Henry Ford...

EdBEdB Senior MemberPosts: 2,958 Senior Member
...raised the minimum wage for his auto workers to $5 per hour for an eight hour day. That's the equivalent of $15 per hour today.

http://www.huffingtonpost.com/michael-moore/henry-ford-minimum-wage_b_4683075.html

One hundred years ago this month Henry Ford began paying his workers a minimum of $15 an hour! (It was $5 for an eight hour day – which would be worth $116.48 now.) That's right – in a much poorer America, one without TV, radio, phones or House of Cards on demand, Ford could afford it. In fact, Ford later said, he couldn't afford not to: "The owner, the employees, and the buying public are all one and the same, and unless an industry can so manage itself as to keep wages high and prices low it destroys itself, for otherwise it limits the number of its customers. One’s own employees ought to be one’s own best customers."
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Replies

  • BuffcoBuffco Senior Member Posts: 10,586 Senior Member
    How many minimum wage workers does Ford employ today?
  • George KGeorge K Super Moderator Posts: 10,196 Senior Member
    Ford had a lot of unsavory ideas and beliefs, but he is spot-on about this.
    Keep your stinkin' government hands off my Medicare.
  • EdBEdB Senior Member Posts: 2,958 Senior Member
    Buffco wrote: »
    How many minimum wage workers does Ford employ today?

    http://corporate.ford.com/news-center/press-releases-detail/677-5-dollar-a-day

    Henry Ford had reasoned that since it was now possible to build inexpensive cars in volume, more of them could be sold if employees could afford to buy them. The $5 day helped better the lot of all American workers and contributed to the emergence of the American middle class. In the process, Henry Ford had changed manufacturing forever.
  • BuffcoBuffco Senior Member Posts: 10,586 Senior Member
    You didn't answer my question.
  • EdBEdB Senior Member Posts: 2,958 Senior Member
    Buffco wrote: »
    You didn't answer my question.

    I don't know, most of them have been replaced by automation and outsourcing their jobs.
  • BuffcoBuffco Senior Member Posts: 10,586 Senior Member
    OK. So upping the minimum wage will do absolutely **** for Ford employees
  • fishingcomicfishingcomic Senior Member Posts: 24,916 Senior Member
    Buffco wrote: »
    You didn't answer my question.

    Since the place is highly unionized, I doubt any.
    'I've spoken of the Shining City all my political life. …In my mind it was a tall, proud city built on rocks stronger than oceans, windswept, God-blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here. That's how I saw it, and see it still.'" Ronald Reagan
  • EdBEdB Senior Member Posts: 2,958 Senior Member
    That's right, raising the minimum wage will not solve the problem of the obsolescent economic system that can't provide an adequate income for millions of Americans.
  • The link in post #4 contradicts the link in post #1.

    There are so many problems with Moore's piece it's ridiculous.

    First, the switch to assembly line manufacturing increased productivity so much that a wage increase was easily absorbed. In fact, this is economics at its finest. Increasing productivity led to increasing wages.

    Second, as Ford Motor points out, working on the assembly line was pretty terrible. Attrition was high, so Ford needed to pay higher wages to keep people there. Ford Motor notes that this was played up as Henry being all noble and such, but the reality was less idealistic.


    Third, saying that Ford Motor raised its minimum wage to $5 per day isn't the same as saying that the minimum wage was $5 per day, the average wage (not even the minimum) in 1913 was $2 per day ($0.22 per hour), which in today's dollars would be $5.13 per hour. Meanwhile the average wage at General Motors (so I'd assume Ford) today is around $30 per hour and that doesn't include bennies like health insurance (which Ford wasn't providing in 1913).

    Fourth, Moore compounds the problem by then comparing this to the minimum wage today, but I find it difficult to accept that the profit per employee at fast food restaurants is the same as the profit per employee at Ford Motor.

    Moore's analysis is just terrible.
  • fishingcomicfishingcomic Senior Member Posts: 24,916 Senior Member
    Buffy, I think you kind of missed the point of the article. It was not about upping the minimum wage. It was about how paying employees more thereby giving them enough money to actually buy the products they were making, was good for the economy.
    'I've spoken of the Shining City all my political life. …In my mind it was a tall, proud city built on rocks stronger than oceans, windswept, God-blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here. That's how I saw it, and see it still.'" Ronald Reagan
  • fishingcomicfishingcomic Senior Member Posts: 24,916 Senior Member
    Steven wrote: »
    First, the switch to assembly line manufacturing increased productivity so much that a wage increase was easily absorbed. In fact, this is economics at its finest. Increasing productivity led to increasing wages.

    So why is this no longer the case?
    'I've spoken of the Shining City all my political life. …In my mind it was a tall, proud city built on rocks stronger than oceans, windswept, God-blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here. That's how I saw it, and see it still.'" Ronald Reagan
  • NZ IndicatorNZ Indicator Senior Member Posts: 10,454 Senior Member
    Ed,

    When department stores, gas stations & restaurants start selling products that are beyond the financial reach of folks, without taking out a loan, you get back to us OK? Let us know when you have to pay $20-$30k for a burger and fries or that candy bar from the gas station.

    It's a poor comparison. Kind of like saying that Boeing would have to pay it's workers a sufficient amount of money so they could afford to buy an airplane. It had nothing to do with creating a workforce that could afford to buy the product. It was to cut down on the turnover at the time.
  • EdBEdB Senior Member Posts: 2,958 Senior Member
    $5 then equals $116.48 now, 116.48 divided by 8 equals $14.56 per hour. So Moore is correct in saying that Ford paid almost $15 per hour 100 years ago, so why can't we do that today.
  • Just so we're clear here, hopefully we're not going to revisit Elizabeth Warren's statement that if only the minimum wage had kept up with productivity.... That's just terrible analysis and she should know better.

    My guess is due to the decline in the power of labor unions. If labor unions were able to bargain for excess economic rents in the past, it could be that the decline in labor unions has allowed capital to take this back to the economic equilibrium. What I'm trying to say here is that wages may have increased far faster than productivity between say 1935 and 1975, but have increased at a much lower rate since then, bringing the relationship of wages and profit back to the 1935 level (or some other equilibrium level).

    I have no idea if this is true, just a theory.
  • EdB wrote: »
    $5 then equals $116.48 now, 116.48 divided by 8 equals $14.56 per hour. So Moore is correct in saying that Ford paid almost $15 per hour 100 years ago, so why can't we do that today.

    One more time.

    Ford pays far more than $15 today. That doesn't mean that McDonald's could pay $5 per day then (if it had existed).
  • Edit to add.

    I read somewhere that the average wage paid hourly workers is $20 per hour. And, as previously mentioned, Henry Ford paid more than double the average. The average worker has done far better than even Moore is claiming they should have done.
  • fishingcomicfishingcomic Senior Member Posts: 24,916 Senior Member
    joekrz wrote: »
    Ed,

    When department stores, gas stations & restaurants start selling products that are beyond the financial reach of folks, without taking out a loan, you get back to us OK?

    They do that already. Or are you unaware of the looming personal debt crisis?
    'I've spoken of the Shining City all my political life. …In my mind it was a tall, proud city built on rocks stronger than oceans, windswept, God-blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here. That's how I saw it, and see it still.'" Ronald Reagan
  • They do that already. Or are you unaware of the looming personal debt crisis?

    You're about four years late on this, no?

    After peaking in 2009, the percentage of household and consumer debt payments relative to personal disposable income is down to the same level it was 1980. Combination of the banks writing this stuff off and people getting their finances back in order.
  • fishingcomicfishingcomic Senior Member Posts: 24,916 Senior Member
    I don't know. It seems I read something different just a year ago. But if it was because the banks have been writing stuff off, does that mean that people no longer need to borrow money?
    'I've spoken of the Shining City all my political life. …In my mind it was a tall, proud city built on rocks stronger than oceans, windswept, God-blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here. That's how I saw it, and see it still.'" Ronald Reagan
  • NZ IndicatorNZ Indicator Senior Member Posts: 10,454 Senior Member
    EdB wrote: »
    $5 then equals $116.48 now, 116.48 divided by 8 equals $14.56 per hour. So Moore is correct in saying that Ford paid almost $15 per hour 100 years ago, so why can't we do that today.

    Ed,

    Re-do your math using the hourly wages in 1914 for everyone else that wasn't working for Ford.

    Let me know what you come up with.
  • EdBEdB Senior Member Posts: 2,958 Senior Member
    Have no idea, this thread is about what Ford did with minimum wage.
  • NZ IndicatorNZ Indicator Senior Member Posts: 10,454 Senior Member
    No, this about what Ford did for HIS workers.

    I'll give you a hint...average wage in 1914 for those that didn't work at Ford was about .25/hour or $2 per day.

    Now re-do your math and let us know where that comes out in today's dollars.

    Sent from my SCH-I535 using Tapatalk 2
  • dryfliedryflie Senior Member Posts: 1,442 Senior Member
    Steven, Joe, Et al. Could you guys live on the minimum wage in your state? Yes or No please, don't give us a lot of BS.
    “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
  • EdBEdB Senior Member Posts: 2,958 Senior Member
    Not interested, all I know is that the minimum wage paid in 1914 and the minimum wage paid today were and are inadequate for providing millions of Americans with a livable income. The economic (money) system is a failure and should be replaced.
  • dryflie wrote: »
    Steven, Joe, Et al. Could you guys live on the minimum wage in your state? Yes or No please, don't give us a lot of BS.

    My son does.
  • EdB wrote: »
    Not interested, all I know is that the minimum wage paid in 1914 and the minimum wage paid today were and are inadequate for providing millions of Americans with a livable income. The economic (money) system is a failure and should be replaced.

    You were interested enough when you thought Michael Moore had a valid point.
  • fishingcomicfishingcomic Senior Member Posts: 24,916 Senior Member
    joekrz wrote: »
    No, this about what Ford did for HIS workers.

    I'll give you a hint...average wage in 1914 for those that didn't work at Ford was about .25/hour or $2 per day.

    Now re-do your math and let us know where that comes out in today's dollars.

    Sent from my SCH-I535 using Tapatalk 2

    No you redo your math. How is what the actual average wag was relevant to $5 value relative to inflation?
    'I've spoken of the Shining City all my political life. …In my mind it was a tall, proud city built on rocks stronger than oceans, windswept, God-blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here. That's how I saw it, and see it still.'" Ronald Reagan
  • fishingcomicfishingcomic Senior Member Posts: 24,916 Senior Member
    Steven wrote: »
    My son does.

    Really? How many jobs does he have? Does he live in a rent controlled apartment? Does he have insurance?
    'I've spoken of the Shining City all my political life. …In my mind it was a tall, proud city built on rocks stronger than oceans, windswept, God-blessed, and teeming with people of all kinds living in harmony and peace; a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here. That's how I saw it, and see it still.'" Ronald Reagan
  • I don't know. It seems I read something different just a year ago. But if it was because the banks have been writing stuff off, does that mean that people no longer need to borrow money?

    No. It doesn't mean that. People will always borrow for houses, cars and big ticket items like washing machines and fridges.

    It means that if people (the royal people) could afford to do so in 1980, they could afford to do so now.
  • NZ IndicatorNZ Indicator Senior Member Posts: 10,454 Senior Member
    dryflie wrote: »
    Steven, Joe, Et al. Could you guys live on the minimum wage in your state? Yes or No please, don't give us a lot of BS.

    Easily in the town where I live. Hell...$10/hour here is good money.

    Probably wouldn't own my own home or own newer cars...more than likely would be renting and have an older car but it could be done.


    Sent from my SCH-I535 using Tapatalk 2

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