Jay wrote:Equality for all = poverty for all.
I've reduced your statement to just the conclusion not because I only have contention with this, but because to debate the rest would take considerable time.
Americans who lean towards the Right tend to have a vision of any form of social spending eroding the competitiveness of markets and the inner drive to compete of citizens. More realistically, however, countries with limited or even moderate social spending see an increase in competitiveness and overall wealth, because now those at the bottom of society can actually contribute to the economy and compete themselves. Preventative measures like social housing or health care end up costing less and producing more wealth in the long run, because no longer are people declaring bankruptcy over a snake bite or broken arm. It's a novel solution: the more people working and having money to spend (even with a min wage floor in place) actually make everyone better off...well, almost everyone. Everyone except the very rich.
We have many social programs, and they disincentive work see:
Seattle was the first city to create the $15/minimum and some people working those jobs have been requesting fewer hours so they can retain their government benefits.
As for your argument, it’s only valid if prices are static, but they’re not and can never be. When you create a minimum wage floor, you are setting the bar for prices. Companies look at a given market and say “there are X number of people making Y dollars per year, if we set our price at Z, we can capture a chunk of the market”. Basically, if Microsoft didn’t think it was feasible for nearly every poor person to buy an Xbox and three games they woudn’t be priced at $300 for the system. They know people can and will stretch for a purchase like that (If you don’t believe me, I can post a nice school picture from middle school where all the kids on government assistance are wearing Air Jordans when paying $100+ for shoes was considered absurd by most people).
So now you raise the minimum wage. Do you think Microsoft is going to keep their price flat or are they going to move to capture more profit now that people have more money? Do you think your landlord is going to keep your rent flat if he knows your income just went up? Do you think the places you normally buy food from aren’t going to have to raise prices to pay for their own wage increases? Sure, there’s going to be a lag between when the wage is raised and when you start to see price increases, but how long will that be? A few months? A year? Then they’re right back where they started, except now everyone else is paying more for everything. That guy who was previously making $20/hour watched his disposable income evaporate because he was suddenly faced with more competition and higher prices. He’s now poorer.
Like I said, in any functioning economy, you need people at the bottom, and there will always be poor people no matter what you do. And frankly, burger flippers are as good as anyone to be at the very bottom of the totem pole. No skill required.
Last edited by Jay (2015-07-23 13:58:56)