Category Archives: crime

Detroit: maximum punishment

4 Replies

Some moths ago, I argued that getting rid of its extra-high minimum wage was perhaps the single best thing that Detroit could do to improve its bankrupt finances and to provide jobs for its youth. I argued that this living wage of $11 or $14/hr, depending on whether healthcare was provided, was too much for the city to pay for it’s minimal skill workers. I also argued that a lower minimum wage would help the city finances, and would allow the unskilled of Detroit to find jobs: it would provide the first rung of a ladder. Well, sort-of good news: Detroit’s living wage has been declared unenforceable by the Michigan Supreme court.

Unenforceable does not mean that wages will lower immediately: anyone working for the city will keep their high salary job, so the finances of the city will remain strained. Also, private companies can not lower anyone’s contracted wages. The only difference is that workers on non-city jobs who agree to be paid $7.50 to $14/hr, can no longer sue to recover additional dollars to meet Detroit’s “living wage.” Bit by bit I expect that more low-skilled workers will be hired, and that their wages will stabilize downward to a free-market value.

The next big things that are needed are reduced crime and increased population who are employed in businesses other than selling drugs or themselves. One way to reduce crime, I think is to have less-stiff minimum penalties for non-violent crimes like drug possession and driving with a suspended license. Currently the penalty for possession runs to 15-20 years. No one who spends that much time in prison will fit back into society. Let’s do them and ourselves a favor by reducing minimum sentences so that the normal sentence is only 1-5 years (ideally with < 1 oz marijuana possession punished by a fine).

Another horror is the penalty for driving with a suspended license. It’s $3000 for a start (a reasonable amount, I think), but then the state adds a $4000 per year penalty for the next 3 years: a total of $15,000. That’s too much for a minimum-wage earner to pay, but the minimum wage earner needs a car to get to work. So he/she can’t work, or he/she drives without a license or insurance. Is this what we want? Lets give a second chance and lower the penalty to produce more working, law-abiding citizens. There is nothing wrong with Detroit that could not be fixed by 200,000 more, law-abiding, employed Detroiters.

R.E. Buxbaum owns REB Research, a maker of hydrogen purifiers and hydrogen generators. We used to be located in Detroit, but are now in Oakland county, 1/2 mile north of the Detroit border.

Dwarf joke

I tripped over a dwarf the other day; I know — bad news. The fellow gets all huffy with me, and seems to think I was looking down on him (So weird, if I’d been looking down on him, I’d never have tripped!).

At any rate he says, “I’m not happy.” “That’s OK.” I say, “So which one are you?” And he gets all upset. These dwarves are all the same, they’re so small. 

Detroit crime demographics

2 Replies

For some reason I find Detroit’s crime demographics fascinating. The city has had more professional makeovers than Sofia Loren, yet the crime rate in the city is about 12 times that of New York on a per-capita basis. What’s more telling is that the distribution has several sharp cut-offs, the most famous being Eight mile road — memorialized in a movie about Emenem — on one side of the Eight mile you have a murder rate higher than Guatemala’s on average, on the other, a relatively decent rate — similar to Brooklyn, NY. I’ve long thought that the high crime was related to the good intentions of the reformers, but I could be wrong. The data is amazing, though.

1 week of crime in Detroit with special focus on 8 mile road -- that's the horizontal cut dividing Detroit, lower from the northern suburbs. The crime area in the upper right is Royal Oak.

1 week of crime in Detroit with special focus on 8 mile road — that’s the horizontal cut dividing Detroit, lower from the northern suburbs. The crime area in the upper right is Royal Oak.

Detroit economics and the minimum wage

12 Replies

A cause of Detroit’s financial problems, it seems to me, is that Detroit has an uncommonly high minimum wage, $13.75/hr for all employees in any company that contracts with the city and does not provide free health care; or $10.50/hr for companies that provide healthcare. This minimum, called a living wage, is about double the state minimum wage of $7.40.

Although the city is financially bankrupt, the city can not hire janitors and pay less than this, nor hire accountants from a company that pays its janitors less than this. Besides the burden on Detroit’s budget, this puts a burden on its unemployment system. Many in Detroit don’t possess the education or skills to justify jobs at this wage. This high minimum wage effectively cuts them from the bottom rung of jobs at these companies — jobs at the bottom of the ladder of success. Many businesses find innovative ways around the law, using corruption and bribes to skirt enforcement, if the recent trials of the mayor are any indication, but a system of corruption is not good for the city.

As these wages are far above standard, most employed workers for the city get their jobs by corruption and connections, and most everyone knows they got their jobs this way rather than skill. As a result, workers have no incentive to improve at their job. In a corrupt system like this, there is no likelihood that  a raise would come with improved performance.

The justification for the living wage is the cost to support a family of 4 or 5, but Detroit is a much cheaper place to live than most, and not all workers are supporting families of 4 or 5. It therefore makes little sense to force all potential workers to refuse entry-level employment at $8.00/hour, a wage that would allow a single, motivated individual a decent living and a chance to climb as his/her needs and skills grew. Instead of promoting hard work and merit, this ordinance fosters corruption and cronyism; it makes it expensive for the city to hire contractors, makes it hard for workers to get their first jobs, and removes the benefits that normally come with improved skills. It’s a disaster, I suspect, and a reason the city is bankrupt.

Dr. Robert E. Buxbaum is a self-employed curmudgeon who tries to speak the truth as he sees it.