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Complete nonsense, based on a flawed understanding of economics.
Assume businesses raise prices to compensate. In real terms, low end incomes go up, and higher end incomes go down. Aggregate incomes don't change. Aggregate demand will actually rise a little. No aggregate change in profits. No change in employment.
Dude, there was this great McDonald's on the campus of Walter Reed, yeah it was a nice spot for all the residents of the fisher house to get a coffee or a late dinner after a taxing day. Well one day the President decreed that all federal contractors must make $10.10/hr plus benefits (totaling just shy of $15/hr). Just a few months later that McDonalds contract came up and four years later it still sits empty. A few dozen jobs lost to "progress."
Clearly the owner was an evil capitalist, just making money on the backs of exploited workers, but everyone knows that those greedy jerks will do anything to make a buck, so it stands to reason that if that McDonalds had the slightest chance of making money, any money at all, there would still be happy meals at Walter Reed, but there's not, there's just crushed hopes of toddlers who see those Golden Arches, but cannot get their nuggets.
Funny enough, if somehow he kept the doors open, his employees would be making more hourly than some of the sailors, marines, soliders, and airmen on that campus. If that's not enough for you, those same McDonald's workers would be making more per hour worked than the civilian medical residents that occasionally do rounds at our Nations Flagship Medical Center.
I say go California! Let's observe what happens. I don't think you're 100% wrong, but I do think that those employees incapable of producing value commiserate with $15/hr will have a hard time keeping or finding a job (is CA a right to work state? That would make this a great social experiment).
So what does that make the typical American worker? All they do is NOT work hard, and secretly lobby Congress instead so they can get their "handout" of a higher MW? That's because they didn't get a job that pays more than $70K a year, they're rejects of society and pretty much deserve to be tossed aside?
If it weren't for such measures, companies would be edging closer and closer to 3rd world country pay, and even start doing shady things like paying not in money, but "company coupons", that can only be used "at the company store".
You want choice? This MW increase being discussed is for CA. The CEOs HAVE A CHOICE. They can always move out of state. TX is often stealing business from CA. Land of the free, and they're free to follow suit.
Yes, those CEO's do have a choice. And more and more are making the choice. As did I. I lived in CA, and made the choice to move to TX.
As for the rest of your post, dramatics aside, nobody expects someone to be tossed aside if they don't make a high salary. But FORCING employers to pay that salary is wrong. Flat out wrong.
We'll see how things shake out in CA. I think this utopian dream of everyone making a good salary is going to crash and burn. Companies will move, others will close, and still more will become automated. But hey, they're welcome in TX, where the economy is booming, and my pay is inching UP, not down.
CA is working on a plan to raise min wage over 5 years to $15/hr. If a employee in a higher position gets $15/hr based on free market wages and an employee below then gets $15/hr based on min wage, assuming that the business can't function without both employees, what would likely happen?
The State of California has only the interests of the Union here. They could care less if the minimum wage worker makes more money. Union pay increases are tied to the minimum wage increases. Increase the minimum wage and all Union employees get a large increase as well. To stay competitive all business will need to increase their pay. They want to attract employees so they will need to follow the Unions. The Healthcare Organization that I work for is an example of this, we are non union and the other two hospitals that are in our neighborhood are union. When they get an increase we end up with one to stay competitive.
Realize though with business the costs to run a business end up being paid by the consumer in some way, either by an increase in price or a reduction in services offered. Companies need to remain competitive. Some will fail to hire additional staff and require the current staff to do more. Some companies will get rid of employees and have machines do the work. Fast food is already working on that now. This will also lead to buying products from lower priced supplies in other nations, offshoring more jobs to lower cost nations, and helping to build the economies of other nations.
But no talk from you of the CEO's who are making more and more money as the company profits go up while their lowest employes do not get raises. Sounds like stealing to me.
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Originally Posted by lieqiang
Sounds like you need to look up the definition of "stealing" to me.
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Originally Posted by Storm Eagle
Actually you do if you think employees wanting more money is stealing. By that definition everyone who does not own a business but works for one who has gotten a raise has stolen no matter the position including you or one of your family members or friends.
Wealth transfer is "stealing". Both from the bottom up and the top down.
But if we invest in bottom end income then everyone is richer. If we put the new growth in the economy in the bottom everyone gets really wealthy. If we allow the new growth in the economy to happen only on the top end, we end up in "an economic depression" like we are having now. Slow stagnant growth.
Companies will move their economic benevolence to Guatamala where the minimum wage is about $2 an hour.
Unless we insist that everyone everywhere gets US minimum wage or higher.
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Originally Posted by redguard57
Seriously, people. If the minimum wage was such a problem, it logically follows that the most successful countries would have the lowest minimum wage. Turns out that is not the case.
Interesting. My wife has been working for the same company for 9 years. She is now making 14 bucks an hour. IF/WHEN the wage goes up to 15, she will probably get a raise, to 15 as well. Seems unfair to a certain degree.
Dollar value doesn't matter. As long as I make net, more than not working. The last time I added it up it took $2 hr to brake even. It is 2% unemployment that I'm after. I'm difficult to work with, so when unemployment is high they say I'll work with someone less difficult. There is a finite number of jobs within commuting distance so when unemployment is high I'm out of work so I don't go through all of them.
And unemployment has been to high for the past decade.
Please name me a successful country with a dynamic economy and high standard of living where the minimum wage is in the $7 an hour range or lower, other than the United States. Please, I challenge you to find one.
I've got a newsflash for all of you - no country with a decent standard of living has a minimum wage as low as the U.S. The closest analogues would be Israel and Japan who also had minimum wages around $7.00 an hour like we do. Japan is raising their minimum wage by 3% per year (15%) starting in 2015 through 2020. Israel in 2014 voted to raise their minimum wage by more than 16% by 2017.
If you want lower minimum wage, there will also be lower standard of living. Mexico has an official minimum wage of about $4.20 an hour, although in reality it is not always enforced so workers there can be paid as little as $0.60 an hour. It is like that in most of Latin America. I don't think I even need to go into wages in Asia.
Is that what you all want? People here are supposed to know something about economics --- so find me the country whose economy excels with a low minimum wage, PLEASE. Stop quoting what you learned in econ 101 which are theoretical models.
If you want a rich country you have to pay your workers.
If you want to stop outsourcing and have everyone better off, then you need everyone to be paid US minimum wage or higher. That is everyone world wide.
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