The supreme court disagrees with your opinion here on the constitutionality of a federal minimum wage.
I haven’t read the case law regarding this in years, but I can pull it up if you think I’m wrong.
I don’t think it ever would go back. I think the vast majority of people would favor a higher minimum wage. If Sanders gets elected, that would be evidence to support my point.
But if it was truly disasterous, I do believe whatever Republican president followed Sanders (because obviously a Republican gets in the white house if Sanders were to have a disasterous term), would change the minimum wage back if at all possible. Much like Republican candidates now want to take back obamacare.
That’s not necessarily true. It doesn’t have to go in both directions.
I said P → Q. That does not infer Q —> P. It’s not a biconditional statement.
Let me see if I can argue with one hand, lol…
Ya, I definitively disagree. Many states have a minimum above the fed rate. MD, for example, is moving to $10.10 over the next 3 years (I believe). The city of Seattle is at $15. There are simply to many unique variables across the country, like cost of living, for one wage to make sense or even work.
I get the hesitation based on history, but times have changed and there are less barriers to moving to an area that pays a fair wage. Honestly, I don’t like the minimum wage at all because it places a cap on companies HC numbers artificially, but if there is going to be one a local one makes more sense. Plus I believe it falls under the 10th
Amendment anyway.
I think it’s awesome you pay your employees well, but let me give you a scenario to think about.
Lets say you’re a small business with 20 employees. Your gross sales are $1M, you COGS are $800K and of that $400K is the salary for those employees. That’s roughly $10/hr ((400,000/2,000)/20). Ignoring everything else your EBITA is $200K. You take the share you want as owner, okay your taxes, and move on.
Now Sanders passes a fed $15/hr minimum. Your COGS just increase to $1M without an increase in Production. Further, you no longer have any excess money to live on. You can’t invest in new product lines either.
What do you do?
Many of Bernie’s plans put smallto medium businesses in this type of situation.
“I think there’s a lot of room for argument and disagreement as far as the economics go. You can absolutely find prominent economists who believe Sanders would move our economy in a better direction. Smart, well educated people.”
I actually think there are almost no prominent economist that believe Sanders would move our economy foward.
These are Obama and Clinton advisors: An Open Letter from Past CEA Chairs to Senator Sanders and Professor Gerald Friedman – lettertosanders
“It’s simply a disagreement on how much the cheapest labor in the country should cost, and to what degree the wealthiest folk share with the poorest.”
Do you believe the haves should be forced by the government to give to the have nots?
Do you belive redistributing wealth solves any of our economic problems as you see them?
It’s also not just about the cheapest labor, though. Anytime the minimum is raised there is a ripple effect. For example, I work in the finance department for a company with about 6,000 warehouse employees. The starting salary is $8.25 for what we call an operator 1. Over the next few years that will be raised to $11.10 (we hired at a dollar higher than the minimum) this is causing what we call wage compression (If I sound condescending or anything I apologize. I just don’t know what you do and don’t know in this area). What this means is that people currently making $8.25 have to be increased to $11.10 as well as everyone that currently makes less than $11.10. Company policy is to provide a 3% minimum cost of living adjsutment annually and very rarely do we not do this. This is another factor (time with the company and past increases) that we need to adjust for. We can’t have an op 1 with 3 yaers service making the same amount as an op1 on their first day. It will destroy moral.
All in all the agregate cost of MD increasing the minimum is around $8M if memeory serves. Now we’re a large company and can absorb this, but only because we’ve had 10+% profit margins for a while now (5+ years) and are strongly positioned in the market and industry. My point is, production hasn’t increased, but costs have. This also affects % based benefits and other portions of COGS.
Big picture, it also drives up materials costs because the minimum effects a lot of company’s. So it isn’t just increased labor costs. It’s increased materials costs as well.
Unfortunately, only sometimes and in some cases can these additional costs be passed on to consumers via higher prices. One of the quickest ways to reduce costs is to cut HC especially for low skilled labor. At some point automation becomes the best budgetory option cutting even more HC. That’s just an unfortunate part of capitalism.
Finally, all of the above results in increased prices across the board. So milk was $2 now it’s $2.10. Your burger was $5 now it’s $5.25. So on and so forth. Once the economy adjusts to the new, artificially inflated, status quo those at the botton are right back where they started and probably worse off as they’ve likely lost purchasing power. The kicker, though, is that more people are hurt by this as prices increase for everyone. So that middle class family that use to spend $400/mon on groceries now spends $450/ mon. That’s and extra $600 a year and their salary was probably not increased. Kicker #2 as it relates to Bernie, now their payroll taxes are higher and iirc their income tax is higher.
America didn’t build the strongest economy in the world, in short order, by over taxing and redistributing wealth.
That’s not to days Capitalism is perfect, far from it.
errrrrmmmmm I have seen support of raising it to $9-10, which personally I have no problem with.
Somehow I cannot find a poll referencing $15 an hour, which seems to be the rallying cry of the burger flippers (full disclosure, I worked in fast food in high school. Anybody having kids thinking they can raise a family doing that should be sterilized.)
I think about 10 dollars is what Bernie would probably actually get accomplished if he were in office. I doubt he’d make 15 happen, particularly if he’s a 1 term prez.
I’ll just address a couple things:
In the specific example you provided, the answer is that my prices would go up. Obviously there are variables not addressed here, like what sort of product or service I’m offering, but in my industry, that’s the answer. And it would be accepted by my customers, who are fucking enormous companies and can afford to pay higher prices. They would have to, because all of the suppliers I compete with would also be raising prices. And your example is essentially the amount of employees at my company, so it fits well enough.
Do I believe the haves should be forced to give to the have nots? Yes, I believe in taxes. And I do not agree with a flat tax. I think I’m in the majority on that one.
The short answer to the next question is also yes.
As to your point of automation replacing people… That’s been happening since the industrial revolution, and will continue to happen, regardless of what we have the minimum wage at, because in most cases, automation will be FAR cheaper than labor when it is implemented.
I’ll disagree on the grocery example. I already mentioned earlier that the cost of groceries has not increased with higher wages. Groceries are actually cheaper today overall than they were 30 years ago. When you throw inflation into the mix, they’re effectively WAAAAY cheaper. I certainly don’t expect a 10+% increase in grocery prices, as your example would have me believe would be the result.
I don’t know if I’m reading this right, but I believe I am. Middle class families would not be paying higher income taxes than they currently do, under Bernie’s plan.
I guess I’ll ask you a question. Do you believe large corporations, and the wealthiest people in the US, are paying a fair amount in taxes?
I’ll have to address the substance later, but I’m pretty Sanders is planning to increase income tax on everyone. I remember hearing him even say it in a speech. I’ll have to see if I can find it.
I mentioned Texas because that’s where I live, not a reference or a jab at you.
If the market is beyond reparable, how does it set wages for all non-minimum wage jobs? The government doesn’t have to set the rules and “save the day”.
I see you believe that corporations are corrupt, which many Bernie supporters do. There are no doubt corrupt businesses, but do you also believe that the government is free of corruption? Socialism (or a socialistic policy like minimum wage) does not eliminate cronyism, although it might reduce crony capitalism (and increase government corruption) by shifting the power more towards the government.
[quote=“flipcollar, post:56, topic:215688”]
You’re obviously right that a living wage varies from region to region. A federal minimum wage is just a base line. A state can always institute a higher minimum wage when appropriate. [/quote]
Why do they need determine a baseline? If it increases for a large portion of the country that has a big impact on a lot of businesses. It would be better to handle the baseline as locally as possible, which is what the free market does.