Cecilie1200
Diamond Member
The response that a raise in minimum wage would lead to the exact same purchasing power shows an ignorance in economics. Such an analysis assumes that 100% of the cost of running a business is related to wages, but that is not true.
Say wages are 50% of running a business. The minimum wage is raised from $8 to $10 per gour. About 60% of those workers make minium wage, but their earnings constitute only 40% of the companies total wages. This represents a 25% increase in wages for the unskilled employees. However the cost of doing business increases only as follows:
(60% + (40% x 1.25)50% + 50% = 1.05 or a increase of 5% of production costs. Assuming that these costs are passed directly to the consumer, then the cost of goods increases 5%, but the earning power of the unskilled worker increases 20%. The net purchasing power increases 20% for those unskilled workers. The purchasing power of other workers goes down 5%.
Admittedly a simplistic model, but I hope you get the idea.
You see it as the opposite. However what you see does not apply to business in real world terms.
The way to get out of min wage is to improve one's skill set, educate one's self and perform tasks in an exemplary fashion.
Wages are not a gift. Employment is not en entitlement.
I was merely addressing your statement that raising the minimum wage would not increase the purchasing power of those who make minimum wage. Your resonse did not address such so my guess it the mathematics is beyond you even though it is of middle school level. That's OK.
As far as your most recent assertions, I agree that the best way to get out of minimum wage is to improve one's skill set. Of course wages are not a gift. The minimum wage earners I observe work hard for their money, so one could not categorize such as a gift. If you want an example of wages as a gift, just review the compensation of CEOs and other highly placed executives at firms that lost money.
Spoken like someone who's never been more than a corporate janitor in his whole life. "Ahh, those suits, all they ever do for their money is go out for three-martini lunches!" Do you even know what a CEO does, chucklehead?