
Originally Posted by
Mudfart
You can never have everyone employed unless you run a fascist totalitarialist? govt aka Adolf Hitler, and press everyone into the armed services.
Thats not really correct. From a pure economics point of view, we choose our level of unemployment.
The tools are the minimum wage, and border tariffs.
They are used to protect the incomes of our unskilled workers, who otherwise, would earn the world rate for their jobs.
Tariffs work by (effectively) taxing consumers who buy the product, to maintain the incomes of the workers in the industry that the tariff applies to.
So, you could tariff T-shirts at say $50. So while you can now buy a chinese T shirt for $10, it would if tariffed cost you $60. This would make it economic for a NZ manufacturer to make T-shirts, even though his raw labour cost is $12.50/hr + ACC, safe working conditions etc etc, when his chinese competitor pays $.50 with no minimum standards.
This breaches many free trade agreements, so has been dropped.
At a minimum wage of $12.50, the NZ tee shirt manufacturer is out of business. But on average (economists claim) that the tax you payn tp provide the dole as an alternative, is less than the cost of buying the T shirts at the tariffed rate.
You could fix it overnight, by dumping the minimum adult wage. Then, full employment, albeit at $5 an hour would result.
Is that the NZ we want ?
IMHO we need to find a compromise.
Their has to be a system to ensure that unskilled kiwis gain skills, or even if they don't, they don't end up on the world rate for unskilled workers.
But that system cant become a resting ground for the lazy or unmotivated, as it (at least in my experience) has become.
No easy solution here.
If it were up to me, Id have only one benefit, which expected work if you were capable. It would have no cash component, being an EFTPOS type card which managed expenditure, and didn't allow excessive grog/smokes/pokies.
And its rate would depend on how long you were in the workforce, and how long you ad been on welfare. So the long term employed, knocked over by a recession, would fare better than those who left school, expecting the DPB.
David must play fair with the other kids, even the idiots.
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