimum wage becomes binding, increases from that point are going to influence behavior. We can see that the $10.50 min wage in NYC cut the growth rate of the full service restaurant sector by half, but it didn’t kill it. The $13 wage, however, just crushed it.
But is this a surprise? No. There is no inelastic demand for full service restaurant meals. So we would expect increasing prices to decrease consumption. The only question is at what price that happens. Well, now we know.
Still trying to get people to read your worthless blog? Come man – you have proven time and time again you have no clue on the data, theory, or anything else. But you deem to lecture someone who does? Go figure!
pgl
“The issue with minimum wage laws is that they are often not binding, or not very binding, depending on where they are set. Not a lot of people work at the Fed min wage level of $7.25. A whole of people work at $10 / hour.”
I see you too have never read Card and Krueger (1994) which is what Barkley was talking about. Oh yea – when NJ raised the minimum wage way back then the market wage was much higher. Seriously Stephen – stop babbling about things you do not understand. Fast food wages were not that high which was the whole damn point of the legislation. This is exactly why no sane person would ever read your blog. You babble on incoherently in a way that makes even PeakTrader look smart. Please stop as it is embarrassing to your family.
PeakTrader
Steven Kopits, focusing only on employment is a very ignorant way to conclude there has been “damage.”
I guess, most Americans losing their jobs in farming over the past hundred years is catastrophic.
PeakTrader
Correcting a market failure benefits the economy.
pgl
Steven is clearly babbling on a topic he does not understand. It seems your response is more babbling on a topic you do not understand.
pgl
Monopsony power is a market failure which a wage floor would correct. Of course know nothings like Princeton Stephen has no idea what we are talking about here. Funny thing – you have no idea what we are talking about here either!
Steven Kopits
You’re confusing creative destruction with just plain destruction. Americans did not lose their farm jobs because of high minimum wages, but because of productivity increases which made their labor unnecessary on the farm. Those farms produce more today than they ever did.
By contrast, imagine that the minimum farm wage were set to $100 / hour. Those farmers would be unemployed and the farm would lie fallow. Economic output would decline, which is what NYC’s minimum wage is doing to the full service restaurant sector. If it were due to productivity gains, sales would be up, profits would be up, and people would be being laid off because robots are serving tables. But that’s not the case, as the NYC Alliance survey makes amply clear.
Big difference.
PeakTrader
Steven Kopits, it’s the same difference.
The correct minimum wage will increase productivity and fewer workers will be needed to produce the same output.
Therefore, labor is freed-up to produce other goods & services.
A market failure is when workers earn less for being more productive.
A minimum wage that’s too low slows productivity growth.
pgl
“Imagine that the minimum farm wage were set to $100 / hour. Those farmers would be unemployed and the farm would lie fallow. Economic output would decline, which is what NYC’s minimum wage is doing to the full service restaurant sector.”
Of course the NYC minimum wage is nowhere near $100/hour. And with all you stupid and incessant babbling on a topic that you understand even less than PeakStupidity, you have presented no credible evidence for your claims.
You know some village idiots stop when the rest of the world is laughing at them. But not Princeton Stephen. He babbles BS over and over again.
Steven Kopits
It’s not the same output, Peak. Output is reduced. Binding wage floors will create deadweight losses.
PeakTrader
There’s a deadweight loss only in a partial equilibrium model Steven.
A higher minimum wage can result in a (positive) income effect that more than offsets a (negative) employment effect, resulting in higher output.
And, the productivity gains can offset price increases.
PeakTrader
Since the minimum wage was established, per capita real GDP has grown at a much faster rate (although, other factors contributed):
Also, using the concept of the price floor for wage floor is incorrect, because wages are more than the price of labor.
Wages are also an input and income.
PeakTrader
Moreover, I may add, wage “stickiness” is much less of a problem, if a problem at all, since monetary and fiscal policies have smoothed-out business cycles.
Before, the Fed, economic boom/bust cycles were frequent and severe.
Barkley Rosser
Steven,
The reason I said I would not get into this particular debate is that there are many elements involved in what goes on, and I do not see any data on various important variables to be able to make a definitive statement, which would involve also doing a fairly sophisticated econometric analysis of all these variables , and even then it can still be debated, as the long debate over the Card and Krueger study after iit was made shows. Simple eyeballing of a couple of figures and citing some media stories talking to whining restaurant owners are not sufficient to establish the case, although there certainly is quite a bit of smoke here with, indeed, a lot of complaining going on from the restaurant owers.
Some of the confounds that are out there have been mentioned by others, but I shall mention a couple more. One is that the sector may be going through its own cycle. Some data cited in your link show that the NY restaurant sector grew very rapidly over the last decade. It may have simply grown too fast and is now facing a nomral cutback.
Another missing matter is what has been happening to prices. The survey reports that notable percentages of restaurants are planning to raise prices, but how big are thos increases and how much have prices risen recently when these reported employment declines have occurred. Were they or will they be greater than what was going on in previous years? I could find no data on this. Prices may not really have risen all that much, with other factors being responsible here.
It may well be that indeed the minimum wage is driving the falling employment, but, for better or worse, this is not nearly as certain as you think it is, Steven. This will take more time and data to really seriously test.
Oh, and I guess I must apologiize for making you subject to Moses Herzog ridiculing you by comparing you to me, especially my clearly shameful behavior in daring to suggest that an even distribution of characteristics across a genome does not mean that there must be an even distribution of genes across a population, something that would shame me in the eyes of my late father if he were alive to see it, this man who got his PhD in math from Princeton and knew Einstein, von Neumann, and Godel. Shame on me.
pgl
A nice discussion but can we have Princeton Stephen focus on one line:
“Simple eyeballing of a couple of figures and citing some media stories talking to whining restaurant owners are not sufficient to establish the case”.
The rest of us have tried in vain to get this simple point across but it all seems lost on Princeton Stephen. But excellent try!
Steven Kopits
Barkley –
In the real world, you have to make a call, and that’s going to be a 51% call. That’s real world management, in which you never have perfect information and never get to a 95% certainty threshold.
“Simple eyeballing of a couple of figures and citing some media stories talking to whining restaurant owners are not sufficient to establish the case…”
We have a survey of 754 establishments. This tells us two things. First, the pain threshold was high enough to prompt someone to commission a survey. I don’t know if you’ve ever worked outside academia, but in my experience, these sorts of things are commissioned when people are feeling pain. Second, unless you are impugning the integrity of the pollsters, that’s a pretty big sample. So we do have some data points here.
“the sector may be going through its own cycle. Some data cited in your link show that the NY restaurant sector grew very rapidly over the last decade. It may have simply grown too fast and is now facing a nomral cutback.”
There is no historical precedent for this. If this were the case, we should be hearing about New Yorkers have less money to spend, over-building, ‘crazy’ restaurant owners, etc. Can’t find anything in the press. The survey shows restaurants are pushing through big prices increases, just as we would expect. They would only fail to do that if they were earning above-normal profits, in which case the industry would be under-served, rather than over-served. On the other hand, if the industry is over-served, then profits should be low and raising the minimum wage would be the height of insanity, no?
Even a cursory analysis suggests that the minimum wage in New York in the commodity, unskilled labor market is close to 50% above the market-clearing level. What’s your feeling, if you’re an economist? Would you say, ‘Gee, don’t worry, be happy,” or “You know, there’s a pretty good chance that’s going to screw up your labor market in a big way.”? I am frankly astonished that these questions are being asked by a ‘self-professed policy analyst’, rather than the economics profession itself. I don’t think it would be particularly difficult to make the case that min wage rises have reduced relative employment by as much as 100,000 in New York over the last three years or so. That’s quite a big number. That warrants a deeper look at whether it’s the plain vanilla explanation — higher minimum wages — or something else, eg, notably a sector overbuild or a New York recession. Both these could be ascertained in relatively short order, and to all appearances, not only is no one doing it, no one has even thought to do it.
The notion that one is not making a call is not the same thing as not making a call. Things are happening while you wait, whether or not you choose to act on them. And I am amazed at the passivity of the economics community. Card and Krueger, so hey, no problem.
Looks like a problem to me.
pgl
“In the real world, you have to make a call”.
Oh Lord – you have no clue what the real world even is. And you have no clue about why these self serving lobbyist wrote their little SURVEY which some village idiot known as Princeton Stephen thought was a “study”. Can you write even more stupid stuff? I bet you can!
Steven Kopits
As for Mozes, he’s just crazy. pgl, that guy is a rabid dog. I wouldn’t let him around my guests.
pgl
No fear. I would never attend a party with arrogant know nothings like you. Cheers!
Moses Herzog
…….. says the extreme racist who doesn’t understand BASIC statistics terminology and miscalculates (to the downside) human death counts.
…….. says “Princeton”Kopits, who feels ill at the thought of food service workers making a living wage for themselves and their families.
…….. says “Princeton”Kopits who fabricates exaggerated immigrant traffic along the border, literally pulling his numbers out of vacuous air.
If separating myself and delineating myself from such trash and pseudo-intellectualism as “Princeton”Kopits bloviates from his bunghole daily makes me a “rabid dog”, I wear your label “rabid dog” as a badge of honor.
Steven Kopits
You attend all my parties. You can’t help yourself.
Steven Kopits
Didn’t call you a rabid dog, Mozes. A little crazy, yeah, maybe.
Moses Herzog
“Princeton”Kopits”
Perhaps you are the beneficiary of one of my more negative personality traits—Giving charlatans and hucksters more attention than they deserve. After all, FOX news is always there to give you their unconditional love.
Steven Kopits
The Fox and Friends interview was actually pretty funny. When Katie Pavlich asked me what we should do about the border, her co-host clearly expected me to say, “Build a wall.” And of course, I said, “Well, it’s a black market and we fix those by legalizing and taxing them.” (See how it’s going with marijuana, here: https://www.princetonpolicy.com/ppa-blog/2019/3/21/human-and-drug-smuggling-trends-under-trump)
I stated before, a reduction in employment is expected from a substantial increase in the minimum wage over a short period.
I’d expect poorly managed restaurants either to become more efficient, and therefore competitive, or go out of business, while more efficient restaurants find ways to become even more efficient and gain market share from the weaker restaurants.
A very high proportion of restaurant workers will be much better off earning much more per hour, even with reduced hours. The positive income effect, particularly for workers with high marginal propensities to consume, will increase demand for products and generate jobs throughout the economy. Also, productivity is expected to increase, including lower turnover rate, and prices will rise only slightly. Moreover, I’d expect people out of the workforce, with higher reservation wages, to come back in. Furthermore, tax revenue will rise and government spending will fall.
Overall, a subsistence wage will be a net benefit to the economy.
pgl
Lord – the peanut gallery spews its usual stupidity. Alan Krueger’s life is being celebrated in part because of that 1994 paper he wrote with David Card. Obviously PeakStupidity has never read it.
Barkley Rosser
PT,
Hopefully you are being paid a subsistence wage, since you think that is “a net benefit to the economy.”
PeakTrader
Barkley, it’s what the labor economics literature suggests.
There have been many more than one study.
And, I completed two grad labor econ classes, enough to take the comp exams, although my two fields of specialty were in something else.
baffling
still relying on that jr phd for credibility, eh peak?
pgl
“it’s what the labor economics literature suggests.”
You are lecturing Barkley on labor economics? My oh my – this is like a 2 year old lecturing a real President on how to run the nation. Of course given who is the current President, maybe we should have him listen to the babies!
“I completed two grad labor econ classes”. Menzie has asked you before who wrote the text books your alleged classes used. And you could not. Oh wait – I know. Dr. Seuss!
PeakTrader
It’s possible, the only people on this link, who had grad labor econ classes are Menzie Chinn and me.
Jim Hamilton and Rick Stryker also possibly had them.
PeakTrader: I didn’t take PhD level labor courses. However, I did take macro from George Akerlof.
Moses Herzog
I never had a “name” economist teach me, but I had one guy teach me economics with a Phd from the University of Chicago and another guy teach me economics who had a Phd from Stanford. Do I get bragging rights??? No, not labor economics specifically. I can also say I never lied about my educational background, so that’s always a plus. (Peak, the last part of the comment is directed at you, but the remark could also be aimed at people who tie their “work” to Princeton but have no association whatsoever to the University).
2slugbaits
PeakTraderOverall, a subsistence wage will be a net benefit to the economy.
I don’t think that’s what you meant to say. Didn’t you really mean something like “a livable wage will be a net benefit to the economy”?
I agree that a higher minimum wage will pull more people into the labor market because it will rise to their reservation wage. I don’t agree that productivity would necessarily increase. The reservation wage is not the same thing as the efficiency wage. The efficiency wage refers to smart employers paying a little above the minimum wage because it motivates greater effort from workers. But the key to the efficiency wage is that there must be a gap between the minimum wage and the efficiency wage. Raising the minimum wage would require employers to raise the efficiency wage in order to maintain that gap.
Steven Kopits
By definition, productivity in terms of ($ output / work hour) should increase, Slugs. Total output will fall.
pgl
Gee – you seemed to have preK arithmetic. Congratulations!
pgl
“Sector X is business and professional services”.
Like CPA firms cannot profit if it paid their employees $15 an hour! Ask Princeton Stephen – the self styled expert at everything!
Steven Kopits
I was relieved that the $15 hourly wage was not binding on New York’s lawyers and investment bankers. I find it astonishing, though, given that NY is so heavily business services, that you can see the effect with the naked eye here as well.
As for self-styled expert. You could have done everything I did. The difference that I did it, and you didn’t.
The Professional, Scientific, and Technical Services sector comprises establishments that specialize in performing professional, scientific, and technical activities for others. These activities require a high degree of expertise and training. The establishments in this sector specialize according to expertise and provide these services to clients in a variety of industries and, in some cases, to households. Activities performed include: legal advice and representation; accounting, bookkeeping, and payroll services; architectural, engineering, and specialized design services; computer services; consulting services; research services; advertising services; photographic services; translation and interpretation services; veterinary services; and other professional, scientific, and technical services.
The Management of Companies and Enterprises sector comprises (1) establishments that hold the securities of (or other equity interests in) companies and enterprises for the purpose of owning a controlling interest or influencing management decisions or (2) establishments (except government establishments) that administer, oversee, and manage establishments of the company or enterprise and that normally undertake the strategic or organizational planning and decision making role of the company or enterprise. Establishments that administer, oversee, and manage may hold the securities of the company or enterprise.
Establishments in this sector perform essential activities that are often undertaken, in-house, by establishments in many sectors of the economy. By consolidating the performance of these activities of the enterprise at one establishment, economies of scale are achieved.
The Administrative and Support and Waste Management and Remediation Services sector comprises establishments performing routine support activities for the day-to-day operations of other organizations. These essential activities are often undertaken in-house by establishments in many sectors of the economy. The establishments in this sector specialize in one or more of these support activities and provide these services to clients in a variety of industries and, in some cases, to households. Activities performed include: office administration, hiring and placing of personnel, document preparation and similar clerical services, solicitation, collection, security and surveillance services, cleaning, and waste disposal services.
pgl
“I was relieved that the $15 hourly wage was not binding on New York’s lawyers and investment bankers.”
Seriously? When one thinks you could not be more stupid, you exceed expectations!
pgl
I just saw what prompted this – another incredibly absurd comment from Princeton Stephen. Rather than admit he got the data dead wrong, he puts some stupid spin on Menzie’s data. I guess he has never heard of Stein’s law (Herb Stein that is):
Doing a trend line during a recovery from a deep recession, which severely impacted Manhattan, as if the food service sector should experience fast growth forever is the dumbest thing Princeton Stephen has ever written. And he has written a lot of really stupid things!
Well, “children”…..”terrorists”, with MAGA it’s all ‘the same”, really…….
pgl
“The federal government is relying on secret shelters to hold unaccompanied minors, in possible violation of the long-standing rules for the care of immigrant children, a Reveal investigation has found.
The Office of Refugee Resettlement, the government agency that cares for unaccompanied minors, has never made the shelters’ existence public or even disclosed them to the minors’ own attorneys in a landmark class-action case.”
The story goes on and this outrage gets even worse. Trump is committing the most severe human rights violations ever.
pgl
Noah Smith’s tribute to the late great Alan Krueger
‘Krueger himself was a key figure in this revolution, helping to pioneer the use of natural experiments. His landmark study, written with David Card, was a 1994 paper evaluating the results of a rise in New Jersey’s minimum wage. Traditionally, economists believed that minimum wages caused a substantial degree of job loss — this was based on the textbook model of supply and demand, which says that placing a floor on the price of something causes a shortage. Card and Krueger, however, suspended judgment on that theory and simply compared employment changes at stores in New Jersey to changes at stores in nearby Pennsylvania, which hadn’t raised the minimum wage. Card and Krueger’s result shocked the economics world — the higher minimum wage had no effect on employment, at least in the short term. A large number of follow-up studies found similar results for a number of minimum-wage experiments. The economics profession was faced with an unusual case where the facts were clear enough to present a challenge to a long-accepted textbook theory. Slowly, economists are being forced to do what natural scientists would do in this situation — look for another theory to explain how labor markets work. Some are converging on the theory of monopsony power as a simple alternative, while others are building more complex, realistic models.’
Krueger taught at Princeton. Princeton Stephen clearly does not as Stephen would like call the Card-Krueger paper “garbage”.
Barkley Rosser
Noah got it wrong. Actually what Card and Krueger found was that employment in those locations rose in NJ while they fell in PA. It was not a “no employment change” finding, so even more shocking. Of course, there were a lot of studies that followed up that challenged their results, and as I already noted this has gone back and for the ever since.
pgl
The labor market economist in me starts to think: did NJ have a monopsony model structure whereas PA’s labor market fit the market clearing competitive market model. Theory should be checked by evidence but evidence free economics begs the theorists back into the discussion.
I say this because of some dumb WSJ oped when the secretaries of Yale unionized. The WSJ is based in Manhattan where there are lots of law firms and other employers of secretaries. In New Haven, Yale is it. The classic monopsonist. So yea – the unionization at Yale did not destroy jobs as the WSJ oped pages predicted.
spencer
By eyeball It looks like you had 4 minimum wage hikes and employment continued to grow.
Now we have a fifth wage hike and employment growth falters.
Why is this fifth time different?
pgl
Because Lord Princeton Stephen hath spoken! Bow down to this self proclaimed expert at everything!
Steven Kopits
I noticed the same thing. See my comment below.
Moses Herzog
Dilbert found the answer (an answer I feel a little dumb for it not dawning on me earlier, before dilbert dogbert commented on it).
Sometimes I’m a little slow to the take, and that’s something that should have hit me nearly immediately after looking at that portion (far right) of the graph. But it didn’t…..
Erik Poole
@Barkley Rosser,
Good summary, concise treatment. Tuck.
I would tend to believe that low-wage workers are complimentary to capital so much so, that minimum wage hikes would only affect final investment decisions on greenfield projects. For existing projects, most capital costs are already sunk.
In other words, over the longer run, there might a negative impact but it is likely very small, small enough that most empirical methods would not catch it.
Frankly I’m surprised this story hasn’t gotten more “legs” or “traction” over the last couple days. I assumed that at least in 4–5 days this would at least get periphery attention from the TV news, but so far, nothing.
dilbert dogbert
dilbert I think you have made a a very astute and sharp-eyed point. My guess is Menzie saw this long before he even put up the graph (an observation like that is child’s play for Menzie). And I have to confess, somewhat red-faced, that it is something that had not dawned on me. I did in fact wonder about the tapering off of the red line at the end of Menzie’s graph above. I viewed it (from an eyeball perspective) as statistically insignificant. Still, I did notice. I think you have NAILED it, the tapering off of the red line (NYC business and professional services employment) on the far right portion of the graph is due to the effects of the BROADER economy slowing down late 4th quarter and into the 1st quarter (the national economic slowdown).
Steven Kopits
In addition to job losses in the restaurant sector, minimum wage hikes in New York City have also claimed 36,000 jobs in professional and business (P&B) services.
On the graph below, we can see a curve fitted to the data from January 2010 to October 2015. The curve carries an R2 of .9965, which is a better fit than a straight line and falls very, very close to the actual data. Doing so, however, shows that employment growth deviates from trend beginning in October 2016, about three quarters of a year after the minimum wage is raised to $10.50 / hour.
We can compare predicted to actual employment in order to estimate the impact of minimum wage hikes on P&B headcount. As the graph below shows, a 2010-2015 trend line shows no job losses until the fourth quarter of 2016, about 6,300 for that year. The losses grow in 2017, adding another 8,100. The wage rise to $13 / hour seems to do the real damage though, with job losses in 2018 (including Jan. 2019) at just below 22,000. Add it all together, and New York City professional and business job losses — those we would have expected to see less those actually attained — total 36,000 from the point that the minimum wage was raised to $10.50 / hour through Jan. 2019.
These losses are large enough to be visible on a graph without the aid of statistics, and they are large enough to stop growth of professional and business services entirely. Further, the job losses seem to occur with a lag, six to nine months after a given minimum wage increase. If this is the case, then P&B employment may continue to unwind in 2019 and see a difficult stretch in the first half of 2020.
Barkley devastated this nonsense but just in case you missed his key point in all of your arrogant babbling, I repeated the key sentence.
But do continue babbling as even your dog is laughing at you by now!
2slugbaits
Steven Kopits Just as an econometric issue, I’m pretty sure that you don’t want to take a simple exponential curve regression with a time trend. Just take a quick look at the correlogram and it should tell you that something is clearly wrong with that kind of a time series model. A simple and much better way to look at the data would be to convert the data to logs, then run a simple ARIMA(1, 1, 0) model with constant from Jan 2010 thru Oct 2015. The residuals will show no evidence of autocorrelation and will be normally distributed with both coefficients being significant. Then dynamically forecast through Jan 2019. You will see that the forecast for Jan 2019 is very close to the actual and well within the error bars.
2slugbaits: If Steven Kopits doesn’t understand what a confidence interval is, I sincerely doubt he will understand the hazards of assuming trend stationarity for arguably I(1) series. But, good try attempting to educate him.
Moses Herzog
@Menzie & 2slugbaits
From a morality standpoint (and just being a good human being) that is a trait and quality to be admired in both you and 2slugbaits. We could include others in that—-James Hamilton, Ashoka Mody, Alan Krueger, etc.
From a pragmatic standpoint??—a waste of time. But pragmatism is something with should be intermittently tossed aside by the best teachers/professors, so as to give that “nth” degree of opportunity to students to learn something, on the small chance they would ever change their attitude—which—some do. In this case??? Draw your own conclusions.
Moses Herzog
*”which should be” not “with should be” Sorry. “bang” energy drink usually helps me avoid these bad late night typos but apparently it’s not kicking in tonight. I think I need to go back to bourbon again. Honestly seemed to have less typos when I was using that.
2slugbaits
Steven Kopits I read your blog article and I think your conclusions, while possibly valid, go beyond what the data actually says. I think the problem is that you looked at one data set (viz., restaurant employment) and concluded that the higher minimum wage must be responsible for that drop in employment growth. You needed to look at other data sets and you should have asked a few more questions. For example, if the minimum wage hike is responsible for the drop in restaurant employment, how do you explain the sharp increase in NYC retail employment https://fred.stlouisfed.org/series/SMU36935614200000001SA? Both occupations require similar skill sets. One explanation is that given a choice between retail work and restaurant work, most people would probably prefer retail work because the work itself is less onerous. If you can get the same wage in retail, why would you want to work as a dishwasher? You also need to explain how the unemployment rate for NY state continued to fall even though NYC raised its minimum wage. I suppose you could concoct a story that might explain this, but it’s an issue that needs to be addressed. You also need to ask if the $15/hr minimum wage really represented that big of an increase in the effective minimum wage. According to the BLS the average restaurant wage for the NYC/NJ metro area was $14/hr back in May 2017. https://www.bls.gov/oes/current/oes_35614.htm#35-0000 So would a $15/hr wage 19 months later be all that much of a hike? Notice that the low end jobs at restaurants are precisely those jobs that would make alternative employment in retail especially attractive. And you might want to check the increased construction employment numbers for NYC. Again, instead of people losing jobs because of the minimum wage, it’s possible that they were just leaving jobs in favor of other better jobs. That’s what we would expect in a healthy economy. In order for restaurant employment to continue growing at the old 8600/yr rate, there would have to be an influx of low skilled workers. There are good reasons to believe that may not have been happening. For example, in the NY/NJ/PA are there are approximately 561,000 people who were born in Puerto Rico according to 2017 census data, with about 421,000 of those concentrated just in the NY/NJ area. In other words, the NYC area depends upon a strong influx of PR born workers. If you’ll look at the BLS data for PR, you’ll see that emigration out of PR flatlined after Hurricane Maria. Indeed, PR unemployment is at record low levels and construction jobs are way up. So the flow of workers from PR to NYC seems to have stalled coincidentally with the slowdown in full service restaurant employment. Fewer PR workers means fewer low skilled workers available for restaurant and hospitality jobs. And notice that according to Census data 37.2% of NYC residents are foreign born: https://www.census.gov/quickfacts/fact/table/newyorkcitynewyork,US/PST045218
So how do you think Trump’s anti-immigrant policies and I-9 enforcement might be affecting the NYC labor supply?
You should also look at other states. In 2017 there were 20 states that increased their minimum wage. In 2018 there were 21 states that increased their minimum wage. In 2019 there were similar numbers. If higher minimum wages represented a problem, then how is it possible that we’ve seen strong employment growth in 2018 nationally?
You claimed that one possible explanation for the sharp drop in full service restaurant employment relative to limited service restaurant employment could be explained by people choosing to downscale their eating habits in response to higher menu prices. That’s possible, but there are a lot of problems with this assumption. For one thing, limited service establishments are much more sensitive to labor costs than full service establishments. At full service restaurants the wage bill typically represents only about 22% of the total costs. Food and rent costs are much bigger costs. So the menu price response to a hike in wage rates is not the same for full service and limited service establishments. A minimum wage hike is likely to reduce the differential menu cost between full and limited service restaurants. But yet we see employment in limited service restaurants not dropping off like full service restaurants. That suggests that the reason for the drop in full service restaurant employment might be due to something other than a minimum wage hike.
You also cited an NBER study that claimed higher minimum wages increased property crimes for 16-24 year olds. Given that FBI statistics show an overall downward trend in property crime rates and given that there has been an overall increase in minimum wages (especially lately), this would suggest that a higher minimum wage would likely reduce property crime rates for those over age 24; otherwise it’s hard to see how the overall rate could be falling while minimum wage rates increase. This true has intuitive appeal.
CoRev
2slugs, you talked around the issue without contradicting Steven’s conclusions. I do agree that the Trump economy is different and better than the Obama economy especially for the low wage earners. As you show: “Notice that the low end jobs at restaurants are precisely those jobs that would make alternative employment in retail especially attractive. And you might want to check the increased construction employment numbers for NYC. Again, instead of people losing jobs because of the minimum wage, it’s possible that they were just leaving jobs in favor of other better jobs.” But, this does not change Stgeven’s conclusion, that the minimum wage increase changed restaurant employment in NYC. BTW, as Mernzie’s chart has confirmed.
I do comment you in your attempt, and actually agree with your conclusion that in the good Trump economy many more jobs have been available for transfer into for those employed in less appealing restaurant jobs. Job changes have gone up under Trump, which also include increased wages for those new jobs. I think if we look at the data this conclusion well supported.
As we approach full employment the effects of these types of mandated wage increases and the industries affected become more obvious supported by <b<industry surveys when compared to previous hypothetical studies.
2slugbaits
CoRevyou talked around the issue without contradicting Steven’s conclusions.
I didn’t endorse his conclusions either. There’s no question that at some point a higher minimum wage will hurt employment. At some point the reduction in employment will be worse than the welfare gains from a higher wage. It’s also the case that very often a rise in the minimum wage has no observable negative effect on employment. It’s entirely possible that NYC’s $15/hr minimum wage has reached the level at which it’s binding and affects employment. Whether or not that reduction in employment is offset by the welfare gains from those who remain employed is another issue. Regarding the NYC minimum wage, I’m simply agnostic. My critique of Steven’s post is that he is overconfident in his conclusions. The econometrics needed to seriously address the issue goes well beyond a couple of simple graphs in one sector of the economy. Frankly, I was a bit surprised that he posted something like that on his professional business website. It’s one thing to make that kind of conclusion in the comments section of a free-wheeling blog topic; but if you’re going to post something to your professional business website, then I think you’d want to present a more rigorous analysis that survived some kind of internal murder board review.
There’s no surprise that the economy has been relatively strong over the last year or so. That’s not a surprise given the size of Trump’s fiscal stimulus. That strong growth was also predicted by most macroeconomic forecasters, including the CBO. But the time for strong fiscal stimulus was in 2009, not 2019 when the economy is already at full employment.
CoRev
2slugs, we’ve agreed on this point since 2009: “But the time for strong fiscal stimulus was in 2009,…” But your follow-on is typical rationalization and denial “… not 2019 when the economy is already at full employment.” where you missed a few years. IIRC t, and created the near full employment.he stimulus was in 2017.
Obama’s was not a strong stimulus, with which you disagreed with me, and Trump has shown how wrong Obama and most liberals were about how to best improve the economy.
2slugbaits
CoRev we’ve agreed on this point since 2009
Your memory is failing you. You strongly opposed the ARRA and said fiscal stimulus would not work. You also joined the Tea Party protests.
stimulus was in 2017
No, it wasn’t passed until the very end of 2017 and did not take effect until 2018.
Obama’s was not a strong stimulus, with which you disagreed with me,
No, like almost everyone else on my side of the argument, I complained that the stimulus was underpowered for the job. Romer’s own calculations called for a stimulus twice the size of what was passed. And I (along with plenty of other folks) complained that too much of the ARRA went towards tax cuts rather than direct spending. It’s amazing how you have managed to completely misremember the entire arguments. Absolutely incredible.
Trump has shown how wrong Obama and most liberals were about how to best improve the economy
The standard textbook argument is that increasing fiscal spending with deficits will increase aggregate demand as long as the Fed does nothing to dampen it. So far the Fed hasn’t done much to dampen things and today the Fed more or less promised to hold rates for the rest of the year. That’s because the Fed believes the economy is actually weakening as Trump’s stimulus is starting to fade…as predicted by the CBO a year ago. The latest NY Fed GDP nowcast calls for GDP growth of only 1.37%. The Atlanta Fed is even more pessimistic with a GDP nowcast of only 0.4%. And that’s scary because the Fed already has most of the 1st Qtr data in hand since there are less than two weeks remaining this quarter. Trump has made just about every mistake possible. He pushed through huge tax cuts for the rich that have blown a huge structural hole in the budget. He put together a “tax cut” that will soon start to gradually increase taxes on the non-rich in order to keep taxes low for the 1%. He started a stupid tariff war with China that he seems unable to “win” (whatever that means). He caused all kinds of headaches to come up with a NAFTA 1.01 that he easily could have had without all of the bluster since most of what he agreed to had already been agreed to back when Obama was renegotiating some of NAFTA 1.0. He’s made a complete hash out of trade with the EU. And the moron even supports Brexit!!! Now how stupid is that? I think it’s pretty clear why Trump doesn’t want anyone to see his grades from Wharton.
CoRev
2slugs, this is getting more funny each time you bring it up: “Your memory is failing you. You strongly opposed the ARRA and said fiscal stimulus would not work. You also joined the Tea Party protests.” I strongly opposed Obama’s style of fiscal stimulus would not work, and yes attended the Tea Party demonstration against the ACA, which has since shown to be a valid position.
Your dodging again. 2017 or end of 2017? ” I complained that the stimulus was underpowered for the job.” etc. My point then was type of stimulus, and today was Trump has shown how easy it was to stimulate the economy, and the form the Obama stumulus should have taken.
The remainder of your comment just delineates the differences you have with his policies. So what!?!
2slugbaits
CoRev So just for the record, in your mind a tax cut multiplier is greater than a spending multiplier??? And in your mind the fiscal multiplier above the ZLB has a stronger effect than the fiscal multiplier at the ZLB??? Is that right? Is that your understanding of macroeconomics?
CoRev
2slugs why are you deflecting again?
Steven Kopits
Slugs –
Again, this is not a topic I particularly wanted to wade into, and if Menzie had not put the headline up, I would have been more than prepared to move on. The posts are on my website because they are analysis, and as importantly, they involve graphs. I have no way to post those here that I know of.
There are three reasons why employment could be falling in the NY full service restaurant sector:
1. New York is in recession. Is New York in recession? If so, raising minimum wages seems a really bad idea.
2. The restaurant business overbuilt. Raising wages is then also a really bad idea
3. The minimum wage is material and binding. That’s the simple read, right?
If you want to argue 1 or 2, by all means, go ahead. Do a little work. Otherwise, I am the guy carrying the water.
pgl
“The posts are on my website because they are analysis”. Seriously? I guess the intellectual garbage that Kudlow put up on National Review could be considered analysis. As far as the rest of your rant, employment is not falling in NYC’s restaurant sector. Learn to read a real graph. As far as your 3 reasons – it is so incomplete it staggers the mind.
Try moving on as we all know by now you babble stupidity with the best of them!
pgl
When I thought this discussion could not get more dumb – CoRev proves me wrong. Supported by industry surveys? Lord – the Usual Suspects remind me of the monkeys typing away thinking they are writing Shakespeare!
CoRev: Huh, as my graph illustrated? So post hoc ergo propter hoc? What about in the preceding years.
CoRev
Menzie, tipping point? To which chart do you refer, the state-wide chart showed slight drops at several wage increases, or the latest corrected chart which shows only the current drop?
BTW, did you do know that this was in the NY minimum wage law: “*Tipped food service workers rate is unchanged at $7.50 until 12/31/2017. We have been talking about this labor sector after all. While you have been talking about the NYC general minimum wage.
CoRev: I’ve been explicit in using the general minimum wage rate. There are exceptions/differentials for employment size of firm, for full service vs. limited service, etc.
CoRev
Menzie, explicit is not pertinent to Steven’s point, which you quoted from his reference: “76.50% of full service restaurant respondents reduced employee hours, and 36.30% eliminated jobs in 2018, in response to mandated wage increases. 75% of limited service restaurant respondents report that they will reduce employee hours, and 53.10% will eliminate jobs in 2019 as a result of mandated wage increases that took effect on December 31, 2018.”
Which is why I pointed out the contents of the wage law and why you have corrected your analysis limiting it to NYC, but not the specific business.
CoRev: The NYC Hospitality Alliance survey cites results from both full and limited service restaurants. Why should I only look at what full service. In addition, why should I look at *unweighted* responses. Just like more *households* will get tax reductions in first year of TCJA, but lion’s share of reductions (by far) will go to top .01% of households.
CoRev
Menzie, if you wish I can repeat the quote highlighting bot full and limited service restaurants, but it doesn’t change the fact that your work has been sloppy in this analysis.
CoRev
Menzie, if you wish I can repeat the quote highlighting both full and limited service restaurants, but it doesn’t change the fact that your work has been sloppy in this analysis.
CoRev: I see you want this point made, by repeating. Actually, I was sloppy in making a mistake on the March 15th post by plotting the wrong series, not this post. This post has no errors, so far as I can tell.
CoRev
Menzie, of course you can’t see an error because a conservative is pointing it out. You are still comparing oranges to citrus. So you and especially pgl can understand, comparing minimum wage effects to restaurant workers (the point to which you took exception) to NYC General Minimum Wage (the comparable which YOU selected).
You started by comparing NYC minimum wage effects to NY State minimum wage effects. Neither were part of the original point. You have been very sloppy in this analysis, and it appears just attack another’s view/sources. Just keep believing in your infallibility. Your students won’t ever know until they get into the real world.
Barkley Rosser
Another possible explanation is that there was a too rapid expansion of the restaurant sector in New York in the last decade, and we are simply seeing a pullback that would have happened anyway. Also, Steven has made a big deal about price increases, but we see no data on what those increases have been in the past.
I have stayed out of this debate in its details because indeed to really get at this requires data on a lot more variables and serious econometric testing, none of which Steven provides. There is smoke here, but he has overstated substantially what can be concluded from it, and there are several alternative explanations possible.
pgl
Ask any restaurant owner which costs is most affecting his bottom line and the reply will be in almost every case “the rent is too damn high”. Labor costs in Manhattan are a very small percentage of your food bill. We have tried to point out other considerations to Princeton Stephen but guess what? He ain’t listening.
Moses Herzog
I can’t 100% verify this, but supposedly it was a CNN poll. Notice the ages of the people polled (or the ages of those excluded from the poll) https://i.redd.it/ys7uowiyt7n21.jpg
The older crowd is going to go for Biden—same people who voted for Hillary with same end result. The useless Biden ego-trip has begun.
pgl
Bonfire of the Vanities? Of course this may apply to the three B’s: Biden, Beto, and Bernie!
Anonymous
Test
Steven Kopits
Slugs –
It’s very difficult to draw conclusions about New York’s retail employment because the city is such an outlier. It’s fair to say that the city was adding retail employment at a good clip — as it had historically during economic expansions — until the end of 2014, after which the minimum wage was raised to $9.00 and the retail sector stopped adding jobs. Therefore, by New York City standards, the post-2014 period is highly unusual and potentially indicative of the effect of increased minimum wages.
On the other hand, we see similar patterns in Boston, Philly and Pittsburgh, with the difference that retail employment in these locals had been falling since 2000, even as New York’s was rising quickly. And of course, Boston, Philly and Pittsburgh are all materially automobile markets, whereas NYC is not, by and large. So it’s all apples to oranges. And of course there is the Amazon phenomenon. New York has a lot of store vacancies, with retail employees falling by more than 10,000 per year in Manhattan for the last three years, according to The Atlantic story below.
How much of that is minimum wage, and how much is underlying trends in retail? I can’t tell from the employment data.
“It’s very difficult to draw conclusions about New York’s retail employment because the city is such an outlier.”
Oh Lord – then blame the moron who cited a NYC restaurant owner survey. Oh wait – that moron was you! Except you never grasped that survey responses were not the same thing as actual market data.
Yes I think Brad DeLong has a new winner for Stupidest Man Alive: Princeton Stephen!!!
Steven Kopits
The survey had nothing to do with retail. It was about the food sector.
Retail is a subsector of Trade, Transportation and Utilities.
Food services is a subsector of Leisure and Hospitality
So you are data mining and shifting your argument until you find something that works. John Lott would be so proud of you!
2slugbaits
Steven Kopitsuntil the end of 2014, after which the minimum wage was raised to $9.00 and the retail sector stopped adding jobs.
I think you misunderstood my comment. Employment in retail sales did flatten after 2014. That’s true. But it’s also true that employment in retail sales spiked beginning in the second half of 2018. Indeed, the Jan 2019 level is just shy of the record high in mid-2014. If the $15/hr minimum wage negatively affected the restaurant sector, then why didn’t that same $15/hr minimum wage negatively affect the retail sector? It’s quite likely that people simply migrated to retail jobs rather than physically demanding restaurant jobs, and absent a fresh influx of unskilled (frequently immigrant) workers, this would show up as a falling off in restaurant employment. Is that what happened? I don’t know. But it’s the kind of scenario you’d have to consider before firmly concluding the $15/hr minimum wage was destructive. There’s no special reason why we should be concerned about the fortunes of the full-service restaurant industry. Just because there might have been a fall off in restaurant employment coincident with one of the many minimum wage hikes does not mean former restaurant workers were left unemployed. They could have found better jobs. And if they didn’t find better jobs, then you have to explain why the unemployment rate continued to fall throughout all of those minimum wage hikes.
Steven Kopits
The only really spiky month in January 2019. Let’s see if it lasts. The wider narrative is of stagnation in retail employment from the beginning of 2015.
Steven Kopits
Again, it’s very hard to draw conclusions from the retail sector. If we take only longitudinal data from New York, then the numbers suggest that increasing minimum wages stymied the growth of what would have been a dynamic sector. On the other hand, put in the comps, and the story is much more murky.
We don’t know about alternative employment. We know that the full service employees were let go. They didn’t quit. So we’re speaking of people who lost their jobs.
Steven Kopits
I think it’s a little flip to say we don’t care about the full service restaurant sector. That’s people’s businesses and livelihoods.
I’m also going to guess we could go category by category and find pretty much what we found in food service and professional and business services. It’s not an isolated event, if I had to guess.
2slugbaits
Steven Kopits We don’t have the latest seasonally adjusted unemployment rate for the NYC area, but we can compare the Jan 2018 NSA to Jan 2019 NSA rates, and the Jan 2019 rate is lower. So if we went category by category, I suspect it would be a little difficult to explain how the overall unemployment rate for the NYC area has fallen if employment in the subcategories is falling.
As to the retail employment data, the nadir was in Sep 2018 and it has trended up since then. Yes, the Jan 2019 number is the “spikiest” but it’s not the only month showing employment increases.
We don’t know about alternative employment. We know that the full service employees were let go.
We don’t know any such thing. The only “evidence” for that is some less than trustworthy survey of restaurant owners who have a clear economic interest in peddling a particular storyline. You shouldn’t base an analysis on biased anecdotal stories.
Look, the minimum wage debate is something that has puzzled some of the best economic minds using some of the best econometric approaches available. And the issue is still a long way from being settled. I’m pretty sure that I have at least as much expertise and experience with econometric models as you have, but I’ll be the first to admit that the econometric effort needed to intelligently discuss this issue is way beyond my skillset. That’s why God created labor economists. I don’t know whether the $15 min wage has adversely affected employment or not. As I tried to explain before, a simple deterministic regression that assumes trend stationarity and doesn’t even consider the possibility of an I(1) stochastic trend just doesn’t pass econometric muster. And as a piece of friendly advice, I’m pretty sure that a lot of your clients don’t want you to confuse a stochastic trend with trend stationarity.
joseph
So, today, in a speech at a tank manufacturing plant in Lima, Ohio, Trump out of the blue with no prompting, suddenly went on a rant about John McCain: “I gave him the kind of funeral that he wanted, which as president I had to approve. I don’t care about this. I didn’t get [a] thank you. That’s ok. We sent him on the way, but I wasn’t a fan of John McCain.”
Nobody knows what Trump was talking about. McCain’s funeral was at the Washington National Cathedral, which is a private Episcopal church. It did not require Trump’s approval – lying once again – but he wants a thank you for it anyway. However you can give Trump credit for giving McCain one thing he really wanted. McCain explicitly dis-invited Trump from attending, although Trump did send his evil spawn, uninvited, which displeased the McCain family.
This man, the Liar in Chief, is seriously mentally ill. This is not the way any sane person behaves, let alone a President. He just blurts out crazed non-sequiturs randomly.
When will Republicans stop protecting him? He is very unlikely to be able to give them another tax cut, so nothing to gain there. More likely, the Republicans are just cowards, afraid of Trump’s wrath and his angry mob of followers.
CoRev
Joseph claims: “Nobody knows what Trump was talking about….Trump out of the blue with no prompting, suddenly went on a rant about John McCain” He stated why and most/many conservatives know why he dislikes McCain.
Try sourcing other than the liberal sources with which you seem to pay attention.
joseph
CoRev, I was referring to Trump’s delusion that he was responsible for McCain’s funeral and that he deserved a thank you for it. That is just flat out craziness. No normal person talks like that.
And out of the blue with no prompting, in a speech at a manufacturing plant, suddenly debating a dead man? Trump has arrived at the “Nixon talking to the portraits on the wall” stage of his dementia.
And Republicans think this is all perfectly normal. At least they got their tax cuts so they don’t want to rock the boat.
Rick Stryker
Lyin Joseph lies again. I’m keeping score. I don’t believe you’ve ever been right about anything.
Well-informed people understand that Trump was talking about this. Mccain’s family asked that Trump approve those honors for his funeral and Trump did, despite the fact that McCain didn’t want Trump to attend the funeral and despite the fact that McCain spread the phony dossier to the FBI. McCain’s family never thanked Trump.
Barkley Rosser
Rick,
That you call the dossier “phony” means you listen to Hannity too much. Most of what is in it has been verified separately. The famous peeing stuff has not been, but the only item that looks probably to be phony was the report on Cohen that he was in Prague at a crucial time. The vast majority of it is in fact true. You are just repeating a Big Lie, as you have regularly previously.
Search on words like verified and you find it used wit a UN prefix. Unverified! Search on validate, and see what they actually say. Or search on corroborate to what they claim was corroborated.
I’d be happy to read anything you provide that verifies the facts in the Steele Dossier, but I suspect most will be similar to the Slate article.
CoRev
Barkley, since your comment the Mueller Report has been delivered with ZERO Americans indicted for any Russian election conspiracy. The whole issue stemmed from Steele’s dossier, and your conclusion that “The vast majority of it is in fact true. “, is just more wishful thinking of you Trump haters. NOT ONE INDICTMENT FROM THE STEELE DOSSIER, shows how wrong you have been.
As an aside there are going to several/many past administration officials investigated/fired/tried and or jailed in what might go down in the history books as the largest political scandal in American history to date.
2slugbaits
CoRev You are misinformed. And relying upon the Washington Examiner makes about as much sense as relying upon Hannity at Fox Noise. Most of what’s in the dossier has been verified. And by “verified” I mean supported by indictments and guilty pleas. The Prague trip is the one piece that is wrong….but even there it’s likely “wrong” due to a confusion with another American named Michael Cohen who was at the embassy in Prague. For a more detailed discussion of what has been verified and what hasn’t been verified, see this: https://www.lawfareblog.com/steele-dossier-retrospective
And note that the Steele dossier was not a piece of analysis, it was simply a collection of raw intelligence. It was intended to suggest avenues of research.
CoRev
And up p;ops 2slugs with more unsupported claims. Several of the been process indictments have process crimes, lying while under oath or not registering as lobbyists, but not related to the Steele Dossier. The criminal cases are primarily tax related also.
For all the snark you and others have provided, it was wrong all around only representing you own wishful thinking. If you can fidn evidence that corroborates the Steel Dossier show it. Otherwise start eating the crow you so deservedly earned.
What is clear is that Hillary was the only official/candidate conspiring during the campaign. You guys are scary in your inability to accept reality.
CoRev: Well, as they say, the investigations — including counterespionage — are ongoing.
CoRev
Menzie, continuing counterespionage investigations? I know of none investigating Trump outside of the House. However there are several internal investigations inside the DOJ that should remove even more from its senior ranks.
You Trump haters best chance has just closed with ZERO conspiracy indictments.
Keep on hoping.
noneconomist
Well, CoRev, I wouldn’t count my soybean profits while the crop is still in the silo.
joseph
Seriously, Rick, this is what Trump is grousing about 8 months later – that he issued a four paragraph press statement about McCain with the least bit of civility he could muster given the advice of his press staff? And nobody thanked him for it? No sane person talks like that.
Trump’s spat with McCain goes back to the campaign when Donald Bonespurs said “He’s not a war hero. He’s a war hero because he was captured. I like people that weren’t captured.”
He brings up his petty grievances that he can never forget in the most inappropriate circumstances – in an appearance at a tank factory. I’m sorry, but this is the sign of a seriously mentally ill person.
But I’m not surprised that you leap to your Dear Leader’s defense. You have been committed to debasing yourself before him since your defense of Trump’s lie about his inaugural crowd on the first day of his administration. The fact that Trump is obsessed with petty and trivial grievances is nothing new. He is a sick man, suffering from dementia, just like his father before him.
noneconomist
McCain was not Trump’s kind of guy. An Annapolis graduate, Naval fighter pilot, veteran and victim of enemy torture, disable from that capture and torture, victor in multiple Arizona elections, protégé of Mr. Conservative, Barry Goldwater.
Trump’s kind of guy? Well, McCain never had his own reality TV show, never had to make difficult decisions like firing LaToya Jackson, never declared bankruptcy four times (after somehow failing to succeed in the casino business), never borrowed billions from foreign banks, never cozied up to Putin, never stiffed various contractors who worked for him, was not the recipient of $millions from his father (nor did he receive the equivalent of $5 Million in today’s dollars to start out in “business”)…Yeah, definitely not Trump’s kind of guy.
noneconomist
If I recall correctly, when the California legislature decided to increase the minimum wage ($1/hr. yearly) to $15– BY THE YEAR 2022– there was much handwringing, wailing, and teeth gnashing in the usual circles. (This year, I believe the minimum is $12, although seeing posters outside restaurants offering $13+ is not unusual).
But, my God! What were those crazed liberal/socialist/communist/ all-around fiscally foolish law makers thinking? Even in the greatest economy in history anywhere (Trumpers will verify), that’s unaffordable, un American, and just plain crazy.
Way back in 2017, a certain restaurant apocalypse was surely on the horizon. Apparently, it still is.
2slugbaits
So…it looks like the 2 yr / 3 month just inverted.
Barkley Rosser
It seems like several recent posts a lot of recent comments have disappeared from this site. Whassup?
Extremely sad news to report tonight. Of course it has already been discussed on most MSM outlets. A man who did a lot of work related to minimum wage laws. 58
https://www.nytimes.com/2019/03/18/obituaries/alan-krueger-dead.html
https://www.youtube.com/watch?v=Crif5E67ar0
Tributes from Noah Smith (featured at DeLong’s place), Peter Dorman (Econospeak), and Jared Bernstein. If he really did commit suicide, one has to wonder why. I know Team Trump is out to destroy everything he and Obama did but he’d been only 60 when Biden becomes the next President.
Today I requested 2 books by Krueger from my local public library. One they already had, and one requested they obtain for the city library. They have been good about it in the past, and I have high hopes they will obtain a copy of “Myth and Measurement”. If we look at Mr. Krueger’s work, it’s very apparent he had vast vast reserves of and a large “cache” of empathy for his fellow man. Empathy is a great quality, and a quality in dire shortage in the current times. Empathy is not a weakness. Empathy is a human strength and can give us a great inner power to do great, and even sometimes, superhuman acts for others. Mr. Krueger was a such a man, who employed (no pun intended) his great intellectual gifts for the benefit of others less well-off than he was himself. I feel guilty I was not more conscious of his work until today (although of course I knew his name and his field). His wife and two children can take great solace in the fact Mr Krueger’s work will live on and that other great economists will take the strong foundation Mr. Krueger has built to benefit current and future societies. What better legacy can a man leave??
Guess this might not get posted for awhile (happy vacation, Menzie), but I would like to note a couple of things to put this highly contentious debate into a bit of a broader perspective. Certainly since the influential study by Card and the now-late Alan Krueger of min wages in the fast food industry over 20 years ago, the debate over this has gone back and forth very vigorously with no definite resolution, some studies finding the traditional result pushed by Steve Kopits of higher min wages reducing employment while others finding them increasing employment, with both of these outcomes possible as they may each hold in different cases. (I am not going to weigh in on this particular round of debating over this particular case in New York City.)
I would like to add a point I only recently heard about relevant to this more generally. It came in a talk by Ben Zipperer of the Economic Policy Institute about a paper by him and some coauthors. They were looking at employment changes in total at the state level after states increased their minimum wages. They found a modest positive relation, but also recognized other studies found the opposite. But this is not the point I wish to emphasize.
Zipperer provided a rather neat argument about what is usually going on in these siituations. On the one hand indeed the traditional textbook argument that when min wages rise there is a tendency for fewer new jobs to be offered is generally true. However, the offset to this that is only rarely mentioned in these debates (although Card and Krueger did), and I have not seen it in in any of this discussion so far, is that workers tend to stay with their jobs much more due to greater work satisfaction, so that there is a decline in job losses. Either of these effects can dominate, and it is an empirical question which one does in any specific case.
“the offset to this that is only rarely mentioned in these debates (although Card and Krueger did), and I have not seen it in in any of this discussion so far, is that workers tend to stay with their jobs much more due to greater work satisfaction, so that there is a decline in job losses.”
Walter Wessel argued that labor supply depends on both wages and fringe benefits in a market clearing competitive model where a minimum wage is offset by lower fringe benefits. A neat argument for explaining why observed employment does not fall much. But toss in monopsony power with his argument is one gets a rise in labor supply from a higher minimum wage.
The Econ 101 model was always too incomplete to address real world labor markets.
Walter Wessels updated this 1980 paper with this 2001 paper:
https://www.epionline.org/wp-content/studies/wessels_06-2001.pdf
He did not mention the monopsony twist although this was publish in the Journal of Labor Research back in 1994:
https://rd.springer.com/article/10.1007/BF02685770
Minimum wages and the Wessels effect in a monopsony model
“The Wessels model suggests that firms respond to increases in the minimum wage rate by decreasing the level of fringe benefits — an action which produces an inefficiency effect that lowers workers’ utility and the supply of labor. Standard models of monopsony, however, argue that wage floors prevent the exercise of market power and increase employment. I show that wage floors, even with fringe benefit curtailment, may increase employment by lowering the marginal expense of labor. Employee utility and employment will rise somewhat but not as much had the firm acted competitively in setting both wages and fringes.”
Barkley –
In this case, the interpretation is not even close. You can see the damage to the NY full service sector by visual inspection (see second graph, link below). The issue with minimum wage laws is that they are often not binding, or not very binding, depending on where they are set. Not a lot of people work at the Fed min wage level of $7.25. A whole of people work at $10 / hour. So setting the Federal min wage to $10 probably wouldn’t have a huge effect nationally.
However, once the minimum wage becomes binding, increases from that point are going to influence behavior. We can see that the $10.50 min wage in NYC cut the growth rate of the full service restaurant sector by half, but it didn’t kill it. The $13 wage, however, just crushed it.
But is this a surprise? No. There is no inelastic demand for full service restaurant meals. So we would expect increasing prices to decrease consumption. The only question is at what price that happens. Well, now we know.
https://www.princetonpolicy.com/ppa-blog/2019/3/17/the-devastating-impact-of-new-yorks-minimum-wage-on-its-restaurant-sector
Still trying to get people to read your worthless blog? Come man – you have proven time and time again you have no clue on the data, theory, or anything else. But you deem to lecture someone who does? Go figure!
“The issue with minimum wage laws is that they are often not binding, or not very binding, depending on where they are set. Not a lot of people work at the Fed min wage level of $7.25. A whole of people work at $10 / hour.”
I see you too have never read Card and Krueger (1994) which is what Barkley was talking about. Oh yea – when NJ raised the minimum wage way back then the market wage was much higher. Seriously Stephen – stop babbling about things you do not understand. Fast food wages were not that high which was the whole damn point of the legislation. This is exactly why no sane person would ever read your blog. You babble on incoherently in a way that makes even PeakTrader look smart. Please stop as it is embarrassing to your family.
Steven Kopits, focusing only on employment is a very ignorant way to conclude there has been “damage.”
I guess, most Americans losing their jobs in farming over the past hundred years is catastrophic.
Correcting a market failure benefits the economy.
Steven is clearly babbling on a topic he does not understand. It seems your response is more babbling on a topic you do not understand.
Monopsony power is a market failure which a wage floor would correct. Of course know nothings like Princeton Stephen has no idea what we are talking about here. Funny thing – you have no idea what we are talking about here either!
You’re confusing creative destruction with just plain destruction. Americans did not lose their farm jobs because of high minimum wages, but because of productivity increases which made their labor unnecessary on the farm. Those farms produce more today than they ever did.
By contrast, imagine that the minimum farm wage were set to $100 / hour. Those farmers would be unemployed and the farm would lie fallow. Economic output would decline, which is what NYC’s minimum wage is doing to the full service restaurant sector. If it were due to productivity gains, sales would be up, profits would be up, and people would be being laid off because robots are serving tables. But that’s not the case, as the NYC Alliance survey makes amply clear.
Big difference.
Steven Kopits, it’s the same difference.
The correct minimum wage will increase productivity and fewer workers will be needed to produce the same output.
Therefore, labor is freed-up to produce other goods & services.
A market failure is when workers earn less for being more productive.
A minimum wage that’s too low slows productivity growth.
“Imagine that the minimum farm wage were set to $100 / hour. Those farmers would be unemployed and the farm would lie fallow. Economic output would decline, which is what NYC’s minimum wage is doing to the full service restaurant sector.”
Of course the NYC minimum wage is nowhere near $100/hour. And with all you stupid and incessant babbling on a topic that you understand even less than PeakStupidity, you have presented no credible evidence for your claims.
You know some village idiots stop when the rest of the world is laughing at them. But not Princeton Stephen. He babbles BS over and over again.
It’s not the same output, Peak. Output is reduced. Binding wage floors will create deadweight losses.
There’s a deadweight loss only in a partial equilibrium model Steven.
A higher minimum wage can result in a (positive) income effect that more than offsets a (negative) employment effect, resulting in higher output.
And, the productivity gains can offset price increases.
Since the minimum wage was established, per capita real GDP has grown at a much faster rate (although, other factors contributed):
Annual per capita real GDP growth:
1863-1937 (75 years): 1.33%
1938-2012 (75 years): 2.44%
Source: Census data, and the BEA.
Also, using the concept of the price floor for wage floor is incorrect, because wages are more than the price of labor.
Wages are also an input and income.
Moreover, I may add, wage “stickiness” is much less of a problem, if a problem at all, since monetary and fiscal policies have smoothed-out business cycles.
Before, the Fed, economic boom/bust cycles were frequent and severe.
Steven,
The reason I said I would not get into this particular debate is that there are many elements involved in what goes on, and I do not see any data on various important variables to be able to make a definitive statement, which would involve also doing a fairly sophisticated econometric analysis of all these variables , and even then it can still be debated, as the long debate over the Card and Krueger study after iit was made shows. Simple eyeballing of a couple of figures and citing some media stories talking to whining restaurant owners are not sufficient to establish the case, although there certainly is quite a bit of smoke here with, indeed, a lot of complaining going on from the restaurant owers.
Some of the confounds that are out there have been mentioned by others, but I shall mention a couple more. One is that the sector may be going through its own cycle. Some data cited in your link show that the NY restaurant sector grew very rapidly over the last decade. It may have simply grown too fast and is now facing a nomral cutback.
Another missing matter is what has been happening to prices. The survey reports that notable percentages of restaurants are planning to raise prices, but how big are thos increases and how much have prices risen recently when these reported employment declines have occurred. Were they or will they be greater than what was going on in previous years? I could find no data on this. Prices may not really have risen all that much, with other factors being responsible here.
It may well be that indeed the minimum wage is driving the falling employment, but, for better or worse, this is not nearly as certain as you think it is, Steven. This will take more time and data to really seriously test.
Oh, and I guess I must apologiize for making you subject to Moses Herzog ridiculing you by comparing you to me, especially my clearly shameful behavior in daring to suggest that an even distribution of characteristics across a genome does not mean that there must be an even distribution of genes across a population, something that would shame me in the eyes of my late father if he were alive to see it, this man who got his PhD in math from Princeton and knew Einstein, von Neumann, and Godel. Shame on me.
A nice discussion but can we have Princeton Stephen focus on one line:
“Simple eyeballing of a couple of figures and citing some media stories talking to whining restaurant owners are not sufficient to establish the case”.
The rest of us have tried in vain to get this simple point across but it all seems lost on Princeton Stephen. But excellent try!
Barkley –
In the real world, you have to make a call, and that’s going to be a 51% call. That’s real world management, in which you never have perfect information and never get to a 95% certainty threshold.
You can’t make an eyeball call on the graphs in this post? I certainly can.
https://www.princetonpolicy.com/ppa-blog/2019/3/17/the-devastating-impact-of-new-yorks-minimum-wage-on-its-restaurant-sector
“Simple eyeballing of a couple of figures and citing some media stories talking to whining restaurant owners are not sufficient to establish the case…”
We have a survey of 754 establishments. This tells us two things. First, the pain threshold was high enough to prompt someone to commission a survey. I don’t know if you’ve ever worked outside academia, but in my experience, these sorts of things are commissioned when people are feeling pain. Second, unless you are impugning the integrity of the pollsters, that’s a pretty big sample. So we do have some data points here.
“the sector may be going through its own cycle. Some data cited in your link show that the NY restaurant sector grew very rapidly over the last decade. It may have simply grown too fast and is now facing a nomral cutback.”
There is no historical precedent for this. If this were the case, we should be hearing about New Yorkers have less money to spend, over-building, ‘crazy’ restaurant owners, etc. Can’t find anything in the press. The survey shows restaurants are pushing through big prices increases, just as we would expect. They would only fail to do that if they were earning above-normal profits, in which case the industry would be under-served, rather than over-served. On the other hand, if the industry is over-served, then profits should be low and raising the minimum wage would be the height of insanity, no?
Even a cursory analysis suggests that the minimum wage in New York in the commodity, unskilled labor market is close to 50% above the market-clearing level. What’s your feeling, if you’re an economist? Would you say, ‘Gee, don’t worry, be happy,” or “You know, there’s a pretty good chance that’s going to screw up your labor market in a big way.”? I am frankly astonished that these questions are being asked by a ‘self-professed policy analyst’, rather than the economics profession itself. I don’t think it would be particularly difficult to make the case that min wage rises have reduced relative employment by as much as 100,000 in New York over the last three years or so. That’s quite a big number. That warrants a deeper look at whether it’s the plain vanilla explanation — higher minimum wages — or something else, eg, notably a sector overbuild or a New York recession. Both these could be ascertained in relatively short order, and to all appearances, not only is no one doing it, no one has even thought to do it.
The notion that one is not making a call is not the same thing as not making a call. Things are happening while you wait, whether or not you choose to act on them. And I am amazed at the passivity of the economics community. Card and Krueger, so hey, no problem.
Looks like a problem to me.
“In the real world, you have to make a call”.
Oh Lord – you have no clue what the real world even is. And you have no clue about why these self serving lobbyist wrote their little SURVEY which some village idiot known as Princeton Stephen thought was a “study”. Can you write even more stupid stuff? I bet you can!
As for Mozes, he’s just crazy. pgl, that guy is a rabid dog. I wouldn’t let him around my guests.
No fear. I would never attend a party with arrogant know nothings like you. Cheers!
…….. says the extreme racist who doesn’t understand BASIC statistics terminology and miscalculates (to the downside) human death counts.
…….. says “Princeton”Kopits, who feels ill at the thought of food service workers making a living wage for themselves and their families.
…….. says “Princeton”Kopits who fabricates exaggerated immigrant traffic along the border, literally pulling his numbers out of vacuous air.
If separating myself and delineating myself from such trash and pseudo-intellectualism as “Princeton”Kopits bloviates from his bunghole daily makes me a “rabid dog”, I wear your label “rabid dog” as a badge of honor.
You attend all my parties. You can’t help yourself.
Didn’t call you a rabid dog, Mozes. A little crazy, yeah, maybe.
“Princeton”Kopits”
Perhaps you are the beneficiary of one of my more negative personality traits—Giving charlatans and hucksters more attention than they deserve. After all, FOX news is always there to give you their unconditional love.
The Fox and Friends interview was actually pretty funny. When Katie Pavlich asked me what we should do about the border, her co-host clearly expected me to say, “Build a wall.” And of course, I said, “Well, it’s a black market and we fix those by legalizing and taxing them.” (See how it’s going with marijuana, here: https://www.princetonpolicy.com/ppa-blog/2019/3/21/human-and-drug-smuggling-trends-under-trump)
Breitbart is regularly publishing my material, including introducing the concept of a market-based approach to illegal immigration. The Washington Examiner had a really nice piece on my work today, again highlighting a market-based approach. https://www.washingtonexaminer.com/washington-secrets/marijuana-smuggling-smoked-under-trump-down-80
Call me what you like, but if I get an audience in the White House, this is where migrant policy is going.
https://www.princetonpolicy.com/ppa-blog/2019/2/18/white-paper-feb-2019-version
I stated before, a reduction in employment is expected from a substantial increase in the minimum wage over a short period.
I’d expect poorly managed restaurants either to become more efficient, and therefore competitive, or go out of business, while more efficient restaurants find ways to become even more efficient and gain market share from the weaker restaurants.
A very high proportion of restaurant workers will be much better off earning much more per hour, even with reduced hours. The positive income effect, particularly for workers with high marginal propensities to consume, will increase demand for products and generate jobs throughout the economy. Also, productivity is expected to increase, including lower turnover rate, and prices will rise only slightly. Moreover, I’d expect people out of the workforce, with higher reservation wages, to come back in. Furthermore, tax revenue will rise and government spending will fall.
Overall, a subsistence wage will be a net benefit to the economy.
Lord – the peanut gallery spews its usual stupidity. Alan Krueger’s life is being celebrated in part because of that 1994 paper he wrote with David Card. Obviously PeakStupidity has never read it.
PT,
Hopefully you are being paid a subsistence wage, since you think that is “a net benefit to the economy.”
Barkley, it’s what the labor economics literature suggests.
There have been many more than one study.
And, I completed two grad labor econ classes, enough to take the comp exams, although my two fields of specialty were in something else.
still relying on that jr phd for credibility, eh peak?
“it’s what the labor economics literature suggests.”
You are lecturing Barkley on labor economics? My oh my – this is like a 2 year old lecturing a real President on how to run the nation. Of course given who is the current President, maybe we should have him listen to the babies!
“I completed two grad labor econ classes”. Menzie has asked you before who wrote the text books your alleged classes used. And you could not. Oh wait – I know. Dr. Seuss!
It’s possible, the only people on this link, who had grad labor econ classes are Menzie Chinn and me.
Jim Hamilton and Rick Stryker also possibly had them.
PeakTrader: I didn’t take PhD level labor courses. However, I did take macro from George Akerlof.
I never had a “name” economist teach me, but I had one guy teach me economics with a Phd from the University of Chicago and another guy teach me economics who had a Phd from Stanford. Do I get bragging rights??? No, not labor economics specifically. I can also say I never lied about my educational background, so that’s always a plus. (Peak, the last part of the comment is directed at you, but the remark could also be aimed at people who tie their “work” to Princeton but have no association whatsoever to the University).
PeakTrader Overall, a subsistence wage will be a net benefit to the economy.
I don’t think that’s what you meant to say. Didn’t you really mean something like “a livable wage will be a net benefit to the economy”?
I agree that a higher minimum wage will pull more people into the labor market because it will rise to their reservation wage. I don’t agree that productivity would necessarily increase. The reservation wage is not the same thing as the efficiency wage. The efficiency wage refers to smart employers paying a little above the minimum wage because it motivates greater effort from workers. But the key to the efficiency wage is that there must be a gap between the minimum wage and the efficiency wage. Raising the minimum wage would require employers to raise the efficiency wage in order to maintain that gap.
By definition, productivity in terms of ($ output / work hour) should increase, Slugs. Total output will fall.
Gee – you seemed to have preK arithmetic. Congratulations!
“Sector X is business and professional services”.
Like CPA firms cannot profit if it paid their employees $15 an hour! Ask Princeton Stephen – the self styled expert at everything!
I was relieved that the $15 hourly wage was not binding on New York’s lawyers and investment bankers. I find it astonishing, though, given that NY is so heavily business services, that you can see the effect with the naked eye here as well.
As for self-styled expert. You could have done everything I did. The difference that I did it, and you didn’t.
BLS Definition of Professional and Business Services
https://www.bls.gov/iag/tgs/iag60.htm#about
The Professional, Scientific, and Technical Services sector comprises establishments that specialize in performing professional, scientific, and technical activities for others. These activities require a high degree of expertise and training. The establishments in this sector specialize according to expertise and provide these services to clients in a variety of industries and, in some cases, to households. Activities performed include: legal advice and representation; accounting, bookkeeping, and payroll services; architectural, engineering, and specialized design services; computer services; consulting services; research services; advertising services; photographic services; translation and interpretation services; veterinary services; and other professional, scientific, and technical services.
The Management of Companies and Enterprises sector comprises (1) establishments that hold the securities of (or other equity interests in) companies and enterprises for the purpose of owning a controlling interest or influencing management decisions or (2) establishments (except government establishments) that administer, oversee, and manage establishments of the company or enterprise and that normally undertake the strategic or organizational planning and decision making role of the company or enterprise. Establishments that administer, oversee, and manage may hold the securities of the company or enterprise.
Establishments in this sector perform essential activities that are often undertaken, in-house, by establishments in many sectors of the economy. By consolidating the performance of these activities of the enterprise at one establishment, economies of scale are achieved.
The Administrative and Support and Waste Management and Remediation Services sector comprises establishments performing routine support activities for the day-to-day operations of other organizations. These essential activities are often undertaken in-house by establishments in many sectors of the economy. The establishments in this sector specialize in one or more of these support activities and provide these services to clients in a variety of industries and, in some cases, to households. Activities performed include: office administration, hiring and placing of personnel, document preparation and similar clerical services, solicitation, collection, security and surveillance services, cleaning, and waste disposal services.
“I was relieved that the $15 hourly wage was not binding on New York’s lawyers and investment bankers.”
Seriously? When one thinks you could not be more stupid, you exceed expectations!
I just saw what prompted this – another incredibly absurd comment from Princeton Stephen. Rather than admit he got the data dead wrong, he puts some stupid spin on Menzie’s data. I guess he has never heard of Stein’s law (Herb Stein that is):
https://quoteinvestigator.com/2018/04/28/go-on/
If Something Cannot Go On Forever It Will Stop
Doing a trend line during a recovery from a deep recession, which severely impacted Manhattan, as if the food service sector should experience fast growth forever is the dumbest thing Princeton Stephen has ever written. And he has written a lot of really stupid things!
This type treatment (black sites) used to be just for terrorists:
https://www.revealnews.org/article/us-government-uses-several-clandestine-shelters-to-detain-immigrant-children/
Well, “children”…..”terrorists”, with MAGA it’s all ‘the same”, really…….
“The federal government is relying on secret shelters to hold unaccompanied minors, in possible violation of the long-standing rules for the care of immigrant children, a Reveal investigation has found.
The Office of Refugee Resettlement, the government agency that cares for unaccompanied minors, has never made the shelters’ existence public or even disclosed them to the minors’ own attorneys in a landmark class-action case.”
The story goes on and this outrage gets even worse. Trump is committing the most severe human rights violations ever.
Noah Smith’s tribute to the late great Alan Krueger
https://www.bloomberg.com/amp/opinion/articles/2019-03-18/princeton-professor-alan-krueger-led-quiet-economics-revolution
One snippet:
‘Krueger himself was a key figure in this revolution, helping to pioneer the use of natural experiments. His landmark study, written with David Card, was a 1994 paper evaluating the results of a rise in New Jersey’s minimum wage. Traditionally, economists believed that minimum wages caused a substantial degree of job loss — this was based on the textbook model of supply and demand, which says that placing a floor on the price of something causes a shortage. Card and Krueger, however, suspended judgment on that theory and simply compared employment changes at stores in New Jersey to changes at stores in nearby Pennsylvania, which hadn’t raised the minimum wage. Card and Krueger’s result shocked the economics world — the higher minimum wage had no effect on employment, at least in the short term. A large number of follow-up studies found similar results for a number of minimum-wage experiments. The economics profession was faced with an unusual case where the facts were clear enough to present a challenge to a long-accepted textbook theory. Slowly, economists are being forced to do what natural scientists would do in this situation — look for another theory to explain how labor markets work. Some are converging on the theory of monopsony power as a simple alternative, while others are building more complex, realistic models.’
Krueger taught at Princeton. Princeton Stephen clearly does not as Stephen would like call the Card-Krueger paper “garbage”.
Noah got it wrong. Actually what Card and Krueger found was that employment in those locations rose in NJ while they fell in PA. It was not a “no employment change” finding, so even more shocking. Of course, there were a lot of studies that followed up that challenged their results, and as I already noted this has gone back and for the ever since.
The labor market economist in me starts to think: did NJ have a monopsony model structure whereas PA’s labor market fit the market clearing competitive market model. Theory should be checked by evidence but evidence free economics begs the theorists back into the discussion.
I say this because of some dumb WSJ oped when the secretaries of Yale unionized. The WSJ is based in Manhattan where there are lots of law firms and other employers of secretaries. In New Haven, Yale is it. The classic monopsonist. So yea – the unionization at Yale did not destroy jobs as the WSJ oped pages predicted.
By eyeball It looks like you had 4 minimum wage hikes and employment continued to grow.
Now we have a fifth wage hike and employment growth falters.
Why is this fifth time different?
Because Lord Princeton Stephen hath spoken! Bow down to this self proclaimed expert at everything!
I noticed the same thing. See my comment below.
Dilbert found the answer (an answer I feel a little dumb for it not dawning on me earlier, before dilbert dogbert commented on it).
Sometimes I’m a little slow to the take, and that’s something that should have hit me nearly immediately after looking at that portion (far right) of the graph. But it didn’t…..
@Barkley Rosser,
Good summary, concise treatment. Tuck.
I would tend to believe that low-wage workers are complimentary to capital so much so, that minimum wage hikes would only affect final investment decisions on greenfield projects. For existing projects, most capital costs are already sunk.
In other words, over the longer run, there might a negative impact but it is likely very small, small enough that most empirical methods would not catch it.
How abt another line, VMPL ?
This is another I had been meaning to post up for awhile. Yes, it’s “off topic” but I think some things (such as children being kept at U.S. government black sites) are important enough to highlight, even if they don’t match the color-scheme of the outfit.
https://www.propublica.org/article/federal-authorities-raided-trump-fundraisers-office-in-money-laundering-probe
Frankly I’m surprised this story hasn’t gotten more “legs” or “traction” over the last couple days. I assumed that at least in 4–5 days this would at least get periphery attention from the TV news, but so far, nothing.
Just read this: https://angrybearblog.com/2019/03/the-government-shutdown-may-have-caused-a-mini-recession.html
and came back here to look at the curve. MMMMM??? Q42018 to Q12019???? Interesting.
dilbert dogbert
dilbert I think you have made a a very astute and sharp-eyed point. My guess is Menzie saw this long before he even put up the graph (an observation like that is child’s play for Menzie). And I have to confess, somewhat red-faced, that it is something that had not dawned on me. I did in fact wonder about the tapering off of the red line at the end of Menzie’s graph above. I viewed it (from an eyeball perspective) as statistically insignificant. Still, I did notice. I think you have NAILED it, the tapering off of the red line (NYC business and professional services employment) on the far right portion of the graph is due to the effects of the BROADER economy slowing down late 4th quarter and into the 1st quarter (the national economic slowdown).
In addition to job losses in the restaurant sector, minimum wage hikes in New York City have also claimed 36,000 jobs in professional and business (P&B) services.
On the graph below, we can see a curve fitted to the data from January 2010 to October 2015. The curve carries an R2 of .9965, which is a better fit than a straight line and falls very, very close to the actual data. Doing so, however, shows that employment growth deviates from trend beginning in October 2016, about three quarters of a year after the minimum wage is raised to $10.50 / hour.
We can compare predicted to actual employment in order to estimate the impact of minimum wage hikes on P&B headcount. As the graph below shows, a 2010-2015 trend line shows no job losses until the fourth quarter of 2016, about 6,300 for that year. The losses grow in 2017, adding another 8,100. The wage rise to $13 / hour seems to do the real damage though, with job losses in 2018 (including Jan. 2019) at just below 22,000. Add it all together, and New York City professional and business job losses — those we would have expected to see less those actually attained — total 36,000 from the point that the minimum wage was raised to $10.50 / hour through Jan. 2019.
These losses are large enough to be visible on a graph without the aid of statistics, and they are large enough to stop growth of professional and business services entirely. Further, the job losses seem to occur with a lag, six to nine months after a given minimum wage increase. If this is the case, then P&B employment may continue to unwind in 2019 and see a difficult stretch in the first half of 2020.
https://www.princetonpolicy.com/ppa-blog/2019/3/19/the-impact-of-new-york-city-minimum-wages-on-professional-and-business-services-employment
Barkley devastated this nonsense but just in case you missed his key point in all of your arrogant babbling, I repeated the key sentence.
But do continue babbling as even your dog is laughing at you by now!
Steven Kopits Just as an econometric issue, I’m pretty sure that you don’t want to take a simple exponential curve regression with a time trend. Just take a quick look at the correlogram and it should tell you that something is clearly wrong with that kind of a time series model. A simple and much better way to look at the data would be to convert the data to logs, then run a simple ARIMA(1, 1, 0) model with constant from Jan 2010 thru Oct 2015. The residuals will show no evidence of autocorrelation and will be normally distributed with both coefficients being significant. Then dynamically forecast through Jan 2019. You will see that the forecast for Jan 2019 is very close to the actual and well within the error bars.
2slugbaits: If Steven Kopits doesn’t understand what a confidence interval is, I sincerely doubt he will understand the hazards of assuming trend stationarity for arguably I(1) series. But, good try attempting to educate him.
@Menzie & 2slugbaits
From a morality standpoint (and just being a good human being) that is a trait and quality to be admired in both you and 2slugbaits. We could include others in that—-James Hamilton, Ashoka Mody, Alan Krueger, etc.
From a pragmatic standpoint??—a waste of time. But pragmatism is something with should be intermittently tossed aside by the best teachers/professors, so as to give that “nth” degree of opportunity to students to learn something, on the small chance they would ever change their attitude—which—some do. In this case??? Draw your own conclusions.
*”which should be” not “with should be” Sorry. “bang” energy drink usually helps me avoid these bad late night typos but apparently it’s not kicking in tonight. I think I need to go back to bourbon again. Honestly seemed to have less typos when I was using that.
Steven Kopits I read your blog article and I think your conclusions, while possibly valid, go beyond what the data actually says. I think the problem is that you looked at one data set (viz., restaurant employment) and concluded that the higher minimum wage must be responsible for that drop in employment growth. You needed to look at other data sets and you should have asked a few more questions. For example, if the minimum wage hike is responsible for the drop in restaurant employment, how do you explain the sharp increase in NYC retail employment https://fred.stlouisfed.org/series/SMU36935614200000001SA? Both occupations require similar skill sets. One explanation is that given a choice between retail work and restaurant work, most people would probably prefer retail work because the work itself is less onerous. If you can get the same wage in retail, why would you want to work as a dishwasher? You also need to explain how the unemployment rate for NY state continued to fall even though NYC raised its minimum wage. I suppose you could concoct a story that might explain this, but it’s an issue that needs to be addressed. You also need to ask if the $15/hr minimum wage really represented that big of an increase in the effective minimum wage. According to the BLS the average restaurant wage for the NYC/NJ metro area was $14/hr back in May 2017. https://www.bls.gov/oes/current/oes_35614.htm#35-0000 So would a $15/hr wage 19 months later be all that much of a hike? Notice that the low end jobs at restaurants are precisely those jobs that would make alternative employment in retail especially attractive. And you might want to check the increased construction employment numbers for NYC. Again, instead of people losing jobs because of the minimum wage, it’s possible that they were just leaving jobs in favor of other better jobs. That’s what we would expect in a healthy economy. In order for restaurant employment to continue growing at the old 8600/yr rate, there would have to be an influx of low skilled workers. There are good reasons to believe that may not have been happening. For example, in the NY/NJ/PA are there are approximately 561,000 people who were born in Puerto Rico according to 2017 census data, with about 421,000 of those concentrated just in the NY/NJ area. In other words, the NYC area depends upon a strong influx of PR born workers. If you’ll look at the BLS data for PR, you’ll see that emigration out of PR flatlined after Hurricane Maria. Indeed, PR unemployment is at record low levels and construction jobs are way up. So the flow of workers from PR to NYC seems to have stalled coincidentally with the slowdown in full service restaurant employment. Fewer PR workers means fewer low skilled workers available for restaurant and hospitality jobs. And notice that according to Census data 37.2% of NYC residents are foreign born:
https://www.census.gov/quickfacts/fact/table/newyorkcitynewyork,US/PST045218
So how do you think Trump’s anti-immigrant policies and I-9 enforcement might be affecting the NYC labor supply?
You should also look at other states. In 2017 there were 20 states that increased their minimum wage. In 2018 there were 21 states that increased their minimum wage. In 2019 there were similar numbers. If higher minimum wages represented a problem, then how is it possible that we’ve seen strong employment growth in 2018 nationally?
You claimed that one possible explanation for the sharp drop in full service restaurant employment relative to limited service restaurant employment could be explained by people choosing to downscale their eating habits in response to higher menu prices. That’s possible, but there are a lot of problems with this assumption. For one thing, limited service establishments are much more sensitive to labor costs than full service establishments. At full service restaurants the wage bill typically represents only about 22% of the total costs. Food and rent costs are much bigger costs. So the menu price response to a hike in wage rates is not the same for full service and limited service establishments. A minimum wage hike is likely to reduce the differential menu cost between full and limited service restaurants. But yet we see employment in limited service restaurants not dropping off like full service restaurants. That suggests that the reason for the drop in full service restaurant employment might be due to something other than a minimum wage hike.
You also cited an NBER study that claimed higher minimum wages increased property crimes for 16-24 year olds. Given that FBI statistics show an overall downward trend in property crime rates and given that there has been an overall increase in minimum wages (especially lately), this would suggest that a higher minimum wage would likely reduce property crime rates for those over age 24; otherwise it’s hard to see how the overall rate could be falling while minimum wage rates increase. This true has intuitive appeal.
2slugs, you talked around the issue without contradicting Steven’s conclusions. I do agree that the Trump economy is different and better than the Obama economy especially for the low wage earners. As you show: “Notice that the low end jobs at restaurants are precisely those jobs that would make alternative employment in retail especially attractive. And you might want to check the increased construction employment numbers for NYC. Again, instead of people losing jobs because of the minimum wage, it’s possible that they were just leaving jobs in favor of other better jobs.” But, this does not change Stgeven’s conclusion, that the minimum wage increase changed restaurant employment in NYC. BTW, as Mernzie’s chart has confirmed.
I do comment you in your attempt, and actually agree with your conclusion that in the good Trump economy many more jobs have been available for transfer into for those employed in less appealing restaurant jobs. Job changes have gone up under Trump, which also include increased wages for those new jobs. I think if we look at the data this conclusion well supported.
As we approach full employment the effects of these types of mandated wage increases and the industries affected become more obvious supported by <b<industry surveys when compared to previous hypothetical studies.
CoRev you talked around the issue without contradicting Steven’s conclusions.
I didn’t endorse his conclusions either. There’s no question that at some point a higher minimum wage will hurt employment. At some point the reduction in employment will be worse than the welfare gains from a higher wage. It’s also the case that very often a rise in the minimum wage has no observable negative effect on employment. It’s entirely possible that NYC’s $15/hr minimum wage has reached the level at which it’s binding and affects employment. Whether or not that reduction in employment is offset by the welfare gains from those who remain employed is another issue. Regarding the NYC minimum wage, I’m simply agnostic. My critique of Steven’s post is that he is overconfident in his conclusions. The econometrics needed to seriously address the issue goes well beyond a couple of simple graphs in one sector of the economy. Frankly, I was a bit surprised that he posted something like that on his professional business website. It’s one thing to make that kind of conclusion in the comments section of a free-wheeling blog topic; but if you’re going to post something to your professional business website, then I think you’d want to present a more rigorous analysis that survived some kind of internal murder board review.
There’s no surprise that the economy has been relatively strong over the last year or so. That’s not a surprise given the size of Trump’s fiscal stimulus. That strong growth was also predicted by most macroeconomic forecasters, including the CBO. But the time for strong fiscal stimulus was in 2009, not 2019 when the economy is already at full employment.
2slugs, we’ve agreed on this point since 2009: “But the time for strong fiscal stimulus was in 2009,…” But your follow-on is typical rationalization and denial “… not 2019 when the economy is already at full employment.” where you missed a few years. IIRC t, and created the near full employment.he stimulus was in 2017.
Obama’s was not a strong stimulus, with which you disagreed with me, and Trump has shown how wrong Obama and most liberals were about how to best improve the economy.
CoRev we’ve agreed on this point since 2009
Your memory is failing you. You strongly opposed the ARRA and said fiscal stimulus would not work. You also joined the Tea Party protests.
stimulus was in 2017
No, it wasn’t passed until the very end of 2017 and did not take effect until 2018.
Obama’s was not a strong stimulus, with which you disagreed with me,
No, like almost everyone else on my side of the argument, I complained that the stimulus was underpowered for the job. Romer’s own calculations called for a stimulus twice the size of what was passed. And I (along with plenty of other folks) complained that too much of the ARRA went towards tax cuts rather than direct spending. It’s amazing how you have managed to completely misremember the entire arguments. Absolutely incredible.
Trump has shown how wrong Obama and most liberals were about how to best improve the economy
The standard textbook argument is that increasing fiscal spending with deficits will increase aggregate demand as long as the Fed does nothing to dampen it. So far the Fed hasn’t done much to dampen things and today the Fed more or less promised to hold rates for the rest of the year. That’s because the Fed believes the economy is actually weakening as Trump’s stimulus is starting to fade…as predicted by the CBO a year ago. The latest NY Fed GDP nowcast calls for GDP growth of only 1.37%. The Atlanta Fed is even more pessimistic with a GDP nowcast of only 0.4%. And that’s scary because the Fed already has most of the 1st Qtr data in hand since there are less than two weeks remaining this quarter. Trump has made just about every mistake possible. He pushed through huge tax cuts for the rich that have blown a huge structural hole in the budget. He put together a “tax cut” that will soon start to gradually increase taxes on the non-rich in order to keep taxes low for the 1%. He started a stupid tariff war with China that he seems unable to “win” (whatever that means). He caused all kinds of headaches to come up with a NAFTA 1.01 that he easily could have had without all of the bluster since most of what he agreed to had already been agreed to back when Obama was renegotiating some of NAFTA 1.0. He’s made a complete hash out of trade with the EU. And the moron even supports Brexit!!! Now how stupid is that? I think it’s pretty clear why Trump doesn’t want anyone to see his grades from Wharton.
2slugs, this is getting more funny each time you bring it up: “Your memory is failing you. You strongly opposed the ARRA and said fiscal stimulus would not work. You also joined the Tea Party protests.” I strongly opposed Obama’s style of fiscal stimulus would not work, and yes attended the Tea Party demonstration against the ACA, which has since shown to be a valid position.
Your dodging again. 2017 or end of 2017? ” I complained that the stimulus was underpowered for the job.” etc. My point then was type of stimulus, and today was Trump has shown how easy it was to stimulate the economy, and the form the Obama stumulus should have taken.
The remainder of your comment just delineates the differences you have with his policies. So what!?!
CoRev So just for the record, in your mind a tax cut multiplier is greater than a spending multiplier??? And in your mind the fiscal multiplier above the ZLB has a stronger effect than the fiscal multiplier at the ZLB??? Is that right? Is that your understanding of macroeconomics?
2slugs why are you deflecting again?
Slugs –
Again, this is not a topic I particularly wanted to wade into, and if Menzie had not put the headline up, I would have been more than prepared to move on. The posts are on my website because they are analysis, and as importantly, they involve graphs. I have no way to post those here that I know of.
There are three reasons why employment could be falling in the NY full service restaurant sector:
1. New York is in recession. Is New York in recession? If so, raising minimum wages seems a really bad idea.
2. The restaurant business overbuilt. Raising wages is then also a really bad idea
3. The minimum wage is material and binding. That’s the simple read, right?
If you want to argue 1 or 2, by all means, go ahead. Do a little work. Otherwise, I am the guy carrying the water.
“The posts are on my website because they are analysis”. Seriously? I guess the intellectual garbage that Kudlow put up on National Review could be considered analysis. As far as the rest of your rant, employment is not falling in NYC’s restaurant sector. Learn to read a real graph. As far as your 3 reasons – it is so incomplete it staggers the mind.
Try moving on as we all know by now you babble stupidity with the best of them!
When I thought this discussion could not get more dumb – CoRev proves me wrong. Supported by industry surveys? Lord – the Usual Suspects remind me of the monkeys typing away thinking they are writing Shakespeare!
CoRev: Huh, as my graph illustrated? So post hoc ergo propter hoc? What about in the preceding years.
Menzie, tipping point? To which chart do you refer, the state-wide chart showed slight drops at several wage increases, or the latest corrected chart which shows only the current drop?
BTW, did you do know that this was in the NY minimum wage law: “*Tipped food service workers rate is unchanged at $7.50 until 12/31/2017. We have been talking about this labor sector after all. While you have been talking about the NYC general minimum wage.
Your work has been sloppy in this analysis.
CoRev: I’ve been explicit in using the general minimum wage rate. There are exceptions/differentials for employment size of firm, for full service vs. limited service, etc.
Menzie, explicit is not pertinent to Steven’s point, which you quoted from his reference: “76.50% of full service restaurant respondents reduced employee hours, and 36.30% eliminated jobs in 2018, in response to mandated wage increases. 75% of limited service restaurant respondents report that they will reduce employee hours, and 53.10% will eliminate jobs in 2019 as a result of mandated wage increases that took effect on December 31, 2018.”
Which is why I pointed out the contents of the wage law and why you have corrected your analysis limiting it to NYC, but not the specific business.
CoRev: The NYC Hospitality Alliance survey cites results from both full and limited service restaurants. Why should I only look at what full service. In addition, why should I look at *unweighted* responses. Just like more *households* will get tax reductions in first year of TCJA, but lion’s share of reductions (by far) will go to top .01% of households.
Menzie, if you wish I can repeat the quote highlighting bot full and limited service restaurants, but it doesn’t change the fact that your work has been sloppy in this analysis.
Menzie, if you wish I can repeat the quote highlighting both full and limited service restaurants, but it doesn’t change the fact that your work has been sloppy in this analysis.
CoRev: I see you want this point made, by repeating. Actually, I was sloppy in making a mistake on the March 15th post by plotting the wrong series, not this post. This post has no errors, so far as I can tell.
Menzie, of course you can’t see an error because a conservative is pointing it out. You are still comparing oranges to citrus. So you and especially pgl can understand, comparing minimum wage effects to restaurant workers (the point to which you took exception) to NYC General Minimum Wage (the comparable which YOU selected).
You started by comparing NYC minimum wage effects to NY State minimum wage effects. Neither were part of the original point. You have been very sloppy in this analysis, and it appears just attack another’s view/sources. Just keep believing in your infallibility. Your students won’t ever know until they get into the real world.
Another possible explanation is that there was a too rapid expansion of the restaurant sector in New York in the last decade, and we are simply seeing a pullback that would have happened anyway. Also, Steven has made a big deal about price increases, but we see no data on what those increases have been in the past.
I have stayed out of this debate in its details because indeed to really get at this requires data on a lot more variables and serious econometric testing, none of which Steven provides. There is smoke here, but he has overstated substantially what can be concluded from it, and there are several alternative explanations possible.
Ask any restaurant owner which costs is most affecting his bottom line and the reply will be in almost every case “the rent is too damn high”. Labor costs in Manhattan are a very small percentage of your food bill. We have tried to point out other considerations to Princeton Stephen but guess what? He ain’t listening.
I can’t 100% verify this, but supposedly it was a CNN poll. Notice the ages of the people polled (or the ages of those excluded from the poll)
https://i.redd.it/ys7uowiyt7n21.jpg
The older crowd is going to go for Biden—same people who voted for Hillary with same end result. The useless Biden ego-trip has begun.
Bonfire of the Vanities? Of course this may apply to the three B’s: Biden, Beto, and Bernie!
Test
Slugs –
It’s very difficult to draw conclusions about New York’s retail employment because the city is such an outlier. It’s fair to say that the city was adding retail employment at a good clip — as it had historically during economic expansions — until the end of 2014, after which the minimum wage was raised to $9.00 and the retail sector stopped adding jobs. Therefore, by New York City standards, the post-2014 period is highly unusual and potentially indicative of the effect of increased minimum wages.
On the other hand, we see similar patterns in Boston, Philly and Pittsburgh, with the difference that retail employment in these locals had been falling since 2000, even as New York’s was rising quickly. And of course, Boston, Philly and Pittsburgh are all materially automobile markets, whereas NYC is not, by and large. So it’s all apples to oranges. And of course there is the Amazon phenomenon. New York has a lot of store vacancies, with retail employees falling by more than 10,000 per year in Manhattan for the last three years, according to The Atlantic story below.
How much of that is minimum wage, and how much is underlying trends in retail? I can’t tell from the employment data.
https://www.theatlantic.com/ideas/archive/2018/10/new-york-retail-vacancy/572911/
Graph is here:
https://www.princetonpolicy.com/ppa-blog/2019/3/20/index-of-retail-employment-nyc-and-other-key-east-coast-cities
“It’s very difficult to draw conclusions about New York’s retail employment because the city is such an outlier.”
Oh Lord – then blame the moron who cited a NYC restaurant owner survey. Oh wait – that moron was you! Except you never grasped that survey responses were not the same thing as actual market data.
Yes I think Brad DeLong has a new winner for Stupidest Man Alive: Princeton Stephen!!!
The survey had nothing to do with retail. It was about the food sector.
Retail is a subsector of Trade, Transportation and Utilities.
Food services is a subsector of Leisure and Hospitality
Completely different things.
https://www.bls.gov/iag/tgs/iag_index_naics.htm
So you are data mining and shifting your argument until you find something that works. John Lott would be so proud of you!
Steven Kopits until the end of 2014, after which the minimum wage was raised to $9.00 and the retail sector stopped adding jobs.
I think you misunderstood my comment. Employment in retail sales did flatten after 2014. That’s true. But it’s also true that employment in retail sales spiked beginning in the second half of 2018. Indeed, the Jan 2019 level is just shy of the record high in mid-2014. If the $15/hr minimum wage negatively affected the restaurant sector, then why didn’t that same $15/hr minimum wage negatively affect the retail sector? It’s quite likely that people simply migrated to retail jobs rather than physically demanding restaurant jobs, and absent a fresh influx of unskilled (frequently immigrant) workers, this would show up as a falling off in restaurant employment. Is that what happened? I don’t know. But it’s the kind of scenario you’d have to consider before firmly concluding the $15/hr minimum wage was destructive. There’s no special reason why we should be concerned about the fortunes of the full-service restaurant industry. Just because there might have been a fall off in restaurant employment coincident with one of the many minimum wage hikes does not mean former restaurant workers were left unemployed. They could have found better jobs. And if they didn’t find better jobs, then you have to explain why the unemployment rate continued to fall throughout all of those minimum wage hikes.
The only really spiky month in January 2019. Let’s see if it lasts. The wider narrative is of stagnation in retail employment from the beginning of 2015.
Again, it’s very hard to draw conclusions from the retail sector. If we take only longitudinal data from New York, then the numbers suggest that increasing minimum wages stymied the growth of what would have been a dynamic sector. On the other hand, put in the comps, and the story is much more murky.
We don’t know about alternative employment. We know that the full service employees were let go. They didn’t quit. So we’re speaking of people who lost their jobs.
I think it’s a little flip to say we don’t care about the full service restaurant sector. That’s people’s businesses and livelihoods.
I’m also going to guess we could go category by category and find pretty much what we found in food service and professional and business services. It’s not an isolated event, if I had to guess.
Steven Kopits We don’t have the latest seasonally adjusted unemployment rate for the NYC area, but we can compare the Jan 2018 NSA to Jan 2019 NSA rates, and the Jan 2019 rate is lower. So if we went category by category, I suspect it would be a little difficult to explain how the overall unemployment rate for the NYC area has fallen if employment in the subcategories is falling.
As to the retail employment data, the nadir was in Sep 2018 and it has trended up since then. Yes, the Jan 2019 number is the “spikiest” but it’s not the only month showing employment increases.
We don’t know about alternative employment. We know that the full service employees were let go.
We don’t know any such thing. The only “evidence” for that is some less than trustworthy survey of restaurant owners who have a clear economic interest in peddling a particular storyline. You shouldn’t base an analysis on biased anecdotal stories.
Look, the minimum wage debate is something that has puzzled some of the best economic minds using some of the best econometric approaches available. And the issue is still a long way from being settled. I’m pretty sure that I have at least as much expertise and experience with econometric models as you have, but I’ll be the first to admit that the econometric effort needed to intelligently discuss this issue is way beyond my skillset. That’s why God created labor economists. I don’t know whether the $15 min wage has adversely affected employment or not. As I tried to explain before, a simple deterministic regression that assumes trend stationarity and doesn’t even consider the possibility of an I(1) stochastic trend just doesn’t pass econometric muster. And as a piece of friendly advice, I’m pretty sure that a lot of your clients don’t want you to confuse a stochastic trend with trend stationarity.
So, today, in a speech at a tank manufacturing plant in Lima, Ohio, Trump out of the blue with no prompting, suddenly went on a rant about John McCain:
“I gave him the kind of funeral that he wanted, which as president I had to approve. I don’t care about this. I didn’t get [a] thank you. That’s ok. We sent him on the way, but I wasn’t a fan of John McCain.”
Nobody knows what Trump was talking about. McCain’s funeral was at the Washington National Cathedral, which is a private Episcopal church. It did not require Trump’s approval – lying once again – but he wants a thank you for it anyway. However you can give Trump credit for giving McCain one thing he really wanted. McCain explicitly dis-invited Trump from attending, although Trump did send his evil spawn, uninvited, which displeased the McCain family.
This man, the Liar in Chief, is seriously mentally ill. This is not the way any sane person behaves, let alone a President. He just blurts out crazed non-sequiturs randomly.
When will Republicans stop protecting him? He is very unlikely to be able to give them another tax cut, so nothing to gain there. More likely, the Republicans are just cowards, afraid of Trump’s wrath and his angry mob of followers.
Joseph claims: “Nobody knows what Trump was talking about….Trump out of the blue with no prompting, suddenly went on a rant about John McCain” He stated why and most/many conservatives know why he dislikes McCain.
Try sourcing other than the liberal sources with which you seem to pay attention.
CoRev, I was referring to Trump’s delusion that he was responsible for McCain’s funeral and that he deserved a thank you for it. That is just flat out craziness. No normal person talks like that.
And out of the blue with no prompting, in a speech at a manufacturing plant, suddenly debating a dead man? Trump has arrived at the “Nixon talking to the portraits on the wall” stage of his dementia.
And Republicans think this is all perfectly normal. At least they got their tax cuts so they don’t want to rock the boat.
Lyin Joseph lies again. I’m keeping score. I don’t believe you’ve ever been right about anything.
Well-informed people understand that Trump was talking about this. Mccain’s family asked that Trump approve those honors for his funeral and Trump did, despite the fact that McCain didn’t want Trump to attend the funeral and despite the fact that McCain spread the phony dossier to the FBI. McCain’s family never thanked Trump.
Rick,
That you call the dossier “phony” means you listen to Hannity too much. Most of what is in it has been verified separately. The famous peeing stuff has not been, but the only item that looks probably to be phony was the report on Cohen that he was in Prague at a crucial time. The vast majority of it is in fact true. You are just repeating a Big Lie, as you have regularly previously.
Barkley, you also need better sources. Verified by whom? Steele himself admitted : “According to deposition transcripts released this week, Steele said last year he used a 2009 report he found on CNN’s iReport website and said he wasn’t aware that submissions to that site are posted by members of the public and are not checked for accuracy. ” https://www.washingtonexaminer.com/news/steele-admitted-in-court-he-used-unverified-website-to-support-the-trump-dossier
Read this article: https://slate.com/news-and-politics/2017/09/a-lot-of-the-steele-dossier-has-since-been-corroborated.html which states “How much of the infamous document ended up being corroborated elsewhere? A whole lot.” But, when it is actually read there is little to no corroboration.
Search on words like verified and you find it used wit a UN prefix. Unverified! Search on validate, and see what they actually say. Or search on corroborate to what they claim was corroborated.
I’d be happy to read anything you provide that verifies the facts in the Steele Dossier, but I suspect most will be similar to the Slate article.
Barkley, since your comment the Mueller Report has been delivered with ZERO Americans indicted for any Russian election conspiracy. The whole issue stemmed from Steele’s dossier, and your conclusion that “The vast majority of it is in fact true. “, is just more wishful thinking of you Trump haters. NOT ONE INDICTMENT FROM THE STEELE DOSSIER, shows how wrong you have been.
As an aside there are going to several/many past administration officials investigated/fired/tried and or jailed in what might go down in the history books as the largest political scandal in American history to date.
CoRev You are misinformed. And relying upon the Washington Examiner makes about as much sense as relying upon Hannity at Fox Noise. Most of what’s in the dossier has been verified. And by “verified” I mean supported by indictments and guilty pleas. The Prague trip is the one piece that is wrong….but even there it’s likely “wrong” due to a confusion with another American named Michael Cohen who was at the embassy in Prague. For a more detailed discussion of what has been verified and what hasn’t been verified, see this:
https://www.lawfareblog.com/steele-dossier-retrospective
And note that the Steele dossier was not a piece of analysis, it was simply a collection of raw intelligence. It was intended to suggest avenues of research.
And up p;ops 2slugs with more unsupported claims. Several of the been process indictments have process crimes, lying while under oath or not registering as lobbyists, but not related to the Steele Dossier. The criminal cases are primarily tax related also.
None are for conspiracy with the Russians to subvert the 2016 election. Conspiracy is a crime collusion is not unless associated with a crime, so I will repeat:n”None are for conspiracy with the Russians to subvert the 2016 election.” As WaPo had to admit well deep in its article attempting to make more than is there: “Notably, the indictments did not accuse any Americans of conspiring with Russia — one of the main questions the special counsel was asked to examine.” https://www.washingtonpost.com/world/national-security/if-you-took-it-all-in-in-one-day-it-would-kill-you-what-muellers-investigation-has-already-revealed/2019/03/22/cb143340-41ee-11e9-922c-64d6b7840b82_story.html?utm_term=.061003cd5b8b
For all the snark you and others have provided, it was wrong all around only representing you own wishful thinking. If you can fidn evidence that corroborates the Steel Dossier show it. Otherwise start eating the crow you so deservedly earned.
What is clear is that Hillary was the only official/candidate conspiring during the campaign. You guys are scary in your inability to accept reality.
CoRev: Well, as they say, the investigations — including counterespionage — are ongoing.
Menzie, continuing counterespionage investigations? I know of none investigating Trump outside of the House. However there are several internal investigations inside the DOJ that should remove even more from its senior ranks.
You Trump haters best chance has just closed with ZERO conspiracy indictments.
Keep on hoping.
Well, CoRev, I wouldn’t count my soybean profits while the crop is still in the silo.
Seriously, Rick, this is what Trump is grousing about 8 months later – that he issued a four paragraph press statement about McCain with the least bit of civility he could muster given the advice of his press staff? And nobody thanked him for it? No sane person talks like that.
Trump’s spat with McCain goes back to the campaign when Donald Bonespurs said “He’s not a war hero. He’s a war hero because he was captured. I like people that weren’t captured.”
He brings up his petty grievances that he can never forget in the most inappropriate circumstances – in an appearance at a tank factory. I’m sorry, but this is the sign of a seriously mentally ill person.
But I’m not surprised that you leap to your Dear Leader’s defense. You have been committed to debasing yourself before him since your defense of Trump’s lie about his inaugural crowd on the first day of his administration. The fact that Trump is obsessed with petty and trivial grievances is nothing new. He is a sick man, suffering from dementia, just like his father before him.
McCain was not Trump’s kind of guy. An Annapolis graduate, Naval fighter pilot, veteran and victim of enemy torture, disable from that capture and torture, victor in multiple Arizona elections, protégé of Mr. Conservative, Barry Goldwater.
Trump’s kind of guy? Well, McCain never had his own reality TV show, never had to make difficult decisions like firing LaToya Jackson, never declared bankruptcy four times (after somehow failing to succeed in the casino business), never borrowed billions from foreign banks, never cozied up to Putin, never stiffed various contractors who worked for him, was not the recipient of $millions from his father (nor did he receive the equivalent of $5 Million in today’s dollars to start out in “business”)…Yeah, definitely not Trump’s kind of guy.
If I recall correctly, when the California legislature decided to increase the minimum wage ($1/hr. yearly) to $15– BY THE YEAR 2022– there was much handwringing, wailing, and teeth gnashing in the usual circles. (This year, I believe the minimum is $12, although seeing posters outside restaurants offering $13+ is not unusual).
But, my God! What were those crazed liberal/socialist/communist/ all-around fiscally foolish law makers thinking? Even in the greatest economy in history anywhere (Trumpers will verify), that’s unaffordable, un American, and just plain crazy.
Way back in 2017, a certain restaurant apocalypse was surely on the horizon. Apparently, it still is.
So…it looks like the 2 yr / 3 month just inverted.
It seems like several recent posts a lot of recent comments have disappeared from this site. Whassup?
Barkley Rosser: I don’t know. Haven’t deleted anything, and nothing is in the queue.