| Groundking said: No, a minimum wage just causes unemployment for the worse of in society, how is somebody with no skills or experience (particularly in America, the black youths) who's labor is worth (for example) $4.00 an hour or less, supposed to get work when the enforced minimum hourly rate is $7.50, and we have a prat who wants to raise this even higher? Does he not want youth to work at all? Also for people bitching about the income inequality, well try living in your means, saving 5-10% of your post tax yearly income, and invest this money in assets that either grow your income or grow your wealth (or both). It's no coincidence that since the 80's, when family savings dropped from an average of ~5% (it depends which state and which country, but this is a fairly accurate average for the western developed countries) to and average of effectively 0%, income inequality has boomed. |
Spoken like somebody who's never known what it's like to be poor. "Just save 5-10%". Assume someone makes $8/hr. Working full time that's roughly $17k per year. Take away 10% for taxes and you're left with $15,300/year.
Now let's say rent in Anytown, USA is $600/month. Good luck getting any place that isn't infested with cockroaches for $600/mo. That's $7,200/yr. You now have $8,100 left.
Now factor in food, utilities, bus pass/car maintainance, laundromat visits, incidentals, doctor bills, AND a health insurance penalty because minimum wage workers far and wide do not receive benefits like healthcare in the US, and I submit to you that you would not have "5-10%" left to save. Not only that, but you can bet with a reasonable degree of accuracy that if you're making minimum wage, you've attained a minimum level of education. You probably grew up poor in a poor neighborhood with lots of crime and went to a poor school with not-so-great teachers and are around other poor people who have no idea what investing even is much less how to do it. Poor people in this country (US) are not afforded the same opportunities through education as their middle and upper class peers.
I've made roughly one post a year on this site for the last 5 or so years. It usually takes something so incredibly ignorant like this to make me actually want to post, but you did it. Good job.
| Geralt said: Hi I am an Economics Major going to get my Master's degree. A high minimum wage can increase the prices of goods but not due to inflation. Inflation only occurs when the money supply increases greater than Real GDP growth. A higher minimum wage forces firms to higher less workers and sell less product (due to having less workers). Society is at a loss overall with a high minimum wage. The best way to increase prices is to increase the output of each worker or increase the amount of jobs available to choose from. |
You had me at "higher less workers".
But seriously, as somebody who actually has his Masters Degree in Business, I can say that this is an incredibly simple and short-sided view. First, minimum wage does not "force" any business to "sell less product". You can make the argument fewer people will be employed, but those who are working will have more money, presumably to either save or spend. In our consumer economy here in the US in 2016, it will most likely be spent.
"Increase output of each worker". Wut. The US has the highest productivity of any workforce IN THE WORLD. In theory, what you're saying is correct. In reality, where the rest of us live, this s*** don't fly. If it were that simple, we'd all be economists.
That all begin said, a $15/hr minimum wage is a terrible idea. Not because I think it'll sink our economy, but because in my opinion, low-skill jobs deserve low-skill wages, and people need to be incentivized to make something of themselves in a capitalist society or they'll just become a drain. I planned to make this post more detailed, but unfortunately I have work. I might add on to this later.
Currently playing: Civ 6
