Econ major my ass. I was going to make a joke about you studying keynesian economics but its clear from your posts you havent studied any economics.
Your argument was the minimum wage doesnt effect the economy and should not only be kept where is but rise with the cost of inflation.
In the past 4 rambling posts of yours, youve
1)contradicted your original argument by claiming minimum wage does have an effect on prices and working hours
2)Then in your second even stupider post you said supply and demand dont effect prices at mcdonalds but claimed their executives do?
3)Then you changed your position a third time when you claimed that Mcdonald workers actually do benefit from the minimum wage increase
So obviously your insane, on the influence of drugs, or a liar and you havent passed a basic econ test in your life.
I think a combination of the above is possible.
Ill give you a quick basic econ lesson before I go to bed tonight, so I can feel confident in myself that I was a good Samaritan today.
Lesson One: Price Controls
The Minimum wage is a form of a price control. Price controls are bad. The minimum wage is a type of price control known as a "Price Floor." This basically means that the government dictates how low a price can be charged for a product. In this case, labor is the product and the price for it is the hourly wage. The businesses are the "consumers of labor" and the potential employees are the "supplier." In order to be effective the price floor must be above equilibrium. Thats why earlier I said its good if the minimum wage is not adjusted for inflation so that over time it will fall below the equilibrium and effectively be a non issue.
Now What price floors do when set above equilibrium is they increase the supply of labor but lower the demand for labor, because as the price rises for a product the demand lowers. This creates what is known as a "surplus" in this case a surplus of labor is also known as Unemployment. The only way to correct a surplus is to lower the price to the market rate in order to raise the demand back to equilibrium.
So basically what happens is all workers whose productivity is below the minimum wage are fired. If companies dont fire people they push the added cost of labor onto the consumer leading to rising prices. They also can attempt to automate their workforce to save costs, they can cut hours of their employees, they can cut their budget in other areas subsequently reducing the quality of their good or service.
They can do a myriad of things, the point is the things they are doing they wouldnt of done in the absence of this price floor. The government forced them to act in an inefficient manner. Some companies as I mentioned earlier run on tight margins and cant afford to raise prices or cut their workforce in half. They could theoretically go under. I also mentioned that big businesses such as McDonalds tend to favor minimum wage since it hurts their smaller competitors more than them since they can afford the added cost of labor and regulatory compliance that smaller firms simply cant. You either ignored this point or you where to thick to grasp it.
Further the minimum wage hurts poor, minority, and the young the hardest as they lack the on the job experience and education necessary to warrant a wage above the minimum wage. Hence they suffer more unemployment and this law hurts them disproportionate. The higher the minimum wage the more people it will effect as it begins to cover a greater range of employees based on their productivity.
If the minimum wage actually worked why not raise it to 50? 100? 200? Why stop at 10? or 9? Well at a certain point idiots like you and Paul Krugman will have to say "Oh well that will cause unemployment" the second you concede that point all your other arguments are nill so youll center the debate (as you have) on rambling about the McChicken and Monsato.
If you bothered to read this (Which I doubt) then your welcome. I just educated you more in economics then any of your (supposed) econ professors ever did.
Good night.
I know those arguments. At $9 an hour, more people will want to work than will want to hire them. At $2 an hour, more people will want to buy labor than sell labor.
I know this. But the downsides are outweighed by the upsides. I understand that the oligarchs have the advantage over the indies. That's unfortunate. I'm assuming that the oligarchs are paying more right now, and a min wage hike wouldn't change their wages.
I get that it would cause unemployment. Of course, if you removed the minimum wage, everybody at the grocery store would be working for $5 an hour, and there would be the same amount of employees, but there's be different people. The 20 best they could get for $9 and the 20 best they could get for $5. Your shopping experience will be worse, because the employees would be worse. The prices would go down, maybe. Their employees wouldn't be able to afford them, otherwise.
I get that it would cause inflation. Wages are a part of prices. Wages go up prices go up.
Inflation, Unemployment - tend to go up with min wage hike
but
Increased Demand - on the other side. Basically, more money is getting into more pockets
and that money is being spent at the very stores that had the min wage hike. They're buying more
at the Supermarket, they might go out once a week or once more a week. A few more bucks
in the bar owners pocket. For most of the people getting minimum wage, a hike is a good thing.
More money in their pockets. Helps the economy.
Decreased Unemployment - the increased demand might cause an increase in hours or even hiring.
Add another bartender if the bars get busier. Another cashier.
I also think it an intrinsically good thing that most of these people got raises. Fed Gov employees get automatic raises. I'd like to stop that. Social Security has a cola. They get raises. these are the poorest of them, and they're the ones who don't get the raises?
What you don't seem to understand, and it really isn't discussed much is that the minimum wage is what keeps poor people from being much poorer and much more pissed off. They're going to want some sort of law to prevent them from starving. And there were a bunch of laws passed that did that. The core one was the minimum wage. Yes, it clearly does distort the market. But overall, I think the pros outweigh the cons.
You mention that "why not make it $50?". Yes, there would be some unemployment (especially in a theoretical sense) and inflation.
On the other hand (we understand the arguments), there will be a bunch of people walking around with $50 more in their pocket, and that's a good thing. It's good that those poor people have more money, and that money gets spent in local businesses.
So, in terms of unemployment, you have a theoretical argument that IF the minimum wage was $6, there would be more people employed. How exactly would that work? What would be some specifics about how that would work? I would think that if a Supermarket could cut everyones pay by $2 an hour, they'd pick up an extra person. Is that why we get rid of the minimum wage? So that Supermarkets can cut everyones pay and add another worker? And then, when all the minimum wage workers spend less money because they have less money, less money comes into the supermarket, and they won't need that extra worker.
You've described the theoretical basis for unemployment here. There are some people who would hire at $6 but not at $9.
It might be helpful if you could site examples of where a typical minimum wage hike, which has been happening since the beginning of the law, would cause a business to have to fire half it's workers. Could you find examples from the past where a minimum wage hike was blamed for bad outcomes. Links. In a supermarket, prices just go up. This minimum wage hike is just like every other minimum wage hike, the supermarkets will just keep doing what they've always done.
