Originally posted by Lucius
It also kills jobs, but hey people don't understand that if you lower the efficiency of one market, its going to impact other markets. Labor and Product markets aren't hermits in the avoid.
Spoiler:
agreeing with tj is a sure sign that your bleeding heart liberal card is in jeopardy. 😛 But srsly, there are strong arguments in favor of a minimum wage.
One thing that it does is provide a backstop against blatant exploitation.
Additionally, it is an established fact that poor neighborhoods are less healthy. A lower wage (unsupported by the a government price floor) for unskilled labor would only hurt low-income earners. (Especially if the minimum wage were abolished now; sticky wages would ensure that the additional money retained by businesses is delayed indefinitely from "trickling down" to consumers.)
Originally posted by truejedi
Hey Z, tell me one good thing that raising minimum wage does. What good did it do to raise it from 5.35 that it was, to the 7.25 that it is now, for instance.
One benefit of this action specifically is (again) from the concept of sticky wages. If the average level of inflation is five percent, the minimum wage should rise at least five percent. Raising it more than five percent would provide a temporary boost to low-income families, as well as a substantial boost to the local economy (since the MPC for low-income housholds is higher than for higher-earners).
Originally posted by ZampanóOne benefit of this action specifically is (again) from the concept of sticky wages. If the average level of inflation is five percent, the minimum wage should rise at least five percent. Raising it more than five percent would provide a temporary boost to low-income families, as well as a substantial boost to the local economy (since the MPC for low-income housholds is higher than for higher-earners).
However, raising minimum wage sets off a wave of rising prices, making those who are making "more money" pay more for every item they buy. In the end, their "wage increase" is actually a net loss. This means no boost at all to the local economy, and after the very temporary boost to low-income families, a drop in their standard of living.
Originally posted by truejediThe problem to me sounds like it lies with the business owners being greedy and raising their prices, not the raising of minimum wage. Maybe business owners should only be allowed to raise their prices as a direct result of increased wages if the increase in wages hurts the company so much that it can no longer function. Maybe net profit, which doesn't actually go towards anything, shouldn't be the priority when running a business.
However, raising minimum wage sets off a wave of rising prices, making those who are making "more money" pay more for every item they buy. In the end, their "wage increase" is actually a net loss. This means no boost at all to the local economy, and after the very temporary boost to low-income families, a drop in their standard of living.
Originally posted by RE: Blaxican
The problem to me sounds like it lies with the business owners being greedy and raising their prices, not the raising of minimum wage. Maybe business owners should only be allowed to raise their prices as a direct result of increased wages if the increase in wages hurts the company so much that it can no longer function. Maybe net profit, which doesn't actually go towards anything, shouldn't be the priority when running a business.
how does that work? If business owners don't raise their prices, their profits shrink, and they can't hire. Why should the government be allowed to dictate to businesses what they can or cannot charge for products? That is pretty much scrapping capitalism all-together.
In fact, your last sentence sounds more than a little... well... re-read it. I think you didn't think it through. Net-profit isn't the goal? Net profit is ALWAYS the goal of capitalism.
Originally posted by truejedi
If business owners don't raise their prices, their profits shrink, and they can't hire.
1. Yes they can. They just need to dig a little more into that useless net profit I mentioned again.
2. Any money the company saves from paying people shit wages isn't going to go toward hiring new workers.
3. If it did, what would be the point? That money is gone anyway.
4. They don't need to hire, because they have workers. Do you think a company is constantly hiring people? The same 9 people have been working in my building for the last 20 years, and for the last 6 we've been recieving annual 1 dollar raises. New workers are only needed if the company is expanding or the old ones are leaving.
Why should the government be allowed to dictate to businesses what they can or cannot charge for products? That is pretty much scrapping capitalism all-together.
Businesses have to be regulated in order to keep things running smoothly. If the government wasn't telling people how to run their businesses, we would have things like monopolies, which really is the definition of anti-capitalism.
In fact, your last sentence sounds more than a little... well... re-read it. I think you didn't think it through. Net-profit isn't the goal? Net profit is ALWAYS the goal of capitalism.
Maybe you should re-read it. I'll bold the part that's important.
Maybe net profit, which doesn't actually go towards anything, shouldn't be the priority when running a business.