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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsEconomics. I've just figured it ALL out. From one very insightful paragraph
Which was:
In his Presidential Address to the American Economics Association (AEA) Mankiw used economics-speak to explain why janitors don’t deserve a living wage while Wall Street executives deserve billions. “Under a standard set of assumptions, a competitive economy leads to an efficient allocation of resources…it is also a standard result that in a competitive equilibrium, the factors of production are paid the value of their marginal product. That is, each person’s income reflects the value of what he contributed to society’s production of goods and services. One might easily conclude that, under these idealized conditions, each person receives his just deserts.” Oh.
http://www.newrules.org/equity/article/occupy-economics-departments
And here's my epiphany re non-Keynesian economists: It's all just pretty words intended to provide a fictional basis and foundation for whatever it is they want it to say and mean. In fact, CLEARLY, John Kenneth Galbraith had it exactly right:
The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness. - John Kenneth Galbraith
That paragraph can be found in this very good read: Occupy Economics Departments http://www.newrules.org/equity/article/occupy-economics-departments
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MadHound
(34,179 posts)That a janitor should be paid the same as a teacher?
Or are you simply saying that CEO's need to have their salaries reduced?
trackfan
(3,650 posts)I think that most people were offered the proposition: tomorrow you can go to work as either a teacher, a CEO/big boss, or a janitor, and the pay were to be the same for all three, very few people would choose to be the janitor; so, if anything, it should pay more than either teacher or CEO in order to attract someone to do it. Hell, I'd do CEO for a lot less than either teacher or janitor.
MadHound
(34,179 posts)Do you know what teachers go through?
trackfan
(3,650 posts)difficult as the job may be, than a janitor, mainly because most people have a distaste for hard, dirty manual labor, and for being in a position that is perceived to be "low".
At least a teacher is respected, so, just speaking for myself, to make up for the lack of societal regard, I would want more to be a janitor. Once again, I'd take a huge pay cut from either of those jobs to get to be the boss.
Honeycombe8
(37,648 posts)More people can do the duties of a janitor than those of a teacher. Being a teacher requires a degree and licensing. You just need to have physical ability to become a janitor.
If you run an ad for a janitor position, a lot more people will apply, because a lot more people qualify to do the job, than for a teaching position.
If the job has few requirements that most people can't meet, and if it's something that a lot of people can do, that job will not pay much. That's because it doesn't have to. If you own a business and can hire a janitor for $6.00 an hour, you will probably not hire someone to do the job for $12.00, all things being equal as to what you need. It doesn't make sense.
That's why Tom Cruise gets paid millions per movie, while Bernie Smith gets acting union wages. Only one person in the world can do what Tom Cruise does. If that's what you need, you have to outbid others to get him.
Life lesson #45: If you want to get paid more, choose a vocation/profession that requires something that most people won't have (or don't want to do), and which is perceived as necessary and valued. An emphasis in a field that is male dominated is helpful, since those fields tend to pay more. (engineering, surgery, dentistry, etc.)
But most people, like myself, just fall into a vocation, esp if they aren't raised to consider this very important thing while they're growing up.
MH1
(17,598 posts)The initial quote was 'insightful' but not in a positive way, i.e. not reinforcing what the quoted passage was saying. Instead, it raised insight as to what Mankiw was actually about. Skip down to the quote by J K Galbraith, which is what the op is supporting.
That's how I read it, anyway.
Remember Me
(1,532 posts)and LINKED to. Go have a look and maybe you'll have a better appreciation for what's written here. Or not.
Odin2005
(53,521 posts)Most economists are the modern day court philosophers.
unblock
(52,195 posts)which, of course, is some sort of panglossian justification of economic anarchy, not capitalism at all.
leeroysphitz
(10,462 posts)
BlueToTheBone
(3,747 posts)Otherwise it is just war and more war.
xchrom
(108,903 posts)Were any good at their jobs.
Why the fuck aren't they fired?
OnionPatch
(6,169 posts)Imagine if no one was around to clean the toilets.
So obviously, work is NOT based on the value of the job being done. It's based on how easily you can exploit workers to do the job for as little compensation as possible, period. Keep them uneducated, keep them in debt for their health care and basic needs and they'll be desperate enough to do anything at any wage. The system is immoral, that's correct.
yurbud
(39,405 posts)it they get involved with companies that do, their contribution is often more like a parasite that drains the life away and then moves on to the next host.
Peace Patriot
(24,010 posts)...the highest paid professions in society.
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"...it is also a standard result that in a competitive equilibrium, the factors of production are paid the value of their marginal product. That is, each person’s income reflects the value of what he contributed to society’s production of goods and services."
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The services of pre-school teachers, mothers and janitors provide the very highest contribution "to society's production of goods and services." Think of a society in which children are abandoned to fend for themselves at birth and in which no one cleans up the messes that others make. Society would soon collapse. Our society is almost entirely built on the backs of these very low paid (or unpaid) people. What would it matter what anyone else does, from CEOs, real estate agents and computer technicians on up to grade school, high school and college teachers, if NO ONE provided loved, cared for human beings to replace the "factors" in the human industrial machine and NO ONE swept the garbage out of our offices, factories, classrooms and homes!
Chaos!
The key to Mankiw's Big Lie, of course, is the phrase "their marginal product." What could be more "marginal" than an iPhone in the pocket of an illiterate. He/she might be able to figure out how to turn it on, then what? More pertinent still, an unloved, uncared for illiterate, if he/she survives babyhood in a society in which no one gives a frack whether he/she does or not, won't ever be able to afford an iPhone because such a person will not likely ever hold a job, open a bank account, get credit, save money. So WHO starts our babies off on a path toward literacy, usefulness and social progress? Who HELPS them, often gratuitously (out of their loving hearts) to be safe and secure and to develop their brains, physical coordination and personalities in those critically important early years?
Jeez, it's so obvious!
And how would these babies and young children fare in an environment full of filth and human waste and trash? How would ANYBODY fare in such an environment? The floors of nurseries covered with feces? The floors of hospitals covered with blood, feces and body parts? Offices with mountains of discarded paper, coffee grounds, half empty soda cans, old pizza and broken computer parts? Factories with industrial dust swirling round as on the wind-swept Sahara? Neighborhoods piled with garbage of every description? Supermarkets with old food, broken packages, mud from many shoes and god knows what-all littering the floors?
Who should be paid the most? Who? Whose "product" is "marginal" in this REAL picture of modern life?
The truth: Modern life WOULD NOT EXIST if it weren't for these lowest paid, most despised and most productive contributors. We can do without almost any other given profession--the least necessary of all being CEOs--but I would give our society months, and maybe just weeks, to total implosion, without parents (didn't mean to dis the dads or other child care givers), pre-school teachers and janitors (and garbage collectors).
Turn this thing upside down and pay them THE MOST--that's what I say. And put all the CEOs and Reaganite economists in jail. Criminals, the lot of them. Empty their pockets first. Hang them by their toes and let their dinero "trickle down" by force of gravity.
nilram
(2,886 posts)