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Making a Global Wage?
- Thread starter Rex
- Start date
Colin_Admin
Member
Paying people in other country's an hourly wage (in their currency) that would be an equivilant to an hour worth of work in U.S. dollar here. If I am correct this is a way to making a global wage and along the lines of the question Rex is trying to ask.
Runt
Well-Known Member
My understanding of economics, in particular global economics, is slim... but let me try to think this through...
It certainly sounds good on the surface... but some points:
Driving the minimum wage up to an equal level in each country would be difficult... you would have to account not only for inflation in THIS country, but in other countries as well, in order to make the value of each minimum wage the same. This would require a HUGE amount of research to coordinate... inflation is constantly changing...and since the US is the base, if we have a recession... we could potentially drive other nations into depression...
Then, even if we did manage to make it equal, this means that US businesses that normally have factories and employees overseas because it is cheaper now not only have to pay them the same they would domestic employees, but would also have to continue to deal with financial issues involved with shipping overseas and other distance problems. It would no longer be lucrative to employ people in other nations, so US businesses will start hiring US employees instead. This would certainly fix the job shortage in the US, but it would deprive millions of people of jobs outside of the country. This, obviously, would NOT be a good result...instead of getting equal pay, they get NO jobs at all! This would increase poverty in foreign nations, rather than decreasing it... not good, not good at all.
It certainly sounds good on the surface... but some points:
Driving the minimum wage up to an equal level in each country would be difficult... you would have to account not only for inflation in THIS country, but in other countries as well, in order to make the value of each minimum wage the same. This would require a HUGE amount of research to coordinate... inflation is constantly changing...and since the US is the base, if we have a recession... we could potentially drive other nations into depression...
Then, even if we did manage to make it equal, this means that US businesses that normally have factories and employees overseas because it is cheaper now not only have to pay them the same they would domestic employees, but would also have to continue to deal with financial issues involved with shipping overseas and other distance problems. It would no longer be lucrative to employ people in other nations, so US businesses will start hiring US employees instead. This would certainly fix the job shortage in the US, but it would deprive millions of people of jobs outside of the country. This, obviously, would NOT be a good result...instead of getting equal pay, they get NO jobs at all! This would increase poverty in foreign nations, rather than decreasing it... not good, not good at all.
Engyo
Prince of Dorkness!
Rex & Colin -
This is actually what globalization is all about. The "free market" will do this for us..... Of course it will tend towards the lowest point rather than the highest. Why should someone pay me $20/hr to do the same job that a worker in India would be thrilled to do for $20/day? Then they find someone else in North Korea who will do the same thing for $20/wk. The technology makes all of it possible.
From a purely idealistic standpoint, it would be great if we could set up a global minimum wage, and global workplace protection laws, and so on.
There are only two problems I can see with this. First, this prevents a lot of greedy people from making as much money as they think they ought to (think executives and exploiters); and secondly it would mean a drastic downward revision of the standard of living in the "western" nations across the board, with a corresponding rise in some of the poorest countries. Neither of these is going to sit well with folks who have a lot of political and/or financial power to either support or oppose such a system. The rise in standard of living in some of the poorest nations is just as problematic if you are a politician depending on those people for your power base.
Again, my cynicism is showing.
This is actually what globalization is all about. The "free market" will do this for us..... Of course it will tend towards the lowest point rather than the highest. Why should someone pay me $20/hr to do the same job that a worker in India would be thrilled to do for $20/day? Then they find someone else in North Korea who will do the same thing for $20/wk. The technology makes all of it possible.
From a purely idealistic standpoint, it would be great if we could set up a global minimum wage, and global workplace protection laws, and so on.
There are only two problems I can see with this. First, this prevents a lot of greedy people from making as much money as they think they ought to (think executives and exploiters); and secondly it would mean a drastic downward revision of the standard of living in the "western" nations across the board, with a corresponding rise in some of the poorest countries. Neither of these is going to sit well with folks who have a lot of political and/or financial power to either support or oppose such a system. The rise in standard of living in some of the poorest nations is just as problematic if you are a politician depending on those people for your power base.
Again, my cynicism is showing.
