it's actually the law. laborers get the first dibs to assets of a company ahead of creditors who in turn are ahead of investors. if you don't like capitalism move to saudi arabia where they treat laborers like you want - slaves
This is what happened in 2008 the economy on every level ExxonMobilmaking too much money at the top Oil rig workers making$100k a year Oil traders driving up the price of oil on what we now know to be ridicously under estimation of oil reserves Most importantly in terms of wages, non competitive workers in terms of production Europeans don't make more cause of unions but cause of production In manufacturing facilities I've worked in all the mechanics are foreigners
Well, without the shareholders many laborers wouldn't have jobs to begin with. This is an interesting topic, though. I think it would be great to raise the minimum wage to $15 an hour but what will happen to the skilled laborers who are making $20 an hour? You know, people like cops, firefighters, teachers, nurses, etc??? Will they all get an appropriate raise or will their pay stay the same? Some entry level airline pilots only make $15/hr right now. Why would anyone want to do these kind of jobs when they can go stock shelves at wal-mart and earn close to the same pay while spacing out all day??? What about the store managers? Will they get an increase in pay or will they make the same as the people they manage? It seems like the only way you could raise minimum wage would be to also raise the pay of others, but all that does is just inflate the dollar and put you right back in the same spot. Companies will lay people off or raise the cost of goods sold, neither of which are very beneficial to us.
That's why federal minimum wage should be raised based on inflation and states/cities can raise it based on cost of living.
COGS isn't a cost a company can raise or cut easily as it's on the supply side of the business mainly. It can set the retail prices though. Given that corporations are at an all-time high profits, the challenge with raising minimum wages for companies with more then say 15 employees will certainly impact profits. Those companies will have their increase partially off-set by the tax break and the impact will mainly be felt by corporations such as walmart and mcdonalds....who employ the most unskilled of workers. So yes, a higher minimum wage will offset shareholder value for some business, but the boost to the economy will be boosted as well from the increase in consumer spend. it's usually a wash in the end...expect that people at the bottom have a bit more to work with. The idea that someone would rather work as a fast food peon instead of working in a skilled job with a career trek is pretty ridiculous.
You still have to account for the people in the middle, though. If you raise minimum wage then people who currently work at or near those wage levels get screwed and you create an environment where there is less incentive to move up or acquire skills to work jobs that require real thought and mental fortitude. Basically, if you set the minimum wage at $15 per hour, then the folks who currently make that need to get bumped up to at least $25 per hour based on the skill required to perform their job. See what I mean? We can't have fry cooks at Burger King getting paid close to the same wages as cops, entry level pilots, school teachers, nurses, construction workers, store managers, and the like. So, we have to increase wages across the board or else its unfair to a very large segment of people.
How much does a 40 hour a week $7 a hour and $15 a hour employee actually cost the employer when you add in all the unseen expenses? Payroll tax, workmans comp, insurance, ect.....
My question is, with current minimum wage of 7.25, if you change it to 8 or 9, it probably would not have huge impact on the economy, but by doubling it to 15, it could affect the economy drastically. What about the people who are currently making 10 or 12 an hour, do they all become minimum wage workers at 15? What about the people who are making 17 currently? Do they stay at 17 or do they get bumped to 24? What happens to all the prices? We know we cannot set the minimum wage at 50 to make everyone rich, is raising minimum wage from 7 to 15 over a short period of time a wise decision?
You guys are missing the point here. Raising the minimum wage will cause some degree of inflation, more than centrists will admit, and less than libertarians will admit. However, other than those at the bottom, no one else gets a pay increase if the minimum wage is raised. So everyone making minimum wage sees - let's assume for fun - no increase in purchasing power. Everyone else loses purchasing power. If you were making $100 per hour, you pay more rent now without making more money. This is not a theory. This has been happening succesfully everyday for decades in many countries where those citizens enjoy a greater quality of life. And that's how you reduce the inequality gap. And this is not an attack on middle or low income people, it is simply a reversal of 40+ years (some would say 70 years) of attacks on low income people. You have to get yourself out of the false assumption that we are operating from a fair basis. We are not. This is not an attack. This is just crisis management. This is an attempt to stop 40 years of bleeding. The current state of affairs is that money is being vaccumed upwards and purchasing power inequality is growing and purchasing power is playing a MASSIVE role in shaping freedoms and civil liberties. Today, 90% of new income is sucked up by the top few %. Assets are similarly dominated by the top few %. Any losses in jobs resulting from rich people hoarding their money is offset by the fact that there is an exponentially larger group of people with discretionary income now, and the middle class will benefit from that if rich people decide to go home and cry. It is an absurd state of affairs that those same people who have been engaging in nuclear class warfare for decades are using the businesses they set up with the money they secured through nuclear class warfare to make you believe that there is a major debate about whether this works. It works. And we are lucky that those class-warmongers are too old to fully comprehend the dramatic changes brought about by the transfer of information online. They have been singing this tune for a long time, but you have access to other tunes. Equally important is that the money hoarders are not creating nearly as many jobs as they claim in the most fruitful time for them in human history. Even an economy set up to give them 90% of new income and retain dominance over unearned assets passed down over generations >> EVEN THAT is not incentivizing them to contribute enough jobs to make everyone in the richest country in history not worry about dying from a lack of healthcare. And make no mistake about it, these people will take and have taken actions that threaten the lives of fellow citizens before taking all their business out. These guys are living a dream at everyone else's expense. Even if they were making half the money they are, they would be at global all-time numbers. They will put your life at risk for that. There are more important things in the lives of 300+ million Americans than whether Bezos is making $2bn or $1bn. Because deep down, we know very well, Bezos's value to America is not millions of times more than the minimum wage earner. And that comparison is not important enough to deny the minimum wage earner a life. A real life. Where you live and love and experience amazing things. Where you have a couple of days to spend with loved ones, a couple of weeks to travel and see America/World, where you have the OPTION of choosing a craft that you are motivated to master and willing to live a very basic life to make it happen. You're here for a century at best if you're lucky, no one wants to spend that century depressed while flipping burgers with little social mobility in their future and then to take anti-depressants all day because you're not sure you're even financially secure enough in your old age to do anything other than sit and be fed garbage. We're all going to die and we are running out of time. It is far less acceptable to let people live entire lifetimes in misery than it is to bicker over whether Bill Gates should be a billionaire or a billionaire. Everyone should get a minimum standard of life objectively better than what the minimum wage in America offers. There are valid points about whether middle and upper income earners are being compensated fairly, and I don't deny that. But whether a middle income earner gets a Mustang or a bicycle is not more important than whether someone can afford cancer treatment or not. It is to some of course, but we cannot base a civilization on that. And we cannot wait for this free market to come through any more than we can wait for Jesus to show up. We have to immediately take steps to stop the embarrassment of letting our fellow humans drag through life this way.
By raising it to 15, it does not affect people who makes 50 or 100 very much, but it does affect the people who makes 18-30 significantly, These are the middle income earners. Their purchasing power will be reduced because of the price increases that will surely follow.
Exactly! The trickle up wealth reduction works as well as trickle down. One of the primary reasons I am against wealth redistribution attempts from the wealthy is because the wealthy have the means to readjust strategy. Its the middle class who ends up taking the brunt of the hit as they often can't readjust. I would say the poor take a hit, but they will be taken advantage of no matter what.
This is partially true, yes, but not to the extent you think. Those at the top spend more than the middle, and they will have to pay more (for example) rent for warehouses, factories, offices, etc. But the main point is: it is not more important than what was theoretically achieved. The minimum has to be livable. The effect it has on people with middle income is simply less important. This is a matter of being a civilized society that doesn't douse its poor in terror and misery. Whether those making 18-30 are driving a mustang or a corolla is not as important. The win here is that no matter what happens in your life, no matter what catastrophes await, no matter the class warfare the top 1% unleash on everyone, the minimum is livable. You are not going to descend into poverty. There is no boogieman. My advice is to tax the hell out of the top 1% of earners and use those taxes to fund small and medium local enterprises. After all, 1 out of 4 Americans are suddenly not in despair and can buy something. Incredibly, there are suddenly opportunities for you to work for yourself and for the quality of your work to be correlated to your income. This is not theoretical. This has worked in many industrialized countries. And there is a reason why the 1% have spent billions since the 50's to discourage this livable wage thing. And you and me both know it's not because they care about the wellbeing of the middle/lower income citizens. It's because it works, and the end game is that they will have less purchasing power and everyone else will have more. That's the bottom line, a repeatable experiment done dozens of times on massive scales. They can argue as long as they like about whether it will work or not, you can bet your ass they will not spend as much as they do on discouraging it if they thought it would result in no change. They will annually lose at LEEEEAST as much as they spend lobbying against it, they know what they are doing.
Cost increases in service / good production will be offset by the increased volume of new market participants who can now spend more money because they earn more. This is a market correction and certain goods which require a level of minimum wage labor are currently underpriced. If the dollar value menu goes away, that is an acceptable casualty of this.
Wouldn't the market reset itself? I mean if I am currently offering 15 per hour to attract talent level above minimum wage, after the minimum wage jumps to 15, I would want to offer maybe 20 plus to attract more qualified talent to work for me, after a while, things would just readjust ,maybe not everyone get a 7 dollar per hour bump but maybe 4-6, then we are going to be back to same position again after a few years? It would be much better to have small increases more often instead of the big jumps spaced out over a long period of time.
Well duh, it should be small increases over time. It should have been pegged to inflation and risen steadily over the past 80 years. The current debate is to get it up to where it is supposed to be after ignoring years after years of inflation. An addendum to that discussion should be to not just raise it, but to have it float with inflation.
There is a lack of creativity in this thread; probably because people in the US equate a livable wage with a higher minimum wage. How about a universal basic income and keep the minimum wage at 7.25? No means testing and bureaucratic bs. Everyone gets that check whether you are unemployed or Mitt Romney. Paid for by an increase in the top marginal rate (could create one more $1M+ bracket) to somewhere in the 1964-1986 rates range (50-70%) and potentially treating capital gains over a certain threshold as income. What about a compromise that eliminates a lot of the means tested welfare programs to get broad support. This would eliminate the disincentive that welfare can have where extra hours/income is offset by reduction in benefits.
