Is it good for the economy if the "working man" is paid less?

Question

Because the percentage of US capitol in the hands of the middle-class has been shrinking while that in the hands of CEOs has been increasing..... And the CEOs take their money offshore to avoid taxation, while Working People spend theirs on cars, shoes, food and everything that keeps the economy moving. If less money is being re-cirulated through the economy, wouldn't that explain why the economy is failing so badly under neocons?

Answer 1

No it is not.

America was better off when blue collar workers had good well paying union jobs. It was a time when you could support a family on one paycheck.

"Free trade" is good for the wall street, not main street. Good for the CEO, not the worker.

Answer 2

Well first of all, the economy is not failing. By most of the metrics we use to gage the health of the economy it is quite robust. But there are big problems (the war, budget deficits, the housing slump with all of its fallout, the shrinking dollar and the rising cost of fuel)

But to your question, it is actually bad for the economy when wages fall or are too low for exactly the reasons you stated. No one disputes that. Of course every business thinks they would be better off with fewer employees and lower payrolls, but if every business got what it wanted in that regard, the economy would collapse. It hasn't (yet).

Answer 3

The theory of supply side economics simply put is supply creates demand. In other words, people have to be put to work first in order to earn the income to spend on produced goods.
The other side of the coin is the theory in which it is believed people must have the money first in order to create demand.
It's a chicken or the egg argument.
Regardless of which theory is correct, neither economic theory will work as long as there is huge federal deficits that contribute to the devaluation of the currency. Whatever increase in income the working person might be enjoying gets eaten up by increased expenses like food and fuel.

Answer 4

It is the fallacy of "trickle down" economics-that enrichiing the rich will bring everyone else up. Econ 101 tells us that money in the hands of the less well off is immediately put back into the economy, and via the "multiplier effect", is exponential in its impact. Trickle down simply does not work that way for exactly the reasons you cited.

Answer 5

cleaners, theres a UN video on youtube, the place they interview somebody in Belgium who stated a woman is called a "cleansing lady" a guy is called a "floor technition" so as that they could get diverse pay, additionally checkout operators, adult males get greater effective than females, for no reason. EDIT: nicely, the UN vid confirmed it happening in Belgium, Ive additionally heard of it taking place in Walmart, (whats up, i worked in a food market too :P ) yet what happens alot is that womens artwork is undervalued, like, maximum admin team are females, and its seen "womens artwork", ie, no longer quite much as good as mens artwork, becasue its "difficulty-free" yet i know admin workers, and that they do a helluva lot of artwork for a pathetically low pay, and that i canthelp yet ask your self if there replaced right into a guy in that individual same pastime, might he get greater pay? it must be an attractive test to confirm, we ought to continuously attempt it sometime.

Answer 6

It isnt necessarily better for the economy, but is sure is for ALL of the political elite in DC. You see the way things are now, can you EVEN imagine, how quick the political machine would have done away with working america if not for the restraints put on them by the US Constitution

Answer 7

The gap between rich and poor is widening. There is not much of a middle-class anymore. Three quarters of the worlds assets is owned by 2% of it's people. When the middle class disappears and the multitudes of poor finally get fed up....Chaos,Revolution,Death. Ahhh...the good old days.

Answer 8

No, it's better when the working man has disposable income to stimulate the economy and make the overall standard of living greater for all Americans.

Answer 9

No.
You've came to a False conclusion, because your premise is incorrect.

The Middle Class is smaller because many have now moved into the lower Upper Class.
Many of the upper Lower Class have moved up into the lower Middle Class.

All working people MOVE UP when there are Tax Cuts.

Answer 10

NO !!!!