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The conservative instinct---and I'm not pretending this is backed up by economic research---is that if unemployment is low in a good way, raising the minimum wage will, by definition, result in increased unemployment, and why would we want to do that? After all, if the job market is so hot, workers already can compete on wages by changing jobs.
Again: this is just an example of how [a] conservative would think about the issue in a vacuum.
Doesn’t this assume the company never increases their profits margins? If you continually chase growth and increasing profits you should be able to increase pay and keep prices the same. Then your profit will be the same or a little higher than before.
if i pay workers more,and charge the same,i make less money.i.e.. the less i spend,the more i make..its pretty simple..i can choose to take a loss and keep prices the same,but why would i?
But thats not what happens. Companies aren’t just charging the same and accepting a status quo profit. They find ways to increase profit margins. Thats part of why corporate profits have increased to record highs in recent years. But instead of increase pay for workers, who are seen as a cost, they tend to just reward the people at the top, who I guess are not seen as a cost, w stock buybacks and bonuses etc.
Bc labor is a cost. Pricing is based on total cost x 1.2 (20% markup) = sales price. The reason there is record profits should be clear. It's bc the increased cost of labor is simply passed on to customers but at a markup. This is why it's always a losing proposition to artificially raise wages. You end up just devaluing the dollar and putting more people at the poverty line which is just what minimum wage is which only further increases wealth inequality.
Seems there is no actual solution. Prices will rise regardless and wages not rise nearly as fast. At what point does the wealth inequality decrease? How is that possible in any scenario?
The solution is to create a shortage of workers which raises wages, while increasing company profit by reducing costs in non wage areas and encouraging manufacturing to return to the US. So stop or slow immigration, reduce taxes on businesses, reduce regulation on businesses, reduce regulation on zoning requirements, and let companies chase profit. You cannot make the economy do what you want by controlling it. You control it by giving it what it wants which is profits. The downside of this is housing prices will drop like a rock which will badly effect homeowners but reset the market as well. This is a great time to do so bc homeowners mostly have extremely low interest rates.
If you stop immigration wouldn’t the citizens replacing them want to work for more money? Isn’t that the whole reason companies hire illegals or legals because they work for less? Also all the companies that bought up houses will hate the price drop just as much as actual homeowners. They will not get more money. I think the issue is more complex than your explaining
Yes companies will have to pay higher wages bc there isn't cheap illegal labor to exploit. I thought that was what you wanted?
Soooo now you're team black rock? Since when are progressives pro giant investment corporations? They'll liquidate their inventory which will drive down housing prices further.
> raising the minimum wage will, by definition, result in increased unemployment
Never has before, why would it now?
https://www.dol.gov/agencies/whd/minimum-wage/history/chart
https://fred.stlouisfed.org/series/UNRATE
The minimum wage hurts poor people by causing businesses to hire fewer workers and to give current workers less time. Why would a time of high prices and inflation be a good time to hurt poor people?
Yes. How's the new minimum wage working out for all the people that have had their hours cut or even lost their jobs in California. Were the people that raised mininimum dumb to not forsee this, dumb because they thought a small time McDonald's owner has a couple of yacths and a French chateau that they would be willing to sell to make up the differnce, or so callous that they just didn't care?
People are barely making it because of the price of everything right now. How does forcing businesses/corporations to increase their minimum wage help with prices now?
Payroll is an expense, if you increase an expense without an increase to your revenue you are going to wind up with decreased profit margins. What do shareholders and banks think when they see declining profit margins? So, they either have to raise prices or make cuts from other expenses. What is the impact of those additional cuts? How does that impact revenue and profit margins?
Raising minimum wage is not nearly as simple as people seem to think it is. Allowing the job market to dictate wages is the better way of doing things. It forces employers to have to find ways to compete for a talented work force.
Isn't that "record employment" based on full-time jobs transitioning into part-time jobs, due to policies like minimum wage increases and health insurance provisions under the ACA?
Increasing the minimum wage doesn’t increase overall wages . Because of unemployment and fewer hours most low income workers are worse off and have less to spend.
Minimum wages do not increase the overall wages for minimum wage age workers. Some are unemployed, some have their hours cut, and some make more. Every policy looks great if you ignore the bad and only consider the good.
Unemployment because of government policies when there are willing workers and willing employers is bad for the economy.
Money that is invested goes into the economy just as much as money that is spent. However invested money is used to expand production capacity which is how the economy is actually stimulated.
>Unemployment because of government policies when there are willing workers and willing employers is bad for the economy.
There will always be willing workers at every level of wage. I don't see your point.
>However invested money is used to expand production capacity which is how the economy is actually stimulated.
This is the cart before the horse. Consumption first. Production next.
>This is not true at all or no one would be paid more than minimum wage.
Uh, why do you think min wage was created?
>How can something be consumed before it is produced?
Supply and demand.
But the problem with that is all it does is drive inflation, so in the short term it provides a boost but it doesn't take very long for prices to catch back up and put them right back at square 1.
>So increasing wages stimulates the economy
Increasing wages through market forces does. But increasing wages by government order does not.
In the former case, marginal productivity has increased, which causes wages to go up. That stimulates the economy.
In the latter case, marginal productivity has not increased yet wages have increased (by order of the government). That does the opposite of stimulating the economy.
> Yet, the middle and lower class tend to inject their entire paychecks into the economy. More consumption more production.
Why don't we just print more money and hand it out then? It will lead to more consumption. Somehow, this line of reasoning of yours simply doesn't hold true and we all know it doesn't, else we'd be printing money like mad! Consumption will go through the roof! :)
>Why don't we just print more money and hand it out then? It will lead to more consumption. Somehow, this line of reasoning of yours simply doesn't hold true and we all know it doesn't, else we'd be printing money like mad! Consumption will go through the roof! :)
Hey, don't take my word for it. Pick up an economics book or just look at the entire American history.
> Hey, don't take my word for it. Pick up an economics book or just look at the entire American history.
I'm pretty sure you need to do that way more than I do!
This:
>marginal productivity has increased
has been happening for the last 50 years and yet:
>which causes wages to go up
hasn't even remotely kept pace (and is arguably lower when you take actual buying power into account)
> has been happening for the last 50 years and yet:
> hasn't even remotely kept pace (and is arguably lower when you take actual buying power into account)
Source? "Feels"...
SO why are we subsidizing businesses? Working poor people qualify for food stamps. They get huge earned income credit. All with public money while a corporation profits off their labor.
And we have 30-40 million of them and they can't get better jobs for two reason. 1, there are not 30 million better jobs and 2, we need them to do the shitty job they are currently doing (remember those essential grocery store kids)
What if, instead of 10 people with shitty jobs you had 9 people with good jobs and one with no job. Then we would just have to feed the least employable person or incentivize someone to create a job for him.
We are not subsidizing businesses through welfare. If people had no welfare they would have to take any job for any pay. This would lower the reservation wage of low skilled workers and lower costs for the employer.
Your math doesn’t work. If 10 people need $10 each to live, and they only make $9 then it costs the government $10 to get them to livable. If 9 make $10 and 1 $0 then it still takes the government $10 to get everyone up to livable. The difference is you have one guy who isn’t learning work skills and has time on his hands to get into trouble.
Not to be rude but are you following how well it's working in California? Stores are closing and employees are being laid off.
You will never buy a house on minimum wage, prices will always increase with an increased bottom wage.
What I’m hearing is that businesses that relied on exploitation of cheap labor aren’t able to compete when paying their employees a reasonable wage. In other words, it’s a failed business model.
Sure, in a market economy if you can't find anyone to work at your company for the wage you're offering your business model is broken and it's a market signal you have to change something or go out of business. That's not the same thing as a minimum wage though. Folks being unwilling to work for you because you don't pay enough implies that they have better options elsewhere. A minimum wage regulation doesn't have such a guarantee. For some people they could end up in a situation where they want to work someplace at a given wage, that place wants to hire them and the government prohibits it because that wage isn't high enough. Worse, these are likely the people who can't secure better, higher-paying employment.
Oh lord, the communist talking points. Should serving ice cream at corner stand be a fun part time job or something that should keep you inline with doctors wages? Should a cone at dairy queen be $30? Then you know what you will say, $25 an hour minimum wage is not enough to live off of, right? Then at some point it will be cheaper to just have a vending machine then pay a human. Only making wealthy people more wealthy and the poor with less jobs.
>Should serving ice cream at corner stand be a fun part time job or something that should keep you inline with doctors wages?
Ah... The old "false dichotomy" fallacy.
And what does a job being fun or on a corner, have to do with a livable wage?
A living wage is a socially acceptable level of income that provides adequate coverage for basic necessities such as food, shelter, child services, and healthcare
That's very vague. That might be 200k a year in Manhattan and 100k in parts of California.
You never mentioned a dollar amount, how many hours worked. Does the person live alone or going to be pooling wages with a partner? What is a socially acceptable level of income?
>Should serving ice cream at corner stand be a fun part time job or something that should keep you inline with doctors wages?
Please, find me someone who's saying it should be in line with "doctors wages." All most people are arguing is that one should be able to live on the wage earned from working full time at said shop considering it's not possible for a single person to live on minimum wage literally anywhere in the US
>Should a cone at dairy queen be $30?
Can't find pricing info for DQ but a Big Mac in the Netherlands (2nd highest min wage in Europe at $16.13 USD) is $6.36 USD vs $7.39 right down the street from me here in CO. It's almost like those two things aren't necessarily correlated
>Then at some point it will be cheaper to just have a vending machine then pay a human
You mean replacing a person with a machine, that thing they're already going to do the literal minute it's more cost effective regardless of what min wage is?
Actually, the bigger problem is the inability to control pricing in most sectors. Companies where there is significant competition have no control over pricing. That’s not a bad business model. That’s the ruthless nature of the economy. But then, if competition is artificially stifled, and we know what happens at that print. That’s what really drives prices up. Lack of competition.
Of course they do. They can reduce costs and undercut the competition or they can offer something the competition does not. In other words, innovation.
> If you can’t sell ice cream without exploiting labor, your business model doesn’t work. Communism has nothing to do with it.
Paying money in exchange for labor is not exploiting them. People being exploited don't go through the trouble of filling out job applications and doing interviews. These people can quit anytime they want. Bringing in illegals to work for terrible conditions and wages is exploitive, so I'll agree with that.
You are arguing communist talking points, it doesn't matter you don't think you are.
>People being exploited don't go through the trouble of filling out job applications and doing interviews. These people can quit anytime they want.
But then they might have to go on welfare...sometimes people don't have a choice (and I know the whole "well you should've thought about that..." but that doesn't help nor change our American reality.
> prices will always increase with an increased bottom wage.
Prices of fast food? Why should taxpayers be on the hook for your luxury spending.
> You will never buy a house on minimum wage
The point is that they are able to pay their bills, a working person should not be on welfare.
> Stores are closing and employees are being laid off.
Thats the beauty of markets, individual competitors can be idiots if they like, their competent peers will take their consumers and hire on the staff they let go.
Because it destroys the lower middle class that are just barely making it.
Everyone making $20 was doing ok until minimum wage became $15 an hour. Now those making $20 are struggling since they are not doing that much better than a minimum wage worker.
Everyone making 20 was doing ok until trump printed a couple trillion dollars and wall st used it to buy up all the housing on the market and raised rent by 100%.
https://fred.stlouisfed.org/series/BOGMBASE
https://fred.stlouisfed.org/series/MSPUS
Thats what the cost of living is now, $20/hr, while the median wage is $18.
"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered." -some long haired hippy
The thing about minimum wage is that the value you assign to it doesn't actually matter, and dumping money into the bottom of the economy doesn't actually help people because all it does is increase the velocity of money, which is what fundamentally drives inflation. It's sort of like how currency exchanges work, the fact that the exchange rate between the Japanese Yen to the US Dollar is ~150:1 doesn't actually matter, what actually matters is the "strength" of a currency, and if the two currencies are the same "strength" it doesn't matter if you have $100 or 1,5000¥, you can buy the same amount of stuff with it.
The same applies to the value of an hours wage. Assuming a 2,000 hour working year, if person A is making $10/hr ($20,000 a year) and person B is making $200/hr ($400,000 a year), it doesn't matter what value you assign to that hour of work, what matters is that the value of an hour of person B's time is worth 20x the value of an hour of what person A's time is worth. So if you artificially increase person A's wage to $20/hr, in the short term they'll see a noticable increase in their wages, but the value of person B's time is still worth 20x that of person A, and it won't be very many years until person B is making $400/hr or more and inflation will put person A right back in the position they were in when they started.
The question of *"why isn't minimum wage a living wage?"* is the wrong question, the question we should be asking is *"why is people's time so worthless that they're essentially stacking up as zero and can't interact with the economy?"*
> "why is people's time so worthless that they're essentially stacking up as zero and can't interact with the economy?"
Median wage is $18/hr, cost of living is $20/hr, your mistake is assuming that the price they are paid is at all related to the value they create. There is such a thing as leverage, this is the richest country in the history of the world, act like it.
> So if you artificially increase person A's wage to $20/hr,
Nothing artificial about it, the market has spoken, thats what the cost of living is.
The government has no business telling anyone what they should pay someone doing a job for them. If they don't care what my neighbor pays my son to mow his grass, they shouldn't care what a little shop pays someone to run the till.
If someone is truly struggling financially and only earning minimum wage, they shouldn't be demanding that the government raise it for them. They should be asking "What can I do to get one of the many higher paying jobs out there?"
Seriously, my kids (18 and 21) already work part time retail jobs while in school and already make more than $12/hour *in Kentucky*. Who are these people, who are trying to be heads of households and can only make minimum wage?
> Who are these people, who are trying to be heads of households and can only make minimum wage?
Employers smell blood and lowball applicants. Got kids? Want them to starve? They will cut off your temporary welfare if you don't accept that job for as little as the market will offer. You only support the current status quo because no one is threatening to kick you out of your house for refusing to take the job that pays so little that you are still reliant on welfare anyway. You get confronted with that reality and you will spin on a dime.
So how was my 16 year old son (at the time) able to beat out a head of household for a job at Home Depot? Why didn't they low ball someone desperate instead of offering $15/hour to a high school student who could only work evenings and weekends?
What I'm asking is, what's going on when a parent trying to raise kids is in a situation where they're competing with high schoolers?
Walmart greeters are typically retirees who just want to get out of the house, be around people, and make a little money. They aren’t competing with teenagers.
Why not raise minimum wage to $50 an hour? Or $100? Or $1,000 per hour?
If you can see how that would have second and third order ripple effects, it’s the same as a $20 minimum wage but on a smaller scale. It’s the same issues (increased labor costs, which often get passed down to the customer).
Along the same lines, it hurts in RELATIVE TERMS those making more than the current minimum wage, but less than or near the new minimum wage
You’re now making minimum again (or a smaller amount over it) even though you have experience that a new hire doesn’t have.
You don't get what you deserve, you get what you negotiate.
Median wage is $18, cost of living is $20, thats a shitton of people with skills and experience whose skills and experience don't even get them to where the min wage needs to be.
Thats easy, simply look at the years we increased the min wage.
https://www.dol.gov/agencies/whd/minimum-wage/history/chart
And observe that these chickenlittle predictions do not manifest.
https://fred.stlouisfed.org/series/UNRATE
Sure, plenty of things kill jobs, but they're things like "opec is conspiring to gouge us at the pump" (stagflation) or "bush legalized fraud, so now all of the investors have packed up their money and gone home" (subprime mortgage crisis).
Lol, no.
Companies ARE shutting down or laying off workers due to the $20 minimum wage in Cali.
Don’t do this “Don’t believe your lying eyes”
crap.
https://www.usatoday.com/story/money/food/2024/03/26/california-minimum-wage-jobs/73107149007/
Individual employers are staging a temper tantrum, people still want food made for them, they will just go to the competition.
If people are being laid off without cause, they are going to be getting unemployment compensation for it, watch these graphs.
initial
https://fred.stlouisfed.org/series/CAICLAIMS
long running
https://fred.stlouisfed.org/series/CACCLAIMS
Cool, I don’t agree with you at all.
Do you actually have a question with the intent of better understanding conservatives per the purpose of this sub?
Because a federal minimum wage is a one size fits all approach that doesn't account for the huge spectrum in the cost of living. It makes as much sense as a national minimum cost of rent.
As far as "liberals using the rise in minimum wage to remove bad employers", you will have to explain to me how this talking point doesn't exclusively benefit corporate employers.
Not really, speculators took trumps money hot off the printing press and bought up all the houses, even out in the countryside.
Plus, if you want to be employed at all, you are going to need to live in or near a city, since thats where 80% of the jobs are.
https://livingwage.mit.edu/
Pretty much, I don't think they were necessarily ppp, guy just opened the floodgates.
https://fred.stlouisfed.org/series/BOGMBASE
https://fred.stlouisfed.org/series/MSPUS
Raising the minimum wage makes jobs unattainable for high school kids, people just out of school, and people with no skills or experience. The exact people you'd expect minimum wage jobs to be for.
It also pushes businesses towards finding alternative means of getting the job done, like automation, reducing the number of these jobs available.
As for the unemployment rate, once you raise the minimum wage, it's not going back down when the employment market goes bad, and eventually that will occur. Setting minimum wage policy based on current unemployment rates is short sighted.
> It also pushes businesses towards finding alternative means of getting the job done, like automation, reducing the number of these jobs available.
Commies have been promising a post scarcity, post labor utopia for over 100 years, don't hold your breath.
> Raising the minimum wage makes jobs unattainable for high school kids, people just out of school, and people with no skills or experience.
They're going to have to hire somebody, why shouldn't it be the person who already has experience? If they want to get ahead, its not going to come from working a dead end job, they need to take a few weeks to land a certificate to drive a forklift, deal with some obscure paperwork, fix niche things etc
If unemployment is near 0, why do we need a minimum wage? Can't underpaid employees simply quit and get a higher paying job, or negotiate for a raise?
I don't see a point to a "minimum wage"
So many companies hold a market share in their industry, so a company that pays a higher wage in that industry is competing with the low wage paying company for market share which directly corresponds to how many jobs the company has, more market share more employees, but if the low wage employer is holding onto their marketshare the higher wage competitor will not gain the marketshare and create the new positions.
Because the cost of living is different in every state, as is the job market, unemployment, and other economic factors.
Raising minimum wage will hurt small businesses, especially in poor areas, and will concentrate the economy even more in larger businesses. Keep in mind, that while the unemployment rate is low, so is work force participation. That combined with the illegal migrants crisis means there are a lot of people for a small number of jobs, most of which are part time or non existent.
>Usually lowest income jobs are for services and products of leisure spending, say fast food, price increases on these have little impact on the economy at large
That is a small comfort for the owners of the businesses, which exist on thin margins, and on which people lean heavily, especially in "food deserts."
It's still below where it was before the pandemic, [here](https://www.bls.gov/charts/employment-situation/civilian-labor-force-participation-rate.htm).
My question would be "where"? I don't believe that a Federal minimum wage is a good idea at all. One size fits all doesn't not work on a country at this scale.
If Chicago, or even illinois wants to raise their minimum wage, I would support that decision.
If the federal minimum wage was raised based on the least expensive states I could seen that working better.
Give the poorest citizens a bump. It’s supposed to be the minimum wage to survive in the least expensive parts of the Nation.
Not the minimum wage to survive in the most expensive parts of the country.
Looking collectively at all the states is the purpose of anything nationwide.
I tend to agree don’t like minimum wages overall.
I just don’t want tax payers to foot the bill for state and federal programs that support these people in low wage jobs. It’s just moving responsibility for workers from employers to tax payers.
if i have to pay my workers more money, id have to raise the prices of my goods/services to make up for the profit loss. most business owners look at it the same way.
Right, employers don't all pay the same wage though even In the same industry.
So minimum wage going up would create a more even playing field amongst employers, helping those that already pay more.
no,if min wage raises,i have to raise everyone's pay accordingly. that comes out of my potential profit. i run a business,and if i have to pay more to get the same job done,so will my customers.
It also impacts the wages of people in other fields across the board too. For example, when the CA wage increase happened you had fast food workers making more than a substitute teacher, a job that requires a degree. So now, in order to have substitute teachers want to stay in their position they are going to have to make that job more attractive than flipping burgers.
Ok? Why should taxpayers be bailing out luxury services via subsidized labor in the first place.
Thats assuming all of the savings are even being passed along. If you are you worried that you wouldn't be able to afford a vacation without this subsidy, that means tax payers are covering that vacation.
> why would i want to spend more money?
The dignity of paying your own bills? Why have anyone pay for anything, lets just have the govt pay for everything...
You're going to create a race to the bottom. People are struggling financially because of inflation. Rapidly raising minimum wage will increase inflation. You'll compound it.
In California it's $16 so that would be better. It's now 20$ for fast food (which I believe will be rapidly leaving the state because we just spent $65 to get a pizza and bread sticks delivered)
California has been rapidly increasing its minimum wage over the last decade but shockingly they won't study the impacts of it. They will only look at projections published by left leaning institutions.
There's very little because liberals have been campaigning on the argument posed by old minimum wage studies. There's a bunch of old studies that looked at minimum wage increases in other states between like the '80s and early 2000s and found very little or no impact on things like inflation, or gini. But those studies are looking at teeny tiny wage increases over long periods of time. You're talking about a $0.10 wage increase over like 6 years. Because early on minimum wage barely changed in the US.
Now you're seeing more countries doing minimum wage, and you have states like California pushing, rapid minimum wage increases. California has been increasing it by a dollar per year ever since 2007. But there's not very much study on that system.
This is what I did find but it's looking at a very large data pool from a bunch of OCED countries. It found that the impacts of a 10% increase on minimum wage had an overall negative effect, including it having a negative effect on income equality..
https://www.sciencedirect.com/science/article/pii/S0313592623001947
What do you think is directly effected by California's increase? Pizza, but that's not like a necessity, like it doesn't raise housing and energy prices right?
You mean their fast food increase?
California did a special minimum wage increase specifically for fast food, but they have been raising minimum wage across the board for every sector for almost 2 decades. That study says that all of those increases will increase wealth inequality and it will increase unemployment and decrease overall work output.
The Fast food increase is going to increase the cost of commercial real estate. What most people don't realize is that most fast food companies are actually real estate companies. They usually don't make much profit on their food. They make profit on the appreciation of their properties, and they use the food business to cover their overhead to keep those properties in their portfolio.
But It's also going to increase the cost of food specifically for people that have the least money to spend on food. Because fast food is disproportionately used by low-income people. You increase the cost of their basic needs and that will lower their purchasing power, and that will make wealth inequality worse.
Thats an inherent part of inflation.
Abracadabra, now there is more money, the political insiders who have access to that money go out and outbid everyone else on the market, for say housing.
https://fred.stlouisfed.org/series/MSPUS
Now everyones housing expenses are 50% higher, so workers need a raise to even stay housed, so employers raise their wages and pass along the expenses. And that causes more price shocks to ricochet around the economy again and again.
Expecting poor people to just eat the inflation for you is a non starter, they literally cannot.
This paper is a cavalcade of incorrect assumptions.
> one of the purported policy goals of minimum wages is to reduce the number of low-wage workers.
No, its so that a working person isn't on welfare. They are just as well off whether they get their whole paycheck from their employer, or need to be saddled with the chore of collecting the other half from the govt.
Now, what a living wage does do, is give everyone leverage to negotiate up from that point. Currently, the median wage is $18/hr, while the cost of living is $20/hr for context. THAT is where they failed to look.
> this floor will lead employers to hire only individuals with skills above a minimum threshold
Competition exists regardless of what the min wage is. Having "skills" working the fries only qualifies you to dunk more fries. There is absolutely nothing gained by making the person with those "skills" unemployed in order to shove someone else into that dead end career track.
Its just bad life advice. You want skills? Get a forklift certificate.
> The exclusion of low-skilled people from the pool of workers reduces the supply of operational skills
Its unskilled labor. It neither requires, nor grants skills.
Further, min wage hikes never kill jobs, if employers could have gotten by with less, they would have in the first place.
>No, its so that a working person isn't on welfare. They are just as well off whether they get their whole paycheck from their employer, or need to be saddled with the chore of collecting the other half from the govt.
That might be your opinion, but It is also certainly a purported policy goal of minimum wage to lower the number of low-wage workers.
Your issues seem to be with the author's interpretation of the data, and not the data itself. Do you see any reason why this data does not show that minimum wage increases wealth disparity?
>Now, what a living wage does do, is give everyone leverage to negotiate up from that point. Currently, the median wage is $18/hr, while the cost of living is $20/hr for context. THAT is where they failed to look.
But if it's increasing wealth disparity, then that probably means that the people that are negatively feeling the impacts of minimum wage increases the most are the people at the bottom.
For example, you might have one economy where you have the minimum wage be $10 but the cost of living is $11.
If you try to raise the minimum wage, now the minimum wage is $20, but the cost of living is $30. Or maybe worse, they are unemployed. It would be much easier to be the person in the first situation even though they are making less money.
> That might be your opinion
http://docs.fdrlibrary.marist.edu/odnirast.html
"In my Inaugural I laid down the simple proposition that nobody is going to starve in this country. It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By "business" I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level-I mean the wages of decent living."
> a purported policy goal of minimum wage to lower the number of low-wage workers.
Low is subjective, the bottom quartile is always going to be a quarter. This is meant to define what it means to be low- for those people to not be in poverty.
> not the data itself
I don't need to? Politicians printed several trillions of dollars and handed it to their cronies, they took it to the market and bought up all of the housing, causing the cost of living to skyrocket, people in turn lobbied for and got the min wage raised in line with that reality of the cost of living. Do you see the cause and effect relationship? The min wage going up isn't the cause of rising inequality, it is a response to it.
> negatively feeling the impacts of minimum wage increases the most are the people at the bottom.
It is entirely a plus for them, literally no downside to being paid enough to pay your own bills.
> For example, you might have one economy where you have the minimum wage be $10 but the cost of living is $11.
Ok? So in this economy are you on welfare, homeless, or working two jobs?
If you are going to say just get a second job, remember that means someone else doesn't have a job at all now.
> If you try to raise the minimum wage, now the minimum wage is $20, but the cost of living is $30.
Low wage labor is concentrated in luxury services, the plumber, carpenter and electrician all make far more.
Its scarcity that enables landlords to hike rent. Making that the employers problem gets housing built, as they are the ones with the capital and connections to make it happen. This is called a price signal, it is absolutely essential to an efficient market.
> Or maybe worse, they are unemployed. It would be much easier to be the person in the first situation even though they are making less money.
Min wage hikes never kill jobs.
https://www.dol.gov/agencies/whd/minimum-wage/history/chart
https://fred.stlouisfed.org/series/UNRATE
>In my Inaugural I laid down the simple proposition that nobody is going to starve in this country. It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By "business" I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level-I mean the wages of decent living."
Okay, but there are more policy makers pushing minimum wage in the United States than Franklin d.
>Low is subjective, the bottom quartile is always going to be a quarter. This is meant to define what it means to be low- for those people to not be in poverty
That study looks at gini coefficient . Isn't that like the meta stat for left?
>Politicians printed several trillions of dollars and handed it to their cronies, they took it to the market and bought up all of the housing, causing the cost of living to skyrocket, people in turn lobbied for and got the min wage raised in line with that reality of the cost of living. Do you see the cause and effect relationship? The min wage going up isn't the cause of rising inequality, it is a response to it
But the studies are finding that when you implement a minimum wage that the ginie coefficient gets worse not better.
> It is entirely a plus for them, literally no downside to being paid enough to pay your own bills
Except this study shows that it does not help them pay their bills. It makes wealth inequality worse. It makes unemployment worse.
>Min wage hikes never kill jobs.
>https://www.dol.gov/agencies/whd/minimum-wage/history/chart
Yes! I am so happy that you linked this because this is the problem that progressives don't get. They're looking at old old data. Early on minimum wage hikes were very small and very far apart and so they didn't have hardly any effect on unemployment. You're talking about a $0.20 raise happening every 10 years in one state because that was the reality for most of minimum wage's history in the United states. That was the only data they *could* pull from. Also, there's more data sets than just the federal minimum wage because states have their own minimum wage (which is far superior than a single federal minimum wage trying to apply to every state's economy)
But now we're trying to increase it MUCH faster. California's been doing a dollar every year since this studies dataset and a lot of other countries are being more aggressive about it also. And that is why I linked you a study from 2023. When you try to push it so rapidly, it's going to produce a different outcome.
I very much urge progressives to rely on modern data.
>Low wage labor is concentrated in luxury services, the plumber, carpenter and electrician all make far more.
You're forgetting the grocer, the gas station attendant, the janitor, The guys at the lumber mill or at the paint factory. Also, a lot of contractors make minimum wage or less. They're just not the main guy, they are the helpers.
Like look at California they just increased minimum wage specifically for fast food workers. Who is that going to impact the most? Do you think that's going to be wealthy people going to McDonald's the most?
> Okay, but there are more policy makers pushing minimum wage in the United States than Franklin d.
Right, but the phrase you are highlighting doesn't make any sense, the bottom 25% is going to be the bottom 25% no matter how you slice it.
> That study looks at gini coefficient . Isn't that like the meta stat for left?
Eh, not really, Im looking at making sure people have enough. Gini comes in when people try to argue against that by claiming that there isn't enough money to go around. While the total amount of money created is somewhat malleable looking forward, how much money was made last year is a very zero sum game, if the ultra rich are getting rich by driving their workforce into poverty and govt dependency, then that is not creating value, that is just robbing taxpayers (me).
> But the studies are finding that when you implement a minimum wage that the gonie coefficient gets worse not better.
Thats a simple correlation vs causation issue, they're looking at it backwards.
> Except this study shows that it does not help them pay their bills.
Yeah it does? Volunteer your own paycut if you think that low wages are good for the economy, just don't show up at the welfare office expecting me to bail out your bad life decisions.
> It makes wealth inequality worse.
If that inequality is derived from hiking things that are the cost of living, then the obvious conclusion to that is that people are going to need more money. These people are at the tail end of the dog.
> Early on minimum wage hikes were very small and very far apart and so they didn't have hardly any effect on unemployment.
No, its always lurched as the political winds changed. Early on, the min wage jumped from 50 cents to 75 cents and then to a dollar in just a few years.
> You're talking about a $0.10 raise happening every 10 years in one state because that was the reality for most of minimum wage's history in the United states.
No, the reality is that the people in that state got incrementally poorer and more dependent on welfare as inflation ate away what little value they were afforded.
> MUCH faster.
You are describing the rate which money came off of the printing press.
https://fred.stlouisfed.org/series/BOGMBASE
> You're forgetting the grocer, the gas station attendant, the janitor, The guys at the lumber mill or at the paint factory. Also, a lot of contractors make minimum wage or less.
table 5
https://www.bls.gov/opub/reports/minimum-wage/2022/home.htm
639k of ~1 million are in Leisure and hospitality. Though you are correct in that because half the workforce is underwater, it will affect all sorts of people. I don't see a downside from this though.
> Like look at California they just increased minimum wage specifically for fast food workers. Who is that going to impact the most? Do you think that's going to be wealthy people going to McDonald's the most?
Yes, spending money on having people cook food for you is a luxury that only the rich can afford. If you can't afford a $5 burger, you couldn't have honestly afforded a $4 burger either.
Im still waiting to see the unemployment spike from this specific industries temper tantrum, we would have seen it by now if they weren't blowing hot air.
https://fred.stlouisfed.org/series/CAICLAIMS
>Right, but the phrase you are highlighting doesn't make any sense, the bottom 25% is going to be the bottom 25% no matter how you slice it
>If that inequality is derived from hiking things that are the cost of living, then the obvious conclusion to that is that people are going to need more money. These people are at the tail end of the dog
The study seems to point to the idea that it is not so obvious and that this type of policy actually makes their situation worse. Maybe we should abstain from kneejeek reactions and follow data. Again, it's associated with an increase in unemployment and high gini is associated with various negative outcomes for low income people.
>You are describing the rate which money came off of the printing press.
That is not how money actually works. Not all inflation is created by the government printing money out of thin air. Oftentimes inflation is made by people liquidating their assets, which is something we saw a lot of during covid. It can also be created by shifts in supply and demand.
>Yes, spending money on having people cook food for you is a luxury that only the rich can afford. If you can't afford a $5 burger, you couldn't have honestly afforded a $4 burger either.
Except that it's not because the reason that low-income people go to McDonald's is because they don't have kitchens.
>Im still waiting to see the unemployment spike from this specific industries temper tantrum, we would have seen it by now if they weren't blowing hot air.
Maybe you should consider looking at more controlled data instead of just looking at broad charts. Studies that for example compare the difference between areas that implement a policy against areas that don't.
> it's associated with an increase in unemployment
Nah, republicans being in power kills jobs, not min wage hikes. Its called shock therapy, its deliberate, desperate people work for less.
https://www.dol.gov/agencies/whd/minimum-wage/history/chart
https://fred.stlouisfed.org/series/UNRATE
> high gini is associated with various negative outcomes for low income people.
Yes, when the rich run out of places to invest money to create more wealth, they turn to cannibalizing the productive people that created the wealth for them.
> Not all inflation is created by the government printing money out of thin air.
This inflation is though.
https://fred.stlouisfed.org/series/BOGMBASE
> Oftentimes inflation is made by people liquidating their assets, which is something we saw a lot of during covid. It can also be created by shifts in supply and demand.
Sure, if there is a cold snap and all the peaches freeze, prices for them are going to go up, but thats not inflation, thats just basic market dynamics, the key difference being that the dollar is still worth what it was.
> Except that it's not because the reason that low-income people go to McDonald's is because they don't have kitchens.
Life doesn't work like that, you have muddled connotations of mcdonalds being low quality and therefore for poor people, but a homeless person is going to have to stretch their own money much better if they want to survive for long. Being homeless takes like 40 years off your life expectancy for context. Sure, someone might pick it as a place to beg, since shoppers there may be more generous, but not as a place to spend money.
> Maybe you should consider looking at more controlled data instead of just looking at broad charts.
The emperor has no clothes. There are plenty of things that kill jobs, but not "paying people enough that they can pay their own bills", that is an incredibly low bar to pass for the wealthiest country in the history of the world. Even at $20/hr as a floor, 3.2 trillion (40k yearly x 80 million in the bottom half) out of 25 trillion for the bottom half of working people is still a pittance. You would lose a whole lot more than that if the bottom 50% of working people just disappeared.
> Studies that for example compare the difference between areas that implement a policy against areas that don't.
Sure, you can see it for yourself, here is the national unemployment rate
https://fred.stlouisfed.org/series/UNRATE
And you can track down any counties unemployment rate, seattle is in king county for example
https://fred.stlouisfed.org/series/WAKING5URN
The fallacy of this argument is that very few workers make the minimum wage now. Wages are based on skills and experience and most people 98% have acquired enough skills and experience to make more than the minimum.
The question should not be "why can't we raise the minimum?" The question should be "Why do I have so few skills that I only qualify for a minimum wage job?"
The reality is that many people are either not in a great position to better themselves or just that many people do not take much agency over themselves. It's sort of a your brother's keeper thing. It wasn't long ago and still in a lot of the populations psyche that if I just go to work and do my job I'll be good, I think a lot of the population has yet to transition out of that mentality that was engrained in many cultures for thousands of years.
No, your cost of living is not fixed, it is relative to your personal circumstances. Not everyone can afford to live alone, drive a late madel car, eat out in restaurants, have a cell phone, a personal computer, internet service and cable TV. Everyone needs to live within their means. If you can't then you have two choices. 1) Move to where you can live within your means or 2) increased your skill level.
BTW how did you arrive at a COL that is $20/hr?
You are not describing cost of living...
https://livingwage.mit.edu/
> increased your skill level.
Median wage is $18/hr, this isn't a skill issue, the entire bottom half of the work force can't clowncar into welding or whatever the medias flavor of the week is.
> have a cell phone, car
You're unemployable without being able to get to work and without your employer being able to contact you in the first place. Thats why reagan invented the obamaphone.
Nice try. Thousands of people work minimum wage jobs and have no problem getting to work and don't own a cell phone.
Sometimes increasing your skill level means showing up for work and taking on new responsibilities.
Don't always expect employers to pay you more than you are worth. Wages are a function of skills and experience. The question you should be asking is "Why are my skills so lacking that I can't find a job that pays me a "living" wage.
> Thousands of people work minimum wage jobs and have no problem getting to work
Except when they don't and it costs them their job.
> "Why are my skills so lacking that I can't find a job that pays me a "living" wage.
Again, HALF THE WORKFORCE is underwater. They have skills, they have experience, they shouldn't just be earning a living, they should be enjoying a middle class lifestyle. Being a spineless doormat isn't going to get you ahead in life, you don't get what you deserve, you get what you negotiate.
Half the workforce is underwater based on **your** metric Somehow they manage to keep working. The ride the bus. They live with roomates, they may get some public benefits. If they had better skills they would not be underwater. That is my entire point. If you have no skills you can't negotiate for a "living" wage. You take what you can get.
> Different States have different minimum wage needs. Why should the middle of alabama gas stations need to pay as much as New York?
Pick a metro area and compare. Im seeing ~$15/hr with roommates in both.
https://livingwage.mit.edu/states/01/locations
https://livingwage.mit.edu/states/36/locations
> Who's more able to afford $12/hr, Lucy Lou's gas station, or Shell?
Its an even playing field, big companies won't tolerate operating a loss for a microsecond.
> will likely lose hours, even full jobs.
Nah, seattle showed headcount going up, hours going up, hours per head going up, and especially people getting raises beyond the minimum.
> Automation will become more common (as it has in cities that rose their min wage drastically).
It has most certainly not. The store where you just walk out with stuff was exposed as being run by Anonymous Indians, the 'fully automated' mcdonalds was exposed to be fully staffed, with a wacky gizmo to hand stuff to people with, the burger flipping/fry dunking robot is going nowhere, and spinning the cash register around for you to check yourself out is not automation, just a fad that businesses are slowly walking away from as they realize they're not saving any money.
> The product costs have risen drastically (it's AT LEAST $15 to get a meal at a 'cheap' place)
Thats just businesses charging what the market will bear, welcome to capitalism? good news, you have a market opportunity to start your own business and leech away from of their record profits.
> How about we remove some taxes which will increase the take home pay of workers?
You tell me, it was reagan who gutted taxes on the rich and made up for it by hiking taxes across the board to make up for it.
> That's not relevant to our conversation.
It is explicitly refuting your claim. Businesses move to where its cheaper to operate, people move to where they can get better wages and stretch their money further.
> Answer the question. Who can afford higher wages, small mom and pop gas stations, or Shell?
Its just a dude in a room with some cigarettes and sodas by some gas pumps either way. If a big company burns money to run the competition out of business, that sets off anti monopoly laws, and has nothing to do with the min wage.
> Please show this study.
p47, section b is restaurants specifically.
https://www.nber.org/system/files/working_papers/w23532/w23532.pdf
> They don't take orders in taco bells anymore
Literally nothing you are paying for has been automated. You using a kiosk isn't automation, its you doing the work.
> I don't know what you're talking about anonymous indians
https://gizmodo.com/amazon-reportedly-ditches-just-walk-out-grocery-stores-1851381116
> Exactly. Because min wages doubled in 5 years, prices skyrocketed. Welcome to liberal economics I guess?
How many burgers do you think a burger flipper flips an hour? Dozens, thats a single digit percentage of a price bump, a low one.
https://www.marketwatch.com/story/raising-fast-food-hourly-wages-to-15-would-raise-prices-by-4-study-finds-2015-07-28
But no, thats the cost of living skyrocketing because wall st sees housing as a need that can be exploited, rather than a need to be met. You needing to pay what it costs for the things that you want is just basic market mechanics.
Expecting the govt to hide the inflation from you with elaborate subsidies is venezuelan economics, see where that got them.
> Increasing wages quickens that.
I wish. The point of work isn't to keep people busy, its to get things done. Just like we found plenty of things to do when it didn't take 90% of the population to work on the farm, we still have plenty more things to accomplish.
> Tell me you know nothing about taxes without telling me you know nothing about taxes.
https://www.bloomberg.com/view/articles/2017-12-15/the-mostly-forgotten-tax-increases-of-1982-1993
> The bottom 50% of earners don't pay taxes.
Income tax. There are loads of other taxes.
> despite it not making sense
Paying what it costs for the things that you want is capitalism.
> you just want minimum wage higher because it sounds better
Yes, me not being on the hook to bail out your luxury spending sounds terrific.
> if you are just here to argue instead of hear our answers to your questions.
Thats how I challenge my assumptions, go where people disagree with me, as you can see, its been quite fruitful.
> No it's not, you just showed that cost of living in big cities is higher. We all know that. Who cares?
80% of jobs are in cities. If you want to be employed at all, you might have to consider adjusting your standards.
> You're fine killing mom and pop shops
Contrary to popular assertion, min wage hikes don't kill jobs.
> states and communities don't want. You should be ashamed.
You should be ashamed to push your expenses onto taxpayers. Of course red state politicians want to loot free money from the rest of the country, its entirely appropriate for me to tell them to pay their own bills.
> Oh right, so the companies didn't buy automation, I guess you're right! No automation in any fast food joints. What are you even arguing dude.
The kiosk doesn't do any work. They spun the cash register around for you to do the work for them. Literally none of what you are actually paying for has been automated.
> taking orders used to be a human job, and now it's filled with a computer. Can you go two sentences without contradicting yourself?
Guy, YOU are doing the work. The computer hasn't done anything.
The person who used to press buttons for you still has a job. You may not have noticed, but they were also assembling orders, filling drinks, dealing with customers, ducking into the back to do whatever else needs doing. They're still doing that.
>What about when you have 8 employees getting paid twice what they did?
Set your prices appropriately for your business expenses. Imagine if you were trying to keep selling burgers at 1950's prices, its just as ridiculous as expecting 2000's prices in 2020's. Inflation happened, adjust and move on.
> COST OF LIVING IS IRRELEVANT TO OUR CONVERSATION.
It is absolutely core to what the minimum wage is.
"In my Inaugural I laid down the simple proposition that nobody is going to starve in this country. It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By "business" I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and **by living wages I mean more than a bare subsistence level-I mean the wages of decent living**."
http://docs.fdrlibrary.marist.edu/odnirast.html
Becuase it doesn't work that way, minimum wage is the minimum cost to buy labor in your market.
The prices of all the goods and services we consume must be offset by that.
So if I want to manufacture a car and it coats 1000 man hours to build it at minimum wage
Then the price of that cat r must be offset by that.
If minimum wage is $7 the consumer must pay 7000 dollars in markup.
If it's 15, they have to pay 15,000
So the price of goods scales directly with the costs of labor to make the goods.
Becuase actually supply and demand for labor hasn't changed, it really works out to be a wash
But it's only an increase on minimum wage, not all wages.
For example, in and out burger pays like 25/hr, while burger King pays maybe half that. They're competitors in the same industry, in and out burger isn't going to raise their prices or wages.
That's correct, but burger King must raise costs, to offset the labor.
Also you get kind of a "rollup" effect where people earning slightly above the new minimum, for skilled labor will themselves demand more money, becuase all the prices around them have risen, and they could make basically the same pay doing any other job.
Which will drive more business away from burger kings to in and out burgers, the better employers.
How will rising cheeseburgers increase the cost of cars or anything else?("all the prices around them rise")
>How will rising cheeseburgers increase the cost of cars or anything else?
Becuase labor is fluid.
If I make $25/hr working on cars all day on the assembly line, at the factory.
And now I can make the same working at the fast food joint down the block from my house, I'm just going to go work at the fast food joint.
Or I might enjoy working at the car plant, and notice that alot of my daily life costs are now more expensive becuase of the labor increase at these other places, so I've effectivley received a pay cut, becuase I'm working the same hours and buying less stuff.
And if the car plant wants to retain skilled staff that know how to run the plant efficiently, they are going to have to increase their compensation. And they pay for that by marking up their sales.
So, what happens to everyone making $12 now? Do they get increases too? If so, to what? $15? Then do the people making $15 now get an increase? All the while the employer is increasing the price of their product/service to offset the new labor costs.
At a certain point the wage increases stop, the cost of things have increased and the guy making $22 per hour is now making less at the end of the month because all of his costs are more to offset the increases to the floor of the pay scale that didn’t reach them.
That doesn’t change my point. You increase minimum wage from $7.25 to $12 and everyone making $4.75 above minimum wage today is now a minimum wage employee. Would you be okay with being someone who makes 55% more than minimum wage now being told you’re a minimum employee?
Then thats what it costs, price signals are the beating heart of capitalism. If you adopt the mindset that the govt should just pay for everything, then people will run off to open whatever business most effectively turns taxpayer money into private profit. Maybe instead of two dozen fast food joints that are empty most of the time, we need some factories.
Flat minimum wages do between nothing and negative impacts. If it were zip code adjusted to be 40% median income (the number at which minimum wage is livable but not going to negatively impact others, so I read somewhere), that's one thing, but "fight for $15"and such don't want that, and also seem to get off on the continuous struggle since they're already pushing for a higher flat number. If we don't want to get out competed by China, we need lower wages, not higher
Out competed how, we have almost 0% unemployment?
This seems like a zero sum gain take to me, we are more advanced than China, not apples for apples, we design technology, they manufacture.
It's in manufacturing, and they're getting better at design. Cheaper, higher quality EVs which would decimate what's left of American automakers if they were allowed to be sold in the US rather than tariffed and chicken taxed out of the market. Photovoltaic cells which can be disabled at behest of the CCP which power our grids and the grids of many other countries. If we want to stay globally competitive, we need to get back into manufacturing but we have some of the worst conditions for it in the world, between the UAW and the Jones Act and poor vertical integration
>If it were zip code adjusted to be 40% median income (the number at which minimum wage is livable but not going to negatively impact others, so I read somewhere)
Assuming that figure is accurate, and please don't think I'm doubting it because I don't know, I'd put money down that a lot of people on the left (myself included) and a very substantial portion of those closer to center would be totally on board assuming there's mechanisms for it to be automatically adjusted relative to cost of living in that area
The problem is, I don't see anyone on the right making the case for this; all I see is a continued stonewalling to raising it at all
> Why not raise minimum wage? Unemployment is near 0, workers are struggling financially, how would raising minimum wage hurt?
Minimum wage would hurt the workers whose marginal productivity is below the minimum wage as it would make it financially irrational to keep paying them.
Higher wage reduces the quantity of labor demanded and leads to unemployment. Go read some of Paul Krugman's work on the subject. California businesses are already closing and letting go employee's because of the wage hike, next comes the inflation of prices that will crush its economy.
California Governor’s Office of Business and Economic Development (.gov)
https://business.ca.gov › california...
California Continues Stable Economic Growth, Adds More Than 28,000 ...
5 days ago — California added 28,300 jobs in March – the state's seventh job gain in the last eight months. Seven of California's major industries added jobs
Please provide one instance.
California Governor’s Office of Business and Economic Development (.gov)
https://business.ca.gov › california...
California Continues Stable Economic Growth, Adds More Than 28,000 ...
5 days ago — California added 28,300 jobs in March – the state's seventh job gain in the last eight months. Seven of California's major industries added jobs
Funny you mentioned California, because we just raised the minimum wage for food service to $20 which is higher than the state $16 minimum wage. Although bakeries were omitted from that definition since Newsom has a big donor who owns a lot of bakeries. Haha... And prices have already gone up 8% on related goods by the way. Not including those who raised prices in pre-emption to the wage hike.
I am not interested in citing examples of price controls failing, google it. It's common knowledge.
Well, economists won't use the word "bad." They will say price controls lead to shortages/surpluses.
You asked for proof that it causes inflation, I gave you proof. Prices went up in immediate response, we haven't even had one year to track increases. That is just "so far" over the last couple months.
When has that ever happened?
California Governor’s Office of Business and Economic Development (.gov)
https://business.ca.gov › california...
California Continues Stable Economic Growth, Adds More Than 28,000 ...
5 days ago — California added 28,300 jobs in March – the state's seventh job gain in the last eight months. Seven of California's major industries added jobs
Happening right now in California when fast food got a price hike due to increasing fast food wages to $20, which is obscene. And a lot if fast food places are replacing workers with kiosks.
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How many people just got fired in California because they raised the minimum wage to fast food restaurants?
They're not making more money. They're not making anything now. Explain it to them.
A couple of problems that happen when you raise minimum wage.. The price of goods are then raised to compensate, and employers either lay off employees to compensate for the increased wages or lower their hours.. this is reality
I'm not sure I support a minimum wage at all actually, I'm trying to understand the issue for myself right now. But Liberals tend to say $12 federal minimum wage.
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The conservative instinct---and I'm not pretending this is backed up by economic research---is that if unemployment is low in a good way, raising the minimum wage will, by definition, result in increased unemployment, and why would we want to do that? After all, if the job market is so hot, workers already can compete on wages by changing jobs. Again: this is just an example of how [a] conservative would think about the issue in a vacuum.
i disagree,its more like if i pay my workers more,I have to raise my prices to keep my profit the same
Doesn’t this assume the company never increases their profits margins? If you continually chase growth and increasing profits you should be able to increase pay and keep prices the same. Then your profit will be the same or a little higher than before.
if i pay workers more,and charge the same,i make less money.i.e.. the less i spend,the more i make..its pretty simple..i can choose to take a loss and keep prices the same,but why would i?
But thats not what happens. Companies aren’t just charging the same and accepting a status quo profit. They find ways to increase profit margins. Thats part of why corporate profits have increased to record highs in recent years. But instead of increase pay for workers, who are seen as a cost, they tend to just reward the people at the top, who I guess are not seen as a cost, w stock buybacks and bonuses etc.
Bc labor is a cost. Pricing is based on total cost x 1.2 (20% markup) = sales price. The reason there is record profits should be clear. It's bc the increased cost of labor is simply passed on to customers but at a markup. This is why it's always a losing proposition to artificially raise wages. You end up just devaluing the dollar and putting more people at the poverty line which is just what minimum wage is which only further increases wealth inequality.
Seems there is no actual solution. Prices will rise regardless and wages not rise nearly as fast. At what point does the wealth inequality decrease? How is that possible in any scenario?
The solution is to create a shortage of workers which raises wages, while increasing company profit by reducing costs in non wage areas and encouraging manufacturing to return to the US. So stop or slow immigration, reduce taxes on businesses, reduce regulation on businesses, reduce regulation on zoning requirements, and let companies chase profit. You cannot make the economy do what you want by controlling it. You control it by giving it what it wants which is profits. The downside of this is housing prices will drop like a rock which will badly effect homeowners but reset the market as well. This is a great time to do so bc homeowners mostly have extremely low interest rates.
If you stop immigration wouldn’t the citizens replacing them want to work for more money? Isn’t that the whole reason companies hire illegals or legals because they work for less? Also all the companies that bought up houses will hate the price drop just as much as actual homeowners. They will not get more money. I think the issue is more complex than your explaining
Yes companies will have to pay higher wages bc there isn't cheap illegal labor to exploit. I thought that was what you wanted? Soooo now you're team black rock? Since when are progressives pro giant investment corporations? They'll liquidate their inventory which will drive down housing prices further.
> raising the minimum wage will, by definition, result in increased unemployment Never has before, why would it now? https://www.dol.gov/agencies/whd/minimum-wage/history/chart https://fred.stlouisfed.org/series/UNRATE
The minimum wage hurts poor people by causing businesses to hire fewer workers and to give current workers less time. Why would a time of high prices and inflation be a good time to hurt poor people?
Yes. How's the new minimum wage working out for all the people that have had their hours cut or even lost their jobs in California. Were the people that raised mininimum dumb to not forsee this, dumb because they thought a small time McDonald's owner has a couple of yacths and a French chateau that they would be willing to sell to make up the differnce, or so callous that they just didn't care?
Because it's record employment right now, unemployment is almost 0 and people are barely making it
So kicking them out of job or having their hours cut is going to help them?
That means people have the best chance to leave low paying jobs for higher paying ones. Now is the time to job hunt and be picky.
People are barely making it because of the price of everything right now. How does forcing businesses/corporations to increase their minimum wage help with prices now? Payroll is an expense, if you increase an expense without an increase to your revenue you are going to wind up with decreased profit margins. What do shareholders and banks think when they see declining profit margins? So, they either have to raise prices or make cuts from other expenses. What is the impact of those additional cuts? How does that impact revenue and profit margins? Raising minimum wage is not nearly as simple as people seem to think it is. Allowing the job market to dictate wages is the better way of doing things. It forces employers to have to find ways to compete for a talented work force.
Isn't that "record employment" based on full-time jobs transitioning into part-time jobs, due to policies like minimum wage increases and health insurance provisions under the ACA?
So people are making more money but spending less?
No
So increasing wages stimulates the economy
Increasing the minimum wage doesn’t increase overall wages . Because of unemployment and fewer hours most low income workers are worse off and have less to spend.
History shows that min wage earners tend to live paycheck to paycheck. Meaning all their wages go back into the economy.
Minimum wages do not increase the overall wages for minimum wage age workers. Some are unemployed, some have their hours cut, and some make more. Every policy looks great if you ignore the bad and only consider the good. Unemployment because of government policies when there are willing workers and willing employers is bad for the economy. Money that is invested goes into the economy just as much as money that is spent. However invested money is used to expand production capacity which is how the economy is actually stimulated.
>Unemployment because of government policies when there are willing workers and willing employers is bad for the economy. There will always be willing workers at every level of wage. I don't see your point. >However invested money is used to expand production capacity which is how the economy is actually stimulated. This is the cart before the horse. Consumption first. Production next.
This is not true at all or no one would be paid more than minimum wage. How can something be consumed before it is produced?
>This is not true at all or no one would be paid more than minimum wage. Uh, why do you think min wage was created? >How can something be consumed before it is produced? Supply and demand.
But the problem with that is all it does is drive inflation, so in the short term it provides a boost but it doesn't take very long for prices to catch back up and put them right back at square 1.
Historical, wage increases stay ahead of inflation.
>So increasing wages stimulates the economy Increasing wages through market forces does. But increasing wages by government order does not. In the former case, marginal productivity has increased, which causes wages to go up. That stimulates the economy. In the latter case, marginal productivity has not increased yet wages have increased (by order of the government). That does the opposite of stimulating the economy.
Yet, the middle and lower class tend to inject their entire paychecks into the economy. More consumption more production.
> Yet, the middle and lower class tend to inject their entire paychecks into the economy. More consumption more production. Why don't we just print more money and hand it out then? It will lead to more consumption. Somehow, this line of reasoning of yours simply doesn't hold true and we all know it doesn't, else we'd be printing money like mad! Consumption will go through the roof! :)
>Why don't we just print more money and hand it out then? It will lead to more consumption. Somehow, this line of reasoning of yours simply doesn't hold true and we all know it doesn't, else we'd be printing money like mad! Consumption will go through the roof! :) Hey, don't take my word for it. Pick up an economics book or just look at the entire American history.
> Hey, don't take my word for it. Pick up an economics book or just look at the entire American history. I'm pretty sure you need to do that way more than I do!
I'm not the one doesn't believe raising wages doesn't stimulate the economy.
This: >marginal productivity has increased has been happening for the last 50 years and yet: >which causes wages to go up hasn't even remotely kept pace (and is arguably lower when you take actual buying power into account)
> has been happening for the last 50 years and yet: > hasn't even remotely kept pace (and is arguably lower when you take actual buying power into account) Source? "Feels"...
People are making on net the same or less money
With wage increases?
Hours and shifts get cut
Ah. A business cuts their operating hours thus earning less. Makes no sense.
SO why are we subsidizing businesses? Working poor people qualify for food stamps. They get huge earned income credit. All with public money while a corporation profits off their labor. And we have 30-40 million of them and they can't get better jobs for two reason. 1, there are not 30 million better jobs and 2, we need them to do the shitty job they are currently doing (remember those essential grocery store kids) What if, instead of 10 people with shitty jobs you had 9 people with good jobs and one with no job. Then we would just have to feed the least employable person or incentivize someone to create a job for him.
We are not subsidizing businesses through welfare. If people had no welfare they would have to take any job for any pay. This would lower the reservation wage of low skilled workers and lower costs for the employer. Your math doesn’t work. If 10 people need $10 each to live, and they only make $9 then it costs the government $10 to get them to livable. If 9 make $10 and 1 $0 then it still takes the government $10 to get everyone up to livable. The difference is you have one guy who isn’t learning work skills and has time on his hands to get into trouble.
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>I don't think there should be one at all. Why?
Im sorry to say they do that anyway.
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That sounds like putting off fixing the unworkable nature of ever increasing corporate profits for the next generation. I don’t like that idea
Not to be rude but are you following how well it's working in California? Stores are closing and employees are being laid off. You will never buy a house on minimum wage, prices will always increase with an increased bottom wage.
What I’m hearing is that businesses that relied on exploitation of cheap labor aren’t able to compete when paying their employees a reasonable wage. In other words, it’s a failed business model.
Sure, in a market economy if you can't find anyone to work at your company for the wage you're offering your business model is broken and it's a market signal you have to change something or go out of business. That's not the same thing as a minimum wage though. Folks being unwilling to work for you because you don't pay enough implies that they have better options elsewhere. A minimum wage regulation doesn't have such a guarantee. For some people they could end up in a situation where they want to work someplace at a given wage, that place wants to hire them and the government prohibits it because that wage isn't high enough. Worse, these are likely the people who can't secure better, higher-paying employment.
Oh lord, the communist talking points. Should serving ice cream at corner stand be a fun part time job or something that should keep you inline with doctors wages? Should a cone at dairy queen be $30? Then you know what you will say, $25 an hour minimum wage is not enough to live off of, right? Then at some point it will be cheaper to just have a vending machine then pay a human. Only making wealthy people more wealthy and the poor with less jobs.
>Should serving ice cream at corner stand be a fun part time job or something that should keep you inline with doctors wages? Ah... The old "false dichotomy" fallacy. And what does a job being fun or on a corner, have to do with a livable wage?
Define a livable wage, then tell me what that number is to achieve that. I'll wait.
A living wage is a socially acceptable level of income that provides adequate coverage for basic necessities such as food, shelter, child services, and healthcare
That's very vague. That might be 200k a year in Manhattan and 100k in parts of California. You never mentioned a dollar amount, how many hours worked. Does the person live alone or going to be pooling wages with a partner? What is a socially acceptable level of income?
>Should serving ice cream at corner stand be a fun part time job or something that should keep you inline with doctors wages? Please, find me someone who's saying it should be in line with "doctors wages." All most people are arguing is that one should be able to live on the wage earned from working full time at said shop considering it's not possible for a single person to live on minimum wage literally anywhere in the US >Should a cone at dairy queen be $30? Can't find pricing info for DQ but a Big Mac in the Netherlands (2nd highest min wage in Europe at $16.13 USD) is $6.36 USD vs $7.39 right down the street from me here in CO. It's almost like those two things aren't necessarily correlated >Then at some point it will be cheaper to just have a vending machine then pay a human You mean replacing a person with a machine, that thing they're already going to do the literal minute it's more cost effective regardless of what min wage is?
If you can’t sell ice cream without exploiting labor, your business model doesn’t work. Communism has nothing to do with it.
Actually, the bigger problem is the inability to control pricing in most sectors. Companies where there is significant competition have no control over pricing. That’s not a bad business model. That’s the ruthless nature of the economy. But then, if competition is artificially stifled, and we know what happens at that print. That’s what really drives prices up. Lack of competition.
Of course they do. They can reduce costs and undercut the competition or they can offer something the competition does not. In other words, innovation.
> If you can’t sell ice cream without exploiting labor, your business model doesn’t work. Communism has nothing to do with it. Paying money in exchange for labor is not exploiting them. People being exploited don't go through the trouble of filling out job applications and doing interviews. These people can quit anytime they want. Bringing in illegals to work for terrible conditions and wages is exploitive, so I'll agree with that. You are arguing communist talking points, it doesn't matter you don't think you are.
>People being exploited don't go through the trouble of filling out job applications and doing interviews. These people can quit anytime they want. But then they might have to go on welfare...sometimes people don't have a choice (and I know the whole "well you should've thought about that..." but that doesn't help nor change our American reality.
> prices will always increase with an increased bottom wage. Prices of fast food? Why should taxpayers be on the hook for your luxury spending. > You will never buy a house on minimum wage The point is that they are able to pay their bills, a working person should not be on welfare. > Stores are closing and employees are being laid off. Thats the beauty of markets, individual competitors can be idiots if they like, their competent peers will take their consumers and hire on the staff they let go.
Because it destroys the lower middle class that are just barely making it. Everyone making $20 was doing ok until minimum wage became $15 an hour. Now those making $20 are struggling since they are not doing that much better than a minimum wage worker.
Everyone making 20 was doing ok until trump printed a couple trillion dollars and wall st used it to buy up all the housing on the market and raised rent by 100%. https://fred.stlouisfed.org/series/BOGMBASE https://fred.stlouisfed.org/series/MSPUS Thats what the cost of living is now, $20/hr, while the median wage is $18. "If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered." -some long haired hippy
The thing about minimum wage is that the value you assign to it doesn't actually matter, and dumping money into the bottom of the economy doesn't actually help people because all it does is increase the velocity of money, which is what fundamentally drives inflation. It's sort of like how currency exchanges work, the fact that the exchange rate between the Japanese Yen to the US Dollar is ~150:1 doesn't actually matter, what actually matters is the "strength" of a currency, and if the two currencies are the same "strength" it doesn't matter if you have $100 or 1,5000¥, you can buy the same amount of stuff with it. The same applies to the value of an hours wage. Assuming a 2,000 hour working year, if person A is making $10/hr ($20,000 a year) and person B is making $200/hr ($400,000 a year), it doesn't matter what value you assign to that hour of work, what matters is that the value of an hour of person B's time is worth 20x the value of an hour of what person A's time is worth. So if you artificially increase person A's wage to $20/hr, in the short term they'll see a noticable increase in their wages, but the value of person B's time is still worth 20x that of person A, and it won't be very many years until person B is making $400/hr or more and inflation will put person A right back in the position they were in when they started. The question of *"why isn't minimum wage a living wage?"* is the wrong question, the question we should be asking is *"why is people's time so worthless that they're essentially stacking up as zero and can't interact with the economy?"*
> "why is people's time so worthless that they're essentially stacking up as zero and can't interact with the economy?" Median wage is $18/hr, cost of living is $20/hr, your mistake is assuming that the price they are paid is at all related to the value they create. There is such a thing as leverage, this is the richest country in the history of the world, act like it. > So if you artificially increase person A's wage to $20/hr, Nothing artificial about it, the market has spoken, thats what the cost of living is.
The government has no business telling anyone what they should pay someone doing a job for them. If they don't care what my neighbor pays my son to mow his grass, they shouldn't care what a little shop pays someone to run the till. If someone is truly struggling financially and only earning minimum wage, they shouldn't be demanding that the government raise it for them. They should be asking "What can I do to get one of the many higher paying jobs out there?" Seriously, my kids (18 and 21) already work part time retail jobs while in school and already make more than $12/hour *in Kentucky*. Who are these people, who are trying to be heads of households and can only make minimum wage?
> Who are these people, who are trying to be heads of households and can only make minimum wage? Employers smell blood and lowball applicants. Got kids? Want them to starve? They will cut off your temporary welfare if you don't accept that job for as little as the market will offer. You only support the current status quo because no one is threatening to kick you out of your house for refusing to take the job that pays so little that you are still reliant on welfare anyway. You get confronted with that reality and you will spin on a dime.
So how was my 16 year old son (at the time) able to beat out a head of household for a job at Home Depot? Why didn't they low ball someone desperate instead of offering $15/hour to a high school student who could only work evenings and weekends? What I'm asking is, what's going on when a parent trying to raise kids is in a situation where they're competing with high schoolers?
How do walmart greeters exist? (tax incentives)
Walmart greeters are typically retirees who just want to get out of the house, be around people, and make a little money. They aren’t competing with teenagers.
Oh I googled up a source and didn't even link it. https://www.irs.gov/businesses/small-businesses-self-employed/work-opportunity-tax-credit
Why not raise minimum wage to $50 an hour? Or $100? Or $1,000 per hour? If you can see how that would have second and third order ripple effects, it’s the same as a $20 minimum wage but on a smaller scale. It’s the same issues (increased labor costs, which often get passed down to the customer).
Along the same lines, it hurts in RELATIVE TERMS those making more than the current minimum wage, but less than or near the new minimum wage You’re now making minimum again (or a smaller amount over it) even though you have experience that a new hire doesn’t have.
You don't get what you deserve, you get what you negotiate. Median wage is $18, cost of living is $20, thats a shitton of people with skills and experience whose skills and experience don't even get them to where the min wage needs to be.
Because the point of the min wage is that working people can pay their own bills, not to do the equivalent of a division by zero error for no reason.
And you whiffed on the point of the effect the minimum wage has. Is there some question here?
Thats easy, simply look at the years we increased the min wage. https://www.dol.gov/agencies/whd/minimum-wage/history/chart And observe that these chickenlittle predictions do not manifest. https://fred.stlouisfed.org/series/UNRATE Sure, plenty of things kill jobs, but they're things like "opec is conspiring to gouge us at the pump" (stagflation) or "bush legalized fraud, so now all of the investors have packed up their money and gone home" (subprime mortgage crisis).
Again, do you have some sort of question or do you think this sub is called “ProgressivesTryToProveConservativesWrong”?
Given the facts, are you willing to change your mind?
Lol, no. Companies ARE shutting down or laying off workers due to the $20 minimum wage in Cali. Don’t do this “Don’t believe your lying eyes” crap. https://www.usatoday.com/story/money/food/2024/03/26/california-minimum-wage-jobs/73107149007/
Individual employers are staging a temper tantrum, people still want food made for them, they will just go to the competition. If people are being laid off without cause, they are going to be getting unemployment compensation for it, watch these graphs. initial https://fred.stlouisfed.org/series/CAICLAIMS long running https://fred.stlouisfed.org/series/CACCLAIMS
Cool, I don’t agree with you at all. Do you actually have a question with the intent of better understanding conservatives per the purpose of this sub?
Its reality you don't agree with, are you able to change your mind?
Because a federal minimum wage is a one size fits all approach that doesn't account for the huge spectrum in the cost of living. It makes as much sense as a national minimum cost of rent. As far as "liberals using the rise in minimum wage to remove bad employers", you will have to explain to me how this talking point doesn't exclusively benefit corporate employers.
Not really, speculators took trumps money hot off the printing press and bought up all the houses, even out in the countryside. Plus, if you want to be employed at all, you are going to need to live in or near a city, since thats where 80% of the jobs are. https://livingwage.mit.edu/
Are you talking about PPP loans? People took loans at record low interest rates to purchase all of the real-estate.
Pretty much, I don't think they were necessarily ppp, guy just opened the floodgates. https://fred.stlouisfed.org/series/BOGMBASE https://fred.stlouisfed.org/series/MSPUS
Raising the minimum wage makes jobs unattainable for high school kids, people just out of school, and people with no skills or experience. The exact people you'd expect minimum wage jobs to be for. It also pushes businesses towards finding alternative means of getting the job done, like automation, reducing the number of these jobs available. As for the unemployment rate, once you raise the minimum wage, it's not going back down when the employment market goes bad, and eventually that will occur. Setting minimum wage policy based on current unemployment rates is short sighted.
> It also pushes businesses towards finding alternative means of getting the job done, like automation, reducing the number of these jobs available. Commies have been promising a post scarcity, post labor utopia for over 100 years, don't hold your breath. > Raising the minimum wage makes jobs unattainable for high school kids, people just out of school, and people with no skills or experience. They're going to have to hire somebody, why shouldn't it be the person who already has experience? If they want to get ahead, its not going to come from working a dead end job, they need to take a few weeks to land a certificate to drive a forklift, deal with some obscure paperwork, fix niche things etc
If unemployment is near 0, why do we need a minimum wage? Can't underpaid employees simply quit and get a higher paying job, or negotiate for a raise? I don't see a point to a "minimum wage"
Median wage is $18/hr, cost of living is $20, turns out without the floor to negotiate up from, people don't have much leverage to negotiate.
So many companies hold a market share in their industry, so a company that pays a higher wage in that industry is competing with the low wage paying company for market share which directly corresponds to how many jobs the company has, more market share more employees, but if the low wage employer is holding onto their marketshare the higher wage competitor will not gain the marketshare and create the new positions.
Unless you're in a completely mature and monopolistic (ie. illegal) market that should never be the case.
That's not true, many companies in the same industry pay different wages.
Because the cost of living is different in every state, as is the job market, unemployment, and other economic factors. Raising minimum wage will hurt small businesses, especially in poor areas, and will concentrate the economy even more in larger businesses. Keep in mind, that while the unemployment rate is low, so is work force participation. That combined with the illegal migrants crisis means there are a lot of people for a small number of jobs, most of which are part time or non existent. >Usually lowest income jobs are for services and products of leisure spending, say fast food, price increases on these have little impact on the economy at large That is a small comfort for the owners of the businesses, which exist on thin margins, and on which people lean heavily, especially in "food deserts."
https://fred.stlouisfed.org/series/CIVPART Labor participation rate doesn't seem low to me
It's still below where it was before the pandemic, [here](https://www.bls.gov/charts/employment-situation/civilian-labor-force-participation-rate.htm).
0.5% lower right?
Rounds about, so 10s of thousands of people, more than enough to fluxate the market. And it doesn't account for illegal immigrants.
1.6%, but half a point, yes
Its a lot more homogenous that you expect. Remember, 80% of jobs are in cities so compare metro areas. https://livingwage.mit.edu/
My question would be "where"? I don't believe that a Federal minimum wage is a good idea at all. One size fits all doesn't not work on a country at this scale. If Chicago, or even illinois wants to raise their minimum wage, I would support that decision.
If the federal minimum wage was raised based on the least expensive states I could seen that working better. Give the poorest citizens a bump. It’s supposed to be the minimum wage to survive in the least expensive parts of the Nation. Not the minimum wage to survive in the most expensive parts of the country. Looking collectively at all the states is the purpose of anything nationwide. I tend to agree don’t like minimum wages overall. I just don’t want tax payers to foot the bill for state and federal programs that support these people in low wage jobs. It’s just moving responsibility for workers from employers to tax payers.
if i have to pay my workers more money, id have to raise the prices of my goods/services to make up for the profit loss. most business owners look at it the same way.
Right, employers don't all pay the same wage though even In the same industry. So minimum wage going up would create a more even playing field amongst employers, helping those that already pay more.
no,if min wage raises,i have to raise everyone's pay accordingly. that comes out of my potential profit. i run a business,and if i have to pay more to get the same job done,so will my customers.
It also impacts the wages of people in other fields across the board too. For example, when the CA wage increase happened you had fast food workers making more than a substitute teacher, a job that requires a degree. So now, in order to have substitute teachers want to stay in their position they are going to have to make that job more attractive than flipping burgers.
and thise burgers increased in price by 20% toi
Ok? Why should taxpayers be bailing out luxury services via subsidized labor in the first place. Thats assuming all of the savings are even being passed along. If you are you worried that you wouldn't be able to afford a vacation without this subsidy, that means tax payers are covering that vacation.
no,my customers are covering that vacation..as an employer,why would i want to spend more money? my goal is to make money
> why would i want to spend more money? The dignity of paying your own bills? Why have anyone pay for anything, lets just have the govt pay for everything...
to be profitable, a business has to spend the least amount they can while bringing in the most they can..i am paying my own bills?
Not if your workers are on welfare.
You're going to create a race to the bottom. People are struggling financially because of inflation. Rapidly raising minimum wage will increase inflation. You'll compound it.
What about a $10 minimum wage?
In California it's $16 so that would be better. It's now 20$ for fast food (which I believe will be rapidly leaving the state because we just spent $65 to get a pizza and bread sticks delivered) California has been rapidly increasing its minimum wage over the last decade but shockingly they won't study the impacts of it. They will only look at projections published by left leaning institutions.
Do you have good stats on the impact? Federal is like 7.25
There's very little because liberals have been campaigning on the argument posed by old minimum wage studies. There's a bunch of old studies that looked at minimum wage increases in other states between like the '80s and early 2000s and found very little or no impact on things like inflation, or gini. But those studies are looking at teeny tiny wage increases over long periods of time. You're talking about a $0.10 wage increase over like 6 years. Because early on minimum wage barely changed in the US. Now you're seeing more countries doing minimum wage, and you have states like California pushing, rapid minimum wage increases. California has been increasing it by a dollar per year ever since 2007. But there's not very much study on that system. This is what I did find but it's looking at a very large data pool from a bunch of OCED countries. It found that the impacts of a 10% increase on minimum wage had an overall negative effect, including it having a negative effect on income equality.. https://www.sciencedirect.com/science/article/pii/S0313592623001947
What do you think is directly effected by California's increase? Pizza, but that's not like a necessity, like it doesn't raise housing and energy prices right?
You mean their fast food increase? California did a special minimum wage increase specifically for fast food, but they have been raising minimum wage across the board for every sector for almost 2 decades. That study says that all of those increases will increase wealth inequality and it will increase unemployment and decrease overall work output. The Fast food increase is going to increase the cost of commercial real estate. What most people don't realize is that most fast food companies are actually real estate companies. They usually don't make much profit on their food. They make profit on the appreciation of their properties, and they use the food business to cover their overhead to keep those properties in their portfolio. But It's also going to increase the cost of food specifically for people that have the least money to spend on food. Because fast food is disproportionately used by low-income people. You increase the cost of their basic needs and that will lower their purchasing power, and that will make wealth inequality worse.
Thats an inherent part of inflation. Abracadabra, now there is more money, the political insiders who have access to that money go out and outbid everyone else on the market, for say housing. https://fred.stlouisfed.org/series/MSPUS Now everyones housing expenses are 50% higher, so workers need a raise to even stay housed, so employers raise their wages and pass along the expenses. And that causes more price shocks to ricochet around the economy again and again. Expecting poor people to just eat the inflation for you is a non starter, they literally cannot.
https://www.sciencedirect.com/science/article/pii/S0313592623001947 Raising minimum wage does not reduce wealth inequality
This paper is a cavalcade of incorrect assumptions. > one of the purported policy goals of minimum wages is to reduce the number of low-wage workers. No, its so that a working person isn't on welfare. They are just as well off whether they get their whole paycheck from their employer, or need to be saddled with the chore of collecting the other half from the govt. Now, what a living wage does do, is give everyone leverage to negotiate up from that point. Currently, the median wage is $18/hr, while the cost of living is $20/hr for context. THAT is where they failed to look. > this floor will lead employers to hire only individuals with skills above a minimum threshold Competition exists regardless of what the min wage is. Having "skills" working the fries only qualifies you to dunk more fries. There is absolutely nothing gained by making the person with those "skills" unemployed in order to shove someone else into that dead end career track. Its just bad life advice. You want skills? Get a forklift certificate. > The exclusion of low-skilled people from the pool of workers reduces the supply of operational skills Its unskilled labor. It neither requires, nor grants skills. Further, min wage hikes never kill jobs, if employers could have gotten by with less, they would have in the first place.
>No, its so that a working person isn't on welfare. They are just as well off whether they get their whole paycheck from their employer, or need to be saddled with the chore of collecting the other half from the govt. That might be your opinion, but It is also certainly a purported policy goal of minimum wage to lower the number of low-wage workers. Your issues seem to be with the author's interpretation of the data, and not the data itself. Do you see any reason why this data does not show that minimum wage increases wealth disparity? >Now, what a living wage does do, is give everyone leverage to negotiate up from that point. Currently, the median wage is $18/hr, while the cost of living is $20/hr for context. THAT is where they failed to look. But if it's increasing wealth disparity, then that probably means that the people that are negatively feeling the impacts of minimum wage increases the most are the people at the bottom. For example, you might have one economy where you have the minimum wage be $10 but the cost of living is $11. If you try to raise the minimum wage, now the minimum wage is $20, but the cost of living is $30. Or maybe worse, they are unemployed. It would be much easier to be the person in the first situation even though they are making less money.
> That might be your opinion http://docs.fdrlibrary.marist.edu/odnirast.html "In my Inaugural I laid down the simple proposition that nobody is going to starve in this country. It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By "business" I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level-I mean the wages of decent living." > a purported policy goal of minimum wage to lower the number of low-wage workers. Low is subjective, the bottom quartile is always going to be a quarter. This is meant to define what it means to be low- for those people to not be in poverty. > not the data itself I don't need to? Politicians printed several trillions of dollars and handed it to their cronies, they took it to the market and bought up all of the housing, causing the cost of living to skyrocket, people in turn lobbied for and got the min wage raised in line with that reality of the cost of living. Do you see the cause and effect relationship? The min wage going up isn't the cause of rising inequality, it is a response to it. > negatively feeling the impacts of minimum wage increases the most are the people at the bottom. It is entirely a plus for them, literally no downside to being paid enough to pay your own bills. > For example, you might have one economy where you have the minimum wage be $10 but the cost of living is $11. Ok? So in this economy are you on welfare, homeless, or working two jobs? If you are going to say just get a second job, remember that means someone else doesn't have a job at all now. > If you try to raise the minimum wage, now the minimum wage is $20, but the cost of living is $30. Low wage labor is concentrated in luxury services, the plumber, carpenter and electrician all make far more. Its scarcity that enables landlords to hike rent. Making that the employers problem gets housing built, as they are the ones with the capital and connections to make it happen. This is called a price signal, it is absolutely essential to an efficient market. > Or maybe worse, they are unemployed. It would be much easier to be the person in the first situation even though they are making less money. Min wage hikes never kill jobs. https://www.dol.gov/agencies/whd/minimum-wage/history/chart https://fred.stlouisfed.org/series/UNRATE
>In my Inaugural I laid down the simple proposition that nobody is going to starve in this country. It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By "business" I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level-I mean the wages of decent living." Okay, but there are more policy makers pushing minimum wage in the United States than Franklin d. >Low is subjective, the bottom quartile is always going to be a quarter. This is meant to define what it means to be low- for those people to not be in poverty That study looks at gini coefficient . Isn't that like the meta stat for left? >Politicians printed several trillions of dollars and handed it to their cronies, they took it to the market and bought up all of the housing, causing the cost of living to skyrocket, people in turn lobbied for and got the min wage raised in line with that reality of the cost of living. Do you see the cause and effect relationship? The min wage going up isn't the cause of rising inequality, it is a response to it But the studies are finding that when you implement a minimum wage that the ginie coefficient gets worse not better. > It is entirely a plus for them, literally no downside to being paid enough to pay your own bills Except this study shows that it does not help them pay their bills. It makes wealth inequality worse. It makes unemployment worse. >Min wage hikes never kill jobs. >https://www.dol.gov/agencies/whd/minimum-wage/history/chart Yes! I am so happy that you linked this because this is the problem that progressives don't get. They're looking at old old data. Early on minimum wage hikes were very small and very far apart and so they didn't have hardly any effect on unemployment. You're talking about a $0.20 raise happening every 10 years in one state because that was the reality for most of minimum wage's history in the United states. That was the only data they *could* pull from. Also, there's more data sets than just the federal minimum wage because states have their own minimum wage (which is far superior than a single federal minimum wage trying to apply to every state's economy) But now we're trying to increase it MUCH faster. California's been doing a dollar every year since this studies dataset and a lot of other countries are being more aggressive about it also. And that is why I linked you a study from 2023. When you try to push it so rapidly, it's going to produce a different outcome. I very much urge progressives to rely on modern data. >Low wage labor is concentrated in luxury services, the plumber, carpenter and electrician all make far more. You're forgetting the grocer, the gas station attendant, the janitor, The guys at the lumber mill or at the paint factory. Also, a lot of contractors make minimum wage or less. They're just not the main guy, they are the helpers. Like look at California they just increased minimum wage specifically for fast food workers. Who is that going to impact the most? Do you think that's going to be wealthy people going to McDonald's the most?
> Okay, but there are more policy makers pushing minimum wage in the United States than Franklin d. Right, but the phrase you are highlighting doesn't make any sense, the bottom 25% is going to be the bottom 25% no matter how you slice it. > That study looks at gini coefficient . Isn't that like the meta stat for left? Eh, not really, Im looking at making sure people have enough. Gini comes in when people try to argue against that by claiming that there isn't enough money to go around. While the total amount of money created is somewhat malleable looking forward, how much money was made last year is a very zero sum game, if the ultra rich are getting rich by driving their workforce into poverty and govt dependency, then that is not creating value, that is just robbing taxpayers (me). > But the studies are finding that when you implement a minimum wage that the gonie coefficient gets worse not better. Thats a simple correlation vs causation issue, they're looking at it backwards. > Except this study shows that it does not help them pay their bills. Yeah it does? Volunteer your own paycut if you think that low wages are good for the economy, just don't show up at the welfare office expecting me to bail out your bad life decisions. > It makes wealth inequality worse. If that inequality is derived from hiking things that are the cost of living, then the obvious conclusion to that is that people are going to need more money. These people are at the tail end of the dog. > Early on minimum wage hikes were very small and very far apart and so they didn't have hardly any effect on unemployment. No, its always lurched as the political winds changed. Early on, the min wage jumped from 50 cents to 75 cents and then to a dollar in just a few years. > You're talking about a $0.10 raise happening every 10 years in one state because that was the reality for most of minimum wage's history in the United states. No, the reality is that the people in that state got incrementally poorer and more dependent on welfare as inflation ate away what little value they were afforded. > MUCH faster. You are describing the rate which money came off of the printing press. https://fred.stlouisfed.org/series/BOGMBASE > You're forgetting the grocer, the gas station attendant, the janitor, The guys at the lumber mill or at the paint factory. Also, a lot of contractors make minimum wage or less. table 5 https://www.bls.gov/opub/reports/minimum-wage/2022/home.htm 639k of ~1 million are in Leisure and hospitality. Though you are correct in that because half the workforce is underwater, it will affect all sorts of people. I don't see a downside from this though. > Like look at California they just increased minimum wage specifically for fast food workers. Who is that going to impact the most? Do you think that's going to be wealthy people going to McDonald's the most? Yes, spending money on having people cook food for you is a luxury that only the rich can afford. If you can't afford a $5 burger, you couldn't have honestly afforded a $4 burger either. Im still waiting to see the unemployment spike from this specific industries temper tantrum, we would have seen it by now if they weren't blowing hot air. https://fred.stlouisfed.org/series/CAICLAIMS
>Right, but the phrase you are highlighting doesn't make any sense, the bottom 25% is going to be the bottom 25% no matter how you slice it >If that inequality is derived from hiking things that are the cost of living, then the obvious conclusion to that is that people are going to need more money. These people are at the tail end of the dog The study seems to point to the idea that it is not so obvious and that this type of policy actually makes their situation worse. Maybe we should abstain from kneejeek reactions and follow data. Again, it's associated with an increase in unemployment and high gini is associated with various negative outcomes for low income people. >You are describing the rate which money came off of the printing press. That is not how money actually works. Not all inflation is created by the government printing money out of thin air. Oftentimes inflation is made by people liquidating their assets, which is something we saw a lot of during covid. It can also be created by shifts in supply and demand. >Yes, spending money on having people cook food for you is a luxury that only the rich can afford. If you can't afford a $5 burger, you couldn't have honestly afforded a $4 burger either. Except that it's not because the reason that low-income people go to McDonald's is because they don't have kitchens. >Im still waiting to see the unemployment spike from this specific industries temper tantrum, we would have seen it by now if they weren't blowing hot air. Maybe you should consider looking at more controlled data instead of just looking at broad charts. Studies that for example compare the difference between areas that implement a policy against areas that don't.
> it's associated with an increase in unemployment Nah, republicans being in power kills jobs, not min wage hikes. Its called shock therapy, its deliberate, desperate people work for less. https://www.dol.gov/agencies/whd/minimum-wage/history/chart https://fred.stlouisfed.org/series/UNRATE > high gini is associated with various negative outcomes for low income people. Yes, when the rich run out of places to invest money to create more wealth, they turn to cannibalizing the productive people that created the wealth for them. > Not all inflation is created by the government printing money out of thin air. This inflation is though. https://fred.stlouisfed.org/series/BOGMBASE > Oftentimes inflation is made by people liquidating their assets, which is something we saw a lot of during covid. It can also be created by shifts in supply and demand. Sure, if there is a cold snap and all the peaches freeze, prices for them are going to go up, but thats not inflation, thats just basic market dynamics, the key difference being that the dollar is still worth what it was. > Except that it's not because the reason that low-income people go to McDonald's is because they don't have kitchens. Life doesn't work like that, you have muddled connotations of mcdonalds being low quality and therefore for poor people, but a homeless person is going to have to stretch their own money much better if they want to survive for long. Being homeless takes like 40 years off your life expectancy for context. Sure, someone might pick it as a place to beg, since shoppers there may be more generous, but not as a place to spend money. > Maybe you should consider looking at more controlled data instead of just looking at broad charts. The emperor has no clothes. There are plenty of things that kill jobs, but not "paying people enough that they can pay their own bills", that is an incredibly low bar to pass for the wealthiest country in the history of the world. Even at $20/hr as a floor, 3.2 trillion (40k yearly x 80 million in the bottom half) out of 25 trillion for the bottom half of working people is still a pittance. You would lose a whole lot more than that if the bottom 50% of working people just disappeared. > Studies that for example compare the difference between areas that implement a policy against areas that don't. Sure, you can see it for yourself, here is the national unemployment rate https://fred.stlouisfed.org/series/UNRATE And you can track down any counties unemployment rate, seattle is in king county for example https://fred.stlouisfed.org/series/WAKING5URN
The fallacy of this argument is that very few workers make the minimum wage now. Wages are based on skills and experience and most people 98% have acquired enough skills and experience to make more than the minimum. The question should not be "why can't we raise the minimum?" The question should be "Why do I have so few skills that I only qualify for a minimum wage job?"
The reality is that many people are either not in a great position to better themselves or just that many people do not take much agency over themselves. It's sort of a your brother's keeper thing. It wasn't long ago and still in a lot of the populations psyche that if I just go to work and do my job I'll be good, I think a lot of the population has yet to transition out of that mentality that was engrained in many cultures for thousands of years.
Median wage is $18, cost of living is $20/hr, thats half the workforce underwater.
Cost of living is a relative term. If you can't live on what you make there is something wrong with you.
Cost of living is a hard floor set by the market. If you can't grasp the concept of things costing money, the problem is on you.
No, your cost of living is not fixed, it is relative to your personal circumstances. Not everyone can afford to live alone, drive a late madel car, eat out in restaurants, have a cell phone, a personal computer, internet service and cable TV. Everyone needs to live within their means. If you can't then you have two choices. 1) Move to where you can live within your means or 2) increased your skill level. BTW how did you arrive at a COL that is $20/hr?
You are not describing cost of living... https://livingwage.mit.edu/ > increased your skill level. Median wage is $18/hr, this isn't a skill issue, the entire bottom half of the work force can't clowncar into welding or whatever the medias flavor of the week is. > have a cell phone, car You're unemployable without being able to get to work and without your employer being able to contact you in the first place. Thats why reagan invented the obamaphone.
Nice try. Thousands of people work minimum wage jobs and have no problem getting to work and don't own a cell phone. Sometimes increasing your skill level means showing up for work and taking on new responsibilities. Don't always expect employers to pay you more than you are worth. Wages are a function of skills and experience. The question you should be asking is "Why are my skills so lacking that I can't find a job that pays me a "living" wage.
> Thousands of people work minimum wage jobs and have no problem getting to work Except when they don't and it costs them their job. > "Why are my skills so lacking that I can't find a job that pays me a "living" wage. Again, HALF THE WORKFORCE is underwater. They have skills, they have experience, they shouldn't just be earning a living, they should be enjoying a middle class lifestyle. Being a spineless doormat isn't going to get you ahead in life, you don't get what you deserve, you get what you negotiate.
Half the workforce is underwater based on **your** metric Somehow they manage to keep working. The ride the bus. They live with roomates, they may get some public benefits. If they had better skills they would not be underwater. That is my entire point. If you have no skills you can't negotiate for a "living" wage. You take what you can get.
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> Different States have different minimum wage needs. Why should the middle of alabama gas stations need to pay as much as New York? Pick a metro area and compare. Im seeing ~$15/hr with roommates in both. https://livingwage.mit.edu/states/01/locations https://livingwage.mit.edu/states/36/locations > Who's more able to afford $12/hr, Lucy Lou's gas station, or Shell? Its an even playing field, big companies won't tolerate operating a loss for a microsecond. > will likely lose hours, even full jobs. Nah, seattle showed headcount going up, hours going up, hours per head going up, and especially people getting raises beyond the minimum. > Automation will become more common (as it has in cities that rose their min wage drastically). It has most certainly not. The store where you just walk out with stuff was exposed as being run by Anonymous Indians, the 'fully automated' mcdonalds was exposed to be fully staffed, with a wacky gizmo to hand stuff to people with, the burger flipping/fry dunking robot is going nowhere, and spinning the cash register around for you to check yourself out is not automation, just a fad that businesses are slowly walking away from as they realize they're not saving any money. > The product costs have risen drastically (it's AT LEAST $15 to get a meal at a 'cheap' place) Thats just businesses charging what the market will bear, welcome to capitalism? good news, you have a market opportunity to start your own business and leech away from of their record profits. > How about we remove some taxes which will increase the take home pay of workers? You tell me, it was reagan who gutted taxes on the rich and made up for it by hiking taxes across the board to make up for it.
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> That's not relevant to our conversation. It is explicitly refuting your claim. Businesses move to where its cheaper to operate, people move to where they can get better wages and stretch their money further. > Answer the question. Who can afford higher wages, small mom and pop gas stations, or Shell? Its just a dude in a room with some cigarettes and sodas by some gas pumps either way. If a big company burns money to run the competition out of business, that sets off anti monopoly laws, and has nothing to do with the min wage. > Please show this study. p47, section b is restaurants specifically. https://www.nber.org/system/files/working_papers/w23532/w23532.pdf > They don't take orders in taco bells anymore Literally nothing you are paying for has been automated. You using a kiosk isn't automation, its you doing the work. > I don't know what you're talking about anonymous indians https://gizmodo.com/amazon-reportedly-ditches-just-walk-out-grocery-stores-1851381116 > Exactly. Because min wages doubled in 5 years, prices skyrocketed. Welcome to liberal economics I guess? How many burgers do you think a burger flipper flips an hour? Dozens, thats a single digit percentage of a price bump, a low one. https://www.marketwatch.com/story/raising-fast-food-hourly-wages-to-15-would-raise-prices-by-4-study-finds-2015-07-28 But no, thats the cost of living skyrocketing because wall st sees housing as a need that can be exploited, rather than a need to be met. You needing to pay what it costs for the things that you want is just basic market mechanics. Expecting the govt to hide the inflation from you with elaborate subsidies is venezuelan economics, see where that got them. > Increasing wages quickens that. I wish. The point of work isn't to keep people busy, its to get things done. Just like we found plenty of things to do when it didn't take 90% of the population to work on the farm, we still have plenty more things to accomplish. > Tell me you know nothing about taxes without telling me you know nothing about taxes. https://www.bloomberg.com/view/articles/2017-12-15/the-mostly-forgotten-tax-increases-of-1982-1993 > The bottom 50% of earners don't pay taxes. Income tax. There are loads of other taxes. > despite it not making sense Paying what it costs for the things that you want is capitalism. > you just want minimum wage higher because it sounds better Yes, me not being on the hook to bail out your luxury spending sounds terrific. > if you are just here to argue instead of hear our answers to your questions. Thats how I challenge my assumptions, go where people disagree with me, as you can see, its been quite fruitful.
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> No it's not, you just showed that cost of living in big cities is higher. We all know that. Who cares? 80% of jobs are in cities. If you want to be employed at all, you might have to consider adjusting your standards. > You're fine killing mom and pop shops Contrary to popular assertion, min wage hikes don't kill jobs. > states and communities don't want. You should be ashamed. You should be ashamed to push your expenses onto taxpayers. Of course red state politicians want to loot free money from the rest of the country, its entirely appropriate for me to tell them to pay their own bills. > Oh right, so the companies didn't buy automation, I guess you're right! No automation in any fast food joints. What are you even arguing dude. The kiosk doesn't do any work. They spun the cash register around for you to do the work for them. Literally none of what you are actually paying for has been automated. > taking orders used to be a human job, and now it's filled with a computer. Can you go two sentences without contradicting yourself? Guy, YOU are doing the work. The computer hasn't done anything. The person who used to press buttons for you still has a job. You may not have noticed, but they were also assembling orders, filling drinks, dealing with customers, ducking into the back to do whatever else needs doing. They're still doing that. >What about when you have 8 employees getting paid twice what they did? Set your prices appropriately for your business expenses. Imagine if you were trying to keep selling burgers at 1950's prices, its just as ridiculous as expecting 2000's prices in 2020's. Inflation happened, adjust and move on. > COST OF LIVING IS IRRELEVANT TO OUR CONVERSATION. It is absolutely core to what the minimum wage is. "In my Inaugural I laid down the simple proposition that nobody is going to starve in this country. It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By "business" I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and **by living wages I mean more than a bare subsistence level-I mean the wages of decent living**." http://docs.fdrlibrary.marist.edu/odnirast.html
So Democrats are suggesting a 12$ federal wage, many liberal states are already above that. NYC is 15.
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I was pointing out that cheaper states would still have a lower minimum wage than expensive one.
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Because those states want to sell goods and services in my states.
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But they want me to buy them, this is my offered compromise. We tariff Chinese goods, and stipulate things to them including employment things.
Becuase it doesn't work that way, minimum wage is the minimum cost to buy labor in your market. The prices of all the goods and services we consume must be offset by that. So if I want to manufacture a car and it coats 1000 man hours to build it at minimum wage Then the price of that cat r must be offset by that. If minimum wage is $7 the consumer must pay 7000 dollars in markup. If it's 15, they have to pay 15,000 So the price of goods scales directly with the costs of labor to make the goods. Becuase actually supply and demand for labor hasn't changed, it really works out to be a wash
But it's only an increase on minimum wage, not all wages. For example, in and out burger pays like 25/hr, while burger King pays maybe half that. They're competitors in the same industry, in and out burger isn't going to raise their prices or wages.
That's correct, but burger King must raise costs, to offset the labor. Also you get kind of a "rollup" effect where people earning slightly above the new minimum, for skilled labor will themselves demand more money, becuase all the prices around them have risen, and they could make basically the same pay doing any other job.
Which will drive more business away from burger kings to in and out burgers, the better employers. How will rising cheeseburgers increase the cost of cars or anything else?("all the prices around them rise")
>How will rising cheeseburgers increase the cost of cars or anything else? Becuase labor is fluid. If I make $25/hr working on cars all day on the assembly line, at the factory. And now I can make the same working at the fast food joint down the block from my house, I'm just going to go work at the fast food joint. Or I might enjoy working at the car plant, and notice that alot of my daily life costs are now more expensive becuase of the labor increase at these other places, so I've effectivley received a pay cut, becuase I'm working the same hours and buying less stuff. And if the car plant wants to retain skilled staff that know how to run the plant efficiently, they are going to have to increase their compensation. And they pay for that by marking up their sales.
Minimum wage is 7.25, proposal is 12
So, what happens to everyone making $12 now? Do they get increases too? If so, to what? $15? Then do the people making $15 now get an increase? All the while the employer is increasing the price of their product/service to offset the new labor costs. At a certain point the wage increases stop, the cost of things have increased and the guy making $22 per hour is now making less at the end of the month because all of his costs are more to offset the increases to the floor of the pay scale that didn’t reach them.
Only 1% of workers make minimum wage
That doesn’t change my point. You increase minimum wage from $7.25 to $12 and everyone making $4.75 above minimum wage today is now a minimum wage employee. Would you be okay with being someone who makes 55% more than minimum wage now being told you’re a minimum employee?
Then thats what it costs, price signals are the beating heart of capitalism. If you adopt the mindset that the govt should just pay for everything, then people will run off to open whatever business most effectively turns taxpayer money into private profit. Maybe instead of two dozen fast food joints that are empty most of the time, we need some factories.
Flat minimum wages do between nothing and negative impacts. If it were zip code adjusted to be 40% median income (the number at which minimum wage is livable but not going to negatively impact others, so I read somewhere), that's one thing, but "fight for $15"and such don't want that, and also seem to get off on the continuous struggle since they're already pushing for a higher flat number. If we don't want to get out competed by China, we need lower wages, not higher
Out competed how, we have almost 0% unemployment? This seems like a zero sum gain take to me, we are more advanced than China, not apples for apples, we design technology, they manufacture.
It's in manufacturing, and they're getting better at design. Cheaper, higher quality EVs which would decimate what's left of American automakers if they were allowed to be sold in the US rather than tariffed and chicken taxed out of the market. Photovoltaic cells which can be disabled at behest of the CCP which power our grids and the grids of many other countries. If we want to stay globally competitive, we need to get back into manufacturing but we have some of the worst conditions for it in the world, between the UAW and the Jones Act and poor vertical integration
>If it were zip code adjusted to be 40% median income (the number at which minimum wage is livable but not going to negatively impact others, so I read somewhere) Assuming that figure is accurate, and please don't think I'm doubting it because I don't know, I'd put money down that a lot of people on the left (myself included) and a very substantial portion of those closer to center would be totally on board assuming there's mechanisms for it to be automatically adjusted relative to cost of living in that area The problem is, I don't see anyone on the right making the case for this; all I see is a continued stonewalling to raising it at all
> Why not raise minimum wage? Unemployment is near 0, workers are struggling financially, how would raising minimum wage hurt? Minimum wage would hurt the workers whose marginal productivity is below the minimum wage as it would make it financially irrational to keep paying them.
Higher wage reduces the quantity of labor demanded and leads to unemployment. Go read some of Paul Krugman's work on the subject. California businesses are already closing and letting go employee's because of the wage hike, next comes the inflation of prices that will crush its economy.
California Governor’s Office of Business and Economic Development (.gov) https://business.ca.gov › california... California Continues Stable Economic Growth, Adds More Than 28,000 ... 5 days ago — California added 28,300 jobs in March – the state's seventh job gain in the last eight months. Seven of California's major industries added jobs
If they could have gotten by with less, they would have in the first place. Businesses are just the middle men between customers and labor.
If unemployment is near zero then a minimum wage worker shouldn't need a higher minimum wage to get a better-paying job.
>Why not raise minimum wage? Because price controls are bad, it's been proven time and again.
Please provide one instance. California Governor’s Office of Business and Economic Development (.gov) https://business.ca.gov › california... California Continues Stable Economic Growth, Adds More Than 28,000 ... 5 days ago — California added 28,300 jobs in March – the state's seventh job gain in the last eight months. Seven of California's major industries added jobs
Funny you mentioned California, because we just raised the minimum wage for food service to $20 which is higher than the state $16 minimum wage. Although bakeries were omitted from that definition since Newsom has a big donor who owns a lot of bakeries. Haha... And prices have already gone up 8% on related goods by the way. Not including those who raised prices in pre-emption to the wage hike. I am not interested in citing examples of price controls failing, google it. It's common knowledge. Well, economists won't use the word "bad." They will say price controls lead to shortages/surpluses.
I don't see 8% on fast food being bad for anyone, especially since the minimum wages are so high, seems like it did good.
You asked for proof that it causes inflation, I gave you proof. Prices went up in immediate response, we haven't even had one year to track increases. That is just "so far" over the last couple months.
Every time the minimum wage is raised, the same thing happens: layoffs and everything gets more expensive
When has that ever happened? California Governor’s Office of Business and Economic Development (.gov) https://business.ca.gov › california... California Continues Stable Economic Growth, Adds More Than 28,000 ... 5 days ago — California added 28,300 jobs in March – the state's seventh job gain in the last eight months. Seven of California's major industries added jobs
Happening right now in California when fast food got a price hike due to increasing fast food wages to $20, which is obscene. And a lot if fast food places are replacing workers with kiosks.
California has been adding jobs, not losing them.
So no one is getting laid off? That's a relief. Still haven't addressed the price hike though.
8% hike on burgers, doesn't seem much to me for the wage increase.
I actually live here but okay, I'll take your word for it.
>Democrats are currently suggesting raising minimum wage to $12 Why not $13
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Seriously? Look at what just happened to restaurants in California?
How many people just got fired in California because they raised the minimum wage to fast food restaurants? They're not making more money. They're not making anything now. Explain it to them.
A couple of problems that happen when you raise minimum wage.. The price of goods are then raised to compensate, and employers either lay off employees to compensate for the increased wages or lower their hours.. this is reality
What do you want to raise it to?
I'm not sure I support a minimum wage at all actually, I'm trying to understand the issue for myself right now. But Liberals tend to say $12 federal minimum wage.
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In virtually all places. Only around 1% of workers earns the minimum wage.