McD's and Wally World have many accountants and lawyers. They will figure out how much this will cost them. If it is an additional 12.57%, they will increase prices 15% or so. The company will not lose. Small businesses will adjust accordingly.
Not really, I'm tired of LC's antics. It's useless to argue with children. I'm just going to ignore him as others have advised me via PM. I'm always up for a debate with adults. Like brokerrookie. Then perhaps you can answer my most basic question, amigo. Since, in the last ten years, the US per-capita GDP, labor productivity, corporate profits, average wages, and cost of living have risen in the 25-30% range . . . why is it unreasonable for the minimum wage to rise in similar fashion?
Because it is uncapitalistic to begin with. I don't have a problem with minimum wage so long as it is reasonable low as to not really affect the economy any, but a $7.25 minimum wage would most certainly negatively effect the economy. It is not a question of whether they deserve it. Economically, people are paid what they deserve. If people make the minimum wage, it is because they deserve it - on a broad scale, although not necessarily on a individual basis.
what people earn and pay is between them. if they dont pay enough, nobody will work for them. the market will raise the wage. if you need competent workers, and you offer minimum wage, you will have trouble hiring anyone except kids and mexicans. again, i sort of think it is immoral for us to tell a man what he must pay another man. it is none of my business.
Many economists disagree. As brokerrookie alluded to earlier, minimum wage workers spend their entire paychecks, they can't save any of it. Their entire wage goes right into the retail economy, along with any raises which is a boost to the economy. I ain't following you here. Minimum wage is about what American labor is worth, not about who is deserving of it. To quote Wikipedia: "Minimum wage forces employers to pay at least the wage society thinks human labor is worth, rather than low-balling potential first time employees with salary offers below their true worth. Employers know that first time employees don't really know how much they're worth and have little bargaining power because if they try to negotiate for a higher wage, the employer can just find another person who doesn't know how much he's worth and give him the job instead."
wkipedia says alot of things, some of which come from me. # Destroys those jobs that are naturally worth less than the minimum wage, thereby increasing unemployment and underemployment. Those who take this view believe it is worse to be unemployed than to be be employed for a poor wage. In most countries a higher percentage of people are unemployed than are employed but earning the minimum wage or a small amount above. They believe it is in such people's interests to take even the lowest-paid jobs. # Curbs economic growth by decreasing the supply of affordable labor. # Increases inflation by making low-skill jobs more expensive to employers. # Decreases opportunities for low-skilled workers to gain the training and responsibility they need to move up the wage ladder. This is an argument McDonald's makes about their jobs -- supposedly many successful people have worked their first jobs at McDonald's, and may have gained important skills. # Increases the cost of government social programs due to assistance programs aiding the laid-off workers. # Encourages teenagers with jobs to drop out of high school because a higher wage makes working more attractive. # Encourages more illegal immigrants from poorer places to enter the country because the pay differential between low-skill jobs in the two countries rises. This problem is particularly pronounced in the US, because the US-Mexico border is the longest developed/developing border in the world and is not well guarded. # Reduces the quality of jobs near the margin as well as the quantity - with less room to negotiate on salary, employers will necessarily cut other key areas such as job training. # Is less effective at reducing social exclusion than some other alternatives, for example training programs. # Is less effective than the Earned Income Tax Credit at targetting the truly needy, and is more damaging to businesses
Exactly why low minimum wages discourage American labor and encourages the hiring of illegals if you are a lettuce farmer. But what you say is true for those jobs that cannot utilize illegal aliens or kids. My professional staff is salaried, but my graduate students and student workers are paid wages. Most departments pay students minimun wage because they must use departmental funds which are limited. But I have found that I can't get motivated, effective student help for that rate. Many American students, I'm sorry to say, are often lazy and apathetic. My funds come from research grants and contracts, so I hire freshmen for $7/hour and cut them loose if they won't work and if they work out I give them a $1 raise each year with seniors earning $10 if they have been with me for four years. In this fashion I can get and keep good workers. I pay graduate students $15,000 a year for part-time work. The best American grad students would cost me even more because they can also work off campus for high wages. Fortunately there is apparently an unlimited supply of very bright Indian and Chinese graduate students whose visas limit them to on-campus jobs. So I understand your point clearly. I just believe that as everybody's wages go up, the economy grows, and the cost of living goes up, the minimum wage should follow along. It will still be a entry-level wage.
Saving money is not necessarily a bad thing for our economy. By saving money, it allows banks to loan money which actually increases the amount of money & spending in the economy more than just straight spending. I suppose I should have used the word "worth". It's not society's job to define that. We can look to socialist states to see what happens when people think they can do a better job than a free market economy.
I don't understand your argument here. Low minimum wages encourages illegal workers because Americans don't want to work for that rate? Is that what you're saying? I think you are making this a part of another issue. We should crack down on illegal workers, not try to adjust our economy accordingly. It isn't just students... people are by nature lazy & apathetic when they are allowed to be. I bet it is even worse in countries like France where you can't be fired without a year's severance pay - where is the incentive to work hard there?
I first off thank you for the compliment. To answer the question though I don't think it is entirely unreasonable to expect this to happen. I just think administrations shy away from government intervention in many markets. The labor market being one of them. It is essentially a price floor on wages. I think the government is comfortable letting the market drive the price of labor but they don't want to be perceived as letting the bottom fall out by completely ignoring wages either. I actually think they want those lower wage jobs to be filled with 1. uneducated employees 2. Foreign labor. I think they want to shift our economy to more of a "thinking" economy instead of a "hands on" economy. I also don't think it is unreasonable for Social Security to keep up with the cost of living but that doesn't happen either. The problem with our economy is that it is completely subjective. Every person has their own particular views on what is and what should be. We just don't ever know who is entirely correct.
