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If you raise the minimum, you increase the number of people who lose their jobs, and thus incresase not only the number of people on welfare, but the cost of living, thus making it more difficult for those who actually live on the newly established minimum wage.
True. In most industries parole is the biggest expense. People want to blame minimum wage, but don't want to talk about NAFTA, and most favored Nation Status for China. Both have done more to create poor people than Walmart paying $12.00 an hour. Yet those who gripe about minimum wage don't seem to have a problem with granting an amnesty for illegals who also contribute to low wages by lowballing industries and forcing legal citizens out of their livelihoods and forcing pay scales down.
That's the first thing they teach you in Econ 101, but thankfully that oversimplified model doesn't represent reality. It tells you that if labor costs are doubled (say, at a restaurant), then the restaurant will have to fire half of its employees if they want to stay economically competitive. If you're not 18 years old, this sounds absurd.
I think $12 would be a good starting point for an American minimum wage.
What is cost of living like in Australia? Might want to check into that. What sort of immigration do they have in Australia? I wonder if they allow anyone to just arrive and start working reducing the value of low skill labor like they do in America?
That's the first thing they teach you in Econ 101, but thankfully that oversimplified model doesn't represent reality. It tells you that if labor costs are doubled (say, at a restaurant), then the restaurant will have to fire half of its employees if they want to stay economically competitive. If you're not 18 years old, this sounds absurd.
I think $12 would be a good starting point for an American minimum wage.
And their cost of living is 30+% higher than ours because of it, while they have a 11% less in disposal income.
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So if you are going to raise the cost of living, then the income requirements to collect welfare also will need to raise.. You arent fixing a dam thing.
And apparently, the many minimum wage zealots don't want to hear what Mircea has to say - WE HAVE A LABOR SURPLUS, and a big one at that. Both parties are trying desperately to increase it with immigration amnesty plans, more onerous regulation and tax on business, and a dopey minimum wage increase.
None of these things solves a labor surplus issue, which means none of them solve downward pressure on the price of wages as determined by supply & demand. Supply keeps going up, and all the hijinks from DC keep demand going down. Where are wages supposed to go, especially at the easily replaceable rungs of the ladder, which is where the government is trying desperately to massively increase the surplus that already exists?
And shifting the cost to the whole country in the form of price increases actually hurts the poor disproportionately.
I guess you need to be a liberal for all this to make sense to you.
3) Paying people a higher wage if they increase their value to warrant that increase may help them get off welfare. But arbitrarily increasing a wage beyond its profitability for the business keeps them on welfare and simply changes how the taxpayers' money is funneled to them. In traditional welfare, it comes from the taxpayers via collection and then entitlement checks. In the minimum wage model, it comes in the form of higher prices at any retailer who decides to keep the same number of employees at the new higher wage. Here's the funny thing about that...in the traditional model, the bottom half of taxpayers give nothing to welfare, since they pay no federal tax. In the minimum wage model, they are now being taxed to pay welfare, but just calling it "higher prices." Since traditional welfare (non-SS/Medicare income and housing assistance) is ~18% of anyone's taxes, the lower 50% pay more for welfare on higher prices if they pay even one penny in higher prices that result from a minimum wage increase.
All you do is shift the welfare distribution process and who pays into it. In your minimum wage case, you penalize the poor with higher prices vs leaving them alone to pay nothing for traditional welfare.
We do not subsidize employees. We subsidize lack of value. Now, you can pick how you want to do that - have the rich 50% pay it all via government redistribution, or shift the cost to every single person in the country in the form of higher prices. Your choice, but you're the one insisting on only helping poor people, so I am curious as to why you are so fired up to raise their daily cost of living to fund your helping them, vs sticking it to the rich as we do now?
You've overlooked the fact that poor people wouldn't be so "poor" with a minimum wage increase. The question of "How will the poor be able to afford another $0.25 for a Big Mac?" is moot.
And their cost of living is 30+% higher than ours because of it, while they have a 11% less in disposal income.
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So if you are going to raise the cost of living, then the income requirements to collect welfare also will need to raise.. You arent fixing a dam thing.
OK... do you have evidence that the cost of living is higher solely due to the minimum wage difference?
You've overlooked the fact that poor people wouldn't be so "poor" with a minimum wage increase. The question of "How will the poor be able to afford another $0.25 for a Big Mac?" is moot.
They'd be even poorer because it wouldnt be $.25..
I remember making Big Macs when I worked at McDonalds 20 years ago, they were $1 each.. (they ran specials 2 for $2)..
And apparently, the many minimum wage zealots don't want to hear what Mircea has to say - WE HAVE A LABOR SURPLUS, and a big one at that. Both parties are trying desperately to increase it with immigration amnesty plans, more onerous regulation and tax on business, and a dopey minimum wage increase.
None of these things solves a labor surplus issue, which means none of them solve downward pressure on the price of wages as determined by supply & demand. Supply keeps going up, and all the hijinks from DC keep demand going down. Where are wages supposed to go, especially at the easily replaceable rungs of the ladder, which is where the government is trying desperately to massively increase the surplus that already exists?
And shifting the cost to the whole country in the form of price increases actually hurts the poor disproportionately.
I guess you need to be a liberal for all this to make sense to you.
So what you're saying is the main group of people who would be hurt by the cost of living increase would be illegal immigrants being paid less than the minimum under the table? I imagine fewer would come if that was the case.
OK... do you have evidence that the cost of living is higher solely due to the minimum wage difference?
Correlation vs. causation, my friend.
I dont need to provide evidence, YOU are the one who touted the benefits of the minimum wage standards there.
What would you attribute the fact that everything cost 30% more there if not higher wages? Where do you think the money comes from?
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