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Who's going to staff the grocery stores, gas stations, restaurants, landscaping companies, etc if all the people who work those jobs have to move to a different area?
As some people move, that creates a relative scarcity of labor who work in those grocery stores, gas stations, restaurants, landscaping companies, etc. With the relative scarcity, the employers discover that they must offer a higher wage to attract applicants. The people who do not move discover they can have those jobs at the new higher equilibrium wage rate.
Oh... by the way... it is a mistake to assume restaurant workers are minimum wage. Here in Las Vegas, you'll find chefs in high end restaurants who make $120,000 to $180,000 per year. Waiters in those restaurants are similarly highly compensated. Heck, even the parking valets make $80,000 per year in cash tips.
MW earners spend more than people who make higher wages.
Incorrect. Higher wage earners spend more $$$ than MW earners. MW earners may spend a higher percentage (even 100% or more via credit or dissavings), but in absolute dollars, higher wage earners spend more.
Minimum wage law is to insure that you are not underpaid.
Most decidedly untrue.
The purpose of the Minimum Wage Law is twofold:
To provide politicians with a reliable campaign contribution stream from labor groups
To increase demand for unionized skilled labor relative to non-union unskilled labor because of the substitution effect (just as an increase in the price of hamburger causes an increase in demand for steak).
I suspect that the store down the road doubling wages paid to workets would neither have much effect on the labour market nor the purchasing power of it's customers. You're applying macro economic concepts to a micro economic theoretical.
No, I was pointing out the sheer ridiculousness of someone else's suggestion that completely rejects how the economy works.
I wasn't suggesting one store would do it in a vacuum. If that was the way things worked then companies would collude to pay their workers more......that sounds ridiculous even suggesting it by the way, but again it wasn't my idea.
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Originally Posted by theonewhois3
It takes purchasing power increases on the scale of millions of workers to affect demand, this isn't something single firms can affect.
Thanks for the pro tip but I passed econ 101 several years ago.
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Originally Posted by theonewhois3
Not to pick on you, but what does this add to your argument?
I doesn't...but I am not sure how pointing that out adds to yours? Not to pick on you.
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Originally Posted by theonewhois3
How is this relevant to the current merits of an increased minimum wage? You haven't explained what the connections between racist state law and hiring practices of the 1920's and the negative outcomes of a $15 minimum wage you've said will happen are.
That was just a little history lesson. Wasn't meant to prove anything.
I don't have to prove anything because this right here
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Minimum wage, like most beloved liberal ideas, has the exact opposite result than its stated intention. It hurts the poorest people the most. People get fired, have their hours cut and the ones that do see the raise get to pay more for...well everything...
is a fact.
The problem we have isn't the result of a minimum wage that is to low. Its the result of political corruption where our so called representatives no longer look after our best interest and instead look after the interest of the hand that feeds them, large corporations. They have steadily dropped barriers to exporting our jobs and now that they have saturated that trade they have now moved to importing more and more immigrant workers, flagrantly violating laws that are supposed to protect American workers from getting displaced by cheap imported labor. Now they will begin another phase with this $15 hr nonsense, they are going to replace anyone they can with robots and self service kiosks. They will leverage this to cut more workers and hours.
The regulatory agencies have been turned into toothless jokes. The only reason people work for them is so they can get the high paying job (payoff for looking the other way) working for the very people they were supposed to be policing. This is rampant in Banks/Wall St and the SEC. Big AG, Big Pharm and the FDA.
Minimum wage hikes aren't going to solve any of that. Its just going to lead to more H1-B visas, more robots, and layoffs. Its just another pointless disagreement that accomplishes nothing but distraction from the real issues.
Ah, but Prop 13 was based on the premise that homeowners were STILL getting priced out by newcomers who caused their assessments to necessarily skyrocket. Rent control is protectionism for renters just like Prop 13 is protectionism for homeowners.
I was in CA for Pop 13. It's a hideous law. You want to compound that mistake? Such shenanigans should have been made unconstitutional.
Do you feel sorry for someone people whose RE skyrockets in value so much that their meager salary has trouble paying the property tax bill? They just won the lotto, and they are crying for extra concessions!
Minimum wage hikes aren't going to solve any of that. Its just going to lead to more H1-B visas, more robots, and layoffs. Its just another pointless disagreement that accomplishes nothing but distraction from the real issues.
I agree that the other problems you mentioned are bigger, but you are wrong about the MW. There is a reason why every developed country does it, and they have a smaller difference between the minimum and median than we do.
I wasn't suggesting one store would do it in a vacuum. If that was the way things worked then companies would collude to pay their workers more......that sounds ridiculous even suggesting it by the way, but again it wasn't my idea.
That wasn't his idea either. Individual companies want to pay as little as they can, else they will be put at a competitive disadvantage. But if wages are increased by law there is no disadvantage.
On an aggregate basis companies can raise prices to cover their cost increase, and there would be no change in sales.
McDonald's makes uncountable billions of dollars a year. Do they HAVE to pass on all the costs of paying their workers a living wage? Really. Do they? I hear you, they probably will. But that's on them and also on people like you because it has not occurred to any of you that it is WRONG to do so..
Public sector pension funds are invested in companies like McDonald's, and retired public sector employees depend on their monthly pension checks which are funded by investments in companies like McDonald's.
If McDonald's voluntarily makes less profit, are you going to tell those public sector pensioners that they should accept a lower pension payout?
Moreover, your assertion that is wrong for McDonald's to maximize profits is horribly misguided. It is through profit maximization that our economy is driven towards and efficient allocation of capital. It is immoral to accept anything less.
Higher wage earners spend more $$$ than MW earners. MW earners may spend a higher percentage (even 100% or more via credit or dissavings), but in absolute dollars, higher wage earners spend more.
In this context, which do you think is relevant? Shifting money to lower income workers will increase demand.
Ah, but Prop 13 was based on the premise that homeowners were STILL getting priced out by newcomers who caused their assessments to necessarily skyrocket.
Rent control is protectionism for renters just like Prop 13 is protectionism for homeowners.
No mention of Prop 13 limit of new assessments unless the voters approve?
This is just as much a cornerstone of Prop 13 as anything else... voter approval.
Last edited by Ultrarunner; 04-17-2016 at 12:13 AM..
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