Why is everyone so excited by the minimum wage increase?

Question

Who do you think pays for the increase? The customers. For the companies to raise the wages, they must raise the costs of what you buy, when in turn, makes the raise nothing. You may get paid more, but you are going to be paying more, so it comes out to no raise.

Answer 1

wow, I never saw it that way. You make a great point

Answer 2

The minimum wage suks. But you are right companies will of course adjust prices to reflect the increase. Sadly a lot of companies will adjust the prices even though the increase will probably not effect them. Hardly anyone makes minimum.
it is a long overdue increase as the wage has not kept up for close to ten years with the cost of living.
If the fat cats that run the companies would take a slight reduction in pay then maybe it would balance out a little. People that make a couple hundred thousand a year have a lot of nerve to cry when they give employees a .20 cent an hour raise while they give themselves a 50-80,000. dollar bonus. It is great that you have made it but stop and think about the greed you have.
Give the worker a little more and maybe they can spend a little more to buy your product.

Answer 3

No, I am not excited in the least bit. I started at my job above minimum wage and every year I get closer and closer to it. The problem is that most employers do not increase the salaries of their employees enough to cover the inflation cause by the increase. I have worked at jobs that I felt that I should have been paid less then the minimum wage and gladly would have accepted less. In modern society a minimum wage is needed only in specific cases and should be left up to the local government, not federally imposed.

Answer 4

We won't starve this year. Next year, maybe. But not this year.

The minimum wage gives at least some power back to the customers, who can fight back against vendor price increases by doing without, buying less, looking for cheaper substitutes, or making it themselves.

If this drives the Big Business into bankruptcy, all the better. Their vacuum-cleaner effect on demand will be gone, and smaller businesses (which in aggregate will employ more people) will take its place.

Captain_Obvious makes a point about small business having a tough time competing with bigger businesses that can operate on higher economies of scale: which means they sell a lot more compared with the number of people they employ. However, the answer to the problems of small business isn't to eliminate the minimum wage -- it is to eliminate Big Business.

You don't win contests, including economic ones, by surrender. If one tactic isn't sufficient, then add another, and another, until you win. The bottom line here is this: the Fat Cats need Little People to do the work for them because Fat Cats have neither the numbers (nor, usually, the skills) to survive on their own. But the Little People can -- and for centuries before the Industrial Revolution did -- survive just fine through their own unincorporated labors.

Think of the best investment scheme ever invented by the mind of man. What does it return as an annual percentage? Maybe 500%? What's the best investment return usually available to Little People? 20%? Probably less.

Okay, next spring take a seed of corn out to a garden and plant it. Keep it watered. Don't let birds or animals dig it up and eat it. In only six months, that one seed will multiply into 500 seeds per ear of corn that develops on the stalk. At a minimum, that's 50,000% gain on investment.

That's the kind of investing that Nature provided every working man and woman with, before the Fat Cats came along and took that opportunity away from them. If you have land and can work, you can forget the whole f-ing world. Let it go to hell around you; you'll be OK. You might not be maximally productive because you'll have to labor with primitive tools, but you can get by the same way as your ancestors did, forty thousand years ago.

Unless, of course, the Fat Cats use legal tricks to take your land away.

Answer 5

Absolutely! With what little raise you get the government takes out of your pay check any way. I have always said instead of raising wages, they need to lower the prices! I grew up during the 50's. Economy was so much better then. My parents bought a beautiful home on an acre of land for $600.00! We thought $1,000.00 was a lot of money. Gas was 25 cents a gallon. In the late 50's there was a show called the Millionaire. Every one was glued to the T.V. It was a big deal back then to be a millionaire! Now being a millionaire only puts you in the middle or upper middle class bracket. Yep, keep the wages the same and lower the economy.

Answer 6

Not necessarily. Afler all it's the people making minimum wage who will be getting the extra money. And that bit mean a lot to them. It means the difference between being able to afford food and car insurance, rent, maybe even a small mortgage in the future. The thing you have to remember is inflation is always going up, especially recently, and just to live above the poverty line now you HAVE to make above the minimum wage.

So my question is why is it the minimum wage, if it doens't even cover the basics for one person? And mind you they won't have the extra money from this wage increase if they don't get medical insurance too, for they'll still be paying all of that money to doctors, pharmacies, etc.

In our country, you are going to pay the price either way, when they go for government assistance or by buying higher priced items from companies. I'd rather buy the higher prices items because it rewards those that try.

Answer 7

Actually, the business person who has minimum wage workers is going to get a fairly large tax break to compensate for the wage increase. The second fact of this matter, is that when you raise the wages or income of people who are low wage workers it automatically effects the entire economy. Those people go out and spend that increase on goods and services they need for their families. Giving the very rich another tax break or 'wage increase' does virtually nothing for the economy because they just sink it into their off shore accounts or their bank account where it sits collecting interest.

Answer 8

The actual pay increase does not have an instantaneous effect on product inflation. It's a slow and gradual increase meant to allow the new wage to sink in and allow people to become comfortable with it A minimum wage increase means it'll be easier for minimum wage workers to survive on the paycheck (not comfortably, but still possible) for a time. It'll eventually grow to the same situation we're in now, but there won't be much cause for concern for roughly a decade. After that we'll have to see where things lead us.

Answer 9

Economics are not well understood here. They still don't understand that lower taxes means more growth and investment which means a larger tax base which usually overcompensates the original cut in taxes.

Walmart was built on this premise and look at how well they are doing. They lower the profit on each single item and then sell large volumes. They increase profit even though the profit margin is lower. The same goes for oil companies. If our government were doing as well we would have no national debt.

Answer 10

I am Not and the statement is absolutely
right on because if people haven't noticed,
the prices at your favorite restaurants have went up at least 15% since the Government raised the minimum wage and also the prices in the stores have went up!! What the hell good is
raising the minimum wage going to do if they keep raising prices on everything????

Answer 11

Because the company will raise their prices irrespective of the value of the minimum wage. Corporations are all about making profits for people like me (the share holders). Increases in the minimum wage is the government propping share holders up by making sure that people at the entry level of the labor force have the basic resources to purchase the products that generate my dividends.

You see, the rich and the poor don't just think differently. We think oppositely. You see a a subsidy for poor people, I see a subsidy that allows poor people to continue producing return on my assets. Believe me when I say to you that the goverment programs and policies are not about poor people, they're about using economics that on the surface appear to benefit poor but in reality keep the business engines humming (and for that I thank them).