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Old 12-06-2017, 09:54 AM
 
Location: USA
18,448 posts, read 9,076,382 times
Reputation: 8485

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Quote:
Originally Posted by thecoalman View Post
This may be about one of the most senseless posts I have read in a long time. LOL

Tax cuts do not raise the costs of goods like raising the minimum wage would. If anything it lowers them and you the consumer have more money in your pocket to buy those goods.

If you need any further explanation beyond that I can't be of any help.
I second that.

On economic issues I’m a “flaming liberal” but it should be easy to see why Fast Food Company X would prefer tax cuts to minimum wage increases.
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Old 12-06-2017, 10:03 AM
 
2,359 posts, read 1,026,935 times
Reputation: 2011
Quote:
Originally Posted by It'sAutomatic View Post

The narrative from conservatives is that if people have more money in their pocket prices will go up. Why isn't this true for tax cuts? Or else it's just another lie from the right.
Fatal error in reasoning detected in post quoted above.

It's not whether people have extra money to spend or not. It's whether the newfound money had to be incorporated into the employer's cost of goods or services sold.

Minimum wage increase = direct increase in cost of goods or services sold. Can be inflationary.

Tax cut = no increase in cost of goods or services sold. Worker merely keeps more of the money he/she earned in the first place. Effect on inflation: Zero.

And there's your difference.

Last edited by Milton Miteybad; 12-06-2017 at 11:08 AM..
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Old 12-06-2017, 10:11 AM
 
Location: NE Mississippi
25,385 posts, read 17,055,761 times
Reputation: 37037
Quote:
Originally Posted by EddieB.Good View Post
We kept hearing from you guys that one off the reasons we couldn't give min wage hikes is because it would cause inflation.............
You never heard that from anyone who was informed.
Min wage hikes will cause a decrease in the number of jobs. Current events bear that out...
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Old 12-06-2017, 10:32 AM
 
9,837 posts, read 4,605,007 times
Reputation: 7292
Quote:
Originally Posted by thecoalman View Post
This may be about one of the most senseless posts I have read in a long time. LOL

Tax cuts do not raise the costs of goods like raising the minimum wage would. If anything it lowers them and you the consumer have more money in your pocket to buy those goods.

If you need any further explanation beyond that I can't be of any help.
you are confused. tax cutting does not have a deflationary effect. In fact it is hard to understand why you would even think it would.
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Old 12-06-2017, 10:41 AM
 
13,711 posts, read 9,187,048 times
Reputation: 9840
Quote:
Originally Posted by thecoalman View Post
This may be about one of the most senseless posts I have read in a long time. LOL

Tax cuts do not raise the costs of goods like raising the minimum wage would. If anything it lowers them and you the consumer have more money in your pocket to buy those goods.

If you need any further explanation beyond that I can't be of any help.

I think an explanation is warranted because what you wrote is completely opposite of what economics is supposed to do.

.
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Old 12-06-2017, 11:05 AM
 
Location: Palo Alto
12,149 posts, read 8,386,924 times
Reputation: 4190
When Eddie realizes that Uncle Sam is not a business he’s going to feel soooo stupid.
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Old 12-06-2017, 11:25 AM
 
Location: Hiding from Antifa!
7,783 posts, read 6,051,852 times
Reputation: 7099
This thread is going to delineate who has a good knowledge of economics versus those who think they have a good knowledge of economics.

Min wage hikes cause the cost of manufacturing or providing a service to go up. If the business maintains the same level of profit, they have to raise prices. (Inflation)

Tax cuts to businesses reduce the cost of manufacturing or providing a service. (It would be the same as reducing employee wages, which is opposite of increasing the minimum wage.) If the business wants to maintain the same profit level, they can lower the price of their product. Or they can reinvest it into the company to create more product (and jobs, meaning more people paying taxes!). Sometimes the lower prices create more demand which can cause the price to rise, but usually not to the same level before the price was reduced, because then fewer people would buy them.

The businesses can always keep their prices the same, thereby increasing their profits, and then they would be paying more in taxes. (revenue for the government increases.)

The reduction in personal taxes, gives people more discretionary money to spend on things they could not previously afford, thereby creating a bigger market for those additional products manufactured as outlined above. From there it snowballs, each part feeding the other, which never happens with a minimum wage hike, because fewer jobs are created, some are eliminated, and the result is stagnant or reduced revenues to the government.

From an accounting perspective, RED is bad, and BLACK is good. I also wanted the dimwits to be attracted to the colors so they might read and learn for a change.
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Old 12-06-2017, 11:28 AM
 
2,615 posts, read 1,337,905 times
Reputation: 2739
Quote:
Originally Posted by Toyman at Jewel Lake View Post
The left really does not have a grasp of economics or even math, do they?

You obviously don't realize that wages are paid by businesses, and that wages are a part of every product or service that they offer. And businesses (unlike government) can not (long term anyway) spend more than they bring in. An increase in their costs (wages) drives an increase in prices.

A cut in personal income taxes has no impact on the business that pays that wage. The wage and the business cost are unchanged.

There MIGHT be an increase in prices due to inflation, driven by extra cash in the hands of consumers driving demand. But that, in turn, may be more than offset by the reduced taxes those businesses pay.

Some days all I can do is shake my head and wonder just what we as taxpayers are getting for all that money we spend on education children...
A bit condescending, are we?
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Old 12-06-2017, 11:34 AM
 
Location: Hiding from Antifa!
7,783 posts, read 6,051,852 times
Reputation: 7099
Quote:
Originally Posted by robertbrianbush View Post
A bit condescending, are we?
Sometimes a two-by-four to the head might work better.
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Old 12-06-2017, 11:36 AM
 
Location: Santa Monica
36,857 posts, read 17,256,184 times
Reputation: 14459
Quote:
Originally Posted by EddieB.Good View Post
We kept hearing from you guys that one off the reasons we couldn't give min wage hikes is because it would cause inflation... All that extra money you gave the poor wouldn't matter because goods would increase in price to offset the raises...

So what happened? Help us understand Conservative economics where extra money in the hands of a lot of workers causes inflation when it comes from wage increases, but not when it comes from tax cuts...
Theft rings, regardless of which team supports it, are usually complicated.
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