The cite in the OP averaged a lie every 14 seconds.
So bullshit and bullshit on the OP’s claims.
Nope.
The BLS’ inflation calculator corroborates the above quote. It calculates 25 cents in 1938 as equivalent to $4.23 in 2015.
Your sad attempt at debunking the facts fails on at least two counts.
(1) Your link places an unwarranted reliance on the decrease in the unemployment rate. People who are unemployed but not looking for a job are not counted in the unemployment rate.
(2) That article conveniently conflates the number of businesses with the number of jobs. The vast majority of businesses employ only a few people. It’s entirely possible to have more businesses in operation, but fewer overall jobs.
As a matter of fact, we would almost EXPECT the number of businesses to rise – because some percentage of laid-off people are going to try to start their own business.
If the minimum wage rises 10%, what percent of low-wage workers will be laid off? (If this is too hard to Google you can just search SDMB. The question has been posed here repeatedly; the answer produced by economic researchers posted over and over; the ignorance repeats and repeats and repeats. Let’s debunk it right now, please, and we won’t need to debunk it again until September.)
If a 15% tax cut is a good thing, why not 50%? If 6% beer is a good thing, why not 30%? If an inane logic fallacy is a good thing, why not incontinent razzle-dazzle?
I agree that the “why not $100/hr minimum wage” counterargument is a logical fallacy for the reasons you point out, however the spirit behind such a question is not so fallacious.
When one proposes a $15/hr minimum wage, we never see arguments as to why that particular number is better. If $7.25 is too low, and $20 is too high, then why is $15 a good number? The only argument I have heard is because that is what “people need to live.” Then we talk about a “living wage.”
Such things are so subjective as to require more analysis. What is basic living? Is it a reliable car, cell phone, high speed internet, place to live in a crime free neighborhood. Yearly vacations to the beach? To Europe? Until we define what a living wage is an whether business owners will subsidize it, we cannot come to an agreement.
Also, who bears the burden? Say that an employee of mine returns $12 per hour of revenue for his labor, but I must legally pay him $15. Every hour he works, I go in the hole by $3. Do I have to bear this burden? Some say yes, because I am a rich businessman who chose to hire the guy. It doesn’t matter if my business is teetering on the brink of bankruptcy, breaking even, barely profitable, or insanely profitable. I must bear this burden regardless.
Well, I’m not going in the hole $3 each hour in any of these scenarios. I’m going to probably get rid of this guy or otherwise restructure my business. Even if I am as rich as Bill Gates, why does society place solely upon me the burden to prop up this one individual so that he has a living wage? If society wants to help him until he acquires more skills to make this wage, then society should bear that burden and not me. And the fact is that I probably will NOT bear the burden and this guy will not only need $3/hr of assistance but the full $15/hr because he doesn’t have a job.
But back to the point of the living wage. Before we talk about that, we need some agreement about what type of lifestyle this entails.
In a previous thread, I had posted part of the dissent in West Coast Hotel v. Parrish, the case which upheld a minimum wage law. I now post another part which I believe makes a good point:
It makes a good point (although I do not believe that the minimum wage laws are unconstitutional). If we are going to make business owners responsible for indigency, could we not equally pass a law saying that store owners must supply a person with sufficient food, clothing, and the like in such amounts to support them?
IOW, a family of four needs $200 worth of groceries to survive. I own the local market. The sole wage earner in the family has only $11.34 in his pocket. Could a law really require me to give him $200 worth of food and make me pay the difference? As the dissent points out, this is really no different than what minimum wage laws do: they place the burden on a private business to supplement a worker’s market value versus his need for a living wage. And the poverty that the person experiences is, in neither case, the fault of the business owner.
A valid argument for a tax cut should be able to answer these questions. A valid argument for a a minimum wage will do the same. Ludicrous extremes are useful tools for highlighting poor policy decisions.
That higher minimum wage decreases employment is hardly controversial. No one here thinks otherwise. It may still be a useful tool for realizing certain policy outcomes. And $15 may be optimal, or not enough. A city can only do so much, absent state or federal action. I like having my liberal feels tickled too, but there’s little indication that Seattle’s legislators thought that through.
A 50% tax cut is definitely better than a 15% cut. But the real answer is that taxes should only be as high as needed to fund constitutionally-allowed and necessary government activities. But that ship sailed long, long ago. 30% beer is not beer at all.
The $50 MW example is absolutely logical. Any minimum wage law distorts and undermines the labor market, to the extent that MW is higher than any company is willing to pay for a position and any worker is willing and able to command. The current MW is largely irrelevant to most workers and companies, so it has little effect. But the higher you raise it, it starts to change how companies structure their operations. Currently, the MW presents less of a burden to new hiring than other regulatory and employment costs, such as FICA taxes, unemployment compensation, workers comp, vacation, health insurance, etc. But for jobs that typically pay low wages, any increase in MW above natural market levels will result in reduced employment for those workers most impacted by MW laws.
It may be hard to extract that data from employment statistics, but it’s not hard to understand that either a) MW laws are irrelevant because the level is lower than workers are able to command in the market, or B) companies will increase automation, reduce service, raise prices and/or go out of business, all of which reduces employment and/or buying power at the low end of the job market.
I do, because that is what the facts say. A 2014 study by Goldman-Sachs proved that raising the minimum wage actually improved job growth:
So let’s hear no more about what everyone knows about what happens when the minimum wage goes up. Everyone can be wrong.
post hoc ergo propter hoc.
There is simply no logical means by which increasing the minimum wage could increase job growth. We might argue over the minimum wage and its level, but nobody can say that it increases employment.
How can forcing an employer to pay higher wages lead to him hiring more people? It’s absurd on its face.
There’s a flaw in your logic: in your example, the burden(giving away $200 of groceries for free) falls on the private buisiness. But in my example(raising Minimum wage to a reasonable living wage )the burden falls on all of society.
If the grocer gives away $200 of food, he has lost $200. But if society forces him to pay $15/hr wages, the grocer doesn’t necessarily lose anything…he can raise his prices. All of society then pays the cost of the grocer’s higher labor costs. There are thousands of other customers who shop at the grocery,most of whom will feel little pain at having to pay an extra 35 cents on a six-pack of beer and a loaf of bread .
The extra money they spend on food may force them to skimp and save money elsewhere…say, by buying their next new car with fewer accessories. So the low-paid grocery store workers benefit from a decent minumum wage, and the higher-paid car factory workers lose money from fewer orders and working fewer hours .But society as whole benefits, because nobody suffers the indignity of trying to support a family on $6/hr.
Yeah, I know what you’ll say:…it sounded like a good theory when Karl Marx wrote similar things. But I’m not trying to revolutionize all of society --I’m just trying to help the bottom 5% or so of workers in minimum wage jobs.
OK. I yield on the cause and effect. However, the simple correlation demolishes the claim that raising the minimum wage decreases employment. Thirteen states increased their minimum wage, and none of them saw a loss of jobs. Point proven.
It’s supposed to work by the “trickle-up” theory, yes? That is, low wage employees don’t tend to save money. They spend their money. Pay them extra, and they spend extra. They spend extra often at the same stores where they work, or other areas in the neighborhood. They’re not spending it on yachts and offshore accounts, they’re spending it on slightly more expensive food and an extra pair of shoes for their kid.
So pay your employees more and they’ll buy more of your stuff, and your increased sales means you can hire more people…or at least that you don’t have to cut hours. If the money is coming back to you when your employees become your customers, it’s pretty close to a wash. If you’re losing fewer employees to high turnover because you’re paying them decently, then you start to win, because hiring and training is expensive.
Makes at least as much sense as “trickle-down”, which only makes sense until people start acting like people and getting greedy, hoarding money instead of creating new jobs with it.
But if the grocer (and every other business who is subject to the increased minimum wage) raises his prices enough to cover his expenses of paying higher wages, they those employees who now have a higher wage, also pay higher prices. The net benefit of the higher wage is next to nothing.
We see, though, that it doesn’t happen. The business owner must assume at least part of it, causing businesses to fail or otherwise putting the burden on the business owner and not society.
I disagree. We don’t know that there wouldn’t have been more jobs gained but for the minimum wage increase. I don’t believe your cite proves anything.
Two points:
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Assuming a perfect isolated market in which no money is taken out of the local community, it may be a net zero effect. My employee orders something on Amazon? Money gone and I lose. Ebay? Lose. Pay AT&T for a cell phone bill? Lose. Takes a vacation the next town over? Lose. Plus there are so many external costs to increased pay (social security tax, unemployment tax, etc.) that there is no way that business owners would ever come close to breaking even on this proposition. It sounds like a perpetual motion machine design.
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Nobody “hoards” money. Buying yachts or investing in offshore accounts promotes all of what you advocate. If I buy a yacht, the salesman at the yacht dealership takes home money. The minimum wage guy that cleans the yachts before sale earns his salary. If I invest my money in a bank in the Cayman Islands, the tellers and the security guards at the bank earn money and take it home to their families. Unless a person stuffs hard cash under a mattress, I can’t see where money is somehow hoarded or wasted.
The claim was that increasing the minimum wage reduces jobs. Thirteen states increased the minimum wage, without losing jobs. Not a matter of opinion.
Let’s say without a minimum wage increase, a state would have added 100,000 jobs. With the increase, they only add 50,000 jobs. That represents a 50,000 job reduction.
Now, neither of us can predict an alternate scenario, but simply pointing to a gain of 50,000 jobs in a state that raised the minimum wage is not support for your position.
I don’t think that anyone has taken the position that the minimum wage, to the exclusion of all other factors, is the sole indicator of job growth or loss. The position that it will cause job loss is conditioned on the asterisk that it means “job loss in relation to a world without the increase.”
LOL you never even read the GS report, did you.
So would you advocate a return to Lochner era-style policies and judiciary decisions?
Also, your hypothetical doesn’t give near enough information to decide whether or not the business owner contributed to other’s impoverishment. For all we know, that hypothetical business owner lobbied for years to reduce regulations, allow yellow dog contracts, usurp the right of workers to organize themselves, allow company scrip, etc. Perhaps he even joined a “commerce” group that lobbies on behalf of all businesses for laws more favorable to their purposes even if that advantage is gained at the expense of the general public.
How do you know this?
If that were true, we would have seen a higher increase in jobs in states that didn’t increase the minimum wage. We didn’t, so the only conclusion is that increasing the minimum wage does not reduce jobs.