islander
2/8/2014 7:18:00 PM
On 2/7/2014 5:55 PM, maxwelton@my-deja.com wrote:
> On Wednesday, February 5, 2014 3:54:02 PM UTC-5, Walt Hadley wrote:
>> On 2/5/2014 10:31 AM, islander wrote:
>>
>>
>>
>>>> On 2/4/2014 10:43 PM, Walt Hadley wrote:
>>
>>
>>
>>>>> On 2/4/2014 7:31 PM, islander wrote:
>>
>>
>>
>>>>>> On 2/4/2014 12:38 PM, Walt Hadley wrote:
>>
>>>>>> President Obama has made raising the minimum wage a centerpiece of his
>>
>>>>>> campaign against "income inequality."
>>
>>>>>> I'm trying to get some kind of a handle on just how many people, other
>>
>>>>>> than low-skill entry-level workers, continue to earn only minimum wage
>>
>>>>>> and don't climb any rungs on the career ladder. What I don't understand
>>
>>>>>> is how increasing the minimum wage would or could have much or even any
>>
>>>>>> affect on "income inequality", as I understand it (which may not be
>>
>>>>>> very well). He is thinking about the great 99%, right?
>>
>>>>>> Does anyone have any idea?
>>
>>
>>
>>>>> I don't think that this is about income inequality.
>>
>>
>>
>> Well, duh.
>>
>>
>>
>>>>> It is essentially about the exploitation of workers who are paid the bare
>>
>>>>> minimum that the law requires. If the minimum wage were eliminated
>>
>>>>> altogether, some employers would pay even less, essentially what the market
>>
>>>>> allowed.
>>
>>>>> There is a serious question as to whether or not we want to live in a
>>
>>>>> world where people work full time and still are not above the poverty
>>
>>>>> level. One of our values is that someone who works hard deserves to
>>
>>>>> make a decent living. That is certainly not true today.
>>
>>>>> How many are working for the minimum wage? About 1.6 million and
>>
>>>>> another 2 million are paid even less due to exceptions to the law, most
>>
>>>>> notably food service personnel for whom the minimum wage is $2.13 per
>>
>>>>> hour thanks to Reagan. Obama's proposal is to bring the minimum wage up
>>
>>>>> to $10.10 per hour which would bring a full time worker above the
>>
>>>>> poverty level. Tipped workers would also get a raise to $7.07.
>>
>>>>> Studies have shown that there is no downside to this except possibly for
>>
>>>>> businesses which are operating at the margin or for businesses that
>>
>>>>> simply milk as much labor per dollar out of their workers as possible.
>>
>>>>> Here in Washington State, the workers at SEATAC airport got together and
>>
>>>>> pushed for an increase in the minimum wage to $15. They won the
>>
>>>>> increase at the polls. Who lost in this? Minimum wage workers at
>>
>>>>> SEATAC are primarily workers at the various concessions and cleaning
>>
>>>>> personnel. The costs will likely be passed along to the airline
>>
>>>>> customers, but who cares? The cost of a soft drink will probably
>>
>>>>> increase by a few cents, not even noticed by a traveler.
>>
>>
>>
>>>> Well, that's all very interesting, but it doesn't answer my question,
>>
>>>> which was how increasing the minimum wage would or could have much or
>>
>>>> even any affect on "income inequality", however that is defined.
>>
>>>> I'm still trying to get a handle on what Obama is talking about.
>>
>>
>>
>>> Read the first sentence of my response.
>>
>>
>>
>> I'm well aware of your first sentence. And I repeat, that's all very
>>
>> interesting, but it doesn't answer my question.
>>
>>
>>
>> All you've done is bloviate on a favored progressive liberal talking
>>
>> point, not provide any useful info that would help a questioning
>>
>> conservative learn something about the great "income gap". Except for
>>
>> your first sentence, your whole response is bogative. I'm still trying
>>
>> to suss out what Obama is talking about - all you've done is confirm
>>
>> that he's just blowing smoke again and doesn't have any proposal to
>>
>> solve the "problem", whatever it is.
>
> Then think about this; what if there was a maximum
> wage?
> If minimum wage is raised where do you think that
> money would come from?
> You need to think about the economy as a system.
>
The economy is, in fact, a system. But, it is not a system based on
zero-sum. It has gain. If you are familiar with system theory, then
you understand something about feedback and the effect that it can have
on system performance.
This argument is fundamental to understanding the difference between
demand side and supply side economics. Increasing the supply of money
to people who will spend most of that money produces demand which
provides the motivation to increase capital investment. This is gain
and the economy improves. This has been proven many times in the past
and policies like increasing the minimum wage, providing unemployment
insurance, and increasing public employment all serve to increase demand
and thereby produce gain in the system.
By contrast, the conservatives seem to be doing everything that they can
to make things worse, opposing a minimum wage increase, canceling
unemployment insurance, reducing public employment and even opposing
badly needed infrastructure projects all serve to reduce the amount of
money available for people to spend. No amount of increased motivation
for supply side spending will work without demand.
Where does the money come from? It comes from increased economic activity.