Jophiel wrote:
gbaji wrote:
Minimum wage goes up. To pay for workers earning minimum wage at a fast food restaurant, the owner has to increase the cost of a meal by $1.
Does he though? Almost certainly not given the rather tiny increase in cost of living from year to year during that period. I guess it's not as much of an argument if the owner is increasing costs by a half penny per heal on average.
You asked for an example. I gave you one. In my example, the owner increases the cost of a meal by $1 to offset the increased labor cost. Does it really matter what the price increase is? If it's *any* increase than anyone who didn't get an accompanying wage increase is harmed. If we assume that this hypothetical McDonalds has 10 minimum wage employees on shift, each of them just having gotten a $5/hour raise, that's $50/hour that the store has to increase its sales by. Assuming just a slightly less than one meal per minute sales rate, gives us that $1/meal increase.
Again though, you're free to make up your own numbers if you want, but the number wont be zero. It can't be. I'll also point out that this assumes that the fast food product cost doesn't go up either. Which is unlikely unless there are no minimum wage earners at any point in the chain in which any of the ground beef, lettuce, tomatoes, onions, potatoes, oil, soda, wrappers, paper bags, etc goes from raw materials to a packaged item in a bin ready to be assembled into a burger, fries, and coke by the worker in the restaurant itself.
Which is pretty unlikely. I think when most people dismiss the product cost increase from a minimum wage increase, they do so because they aren't considering that entire chain. It's not just the direct effect of the retail outlets wage increase. It's the effect of the wage increase for every business along the way to getting that product to the retail outlet itself as well. Each of those may only experience a smallish increase in their costs, but each of those increases adds to the next step and the next and the next. The retail outlet is the last step in that chain, and you'll see the greatest increase there. And that increase will be far more than you might think if all look at is the direct wage increase on the business.
When you do this sort of thing,
everything gets more expensive.
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Sure, but to what degree? Is it sufficient enough to use as an argument to not raise the minimum wage? Honestly, it mainly sounds like petulance on your part that you're mad someone might not be as poor in relation to you as they once were.
No. My argument is that some people will only be marginally less poor in relation, and some other people will be marginally more poor in relation, and that these will tend to wash out with the net effect that you didn't actually help anyone at all. My conclusion to all of this is that no amount of those sorts of wage increases amounts to much more than re-arranging the deck chairs on the Titanic. You're never going to support a household on a minimum wage job, no matter how many such manipulations or adjustments are put in place. They're always going to be too small and too transitory to have any real effect over time. So instead of obsessing over how much we pay the minimum skill workers in our society, we should be focusing on maximizing their odds of gaining skills that allow them to command a higher
real wage.
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Any time you start saying "We can argue..." it's just your way of saying "I don't actually have good evidence for this but please just accept me at my word". Your word isn't good enough.
Saying that $15/hour still isn't enough to support a household on, and thus doesn't satisfy the "living wage" claim? That's strong "evidence" that this isn't about accomplishing that, right? I think we can all agree that even absent any sort of price affect such a wage increase would have, it wouldn't be enough. I would hope we can also all agree that the bigger the increase, the faster and more severe the price increase effect will be, which will eat away at any real economic gains for those affected. I'm not sure what would qualify as "evidence" for you here, but that certainly seems like good evidence that minimum wage increases are less about sound economic policy, and less about "helping the poor", and much more about empty political rhetoric designed to garner support while never actually providing any real solution.
But hey. Why don't you tell me why you think raising the minimum wage will help people out of poverty? I'd love to hear it. Because I'm reasonably certain that there's no evidence doing so actually helps people's economic outcomes over any reasonable period of time. You'd have a much better time arguing for food stamps and welfare programs. Those at least actually contribute directly to recipient's standard of living without having too much direct cost increase eating it back, and can actually be focused at those in need rather than handed out to a group mostly consisting of students and dependents. But raising minimum wage across the board? Doesn't make a lick of sense.
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Sure, for certain values of "harm". Is this one of those things where you keep insisting that no one will admit to some point despite the fact that everyone will happily admit to it? Sort of like pretending that no one else realizes that money doesn't "materialize", etc?
When your arguments, up to this point, have consisted of denying that anyone is harmed by a minimum wage increase, yes. At least you're finally acknowledging that, yes, some people do actually get directly harmed by a minimum wage increase. That's progress at least.
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You use the term "harm" instead of "cost" purely to create an emotional argument but without evidence of significant harm, it's meaningless.
Lol! Says the guy who just dismissed harm because it's not "significant" harm. Whose playing word games now? Look. If raising someone's wage by a few dozen dollars a week is such a huge deal, than increasing their cost of living by a few percent should be a huge deal too, right? I'm just trying to get you to realize that you're placing an enormous weight on one of these factors, and nearly none on the other. And if using one of the pillars that will actually catch your eye is the way to do this, then I'll do so.
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It "harms" me to have to walk across the room for a glass of water. It "harms" me to merely breathe since I must expend calories to do so. Saying you "don't need numbers" is essentially saying that you can only fail to provide evidence that the "harm" is meaningful which is saying that you have no argument at all.
It's harm vs help though. From a macro-economic point of view, every single dollar you "help" one group of people with by increasing their wages relative to their cost of living, you "hurt" another group of people by doing the opposite. And no, I don't need exact numbers to say that if X+Y=1, then any increase in X must result in an exactly corresponding and equal decrease in Y. That's how people who understand math at a level higher than simple arithmetic approach things. We don't think in terms of specific numbers, but formulas. And in this case, the formula, while quite complex itself, somewhat requires that, the total number of resources in the economy remains unchanged by a minimum wage increase. You have not increased the total number of "stuff" contained within. Therefore, if the amount of that "stuff" shifts such that one group has relatively more of it, then it must have decreased relatively for some other group.
The only question is identifying which group(s) are most likely to be negatively impacted by this. And I've already spent quite a bit of time arguing who that will be. Employers aren't just going to take the labor cost on the chin. They're going to raise their prices to cover not just wage increases by their own employees (if any), but the price increase to all goods and services their business pays for in the process of generating a bottom line. And they're going to make sure that bottom line stays the same for them relatively speaking. I think it's quite obvious that those most negatively impacted by a minimum wage increase are those wage earners earning some amount above the new minimum, but who do not themselves immediately gain a wage increase themselves. And the relative "harm" of that effect will be born most by those closest to that new minimum. Those earning much higher salaries can manage. Those living paycheck to paycheck in a working class job will be least able to do so.
The irony being that it's this precise group that most people think they're helping with this process.
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More to the point, my initial comment wasn't that "no one" is being "harmed" but that people who were making a dime over minimum wage when wages are increased isn't being harmed. Which is absolutely correct -- they are now making more money than before and reap an economic benefit from the increase even if they start sulking that they're "only" making minimum wage again and their coworker isn't a dime poorer in comparison any longer.
Huh? I'm talking about the person who was making a dime over the new minimum wage before it was increased to become the new minimum. They are not making any more money, but the cost of living will jump as a result of others earning a bit more. Now yes, if they manage to secure an equivalent raise for themselves, they can offset this, but there's no guarantee that will happen. I mean, the entire argument *for* minimum wage in the first place rests on the assumption that employers will pay their employees the minimum they can, and wont increase it absent some external force compelling them. So it seems bizarre to me that anyone advocating for a minimum wage would downplay this negative effect on the assumption that all of these employer will also raise the wages of those not in the range between old and new minimum just out of the kindness of their hearts or something.
That's a completely incompatible set of assumptions. Your assumption should be that very few employers will do this. Thus, very many people will be harmed. Unless you are arguing that employers will all raise their workers wages to be a "fair wage" in proportion to cost increases in the economy. But... Um... If you actually believed that then there would be no reason to argue for a minimum age increase.
Catch-22, right? Which one is it? Employers always quickly raise their workers wages in proportion to COL increases? Or they don't? Because if they do, then there's no need for minimum wage increases (or laws at all), and if they don't then raising minimum wage hurts a lot of people. Pick one.