Minimum Wage

One of the first matters of business for the new congress appears to be the minimum wage. Of course the trailer park millionaires on the right are out to defend the greedy and point out how it is a bad idea. I was recently pointed to this piece by a righty as an example of insight. Let's take a look at this piece of economic genius and popular opinion.
The minimum wage is an emotional issue that sounds good on the face, but if you dig deeper and look at facts most people will see that raising it will do more damage than it will do good.

Oh really, every state that had a minimum wage issue on the ballot passed it. Somewhere around half a dozen if I remember correctly. Over 80% of Americans favor raising the minimum wage. I guess the overwhelming majority of people are just uninformed?
The first question that needs to be asked is not why the MW should be raised, but to what level?? Should it be raised to $7 an hour or $10? And if you can agree on a number, why that number?? The other question that must be asked is, why does the fed think that the minimum wage is a one size fits all proposition??? It costs a hell of a lot more to live in NY City than it does in Westfield WI. That is why any minimum wage issues should be handled at the state level. If a ‘fair wage’ is $20 an hour, why not make the MW $20 an hour or even more. Many people on the left will say that a fair income for a family of four is $40,000 a year and that at 40 hours a week is overworking us. Many unions want to go to a 32-35 hour work week. So why not make the MW $22.86 an hour. That would be based on 50 – 35 hour work weeks with two weeks of vacation. Hell, why not also create a federal minimum vacation time too. Everyone gets 5 weeks of paid time off a year… Why not – the dems want to artificially inflate wages – we might as well artificially PTO hours as well.
I take the point to be that it is all arbitrary and just how generous do we want to be anyway? Do we just give workers everything they want? First let me say that arguing about giving people willing to work more money coming from the same people that complain about the “lazy welfare bastards” seems much like circular logic to me. Damned if you do, damned if you don't. Next lets look at what he is saying about differences in areas. Yes this is true and it is why we have regional and even city differences in what the minimum is. The federal law is meant to be a bottom line floor. A bottom line guarantee. It does not inhibit local action and is in most instances handled by the states. As a matter of fact most states DO have minimum wages above the national level. It is apparent to anyone that follows politics that this group that is opposed to the federal minimum wage also has or would fight local ones too. He's throwing out a red herring. What does he think the minimum wage should be in Wisconsin or NYC? Additionally to reverse his argument(as long as we are “digging” into the issue) if 7 dollars is too much why not 4 dollars or 2 dollars?

By raising the MW will regulations be loosened?? For example, right now by Wisconsin law, day cares are limited to the number of children that each licensed adult can watch. Will those ratios be loosened to allow for a proportionate increase in productivity? Or will the cost of the MW raise have to be born by the consumers?? Day cares currently operate on an extremely tight budget. In addition, if anyone thinks that business owners are going to sacrifice their 4% margin to raise the MW 25-30%, you are on crack. And when was the last time that a liberal repealed regulations on a company? So don’t expect them to start now.
That means that consumer prices for everything just went up. That $4 extra value meal will now cost $4.50. It will now cost you an extra dollar to get your pants dry cleaned. It will cost an extra $3 to stay at a hotel when you visit out of town friends and family. That gas that you need to visit that family just went up. It already costs $30 to go see a movie on a Friday night, now it will cost $35.
Because of the extra costs, people will be doing less spending, which will put those people that the dems claim to want to help out of work. That puts them back on the welfare or unemployment rolls… but don’t worry, the dems will be handing out more taxpayer money in the form of entitlement programs to those people that their policies put on unemployment and on welfare in the first place. That will increase gov’t spending and create more of a burden on the taxpayers which will force them to spend less money which will hurt the economy which will put more people out of work…. And the endless spiral will continue.
The dems own policies will destroy the economy
That sound that you hear is the economy going down the toilet… and the only people that will still have jobs will be those that work for the government… the people that put the dems in power to begin with…
Wow! That is economics by brainwashing if I have ever heard it. Mr. Free market productivity thinks the only way you can cut the cost of doing business is labor related. He thinks giving people more money will result in LESS spending. Oh and the horror of welfare raises its ugly head and it is all because we gave some people at the bottom of the ladder, that are willing to work, a raise. Laughable.
Will there be inflation? Likely some. The best businesses, the ones that deserve to survive, will find a way to make it work. Let's look at ways to cut costs without raising prices. How about more efficent uses of energy and investments in alternatives that may cost less in the long run and have tax advantages now? What are the costs of your product, your building and infrastructure? Are there ways to get a better deal in another location or from another supplier? How about streamlining or reducing costs in other areas of the business beyond the people that make it hum? How about efficient marketing and advertising and special services to bring in new business? How about the guy at the top taking a bit less so the people that operate it everyday can have a pittance more? These are just a few ways to pay more to people who will eventually use or buy your services resulting in more profits not fewer. More money in more hands will result in more spending and a more diverse economy not less. Certainly the guy writing this has little experience in the business world or just wants to ignore the challenge and tough choices.
Beyond this better payed workers are happier workers. If Target pays 10 dollars an hour and Walmart pays 7 where do you think people are going to want to work. Who do you think will have the larger pool of the best workers? Who do you think will have the better business in the long run? That sound you hear is wingnuttia going down the toilet.