Raising the minimum wage usually goes along with inflation. It needs to happen to help pull up the lowest level of hourly workers.
What we are seeing is the natural progression that has happened in some form or fashion for the last 75 years or more.
When gas went to 1.00 back when, it began to pull up the wages of people with it. If people cannot afford to buy things then everything stops. The markets know this. The real market is not the 1%, the real market is the little guys that buy whatever they can afford. Walmart is not kept in business by the us gov, it is kept in business by the little man spending their money for little items.
The minimum wage will go up but everyone needs to understand the the costs of items will also go up. This is called inflation.
Many of us have always suspected that upward pressure on wages in the 1930s can’t have made it easier to hire. But only lately, in the last 10 or 15 years, has newer research formed a complete picture of what happened in the 1930s. It seems that the policy of upward pressure on wages, which is the idea of the minimum wage, made the Depression worse.
As with most liberal ideas, this is all about "feel good" economics. What actually happens is that it increases unemployment and decreases opportunity, which is the opposite of what "they" try to make it sound like. As someone who is a job creator, when I hire someone, I want that person to "save" more than I am paying them. If raising the minimum wage solves poverty, then why hasn't some enlightened state raised it to $20/hour and solved poverty? Minimum wage is intended as an entry-level wage until someone can show they deserve more.
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If we ever forget that we're One Nation Under God, then we will be a nation gone under - Ronald Reagan
What is the concept behind establishing a minimum wage?
it depends on who you talk to.
in part altruism was/is at work. how can you deny the good will associated with suggesting that poor people be paid a living wage?
There is another part however when it relates to the establishment of the MW.
Unions believe it or not worked hard to establish MWs because by doing so, they could argue their skilled members MUST be paid above that number. The goal of the MW madates was in their minds an attempt to drive up wage inflation for their members.
__________________ If I do something stupid blame the Lortab!
So when you are talking about minimum wage, it’s always couched in terms of helping those less fortunate. It’s about getting the working poor to a level where they don’t need public assistance etc.
What the framers of the arguments don’t want is for people to come to logical conclusions.
The reality is there are several conclusions that one has to come to that just don’t support the idea that raising MW actually, structurally helps the working poor.
In the first place, every company works on a paradigm of cost/profit. The business owner understands what profit they need to contine the business. If they don’t make that number, they know they need to make adjustments.
Either they reduce spending or they increase revenue. Businesses project out expensis over a number of years, so if you come along and increase spending to those companies by raising minimum wages, you have changed that dynamic.
In the short term, the company has to adjust to major increases in costs (related to salary expense) that arent planned.
The short term reality is those companies will shed some workers to reset based on their cost planning.
That means some workers will work more, while other workers will not work. Niether group will be exactly happy about those prospects.
Then there is the mid range effect. Companies that rely on low wage workers, will have to continue hiring, but their cost structure will have to adjust meaning they will have to charge more for their goods and services.
The simple reality is, companies that rely on such workers tend to have greater impact at the lower end of the economic ladder. Meaning, their rise in prices will do more harm to their patrons who tend to be lower income earners.
The mid term impact doesn’t do much to the lives of the upper income earners because they arent in the market for goods and services at the bottom end of the market in the same way.
The mid term effect to low income earners is inflation that hits them hardest. Even though they may make more $$, their personal cost structure has adjusted and they gain nothing, and may even lose in the end.
Then there is the long term impact. Wage inflation. When the bottom end is forced to move up then all those other cost points necessarily have to rise too. If you move MW from $5 to $7.50 per hour, then the guy at $7.50 an hour expects to get a raise comiserate with the rate the guy below him just got. Then the important people higher up, demand more because they know they are more valuable. In the end, the real endgame of MW increases is to increase wages across the board.
While that sounds like a win for everyone, the only winners are the people saying they made it happen. They get good will because some poor fellow just jumped up in wages a bit. But that same guy doesn’t understand that his cost of living also increased and likely did so at a level above the benefit of his own wage inflation. Wage Inflation ALWAYS leads to real inflation, but the real inflaction always impacts the areas of the economy that impact the poor and middle class far harder.
It may feel good to raise the minimum wage, but in the end it typically causes ripple effects that sink the most vulnerable ships.
__________________ If I do something stupid blame the Lortab!
So when you are talking about minimum wage, it’s always couched in terms of helping those less fortunate. It’s about getting the working poor to a level where they don’t need public assistance etc.
What the framers of the arguments don’t want is for people to come to logical conclusions.
The reality is there are several conclusions that one has to come to that just don’t support the idea that raising MW actually, structurally helps the working poor.
In the first place, every company works on a paradigm of cost/profit. The business owner understands what profit they need to continue the business. If they don’t make that number, they know they need to make adjustments.
Either they reduce spending or they increase revenue. Businesses project out expenses over a number of years, so if you come along and increase spending to those companies by raising minimum wages, you have changed that dynamic.
In the short term, the company has to adjust to major increases in costs (related to salary expense) that aren't planned.
The short term reality is those companies will shed some workers to reset based on their cost planning.
That means some workers will work more, while other workers will not work. Neither group will be exactly happy about those prospects.
Then there is the mid range effect. Companies that rely on low wage workers, will have to continue hiring, but their cost structure will have to adjust meaning they will have to charge more for their goods and services.
The simple reality is, companies that rely on such workers tend to have greater impact at the lower end of the economic ladder. Meaning, their rise in prices will do more harm to their patrons who tend to be lower income earners.
The mid term impact doesn’t do much to the lives of the upper income earners because they aren't in the market for goods and services at the bottom end of the market in the same way.
The mid term effect to low income earners is inflation that hits them hardest. Even though they may make more $$, their personal cost structure has adjusted and they gain nothing, and may even lose in the end.
Then there is the long term impact. Wage inflation. When the bottom end is forced to move up then all those other cost points necessarily have to rise too. If you move MW from $5 to $7.50 per hour, then the guy at $7.50 an hour expects to get a raise commiserate with the rate the guy below him just got. Then the important people higher up, demand more because they know they are more valuable. In the end, the real endgame of MW increases is to increase wages across the board.
While that sounds like a win for everyone, the only winners are the people saying they made it happen. They get good will because some poor fellow just jumped up in wages a bit. But that same guy doesn’t understand that his cost of living also increased and likely did so at a level above the benefit of his own wage inflation. Wage Inflation ALWAYS leads to real inflation, but the real inflation always impacts the areas of the economy that impact the poor and middle class far harder.
It may feel good to raise the minimum wage, but in the end it typically causes ripple effects that sink the most vulnerable ships.
Well, drat! I wanted to write this, Ferdinand! All I got to do was correct your typos.
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