More on the $15 an hour wage

 

The average US CEO makes 319 times what the average worker at his company makes whereas the average Japanese CEO makes about 20 times what his average worker earns. There is no "productivity" explanation for that difference Second, Henry Ford years ago taught that for the economy to work, he needed to pay his workers enough money so that they could buy his cars. The economy fails when workers are underpaid.

 A couple more responses from web articles follow:

Article: " Employers do not hire people who cannot produce more in work product than they cost. Teenagers, and other young people, often have not developed the job skills to be worth more than a very low wage."

Response: I guess this sounds good if your sitting in a fancy office somewhere and your detached from reality.  In reality though, you need to ask the question: who will do the work at your business?  Most businesses need employees, it is really a basic need.  So sure a business owner might sit back and say that young people are not worth hiring as employees.  That business owner can then try and only hire older people.  That might work, or maybe not.  In most cases the business owner won't have much choice other then to hire anyone that applies for the job.  The basic truth is that most businesses need employees.  

 The whole talk of "skills" is just a smokescreen, at best.  You can say many jobs don't take "a lot of any skill", but that is not really the point.  The job NEEDS to be done.  It does not take much of any skill to make a basic hamburger or toss out a bag of trash: but you do need to have someone do it.  So this puts the "value" of an employee at the simple fact that your business would not even exist if that employee was not there working.  

Article: "Assume the deck on your house needs to be painted, and the teenage girl next door is willing to do it for $8/hr., so you hire her. But if the government says you must pay her $15 an hour, you might decide to paint it yourself or let it go for another year. The teenager is left without a job to help pay for her schooling, and you have a less attractive deck."

 

Response:  This is a good enough example.   Though note it's an elective job task, something that does not have an immediate need to be done, but we will get back to that.  So sure if you want to be greedy and rant and rave you can scream that you will never pay an unskilled teenage girl $15 an hour to paint your deck.  So sure you can just leave the deck unpainted another year.  Though you do want the deck painted.  Sure you could do it yourself, but that is a big investment of time and work.  You could do it if you really wanted to get it done.  Painting a deck is a lot of work and can take hours, maybe even days, and many people won't want to put in all that effort.  Suddenly paying someone else to do it might sound a bit better when your tired and half covered in paint.

Also, note this example is an elective job task.  It's something you don't have an immediate need to get done.  It's something you can put off, or even not do for a whole year.  If the task is not elective, it very much changes things.  Take babysitting.  You want to go to work, but obviously need someone to care for your two year old child while you are at work.  If this person wants to rant and rave and say that they will never pay a teenage girl $15 an hour to babysit, and can't find a highly skilled professional babysitter, what will they do?  Quit their job?  

Article: "In order to comply with a higher minimum wage, a business has two choices: cut hours or increase sales."

Response: Again, the old tired binary that a business only has two choices.  In reality, they have many.  The big one never mentioned, is the business can make less profit.  Maybe the owner(s) might need to sell a mansion or yacht or two. The business can also scale back or become more efficient.  

Article-"A $15 federal minimum wage translates into over $36,000 per year in wages and mandated taxes and benefits paid by employers. That means that any jobs that don’t produce at least $36,000 per year in goods and services will eventually be eliminated — either because businesses close their doors, outsource their labor or automate low-skilled jobs."

Response-Again, when faced with going out of business forever, I'll bet businesses will get some new math.  Suddenly that job, no matter how simple and unskilled, will be worth keeping the business open.

 

Article: " That’s why even liberal economists and the nonpartisan CBO caution that a $15 federal minimum wage would lead to a survival-of-the-fittest labor market, reduce future incomes and disproportionately harm African Americans and women."

Response: Well, this might shock some people but the current world is a survival-of-the-fittest labor market, with reduced future incomes and does disproportionately harm African Americans and women.  So what would change?

Less than 1% of the spend of businesses, on average, goes to paying minimum wage workers. They have already had a $15 minimum wage in lots of places, for years now in some cases, including lots of rural areas, and no issues.

This isn't about some actual concern about the cost to businesses it, it is about Republicans getting satisfaction from keeping people poor. Some Republican who makes $20/hour now feels better about themselves if they know that they make 250% as much as somebody flipping burgers, and they think they would feel less good about themselves if they made 133% as much as somebody flipping burgers... That isn't a real reason to base policy on.

Why has wealth concentrated over the last forty years?
Why has the middle class shrunk and the gap between the elite and the middle class gotten wider and wider, even accelerating under Trump?
Why has economic mobility all but ended for this generation and certainly for the one coming up?
Lots of reasons, but freezing the minimum wage and reducing support for education are two very significant reasons.

 

 

Money is an instrument of exchange. It belongs to nobody but the government who produces it, maintains the markets for "money", the flow of dollars has a cost ... that cost is deferred by good fiscal policy that means money, cash ... is circulated. Each circulation is a positive for the economy.

Allowing large corporations to hoard cash while their employees come to the government for basic services is an obscene result of our politicians who've drunk the trickle-down economic theories that have failed miserably.

So yes ... back to the employers is a very important aspect. If their employees are paid poorly .. their profits should pay for all those services given until the markets decide they aren't doing their part to make cash flow. For every corporation that falls on their face ... there are entrepreneurs who'd gladly step in.