Why is the idea of raising minimum wage so popular?

Great our armchair economist thinks $10/hr sounds good lock her in boys. 35 hrs a week so more people can work, makes sense. We can't let the invisible hand work and people place themselves as businesses need so everyone is productive and working as much as possible. What's scary is this is how the politicians work. The public likes a $15/hr minimum wage lets do that. They have no clue what this means to the economy or what the real impacts will be on people. When they get the hell out of the way the economy manages to regulate itself but when they try to central plan that's where you get nonsense ideas like there is not enough work for everyone or we need a universal income.

You can increase the minimum wage without a 1:1 increase in product prices. You just have to reduce executive compensation.

x days without injury wrote:

You can increase the minimum wage without a 1:1 increase in product prices. You just have to reduce executive compensation.

You think? Or the shareholders profits are slightly less for the good of many. But that is not the thought process of many. Just look at some of the replies to this thread. Minimum wage workers are lazy, too unmotivated to go to college, not worth living wages......

As I quoted prior, management and CEO wages have increased almost 800% since the last minimum wage increase. And the cost of living has increased 20%, while the price of essentials such as housing and health care have increased even faster.

Your so right, we should keep paying retail employee's and laborers $9 Hour, also, let's lower your wages to $9 equivalent so that prices of any products or services you impact can be lowered...

Primo Numero Uno wrote:

. What's scary is this is how the politicians work. The public likes a $15/hr minimum wage lets do that. They have no clue what this means to the economy or what the real impacts will be on people. .

Does this mean you think that you know what a $15 wage means to the economy and if so, why?

Wait... wrote:

If you have to pay your workers more money then the prices of what you are selling have to go up to continue to break even on what you are selling, so raising the minimum wage wouldn't accomplish anything other than inflation, so why?

Many companies do not have minimum wage work force as a major component of the overall salary and production costs, so their products would largely be unaffected in terms of profitability but would be more affordable to a larger number of people.

I apologize if this has already been included in the conversation, but people shouldn't be supporting themselves and a family on a "minimum wage job". Many minimum wage jobs should be entry level jobs that kids get in high school and before establishing themselves financially. If the government raises the minimum wage on these low skilled jobs to $15 an hour, if a business doesn't either reduce their workforce or go out of business, then people who are on the fence about working (either extra hours as a second job or a spouse with a well-paid partner) will move in and take jobs that uneducated and/or unskilled people need to enter the workforce. As a business owner, would you rather have a 21 year old person who has never had a job or a 30 year old person who went to college and doesn't need to have a high pressure 9-5 job but is bored at home and wants to do something productive? I'll take the 30 year old. There will never be a perfect solution to getting this right for all people and all scenarios, so the most "American" thing to do is get out of the way and let the free market and supply and demand guide wages. If you can't get by on less than $10 per hour, then do the best you can while learning the skills to get a job that pays a higher wage.

This is one of the most ridiculous and emotional replies on this thread. Everyone who thinks like this is imagining that every business is Amazon or some other huge public company. The vast majority of companies in America are small businesses run by people passionate about what they do who just want to make a decent living. I have a business that does over $4 million in sales each year but my take home is around $100K......certainly nice but not fly around the world or buy a second/vacation home nice. ....as a matter of fact this is below the average household income where I live. I pay people $11/hr....if the minimum wage goes to $15/hr then my income goes down. If I can't afford to pay my mortgage and save for my kids education and live the lifestyle I am used to on this salary, then I will close my business and get a traditional 9-5 and my 40+ employees will need to get new jobs. Remember that this overarching minimum wage people wish for.....often out of anger at hearing about huge CEO compensation.....will mostly affect small businesses with owners that make less than the typical person working a traditional job.

This is one of the most ridiculous and emotional replies on this thread. Everyone who thinks like this is imagining that every business is Amazon or some other huge public company. The vast majority of companies in America are small businesses run by people passionate about what they do who just want to make a decent living. I have a business that does over $4 million in sales each year but my take home is around $100K......certainly nice but not fly around the world or buy a second/vacation home nice. ....as a matter of fact this is below the average household income where I live. I pay people $11/hr....if the minimum wage goes to $15/hr then my income goes down. If I can't afford to pay my mortgage and save for my kids education and live the lifestyle I am used to on this salary, then I will close my business and get a traditional 9-5 and my 40+ employees will need to get new jobs. Remember that this overarching minimum wage people wish for.....often out of anger at hearing about huge CEO compensation.....will mostly affect small businesses with owners that make less than the typical person working a traditional job.

x days without injury wrote:

You can increase the minimum wage without a 1:1 increase in product prices. You just have to reduce executive compensation.

Let me try one more time....as you can see I don't post here very often:

This is one of the most ridiculous and emotional replies on this thread. Everyone who thinks like this is imagining that every business is Amazon or some other huge public company. The vast majority of companies in America are small businesses run by people passionate about what they do who just want to make a decent living. I have a business that does over $4 million in sales each year but my take home is around $100K......certainly nice but not fly around the world or buy a second/vacation home nice. ....as a matter of fact this is below the average household income where I live. I pay people $11/hr....if the minimum wage goes to $15/hr then my income goes down. If I can't afford to pay my mortgage and save for my kids education and live the lifestyle I am used to on this salary, then I will close my business and get a traditional 9-5 and my 40+ employees will need to get new jobs. Remember that this overarching minimum wage people wish for.....often out of anger at hearing about huge CEO compensation.....will mostly affect small businesses with owners that make less than the typical person working a traditional job.

The key is businesses are getting away paying workers for 10 hrs a week, so they have to piece together 3 jobs just to make ends meet, and then they have no health insurance or benefits at the end of all this. This forced part-time work, by folks who want to work full time, is a huge problem. Raising the minimum wage won't solve it alone. Forcing a higher minimum wage for part-time workers is a good idea. Basically, if a full-time worker is making $10/hr but receives effectively $5/hr in health insurance and retirement benefits, then the part-time rate should be $15/hr.

Wait... wrote:

If you have to pay your workers more money then the prices of what you are selling have to go up to continue to break even on what you are selling, so raising the minimum wage wouldn't accomplish anything other than inflation, so why?

I'm very progressive. I voted for Nader 3 times. But this is one policy idea I totally disagree with progressives on. I get the sentiment. I'll actually defend it to the extent that I don't think it would be that damaging or crazy. The proposals are actually just to raise the minimum wage back to the way it already was decades ago, adjusted for inflation.

Problem is, it doesn't solve much. Better to tackler the problem of why the cost of living is so expensive in the first place.

Minimum wage doesn't work and should be abolished. Everyone knows you can't just raise the minimum wage to $200/hr and make everybody rich. For some reason they incorrectly think these inflationary consequences don't happen for smaller minimum wage hikes. There's lots of better ways to help the poor that actually work than dumb price control schemes

small business owner wrote:

, then I will close my business and get a traditional 9-5 and my 40+ employees will need to get new jobs.

Remember that this overarching minimum wage people wish for.....often out of anger at hearing about huge CEO compensation.....will mostly affect small businesses with owners that make less than the typical person working a traditional job.

Go ahead and close. Welcome to business life-cycles.

It is not the role of government, nor of the employees, to keep employee compensation in line with employer's objectives.

The argument for minimum wage, as I already stated in previous posts, is to enforce a fairer distribution of the revenues. The goal is to achieve the distribution that would be expected if the labor markets were nearly perfectly competitive. Instead, the low-skilled workers, particularly those who are new entrants to the labor force, are at a disadvantage in negotiating their compensation, and so accept wages below their marginal product of labor, to the benefit of owners (shareholders) and management.

Another poster said management and CEO compensation went up 800% while the minimum wage was fixed.

There is substantial research by PhDs in Economics on employees being trained while on the job, so that this training is valuable and could increase their earnings potential if then leaving for another job. To this extent, it is accepted that wages are a little lower the first few years of employment, and that would be true for the teenagers looking for minimum wage work.. Here is an example:

However, the low skill wages were too low, so much that even the laissez faire USA took action. It may not seem laissez faire in the labor markets nowadays, but it was very much so back when minimum wage was implemented (1938).

Economists are good at determining how revenues should be distributed based on marginal product of labor, to include the value of entrepreneurs.

The repeated theme in this thread about not needing a minimum wage was already proven false during the 2 decade depression in Great Britain after WWI, and the prolonged depression in the USA after 1929 market crash, or more accurately after 1931 Federal Reserve actions. Wages did not sink low enough to clear the labor market, for the obvious reason that workers could not survive on such meager wages. Why? Because the owners would not lower their prices enough to make the lower wages viable for workers from other firms to buy the products.

SeattleSilver wrote:

Wait... wrote:

If you have to pay your workers more money then the prices of what you are selling have to go up to continue to break even on what you are selling, so raising the minimum wage wouldn't accomplish anything other than inflation, so why?

Many companies do not have minimum wage work force as a major component of the overall salary and production costs, so their products would largely be unaffected in terms of profitability but would be more affordable to a larger number of people.

This is the major misconception (or deliberate misdirection ) on the issue. When minimum wages go up, all wages go up. When all wages go up, the costs of everything goes up. This is just fine if market forces encourage it. But when it starts as an artificial process, it is harmful.

Because ethical capitalism doesn't exist. Because minimum wage should be $20+/hr if it moved with productivity & inflation. Corporations know this and are squeezing out labor but concentrating profits at the top instead of doing more for front line workers in terms of wages/health care/retirement/etc.

Imagine you're on top of Walmart tomorrow. How much money is enough money? Are you so greedy that you actually need the amount of money that you take in versus your workforce. I would start paying everyone $20/hr with health care and pensions. I would hire more people even if just to do nothing because I'd have too much money for myself. The issue is you're told to accumulate for yourself and to trim as much off as you can at the bottom so you can live lavishly. Because of that, government needs to intervene and target areas like the minimum wage because profitable corporations don't act responsibly on their own. Raise the minimum wage and tax them if they don't change their models.

& I feel for the small businesses but how many of them actually exist? The Amazons of the world have run them all out of business. Put an exemption into laws to account for employers with less than X number of employees. Fine. But minimum wages are higher in so many other countries and all that happens is front line workers sleep a little better at night while CEOs have one less yacht. We can do things differently and don't just have to accept untethered capitalism.

Wait... wrote:

If you have to pay your workers more money then the prices of what you are selling have to go up to continue to break even on what you are selling, so raising the minimum wage wouldn't accomplish anything other than inflation, so why?

Also, OP -- this is not factual at all. Prices are typically set up by region or by country even. If you buy an iPhone or PS5, it costs the same amount of money no matter where you purchase it in the US. Individual states, however, have different taxes. So why doesn't a corporation in a state with higher taxes sell those products for more in those states? The answer is because they're already doing just fine. It's the same with paying your workers. You're operating under a false premise that America isn't run by profitable corporations that could both pay workers more and lower their prices now.

They would totally use minimum wage as an excuse to raise prices but so many of them would not need to. They could just have less money on the executive side of things. Maybe it would inspire more competition and smaller businesses could actually come in if they really did jack up prices.

NERunner53 wrote:

Because ethical capitalism doesn't exist.

But minimum wages are higher in so many other countries and all that happens is front line workers sleep a little better at night while CEOs have one less yacht. We can do things differently and don't just have to accept untethered capitalism.

One major block is Income Tax.

Personal income tax was against the constitution for a reason, and it took chicanery to get the amendment passed.

JD Rockefeller Sr. was the main proponent of income tax, and that should be an immediate red flag.

The original premise was a 2% tax on the very high incomes, and the public thought that was a good idea because the public was not rich. This envy was used against the public.

After a few years, income tax became a tax on the middle class, not on the wealthy.

Rockefeller's goal was to shift the costs of infrastructure away from corporate taxes to the public via income taxes. Insult onto injury, as workers were already underpaid by these Robber Barons during The Gilded Age.

Taxes on income from capital assets was low, no matter how much money was involved, and that is how the very wealthy can live--just on their dividends and interest incomes.

Trying to get income tax repealed is like trying to market a 200 mpg carburetor or find a cure for cancer (rather than finding a medication that if repeatedly taken will prolong the life of those with cancer).

The public will not even be able to get a flat income tax rate of 10% passed (e.g. 10% for anyone over $50k income or some figure than can be adjusted). Big money controls Congress, and big money won't allow income tax to be repealed or to be set at a fixed and low rate of 10%.

If income tax was abolished, or set at a low fixed rate, then labor markets would behave much more efficiently.

As a consequence small businesses owners will find their bottom lines improving because they don't have to pay income taxes.

Haven’t read through the post in this thread so I am it’s been mentioned already. But you really don’t know why the idea is popular? Most don’t understand micro economics. You just see you’re getting more money, when the real value stats stagnant they can continue to blame game.