What would happen to the economy if minimum wages are raised?

[danielpalos]

Small business and corporations have seen their wealth increase $13 trillion in the last eight years

Almost none of that wealth went to increase wages

Employee compensation is up from $7.787 trillion in 2009 to $9.693 trillion last year.

Wages and salaries are up from $6.251 trillion to $7.855 trillion over the same period.

http://www.bea.gov/itable/iTable.cf...=1&904=2000&903=58&906=a&905=2016&910=x&911=0

Employee compensation to whom?

From 2009-14, CEO compensation rose 54.3%, while private-sector production/non-supervisory workers rose 0.0%.

Top CEOs Make 300 Times More than Typical Workers: Pay Growth Surpasses Stock Gains and Wage Growth of Top 0.1 Percent

Employee compensation to whom?

Employees.

http://www.bea.gov/itable/iTable.cf...=1&904=2000&903=58&906=a&905=2016&910=x&911=0

Which employees? From 2009-14, CEO compensation rose 54.3%, while private-sector production/non-supervisory workers rose 0.0%.

 

[Skull Pilot]

and since 97% of workers already make more than the federal MW it seems silly to raise it drastically

It seems silly to raise it at all.

Scrap that, it seems silly for the corporate government to play wage control at all.

I agree. It doesn't matter what the MW is IMO because employment is a ladder not a bed you're not supposed to stay at the bottom rung your entire life

yes, it matters. the cost of social services is about fourteen dollars an hour. a fifteen dollar an hour minimum wage competes favorably with the cost of social services. it is about privatizing costs and not socializing costs; only the right wing, never gets it.

Social services have nothing to do with the market value for the labor required to do a specific job.

 

[danielpalos]

With the exception of degree professionals/certificate/licensed, every job is low tech. Greed is why workers make crap today.

Skilled labor like plumbers welders and electricians are arguably more technical than a barista which is where most people with worthless degrees end up

But Baristas make more revenue for their employer. Besides, any corn hole can do all three jobs......Even you!

Really? You can wire and plumb a house to code?

I know I can because I wired and plumbed my own house you on the other hand I don't think you can

With a minimal amount of instruction, anyone can do what you did.

Then why is there a shortage of skilled labor? If it's soooo easy why bother to get a worthless BS in Psych and work as a counter schlep at Starbucks?

There is no shortage; only underpayment. Do the laws of demand and supply mean nothing, to the fantastical, right wing.

 

[danielpalos]

More people would spend more money, causing stores and restaurants to hire more people...

More tax money would go into local, state, and federal programs, so schools and infrastructure would improve.

Wow, I'm constantly amazed at the people here who have absolutely no clue how an economy functions! You want a large increase in the minimum wage? OK, fine...raise the minimum wage to $15 an hour and lets step back and take a common sense look at what would happen. First of all a raise that large at the bottom of the wage scale would have to cause a corresponding increase in the wages of throughout the wage scale. Does anyone here think that someone with years of experience and far more job skills then an entry level worker is going to be content getting paid the same as someone who just started? Obviously not...correct? So you have to raise everyone's wage. Since labor costs are generally the largest expense of any company...it's common sense that prices will have to be raised to pay for these across the board pay raises...correct? So the cost of everything you purchase...all the services you need...would have to increase...correct?

So if I came to you and said...Hey, I'm going to give you a ten dollar an hour wage...but I'm going to increase your rent...increase the cost of your lunch...increase the cost of that plumber you call to fix your leaky pipe...increase the cost of your internet service provider...increase the cost of EVERYTHING you purchase...would you still be thrilled with your wage "increase"? Come on people...THINK!

Increasing the cost of labor will lead to capital seeking gains from efficiency.

Henry Ford did not have a problem doubling autoworker wages, not minimum wages.

Inflation happens, only the right wing complains when it actually is due to the least wealthy having more money to spend.

 

[Skull Pilot]

Skilled labor like plumbers welders and electricians are arguably more technical than a barista which is where most people with worthless degrees end up

But Baristas make more revenue for their employer. Besides, any corn hole can do all three jobs......Even you!

Really? You can wire and plumb a house to code?

I know I can because I wired and plumbed my own house you on the other hand I don't think you can

With a minimal amount of instruction, anyone can do what you did.

Then why is there a shortage of skilled labor? If it's soooo easy why bother to get a worthless BS in Psych and work as a counter schlep at Starbucks?

There is no shortage; only underpayment. Do the laws of demand and supply mean nothing, to the fantastical, right wing.

There is most definitely a shortage of skilled labor in this country
.
Survey shows growing US shortage of skilled labor

 

[danielpalos]

More people would spend more money, causing stores and restaurants to hire more people...

More tax money would go into local, state, and federal programs, so schools and infrastructure would improve.

Wow, I'm constantly amazed at the people here who have absolutely no clue how an economy functions! You want a large increase in the minimum wage? OK, fine...raise the minimum wage to $15 an hour and lets step back and take a common sense look at what would happen. First of all a raise that large at the bottom of the wage scale would have to cause a corresponding increase in the wages of throughout the wage scale. Not at all. Increase, yes. Proportional, no. Does anyone here think that someone with years of experience and far more job skills then an entry level worker is going to be content getting paid the same as someone who just started? Uh, no one suggested that. Are you having delusions? Obviously not...correct? So you have to raise everyone's wage. Since labor costs are generally the largest expense of any company...it's common sense that prices will have to be raised to pay for these across the board pay raises...correct? So the cost of everything you purchase...all the services you need...would have to increase...correct? No, not actually. You may want at some point to look at the history of minimum wage increases, and notice that what you suggest "must happen" did not happen. Labor costs are a different percent of the cost of operations based on the type of market the company is in, and other variables. Assuming that labor costs are always the highest costs indicate that you believe all companies are similar to restaurants. They are not.

So if I came to you and said...Hey, I'm going to give you a ten dollar an hour wage...but I'm going to increase your rent...increase the cost of your lunch...increase the cost of that plumber you call to fix your leaky pipe...increase the cost of your internet service provider...increase the cost of EVERYTHING you purchase...would you still be thrilled with your wage "increase"? Come on people...THINK!
Uh, perhaps you are the one that needs to think. You are simply pushing well established and totally unproven conservative talking points. Which does not require you to think anything through. And in fact discourages the exercise of thinking.
No, I would simply think you are a far right wing nut case pushing right wing talking points, and have no understanding of economic history. But we will all find out. $15 is a big number, but you obviously ignored the fact that it is implemented over time. Not all at once, as you suggest. And, of course, you ignore the simple fact that raises in minimum wage are always opposed by the far right with the same rhetoric from the same right wing talking points, and in every case are proven to be wrong.
What is constant ant true is that the corporatists and their right wing supporters always say the same exact thing and have always been proven wrong.

Really, trying to find the truth about this is very simple if you are interested. A basic look at the subject could start, if you actually cared, with the dol site and their refuting of the untrue conservative talking points and untrue claims that the right uses. Here. Assuming you are interested at all.

"Minimum Wage Mythbusters
Myth: Raising the minimum wage will only benefit teens.

Not true: The typical minimum wage worker is not a high school student earning weekend pocket money. In fact, 89 percent of those who would benefit from a federal minimum wage increase to $12 per hour are age 20 or older, and 56 percent are women.

Myth: Increasing the minimum wage will cause people to lose their jobs.

Not true: In a letter to President Obama and congressional leaders urging a minimum wage increase, more than 600 economists, including 7 Nobel Prize winners wrote, "In recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market. Research suggests that a minimum-wage increase could have a small stimulative effect on the economy as low-wage workers spend their additional earnings, raising demand and job growth, and providing some help on the jobs front."

Myth: Small business owners can't afford to pay their workers more, and therefore don't support an increase in the minimum wage.

Not true: A July 2015 survey found that 3 out of 5 small business owners with employees support a gradual increase in the minimum wage to $12. The survey reports that small business owners say an increase "would immediately put more money in the pocket of low-wage workers who will then spend the money on things like housing, food, and gas. This boost in demand for goods and services will help stimulate the economy and help create opportunities."

Myth: Raising the federal tipped minimum wage ($2.13 per hour since 1991) would hurt restaurants.

Not true: In California, employers are required to pay servers the full minimum wage of $9 per hour — before tips. Even with a 2014 increase in the minimum wage, the National Restaurant Association projects California restaurant sales will outpace all but only a handful of states in 2015.

Myth: Raising the federal tipped minimum wage ($2.13 per hour since 1991) would lead to restaurant job losses.

Not true: As of May 2015, employers in San Francisco must pay tipped workers the full minimum wage of $12.25 per hour — before tips. Yet, the San Francisco leisure and hospitality industry, which includes full-service restaurants, has experienced positive job growth this year, including following the most recent minimum wage increase.

Myth: Raising the federal minimum wage won't benefit workers in states where the hourly minimum rate is already higher than the federal minimum.

Not true: While 29 states and the District of Columbia currently have a minimum wage higher than the federal minimum, increasing the federal minimum wage will boost the earnings for nearly 38 million low-wage workers nationwide. That includes workers in those states already earning above the current federal minimum. Raising the federal minimum wage is an important part of strengthening the economy. A raise for minimum wage earners will put more money in more families' pockets, which will be spent on goods and services, stimulating economic growth locally and nationally.

Myth: Younger workers don't have to be paid the minimum wage.

Not true: While there are some exceptions, employers are generally required to pay at least the federal minimum wage. Exceptions allowed include a minimum wage of $4.25 per hour for young workers under the age of 20, but only during their first 90 consecutive calendar days of employment with an employer, and as long as their work does not displace other workers. After 90 consecutive days of employment or the employee reaches 20 years of age, whichever comes first, the employee must receive the current federal minimum wage or the state minimum wage, whichever is higher. There are programs requiring federal certification that allow for payment of less than the full federal minimum wage, but those programs are not limited to the employment of young workers.

Myth: Restaurant servers don't need to be paid the minimum wage since they receive tips.

Not true: An employer can pay a tipped employee as little as $2.13 per hour in direct wages, but only if that amount plus tips equal at least the federal minimum wage and the worker retains all tips and customarily and regularly receives more than $30 a month in tips. Often, an employee's tips combined with the employer's direct wages of at least $2.13 an hour do not equal the federal minimum hourly wage. When that occurs, the employer must make up the difference. Some states have minimum wage laws specific to tipped employees. When an employee is subject to both the federal and state wage laws, he or she is entitled to the provisions of each law which provides the greater benefits.

Myth: Increasing the minimum wage is bad for businesses.

Not true: Academic research has shown that higher wages sharply reduce employee turnover which can reduce employment and training costs.

Myth: Increasing the minimum wage is bad for the economy.

Not true: Since 1938, the federal minimum wage has been increased 22 times. For more than 75 years, real GDP per capita has steadily increased, even when the minimum wage has been raised.

Myth: The federal minimum wage goes up automatically as prices increase.

Not true: While some states have enacted rules in recent years triggering automatic increases in their minimum wages to help them keep up with inflation, the federal minimum wage does not operate in the same manner. An increase in the federal minimum wage requires approval by Congress and the president. However, in his call to gradually increase the current federal minimum, President Obama has also called for it to adjust automatically with inflation. Eliminating the requirement of formal congressional action would likely reduce the amount of time between increases, and better help low-income families keep up with rising prices.

Myth: The federal minimum wage is higher today than it was when President Reagan took office.

Not true: While the federal minimum wage was only $3.35 per hour in 1981 and is currently $7.25 per hour in real dollars, when adjusted for inflation, the current federal minimum wage would need to be more than $8 per hour to equal its buying power of the early 1980s and more nearly $11 per hour to equal its buying power of the late 1960s. That's why President Obama is urging Congress to increase the federal minimum wage and give low-wage workers a much-needed boost.

Myth: Increasing the minimum wage lacks public support.

Not true: Raising the federal minimum wage is an issue with broad popular support. Polls conducted since February 2013 when President Obama first called on Congress to increase the minimum wage have consistently shown that an overwhelming majority of Americans support an increase.

Myth: Increasing the minimum wage will result in job losses for newly hired and unskilled workers in what some call a “last-one-hired-equals-first-one-fired” scenario.

Not true: Minimum wage increases have little to no negative effect on employment as shown in independent studies from economists across the country. Academic research also has shown that higher wages sharply reduce employee turnover which can reduce employment and training costs.

Myth: The minimum wage stays the same if Congress doesn't change it.

Not true: Congress sets the minimum wage, but it doesn't keep pace with inflation. Because the cost of living is always rising, the value of a new minimum wage begins to fall from the moment it is set."
Minimum Wage Mythbusters

So you believe that those making a wage above minimum wage will be content with a small raise and not one that is proportional to the raise that an entry level worker makes...even though businesses will of course have to raise the price of their goods and services to make up for the increase in labor costs? Do you not grasp that means that the buying power of those above minimum wage will actually decline? You think they'll be "fine" with that though because it will let entry level people make more?

no, i don't. wages need to outpace inflation, that is all.

 

[danielpalos]

Funny how you Progressives are always talking about how you're "here" for the Middle Class...yet all of your policies to help the poor end up with the Middle Class footing the bill.

I am trying to get it from the one percent.

 

[danielpalos]

Raising the.min wage HISTORICALLY damages the.middle.class, by devaluing their work, and.making it almost impossible to start a business.

no, it doesn't. that is just, right wing propaganda.

 

[danielpalos]

Raising the.min wage HISTORICALLY damages the.middle.class, by devaluing their work, and.making it almost impossible to start a business.

Can you explain. Can you provide you provide proof? I think you are simply pushing dogma, with no truth at all.

Minimum wage more pure libsocialist ignorance:

1) makes it illegal to employ people not worth minimum wage
2) raise prices for poor people who often shop where minimum wage folks work
3) speeds up automation and replacement of minimum wage jobs
4) teaches people that you get ahead with govt violence rather than being worth more
5) raises prices, reduces demand, and thus reduces employment
6) makes American workers even less competitive with foreign workers



One of the simplest and most fundamental economic principles is that people tend to buy more when the price is lower and less when the price is higher. Yet advocates of minimum wage laws seem to think that the government can raise the price of labor without reducing the amount of labor that will be hired.

Thomas Sowell, "Minimum Wage Madness," September 17, 2013

Only the right wing has nothing but repeal instead of better solutions at lower cost.

We should be solving simple poverty on an at-will basis in our at-will employment States, via unemployment compensation.

 

[danielpalos]

There's a rather simple answer to this.

Person A makes $9.50 an hour. Person B makes $14 an hour. Person C makes $25 an hour.

Person A Gross Pay = $380
Person B Gross Pay = $560
Person C Gross Pay = $1000.

Person A will get a $4.50/hour raise, persons B&C will get a $0.00/hour raise while prices double. So more people will be making minimum wage than ever. Nearly 50% of the population actually. I barely know anyone who makes more than $14 an hour...

What prices will double? Only the fantastical right wing prefers fantasy to facts.

 

[danielpalos]

There's a rather simple answer to this.

Person A makes $9.50 an hour. Person B makes $14 an hour. Person C makes $25 an hour.

Person A Gross Pay = $380
Person B Gross Pay = $560
Person C Gross Pay = $1000.

Person A will get a $4.50/hour raise, persons B&C will get a $0.00/hour raise while prices double. So more people will be making minimum wage than ever. Nearly 50% of the population actually. I barely know anyone who makes more than $14 an hour...

yes prices will go up by the exact amount of the wage increase and no net benefit will be possible. Everybody earning the minimum wage will kill incentive to improve your skills.


Minimum wage more pure libsocialist ignorance:
1) makes it illegal to employ people not worth minimum wage
2) raise prices for poor people who often shop where minimum wage folks work
3) speeds up automation and replacement of minimum wage jobs
4) teaches people that you get ahead with govt violence rather than being worth more
5) raises prices, reduces demand, and thus reduces employment
6) makes American workers even less competitive with foreign workers
7) makes a huge % of work force minimum age workers with no incentive to improve their skills.

No, they won't. The right wing just has stale propaganda and rhetoric, that is easily disproved, every time it comes up.

 

[danielpalos]

and since 97% of workers already make more than the federal MW it seems silly to raise it drastically

It seems silly to raise it at all.

Scrap that, it seems silly for the corporate government to play wage control at all.

I agree. It doesn't matter what the MW is IMO because employment is a ladder not a bed you're not supposed to stay at the bottom rung your entire life

yes, it matters. the cost of social services is about fourteen dollars an hour. a fifteen dollar an hour minimum wage competes favorably with the cost of social services. it is about privatizing costs and not socializing costs; only the right wing, never gets it.

Social services have nothing to do with the market value for the labor required to do a specific job.

it has to do with a profit motive. the rich simply get richer faster by making the poor work harder for less.

 

[Toddsterpatriot]

More people would spend more money, causing stores and restaurants to hire more people...

More tax money would go into local, state, and federal programs, so schools and infrastructure would improve.

More people would spend more money, causing stores and restaurants to hire more people...

Fewer stores and restaurants would open.
Stores and restaurants would hire fewer people. People and businesses would have less money to spend.
More tax money would go to welfare and unemployment.

why would fewer stores open or demand decrease, with an increase in spending due to a minimum wage increase?

do the laws of demand and supply stop working, whenever the right gets involved?

why would fewer stores open or demand decrease

If you increase the expenses related to open a store, fewer stores will open.
Raise the expenses of current stores and they will raise prices which will decrease demand for their products.

do the laws of demand and supply stop working, whenever the right gets involved?

No, but the left fails to understand those laws of supply and demand.

 

[Toddsterpatriot]

Simple.

No independent restaurant startup would ever be able to compete. The rate of failure for restaurant startups is already 9 out of 10.

special pleading much? that applies to all startups, not just the restaurant sector.

If, a person can Only make it on the back of cheap labor, do they really have a worthwhile product?

If, a person can Only make it on the back of cheap labor, do they really have a worthwhile product?

If Daniel isn't satisfied with the wages offered, let's shut down that business and give their employees $0?
Very smart, comrade.

 

[Toddsterpatriot]

Jobs would be cut, investment diminished.

It's the value of the work that determines the pay.

Employees make all of the monies for employers. If you cut employees you make less money.

Employees make all of the monies for employers.

All of it? What about the equipment?

If you cut employees you make less money.

If the minimum wage is more than the employee is producing, you would actually save money by cutting employees.

Or, improving efficiency like Henry Ford, and be able to double wages, as a result.

Or, improving efficiency like Henry Ford,

Firms that improve efficiency don't need a government mandate to raise wages.

 

[danielpalos]

More people would spend more money, causing stores and restaurants to hire more people...

More tax money would go into local, state, and federal programs, so schools and infrastructure would improve.

More people would spend more money, causing stores and restaurants to hire more people...

Fewer stores and restaurants would open.
Stores and restaurants would hire fewer people. People and businesses would have less money to spend.
More tax money would go to welfare and unemployment.

why would fewer stores open or demand decrease, with an increase in spending due to a minimum wage increase?

do the laws of demand and supply stop working, whenever the right gets involved?

why would fewer stores open or demand decrease

If you increase the expenses related to open a store, fewer stores will open.
Raise the expenses of current stores and they will raise prices which will decrease demand for their products.

do the laws of demand and supply stop working, whenever the right gets involved?

No, but the left fails to understand those laws of supply and demand.

9 out of 10 startups fail anyway. under capitalization is one major reason.

if all you have to make money is cheap labor, how good of a Capitalist can you be.

 

[danielpalos]

Simple.

No independent restaurant startup would ever be able to compete. The rate of failure for restaurant startups is already 9 out of 10.

special pleading much? that applies to all startups, not just the restaurant sector.

If, a person can Only make it on the back of cheap labor, do they really have a worthwhile product?

If, a person can Only make it on the back of cheap labor, do they really have a worthwhile product?

If Daniel isn't satisfied with the wages offered, let's shut down that business and give their employees $0?
Very smart, comrade.

nothing but red herrings to look tough? diversion is usually considered a fallacy.

 

[danielpalos]

Jobs would be cut, investment diminished.

It's the value of the work that determines the pay.

Employees make all of the monies for employers. If you cut employees you make less money.

Employees make all of the monies for employers.

All of it? What about the equipment?

If you cut employees you make less money.

If the minimum wage is more than the employee is producing, you would actually save money by cutting employees.

Or, improving efficiency like Henry Ford, and be able to double wages, as a result.

Or, improving efficiency like Henry Ford,

Firms that improve efficiency don't need a government mandate to raise wages.

maybe not, but social services cost around fourteen dollars an hour, by comparison.

 

[Toddsterpatriot]

Small business and corporations have seen their wealth increase $13 trillion in the last eight years

Almost none of that wealth went to increase wages

Employee compensation is up from $7.787 trillion in 2009 to $9.693 trillion last year.

Wages and salaries are up from $6.251 trillion to $7.855 trillion over the same period.

http://www.bea.gov/itable/iTable.cf...=1&904=2000&903=58&906=a&905=2016&910=x&911=0

Employee compensation to whom?

From 2009-14, CEO compensation rose 54.3%, while private-sector production/non-supervisory workers rose 0.0%.

Top CEOs Make 300 Times More than Typical Workers: Pay Growth Surpasses Stock Gains and Wage Growth of Top 0.1 Percent

Employee compensation to whom?

Employees.

http://www.bea.gov/itable/iTable.cf...=1&904=2000&903=58&906=a&905=2016&910=x&911=0

Which employees? From 2009-14, CEO compensation rose 54.3%, while private-sector production/non-supervisory workers rose 0.0%.

http://www.bea.gov/itable/iTable.cf...=1&904=2009&903=58&906=a&905=2016&910=x&911=0

Go to personal income and outlays. Table 2.1
From 2009-2014, employee compensation rose from $7.787 trillion to $9.693 trillion.

 

[Toddsterpatriot]

More people would spend more money, causing stores and restaurants to hire more people...

More tax money would go into local, state, and federal programs, so schools and infrastructure would improve.

More people would spend more money, causing stores and restaurants to hire more people...

Fewer stores and restaurants would open.
Stores and restaurants would hire fewer people. People and businesses would have less money to spend.
More tax money would go to welfare and unemployment.

why would fewer stores open or demand decrease, with an increase in spending due to a minimum wage increase?

do the laws of demand and supply stop working, whenever the right gets involved?

why would fewer stores open or demand decrease

If you increase the expenses related to open a store, fewer stores will open.
Raise the expenses of current stores and they will raise prices which will decrease demand for their products.

do the laws of demand and supply stop working, whenever the right gets involved?

No, but the left fails to understand those laws of supply and demand.

9 out of 10 startups fail anyway. under capitalization is one major reason.

if all you have to make money is cheap labor, how good of a Capitalist can you be.

9 out of 10 startups fail anyway. under capitalization is one major reason.

Raise expenses, that'll help with capitalization.

if all you have to make money is cheap labor, how good of a Capitalist can you be.

I agree, lets outlaw all jobs under $10 an hour. That'll help the low skilled workers employed by bad capitalists.