patrick.net

Vaticanus says

If raising the minimum wage can end poverty, why not raise it to $20 an hour so everyone can be middle class?

Because THAT would trigger wage based inflation.

Of course somehow piling money on the 1% has not. Probably because they are hoarding the money rather than spending it.

Oh what a tangled web we weave.

At work yesterday (not logged in) I saw a comment on Patrick in another thread, from someone whos comments I don't usually see, who said that Obama doesn't understand economics, and that if he did, he would realize, that raising the minimum wage up to $9. would only result in our cost of living going up.

Wtf ? Really?

$9/hr is going to cause everyone's cost of living to go up? I don't think it's Obama that lacks an understanding of economics.

Maybe this idiotic reasoning is where the right is coming from with killing unions and privatization of everything. Let's Privatize the post office and police and schools, and pay the workers as little as possible, with no benefits.

It will be good !! Because it will bring the cost of living down for the poor. Landlords won't be able to charge as much. Everything will have to be less expensive if the average income is lower !!

Right ?? It's not like some of the people who now are on food stamps have low paying jobs !

Apparently, that's what having a good understanding of economics looks like.

Why don't we raise the minimum wage to $400k a year? matching the POTUS' own salary.

Reality says

Why don't we raise the minimum wage to $400k a year? matching the POTUS' own salary.

Not everyone's, just mine will do.

Vicente says

Please tell me how every minimum wage increase has resulted in huge unemployment, hyperinflation, dogs & cats living together.

Oh wait, it hasn't.

I was speaking about this in the context of all the other dumbassery that passes for economic genius these days. Apparently monetizing our debt isn't killing the dollar fast enough, so why not throw in a little wage increase to get the ball rolling faster.

BTW, if ya'll believe the increase in an employers expense for hiring unskilled labor just get's absorbed into his fat wad of profit, I have some excellent swamp land to sell you, guaranteed gater free!

Time to make the Doughnuts HAL 9000

New Renter says

Vaticanus says

If raising the minimum wage can end poverty, why not raise it to $20 an hour so everyone can be middle class?

Because THAT would trigger wage based inflation.

Of course somehow piling money on the 1% has not. Probably because they are hoarding the money rather than spending it.

Oh what a tangled web we weave.

I spoke with a woman whose husband works in the oil field. They used to live in Texas. She said every time her husband got a raise the rent went up. The owners knew the peons had more money so they would simply up the rent and the laborers could never get ahead. I do not believe giving people higher wages increases their prosperity as long as they are renters the owners will find a way to steal any wage increases for themselves.

New Renter says

Vaticanus says

If people don't earn enough to SAVE a little money each month, raising the minimum wage so they can just have a few more bucks to spend will not make them any less of a slave to the 1%. They poor and middle class need a way to save money that DOESN'T give the 1% first access to their money as the stock market, and savings accounts and home mortgages do.

What do you propose?

End inflation, end fractional reserve banking and end the fed. Inflation guarantees the poor cannot get ahead.

Vaticanus says

New Renter says

Vaticanus says

If raising the minimum wage can end poverty, why not raise it to $20 an hour so everyone can be middle class?

Because THAT would trigger wage based inflation.

Of course somehow piling money on the 1% has not. Probably because they are hoarding the money rather than spending it.

Oh what a tangled web we weave.

I spoke with a woman whose husband works in the oil field. They used to live in Texas. She said every time her husband got a raise the rent went up. The owners knew the peons had more money so they would simply up the rent and the laborers could never get ahead. I do not believe giving people higher wages increases their prosperity as long as they are renters the owners will find a way to steal any wage increases for themselves.

The landlords definitely increased the rent during the 2 years social security tax reduction. It's like they knew it was gonna happen like someone telegraphed it lol

I will let you all know how it works out in my city/county. They are raising the minimum wage from $8.00/hr to $10.00/hr in March. So that's a 25 percent increase for the employers to pay salaries. Not only that, remember they will have to take out more for the employer's portion for Social Security, so it will end up being more than 25 percent.

So I expect to see a lot of price increases at stores.

NuttBoxer says

BTW, if ya'll believe the increase in an employers expense for hiring unskilled labor just get's absorbed into his fat wad of profit, I have some excellent swamp land to sell you, guaranteed gater free!

It does if the given market is sufficiently elastic. This is econ 101. Certain goods and services are more sensative to price changes than others. If what you sell is highly price sensative, then yes, most sellers will have to suck it up and absorb the extra cost. This libertarian fallacy that any raise in the minimum wage ALWAYS results in massive price inflation is merely a scare tactic.

futuresmc says

It does if the given market is sufficiently elastic. This is econ 101. Certain goods and services are more sensative to price changes than others. If what you sell is highly price sensative, then yes, most sellers will have to suck it up and absorb the extra cost. This libertarian fallacy that any raise in the minimum wage ALWAYS results in massive price inflation is merely a scare tactic.

Let's try context 101 then...

Minimum wage hikes only affect those who hire unskilled labor, since skilled positions pay higher salaries. Talk to a supermarket owner about their profit elasticity, or a fast food restaurant.

Companies have three choices, fire the suddenly more expensive employee who still does the same unskilled work, raise the price of goods, or go in the red

... Not too many businesses take choice 3.

futuresmc says

This libertarian fallacy that any raise in the minimum wage ALWAYS results in massive price inflation is merely a scare tactic.

If the "market" responded the way they fear, why wouldn't prices increase for all of the goods and services the retailers pay for go up every time that company was profitable? What stops the inflation between business owners and the companies they pay?

Merely having more money doesn't translate into higher costs. Competition holds it down, right?

So if 7/11 wants to charge $10 for a bag of Doritos, there is a Safeway nearby that won't.

Competition, and supply and demand principles only apply to a free market(which we are not). Obviously in a free market, there is no "Minimum wage" only what competition, or supply and demand dictate be paid.

So the Safeway down the street is also charging $10 because the guy who stocks the chips MUST be paid $10/hr, and again, that cost won't come out of Safeway's end.

NuttBoxer says

So the Safeway down the street is also charging $10 because the guy who stocks the chips MUST be paid $10/hr, and again, that cost won't come out of Safeway's end.

Why wouldn't Safeway charge $9 on volume, since they can make more by taking all of 7/11's customers, even those who get paid more than the mw?

The alternative would require collusion between these competitors, simply to screw the bottom.

New Renter says

Vaticanus says

If people don't earn enough to SAVE a little money each month, raising the minimum wage so they can just have a few more bucks to spend will not make them any less of a slave to the 1%. They poor and middle class need a way to save money that DOESN'T give the 1% first access to their money as the stock market, and savings accounts and home mortgages do.

What do you propose?

We also should eliminate the payroll tax, at least on the first $30,000 of earnings.

CL says

Why wouldn't Safeway charge $9 on volume, since they can make more by taking all of 7/11's customers, even those who get paid more than the mw?

Because Safeway's cost has also gone up too due to minimum wage law requirement. Another possiblity is that one of them stops carrying the chips altogether because the sales volume split between the two stores could only afford a $7.50/hr stocker at each store. The remaining store then can raise the chip prices quite a bit higher, $11.

The alternative would require collusion between these competitors, simply to screw the bottom.

No collusion necessary on the chip price. It's easy to estimate the competition's cost rise when the minimum wage law is publicly announced like this.

Minimum wage law itself is actually a form of collusion: it outlaws competition from younger/newer/less-experienced workers. For example, if the experienced stocker is currently paid $15/hr. When the minimum wage was $7.50/hr, it was possible to have two new workers that can stock at half his speed each making $7.50/hr. Now that is outlawed. Unemployment among the youth will increase.

NuttBoxer says

Vicente says

Please tell me how every minimum wage increase has resulted in huge unemployment, hyperinflation, dogs & cats living together.

Oh wait, it hasn't.

I was speaking about this in the context of all the other dumbassery that passes for economic genius these days. Apparently monetizing our debt isn't killing the dollar fast enough, so why not throw in a little wage increase to get the ball rolling faster.

Wages at low end of economy get spent and energize economies. This may actually work unlike bullshit QE which does nothing but preserve power structure.

Vicente says

Wages at low end of economy get spent and energize economies. This may actually work unlike bullshit QE which does nothing but preserve power structure.

What would they be spending when they are laid off from $7.50/hr job because the employer can't afford $9/hr+tax? It's not a law that requires people to hire people at $9/hr, but a law that bans all jobs below $9/hr.

Well, they can always make the trillion dollar coin and give one to every American-problem solved!!!

Reality says

Vicente says

Wages at low end of economy get spent and energize economies. This may actually work unlike bullshit QE which does nothing but preserve power structure.

What would they be spending when they are laid off from $7.50/hr job because the employer can't afford $9/hr+tax? It's not a law that requires people to hire people at $9/hr, but a law that bans all jobs below $9/hr.

How true. Raising minimum wage is really just a ban on hiring people whose labor isn't worth the arbitrary minimum wage.

If you can't pay someone $9/hour to work at your business then you have a shitty business.

Moderate Infidel says

If you can't pay someone $9/hour to work at your business then you have a shitty business.

For the employee, it's better than joblessness . . . otherwise the employee wouldn't be there. Your attitude towards those beginner jobs is about as obnoxious as a limousine riding liberal deriding what the working class have to drive as shitty cars that should be taken off the road.

Moderate Infidel says

If you can't pay someone $9/hour to work at your business then you have a shitty business.

See Apple contractors in china

NuttBoxer says

Minimum Wage Increase to End Poverty Forever!

Let's keep the minimum wage low enough, that anyone making minimum wage will also need food stamps if they are going to afford both rent and food.

We should all pitch in together to fairly compensate workers,...right?

It's wrong to think that an employer should be required to pay an employee a wage that they can survive on, when the government can just make up the difference with food stamps or other programs.

(Note: the beauty of this is that it's a back door subsidy to business, that we can blame on the "bleeding heart liberals," for the entitlements that become necessary.)

Food, housing, and energy prices are the problem. Therefore, an increase to minimum wage will reduce the percentage minimum wage workers spend on these necessities. Overall, the economy does better when food, housing, and energy costs are lower. Since economic pandemonium would ensue if those costs were to go down then they have no choice but to allow for some wage inflation. It's a little like the tail wagging the dog.... and won't fix anything if continued manipulations in other areas cause the cost of housing, food, and energy to rise in line with the minimum wage increase... Personally, I'd rather see them stop manipulating markets and allow for costs to fall in line with wages rather than the other way around. But I don't have bankers to answer to nor a campaign to fund.

marcus says

Let's keep the minimum wage low enough, that anyone making minimum wage will also need food stamps if they are going to afford both rent and food.

Are you suggesting only heads of households should be allowed to work? Everyone else in the family should be banned from working?

There have to be jobs for people who are still living at home under their parents' roofs. That's where kids learn work ethics instead of being jobless and joining gangs.

I thought having Slaves was illegal? Paying someone less than 9 bucks is actually CHEAPER than the upkeep of a slave. Since you can't make a living of $9 the government picks up the tab with food stamps, free cellphone, Medicaid, Section8 etc. If you got a family and earn 9 Dollar you qualify for all of that. A slave would be a higher expense for an employer, therefore we got rid of slaves.

$9 per hour is $19,000 per year if you never take a day vacation. I agree with
Moderate Infidel, if your business cannot even pay that kind of slave wage then you got a shitty business. Just give it up.

CashWillCrash says

I thought having Slaves was illegal? Paying someone less than 9 bucks is actually CHEAPER than the upkeep of a slave. Since you can't make a living of $9 the government picks up the tab with food stamps, free cellphone, Medicaid, Section8 etc. If you got a family and earn 9 Dollar you qualify for all of that. A slave would be a higher expense for an employer, therefore we got rid of slaves.

Banning all jobs paying less than $9 an hour is banning the 2nd, 3rd or 4th worker in the family from working. That means the teenage youth can never find a job before graduating from college or even before graduating graduate school.

CashWillCrash says

$9 per hour is $19,000 per year if you never take a day vacation. I agree with

Moderate Infidel, if your business cannot even pay that kind of slave wage then you got a shitty business. Just give it up.

Raising minimum wage does often eliminate smaller competitors to big business, so that big businesses can raise price and become more profitable. That's why Walmart has been supporting raising minimum wage for many years. Raising minimum wage literally enrich the big corporations at the expense of the laid off low-income workers who are now banned from working, and low income families who spend a higher percentage of their income on consumables therefore hit more severely by the prices rising at the big retailers after the smaller competition is driven out of business.

with so many good jobs sent overseas I see no other option but to raise it substantially to $10 hr. If that job at $10 hr. could have been outsourced it already would have. I have never been a big fan of raising the min. wage but, we are in an economic situation that has never been encountered before with corporate greed and gov't collusion being what it is today. this just might be the only thing we can do.... that or place a huge and I mean HUGE tariff on all products coming into the country that used to be made in this country within the last 25 years.... then watch all the jobs come back.

The problem is not lack of regulation. Federal regulation of wages is a very innefficient way to allocate resources. Tariffs don't make us more efficient either.

we have a corrupted government in bed with big business spoon feeding us about the "global" economy and what not........how is that working for you? better have a job in government, utilities or the health field. it gets pretty slim after that anymore.

mikem says

with so many good jobs sent overseas I see no other option but to raise it substantially to $10 hr. If that job at $10 hr. could have been outsourced it already would have.

So you want the jobs paying $7.50~$9.99 banned here, and have to be out-sourced too.

Do people still believe bleeding the patient is the best cure?

BTW, the manufacturing jobs outsourced in the past two decades may well be in-sourced to robots soon. Should the robots be banned too? Sounds like Ludditism to me.

Our problem is not with outsourcing or global trade, but government regulations and high taxes that prevent new businesses from being formed to hire the laid off workers. The raising of minimum wages along with mandatory healthcare further discourage new businesses from forming and existing businesses from expanding into new fields and hiring more workers.

Reality says

Because Safeway's cost has also gone up too due to minimum wage law requirement. Another possiblity is that one of them stops carrying the chips altogether because the sales volume split between the two stores could only afford a $7.50/hr stocker at each store. The remaining store then can raise the chip prices quite a bit higher, $11.

What if Safeway already pays its employees more than the MW due to being unionized?

Do you have any evidence that this has occurred before? Have prices ever increased due to a minimum wage increase?

What about demand?

We have employer based healthcare and retirement plans thanks to Roosevelt. But don't go thanking him directly, it wasn't his idea.
He passed disastrous wage laws, that required all workers be paid the same, for the same job, regardless, skill or experience, or productivity.
So the only way companies could get qualified workers was to offer them medical(100% for family as well) and Profit sharing. The Roosevelt law was eventually repealed but the Employer based Slave entrapment stayed as a relic, as testament on how fucked shit gets when the Government intervenes and meddles with wages.

CaptainShuddup says

He passed disastrous wage laws, that required all workers be paid the same, for
the same job, regardless, skill or experience, or productivity

Isn't that the Leadbetter law passed by Obama?

CL says

What if Safeway already pays its employees more than the MW due to being unionized?

Big companies often can afford to and have to pay workers more due to economy of scale and the dehumanizing big-corporation environment that need to pay people more to keep people (and prevent them from stealing from the company). Just like Henry Ford had to pay people more in order to keep workers on his production line (contrary to his pseudo economics claiming a company can get rich by giving away products to its own workers).

Unionizing a retailer OTOH is usually a quick way to bankruptcy, as retailing is a competitive industry, so far.

Do you have any evidence that this has occurred before?
Have prices ever increased due to a minimum wage increase?

What do you think happens to price when smaller competition is driven out of business? Why do you think big companies like Walmart have been advocating raising minimum wage for many years?

What about demand?

What about demand? Don't you need to eat? In a local convenience store market, competition has a much greater effect on price than the theoretical possibility of all nearby residents refusing to eat.