Minimum Wage Increase

[nayt]

I'm having trouble supporting the minimum wage increase. I'm voting for Kerry either way, but maybe someone could explain to me why I should support this?

It seems like the minimum wage increase will be a slight help to people making under $7 an hour, but people like me who make around $16000 will be hit the hardest. i will see no benefit whatsoever, but retail prices will definitely increase and take a big chunk out of my already low disposable income.

[bluestateguy]

1. Don't fall for the Chamber of Commerce spin

The last increase was in 1996. Unemployment went down. Since there has been no increase in 8 years, that means minimum wage workers have been taking a pay cut each year. Because these are low income workers, raising their wages will put money right back into the economy as consumer spending.

[theorist]

7. It's actually an amazing trend.

Whenever their is an increase in the minimum wage, there is an increase in economic growth. Republicans don't like to point this fact out for some reason.
:eyes:

[Redleg]

24. You're right about that.

EOM

[Dookus]

2. it's not true

that a rise in the minimum wage causes inflation.

[truthpusher]

3. The country will be a better place when more people prosper!

[loveable liberal]

4. hey...in my position as 911 dispatcher i dont get a raise...

for 3 years due to our glorious state senators, i do get a step increase of about 90 cents per hour, however, i just found out my healt insurance premiums are going up $100 per month next year. Im getting taxed and going without a pay increase for 3 freakin years. Now you may say that I should change jobs, my reply to that is its hard enough to get competant people to answer 911 calls and if your parents or child called 911 wouldnt you want to have confidence that you would get help? now i have a wife and 2 kids to support on 1.5 incomes. when you talk about making 160 large and arguing how you cant support a minimum wage increase, that irritates me. I cant afford a vacation, we've never gone on one. My wife and I have decided not to put our children in daycare, which is our decision. she could go out and get a job, but we feel raising our children is a priority. you show me a price cap on all goods and services and i'll show you support for keeping the minimum wage where it is. $160,000.....you could take a 5000 hit in taxes and not know the difference as far as im concerned..... oh by the way, im not yelling at you, but i think my job is important, and where i used to work for a utility i see people who dont have any responsiblity or liability makeing twice as much as i do per year. as far as im concerned private corporations pay people too much. spread the wealth, spread the burden. sorry for the rant.

[nayt]

8. i think you misread

16000, or $9 an hour, not 160k.

[loveable liberal]

10. sorry, my bad.....still, it felt good ranting...thanks

I saw $160,000 and thats all i could focus on.....i feel like such a big dope....

[nayt]

11. no problem

i hope your situation improves

[loveable liberal]

12. it will when president kerry starts taxing the people who can afford it.

I have no problem or sympathy for people who make a lot of money.

[theorist]

5. Facts and myths about the minimum wage.

http://universallivingwage.org/factsmyths.htm

Please read this. There is a reason why Dems want an increase in the minimum wage. The main one is that every year that the minimum wage is not increased, more people (including families with children) fall below the poverty line.

As for your concern:

Myth #12: "If wages increase, the cost of everything else will increase."
FACT: Wages are just one of many factors that make up the cost of an item. Factors such as manufacturing, transportation, equipment, rent, advertising, business location, income demographics of the community, employee recruitment and training, expenses all add together with wages to create the cost make-up of an item. Clearly, the cost of goods does not have to automatically rise just because one small portion of their make-up increases.

Much more...

[loyalsister]

6. I will get by.......

Most economies are fueled by sales taxes. Poor people would finally have some cash to spend!
With healthcare to go along with it, a single person may finally be able to support children with that job. People with disabilities may finally be able to afford to try to go to work. There might be a light at the end of a seemingly endless tunnel that a lot of people have been living in.
Don't worry, friend you probably have some skills\experience you'll do just fine. More people health and working= more people spending= more people starting business= a healthier economy and circle back. Skilled people such as yourself would make more money and can afford a higher standard of living. Don't worry. The old Grateful Dead Baby Boomer anthem applies to you.
You will survive.

[nayt]

9. true

i just think it will make my last 3 years of school harder, and that i might have to borrow more if i can't save as much each semester for the next's tuition.

it just seems like at least in the short term this will hurt as many people as it helps?

i think i would rather see it adjusted annually with inflation than done in large leaps like this.

[loyalsister]

14. That gives me some more reference

I spent my first couple of years of school under poppy the latter under Clinton after we finally had an increase.
You have to remember what happens to inflation when the economy improves. That could counter any potential effects you fear. Businesses are going to want to take advantage of an influx of people poorer than you with a new limited ability to spend. There's no way in the world they're going to jump to raise prices and blow that.

[DjTj]

30. Kerry will adjust it annually - there's no large leap.

He's moving it up to $7 over four years, not immediately when he gets into office (and it has to make it through Congress, of course).

[UdoKier]

13. Nonsense. Prices barely budged when Clinton raised it.

And consumer prices have been soaring since Dumbya took office - with trickle-down and no min. wage increase...

Also, you should see better income gains if the min. is raised. It usually helps to push up all wages at the lower end.

[Zinfandel]

15. Bush never answered the Minimum Wage question, changed the subject...

danced all around it. Bush and republican ideology could not give one fuck about the poor or the workers...the republicans party is the party of corporations and multi-nationals...you really think they give a shit about workers safety, health care or the Minimum Wage?

Anything that affects the bottom line, the profit margin...mangement will NEVER take care of the worker. Union is the ONLY way to protect workers rights, safety and benefits, strength in numbers.

[durutti]

16. Business propaganda. Not true at all.

Small businesses spend a lot of money on training and recruitment. By decreasing turnover, minimum wage increases lower these costs. They also typically lead to increased productivity. Furthermore, minimum wage increases can encourage growth by stimulating demand.

The idea that minimum wage increases usually result in price increases is pretty absurd. The very logic of profit-making dictates that businesses are already charging as much as they can for their products.

The minimum wage was much higher in real terms between the in the 1940s and 1960s than it is today, but the country experienced much stronger growth and lower unemployment then. And obviously, Clinton's minimum wage hike didn't stop the '90s boom. Also, most other Western nations have both higher minimum wages and stronger growth.

There's a good overview of this issue in the book Raise the Floor by Holly Sklar.

[On the Road]

17. When the Minimum Was Raised to $5.15

did you see an increase? Maybe it showed up in the statistics somewhere, but I certainly didn't notice it on the street.

Raising the minimum to $7 will probably affect people who already make $7 an hour simply due to competition. Employers will pay higher wages if they want to attract higher quality employees, and if the minimum is $7, they'll have to go a little higher.

[rowire]

18. $20/hr Minimum Wage

I'm not an economist, but I would think we could lift a ton of people out of poverty if we raised the minimum to $20-25/hr. Assuming a 40hr work week, that would be an annual income of about $41,600 - $52,000.

Why is nobody mentioning this? Why doesn't Kerry make a bold proposal like this and really get the word out. Talk about an October Surprise!

[LuminousX]

21. You are missing the crux of the argument

Cost of living edges up slightly each year, is it wrong to say minimum wage should stay the same? Yes, of course it is wrong to say that.

By jacking it up to $x an hour where x is some absurd figure you pulled out of your ass, you aren't keeping the minimum wage in line with cost of living, you are just dicking around with the marketplace.

[cosmicvortex20]

25. Ask yourself why the cost of living goes up every year....

Inflation makes people poorer. A truly free market would experience gentle deflation, making dollars worth more. Thats a far better way to make the poor a bit more wealthy then just inflating the currency supply.

[cosmicvortex20]

26. I vote we up it to 1000 dollars an hour...

Or maybe a million dollars an hour!

Obviously if a little increase is good, a big increase is better right? See how easy it is to make the economics of this crystal clear?

[ProfessorGAC]

19. A Conservative Economics Canard

There is absolutely no evidence that the raising of a wage floor (within some statistical reason) directly influences retail prices or employment levels.

I know that is conservative conventional wisdom in economics. There's one problem with that theory. IT HAS NEVER HAPPENED! Not one time since the instituting of the minimum wage law, and all subsequent statutorily mandated increases, has there been a correlation to lower employment or higher prices at retail. Not once. That's over 30 times when it could have happened, but didn't. ZERO for 30!

This type of two dimensional hypothesizing is what's wrong with not only the average person's understanding of economics, but of professional economists as well. Every time i go to a conference or a local group meeting, i am astounded at how willing economists are to take theories on faith, rather than develop their own theories based upon the actual facts.

Small changes in minimum wage do not have a net negative effects on anybody at retail, and the number of minimum wage jobs does not fall due to it. You can relax about this issue.
The Professor

[TahitiNut]

20. AFAIK, the correlation of increases in the minimum wage to ...

... increases in unemployment is actually a negative correlation. (In other words, it reduces unemployment, if anything.)

This makes sense to me. When people have more disposable income, they tend to spend it and thereby create even more jobs. This, in turn, seems to have a hysteresis effect, creating more opportunity for minimum-wage jobs.

I think it's the same kind of "bootstrap effect" as the initial impact of the post-WW2 G.I. Bill. I also strongly believe it reduces the Gini coefficient (increases income equity).

[ProfessorGAC]

22. It's Really Statistically Insignificant

I've looked at this several times since 1980. The confidence interval around the changes in employment are not correlated to minimum wage changes.

Actually, if one looks at when most of these changes occurred, they tend to occur in times of financial prosperity for american industry. Therefore, they are flush with cash and are hiring. So, employment goes down because of that, and the impact of having to pay the lowest paid workers a pittance more has no real bottom line effect.

So, the hiring is not really correlated to the wage, but to the generalized timing of the MW increases.

That's why i'm so opposed to the idiots who appear on TV with their silly two dimensional constructs of economics. The economy doesn't work that way and the causative relationships are WAY more complicated than that which fits neatly onto an XY graph. (No offense intended to your graph, Tahiti.)
The Professor

[Cleita]

37. Here is kind of an ancedotal proof of what you said.

Supermarket employees are very well paid for service jobs because they are unionized. I believe they earn about three times on average of minimum wage. They also get a benefits package. Yet, food prices are the most competitive out there. Yet, somehow our supermarket giants have have managed to have one of the best food distribution systems in the world, lower prices and well paid employees.

What kills the business is people who are out of work and can't afford to buy anything but the most basic and cheap of food items, not the fact that their employees are well paid. The lowering of volume drives the prices down. Of course now that non-union Wal-Mart is making incursions into the grocery business, things are becoming unsettled, yet shopping at Wal-Mart doesn't yield a lower grocery bill, just poorly paid employees.

I don't know where this is going, but people who are being gouged for drugs and medical care insurance, who are out of work with no paycheck, those who are working for slave wages, aren't going to have money to spend to help business.

[Hello_Kitty]

23. I'm no economist but I majored in marketing

I was taught about the numerous market forces that determine price and demand. Wage levels are only one factor. Retail goods, particularly those that are common necessities, are purchased by people at all income levels and there is strong competition for markets in most industries. Raising minimum wages IMO will actually give lower income people more purchasing power and choices. For example: Many middle class Americans buy groceries at large warehouse type outlets like Cosco, where they can take advantage of lower cost bulk purchases. Most Coscos are located in suburban areas where access via public trasportation is difficult. Besides, who wants to lug a pallette of toilet paper on the bus? Now, if a minimum wage worker who relies on public transportation gets paid a wage that enables her to purchase a reliable used car, she can go to Cosco and buy the cheaper t.p. in bulk rather than pay a premium price for a single pack of t.p. from her local convenience store. Cosco is not going to raise the price of its toilet paper because of it. It still has to compete with supermarkets for the middle class dollar.

[ikojo]

27. Most things like clothes and electronics

are manufactured overseas where people are paid pennies an hour and they are still expensive. Look at a pair of Nike sneakers..the people who make them are not paid very well but I don't think that savings is passed on to the people who buy the shoes.

[Cleita]

28. People don't seem to understand that retail prices are

set by the buyer. The seller has to price a product to sell it. Of course he will price it high and hope that people will pay. Wages have nothing to do with it. Trust me, the waiter in the French restaurant is making the same wage as the waitress in the pizza joint.

There are factors that influence the price like high insurance, rent and wages, but ultimately, it is the guy with the right prices that makes the money. This is why it's important to shop around for the best deal. The problem with the Wal-Marts is that they can undercut the smaller retailer with price leaders, but they make it up with other stuff that is over-priced.

The profits are never passed on to the worker unless there is a union that bargains for their wages and rights, or the government sets a minimum wage. This is the only way to force these corporations to pay aliving wage. You may find that the prices don't change because it's the consumer in the long run that sets the price of the goods by demand.

I am surprised that large corporations like Wal-Mart don't get the correlation. They would actually sell more volume wise if more people had money to spend.

[cosmicvortex20]

31. I agree - which is why I said we should raise it to a million an hour...

Then we would ALL be rich right!?

[Cleita]

35. Funnneee.

I think $10 an hour is what they are asking for. I suppose the company could throw in a lotto ticket for fun. If they won then there's your million or so. TaDum!

[murdoch]

29. why...

...you're saying you want low wages because it leads to lower priced commodities. Since you are paying for the wages put into and the profit taken out of a commodity, why are you ignoring profit and just seeking to lower wages?

[Silverhair]

32. Sorry, but it will mean prices will have to go up.

My wife works at a small business that employs about 200 minimum wage people. If the MW is raised, everybody's pay will have to rise proportionately. But let's just consider the MW workers. A raise of $1.85hr actually means the business will have to pay $2.13/hr because of matching Social Security. The works out to $886,080.00 per year increase in the cost of labor. The business has several competitors so they are already as efficient as they can get. The only way they can get the money will be to raise their prices. And that will be the same with other sectors of the economy too. Their suppliers will be charging them more too, which will also result in higher prices.

Notice that due to everybody getting a raise, some people will be pushed into a higher tax bracket - even if they aren't any richer in real terms. Raising the MW is a back door way to raise income taxes, while fooling people into thinking they have gotten a raise in pay.

I remember when the MW was $1.00/hr. And I used to get excited when the MW went up. But I have learned from experience that it is only an illusion. I'm not faked out by it any more.

[Cleita]

36. I used to pay my employees 25% more than minimum wage,

yet, my product was on the lower end of the price scale when I had a business. I also gave them time and a half for overtime when I didn't have to. They had to work hard for me to maintain the volume I needed to pay them. I found that if I couldn't meet the payroll, I needed to get creative in cost control, sales and promotion. I never considered the money I had to pay out in taxes of any sort as my money, so it was mentally easier to work within the parameter of what I could consider my money.

This is just my experience. I'm not judging how your wife does things as I know it's very hard to hit a balance. I always thought that small businesses could use some help in the way of tax credits, loans and other help from the government to get us over the rough spots that occur so we can stay in business. The government does such programs with farmers and I think they should also do it with small businesses, not just their corporate campaign contributors.

[sangh0]

33. What are you worried about?

Stop listening to the BS republican propoganda about economics. Have their results justified any credibility for them?

You have been lied to. Just because an employer has to pay it's employees a little more money that doesn't mean that they can raise their prices AND GET IT!!! If they could get charge more money, they would and they wouldn't need the excuse of a higher minimum wage to justify it.

The real value of the minimum wage is at its lowest point in decades. (Kerry mentioned it last night, in case you didn't see it) Have you seen prices going down?

[BeFree]

34. Looking at it a different way

The countries that have a minimum wage below our's, are poorer than us.

When you lower the wages of the workers, as happens with inflation, you are lowering your base level and everyone becomes poorer, except for the profiteers.

Besides, someone getting a raise almost always becomes more productive. It works for me!