
Swiss to vote on $25 an hour minimum wage - jamesbritt
http://www.usatoday.com/story/news/world/2014/05/16/swiss-minimum-wage/9166687/
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workhere-io
Before you compare it to American wages, keep in mind that Switzerland has one
of the highest costs of living in the world. [http://www.numbeo.com/cost-of-
living/rankings_by_country.jsp](http://www.numbeo.com/cost-of-
living/rankings_by_country.jsp)

~~~
unreal37
Before you dismiss it so fast, the question of how can a person live on $7.25
an hour still deserves some thought? $1,200 barely enough for rent, food and a
bus pass.

Maybe $25 is too high, but $7.25 is low.

~~~
yummyfajitas
Yet somehow, billions of people worldwide live on far less than that number
_after adjusting for purchasing power_. The average Bulgarian subsists on
roughly a US minimum wage salary (after adjusting for purchasing power -
before adjusting for PPP it's about half a min wage salary). The average
Indian subsists on far less.

How do they do this?

[http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_...](http://en.wikipedia.org/wiki/List_of_countries_by_GDP_\(PPP\)_per_capita)

(Hint: roommates, cooking at home, long commutes or less desirable cities,
giving up luxuries which are common in the US like a car.)

Note: don't say "cost of living". The numbers I cite adjust for that.

~~~
psykotic
There are social, cultural and infrastructural factors which you completely
trivialize by neglecting to mention them. In Thailand, for example, working-
class people do often live with others in small spaces, but either they are
strangers in factory dorms or they are extended family members in small
apartments.

The crucial role of the extended family may be the hardest for modern
Westerners to appreciate. It is not our feel-good notion of family. My brother
in law has spent the last 15 years continuously working out of country as a
truck driver in Singapore, living in a ramshackle shelter on construction
sites while sending most of his earnings back to his wife and kids. This is a
somewhat extreme case, but milder instances are commonplace. People often have
to work away from their families for years at a time to make ends meet and
accrue any sort of savings.

Then there is transportation. Every day you will see mothers on scooters
carrying several toddlers who are certain to die in even minor accidents.
Another common sight and a less egregious example would be pickup trucks with
the backs piled full of day laborers, or commuters casually hanging off the
back of high-speed songthaew busses. This is highly efficient in monetary
terms, but the human cost is huge.

It's a complex issue that is not reducible to PPP numbers.

~~~
yummyfajitas
I'm not sure why you say things aren't "reducible" to PPP numbers - low PPP-
adjusted income corresponds quite well to the low consumption levels you are
describing.

In any case, I'm glad we are agreed that unreal37 is incorrect, and it is
possible to "live on" $1200/month. It's not anywhere near as nice as American
poverty, but it's hardly clear that $7.25 is too low.

I'd propose an alternate direction for the discussion - if we believe the
American poor are lacking in some necessary good or service, lets be specific
and name it.

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folli
The vote is tomorrow and has almost no chance of getting passed.

[http://www.gfsbern.ch/DesktopModules/EasyDNNNews/DocumentDow...](http://www.gfsbern.ch/DesktopModules/EasyDNNNews/DocumentDownload.ashx?portalid=0&moduleid=677&articleid=1077&documentid=443)
[german, pdf]

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copx
This is the key sentence in the article:

>However, 90% of Swiss workers earn well above the proposed minimum and are
already among the highest paid in the world.

~~~
id
This law aims at the 10% that don't earn well.

The US isn't a poor country either. In fact, Americans are also among the
highest paid in the world [1]. It's just not evenly distributed.

[1]
[https://en.wikipedia.org/wiki/List_of_countries_by_average_w...](https://en.wikipedia.org/wiki/List_of_countries_by_average_wage)

~~~
cma
Due to the marginal utility of money dropping rapidly as you get more, uneven
distribution is much worse than it sounds.

------
olalonde
Didn't the Swiss vote on basic income recently? Seems like it would be a much
better alternative. Such a high minimum wage is likely to discriminate against
the very poor by favouring automation and reducing demand for unskilled
workers.

~~~
Kiro
Automation is never bad.

~~~
olalonde
Different schools of thoughts have differing opinions regarding that. As a
libertarian, I'd argue that the free market is better than government at
deciding what needs to be automated. Minimum wages effectively impose a tax on
human labor which in turn artificially incentivizes automation. Basic income
might suffer from the same problem to some degree (by disincentivizing people
to do lower paid jobs) but at least, it would accomplish the stated goal of
minimum wages (that is, helping the more needy).

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joelgreen
Sounds like a fast way to get rid of immigrants.

~~~
bayesianhorse
And in the process lower the standard of living of the rest. Or tank the
tourism sector, since they might have trouble paying this wage to the low-
skilled workers they need. If they don't have that trouble, then even
immigrants don't care, most of which already earn well above the proposed
minimum wage.

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mkhattab
Let's say the Swiss set the minimum wage to $25/hr or even half that, $12/hr,
what kind of ripple effect would we expect on other salary groups? Would they
increase by the same proportion?

~~~
seanmcdirmid
The effective minimum wage (what you have to pay to attract workers) is
already probably over $12/hr in Switzerland.

Everything is already expensive, so I would expect the ripple effects to be
slight.

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bmmayer1
The actual dollar amount of the wage isn't the same as real income in terms of
what goods and services you can buy relative to the wage, so sentences like
this are useless: "would make mostly immigrants here in agriculture,
housekeeping, and catering among the world's highest paid unskilled
workforce." It's actually likely that the higher minimum wage will lower real
incomes by driving up production costs.

------
bayesianhorse
There seems to be a pattern here: Swiss referendums more often than not follow
the opinion of the government. In cases where they don't, they seem to be
quite problematical.

In the vote for "restrictions on EU immigrations" the swiss want to throw out
immigrants. But not those they know personally. Or those on whom their economy
depends. So basically the government has the choice between not implementing
the proposal as intended, or to harm the economy badly. As far as I know, they
haven't solved this Dilemma quite yet.

Maybe this "element of direct democracy" has less impact on the actual
"democraticness" than some believe it has. At the very least it poses a
serious risk for long term investors or entrepreneurs. Any harebrained idea
that comes up in this process has a non-zero chance of being implemented just
by the power of low participation or ambiguous opinions.

At best, governments already take the "pulse" of public and expert opinion
when setting policy, making referendums futile or redundant.

~~~
algorias
> At best, governments already take the "pulse" of public and expert opinion
> when setting policy, making referendums futile or redundant.

So you're saying a referendum is futile because it forces the government to
(preemptively) do what the people want? That's exactly it's purpose!

~~~
bayesianhorse
I have not said that, and you deliberately misunderstood me to make a point
against practical democracy.

In any country with a practical, working, real-world democracy you can see the
government mostly following opinion polls.

Finding out "what the people want" is extremely hard, at least if you aren't a
populist politician or their adherents. The task doesn't get easier if you
pose simple yes and no questions.

I think it is dangerous that people in western democracies increasingly equate
referendums and votes with democracy, leaving out the conditions of the vote,
the environment, the institutions and the state of the human rights.

------
Yrlec
In Sweden there's no minimum wage at all. We let the market set it.

~~~
UweSchmidt
Nice.

However there is an implicit minimum wage linked to welfare. Any wage must be
above what welfare pays or people might not bother working at all.

~~~
hershel
Do youmean that if someone doesn't want to work he can easily get welfare ?

~~~
soneil
"doesn't want to" is an awkward way to look at it.

It's more of a catch-22. If you simplify 'welfare' to "If you're not above the
poverty line, you're entitled to assistance", then a job which does not bring
you above the poverty line is zero-sum - you're still entitled to assistance.

An example I see here quite often, is people who can only find part-time work,
and still receive assistance. It's not unusual to find people in the position
where they're working <20hrs/week, but do not want to work 20<n<30 hours a
week because it'll interfere with their benefits.

This is _not_ the "don't want to work" trope - they'd take 40/hrs week in a
heartbeat. But if 20hrs/week + benefits is better than 25hrs/week sans
benefits, who would realistically take more work for less pay?

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lauradhamilton
$25 in Switzerland is gets you about what $12 in the US does. So this really
isn't as high as it sounds.

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brunnsbe
Switzerland's need to export stuff and to do business with the surrounding EU-
countries is bigger than the EU-countries' need to do business with
Switzerland. Putting a minimum wage this high will naturally impact the prices
on goods leading to a shrinking export market. I wonder how they came up with
$25/hr and not, let's say, $17,50/hr?

~~~
seanmcdirmid
Switzerland is already very expensive; a meal at McD's will run you at least
12 CHF. This rise in the minimum wage is not going to affect exports at all
(which are all very high end...and how many bankers make minimum wage?); it
will make some things slightly more expensive (on top of already being pretty
expensive).

~~~
brunnsbe
Switzerland exports more than just bank services, e.g. grocery products like
cheese and chocolate which are products produced with low wages. And yes
it'expensive, I'm currently living in Gèneve and paying more than enough for
my kebabs (it's cheaper to pay for the tram to Annemasse in France and have
the kebab over there).

~~~
seanmcdirmid
The farmers are well protected in Switzerland, while the chocolate making is
highly automated.

What the higher minimum wage will do is push either for automating or
exporting lower wage tasks, which will reduce immigration (since those jobs
are not really done by swiss citizens anyways), and there are surprisingly a
lot of xenophobic people in Switzerland that are OK with this.

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crb002
The effect is that lower skilled swiss citizens will emigrate now that they
can no longer be employed in their home country. It is the wolf of eugenics
under the sheep's clothing of leftist charity.

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hellbreakslose
Fact here: If you convert $ to euros with the current rates, that makes
minimum wage 4380 Euros a month.

I worked for a year in Switzerland and I am telling you, you can barely live
with that kind of money. Everything is so expensive over there at least
Zurich.

So yes expect a Swiss Tourist coming in the US buying everything and have a
lot of funs, but in Switzerland with that wage he won't be saving anything.

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whoismua
and how much does a loaf of bread, gasoline, rent etc etc cost there? It's all
relative

~~~
maccard
cost of living is about 1.5 times higher than the US. Source is somewhere in
this comment thread

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saosebastiao
I love when people give us opportunities to empirically measure their bad
theories.

~~~
octonion
Those "bad theories" have led to a far higher quality of life than the US.

~~~
facepalm
Yeah because you can directly compare Switzerland and the US. Where does the
high income of Swiss people come from? I don't think the same thing would be
replicable for the US (for starters, the US is not a tiny neutral country
surrounded by Alps).

~~~
anonymousDan
So? Even if that were true, it's irrelevant to the above poster's counterpoint
to the previous poster's statement.

~~~
facepalm
How so?

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thecopy
Government intervention in the free market is never a good thing. If i would
have a citizenship i would have voted no.

~~~
bayesianhorse
I can see various situations where government intervention in free markets is
most decidedly a good thing.

For example, food and health industry needs to be regulated. The incentives
for self-regulation otherwise are so low, that lots of people die and suffer
until the market reaches its supposed optimal equilibrium of high safety
standards.

Antitrust regulation is an intervention in a free market, though one could
argue that without antitrust regulation, there is no free market...

