Someone asked me to give my thoughts on the minimum wage: The minimum wage issue is complicated. Armchair economists on the right will say, This will cost us jobs, whereas armchair economists on the left will say, More money in the pockets of workers will equal more money in the economy, stupid! The former is empirically wrong (mostly), and the latter is oversimplifying a complex issue. Once you wade through all of the nonsensical talking points, what we find is that theres an economic benefit in increasing the value of peoples labor with a minimum effect on both the consumer and business. The problem is that weve waited so long to normalize minimum wages with anything even remotely close to the standard of living that there will certainly be a shock to the system. It might not cost jobs, but it could possibly cause some companies to freeze hiring until their profits and losses have normalized to sustainable levels. But, thats to be expected with any change, and the rights argument seems to be, If it aint broke, dont fix it. Though, if youre looking at the rising income inequality in this country and the amount of money investors and CEOs are making in comparison to their workforce, the system is VERY, VERY broken. Those are the facts. Here are my personal opinions on the matter: The minimum wage wasnt designed to act as a living wage, but years of union busting and removal of collective bargaining rights have slowly created an underclass with minimal opportunities to increase economic mobility. So, either the argument is that were perfectly fine with a small minority of people in this country making insane amounts of profit while their employees go on the government dole, or we want to provide those employees with an opportunity to make more money and live better lives; whether that is at the cost of profitability to the company or a monetary increase in goods and services to the consumer, both accomplish the same thing. You cant have a situation where workers wages arent protected or standardized and then be surprised that so many people are living below the poverty line. Despite what right-wing fundamentalists and Libertarians will say, the market thrives on keeping wages low to maintain profitability and growth. Without unions, this country would have probably never created such a strong middle-class, and, without them (or a standardized wage), it will continue diminishing over time. By the way: Im more in favor of a Cost of Living Index attached to states or districts to determine minimum wage, since what it costs to live in Northeast Texas is in no way close to what it costs to live in Seattle or Los Angeles.
Posted on: Tue, 09 Sep 2014 13:37:02 +0000
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