Biden Wants 15/Hour Min Wage

[BFritz21]

Just another way the Dems way of thinking that everything should be handed out will end up hurting the country.

One major thing that I took away from the economics classes I have took in college was that raising the minimum wage to $15 leads to 2 things:

(1) The elimination of jobs: companies will deem some jobs not worthy of a $15 per hour salary & simply realize they do not need them. (Say goodbye to grocery store bag boys!)

(2) Inflation: to compensate for the lowest wage being paid being nearly doubled, jobs that currently pay $15 per hour will have to up their pay for employees as well. This simply just leads to the dollar being worth less. (Say hello to $10 for a gallon of milk & $12 for a McDonald’s cheeseburger combo!)

(3) The loss of small businesses... some small businesses who rely on teenage or other minimum wage employee help won’t be able to afford to hire employees that keep their lights on, ultimately leading to more reliance on big box companies who will be able to afford to pay workers these wages.

To increase one’s pay, one must learn to acquire the skills necessary to get a job that pays more than minimum wage. That is the beauty of capitalism- you can grow as far as you wish by increasing your skill level!

Does anyone think small businesses and our economy overall will be able to survive this?

[Benton]

(01-16-2021, 02:32 AM)BFritz21 Wrote: Just another way the Dems way of thinking that everything should be handed out will end up hurting the country.

One major thing that I took away from the economics classes I have took in college was that raising the minimum wage to $15 leads to 2 things:

(1) The elimination of jobs: companies will deem some jobs not worthy of a $15 per hour salary & simply realize they do not need them. (Say goodbye to grocery store bag boys!)

(2) Inflation: to compensate for the lowest wage being paid being nearly doubled, jobs that currently pay $15 per hour will have to up their pay for employees as well. This simply just leads to the dollar being worth less. (Say hello to $10 for a gallon of milk & $12 for a McDonald’s cheeseburger combo!)

(3) The loss of small businesses... some small businesses who rely on teenage or other minimum wage employee help won’t be able to afford to hire employees that keep their lights on, ultimately leading to more reliance on big box companies who will be able to afford to pay workers these wages.

To increase one’s pay, one must learn to acquire the skills necessary to get a job that pays more than minimum wage. That is the beauty of capitalism- you can grow as far as you wish by increasing your skill level!

Does anyone think small businesses and our economy overall will be able to survive this?

It's a very complicated issue. Wage stagnation has been an issue for decades. The idea that you can add skills and get a higher wage job is dependant on the industry,. Which can change rapidly. 

It reminds me of the late 90s when lots of my friends got degrees related to workplace safety because of growing osha requirements. Plants were paying huge salaries for safety engineers because there weren't any. Then there were and you had all these young adults with worthless degrees and tons of debt.

But here's the issue: if companies aren't willing to pay a living wage, then taxpayers will have to.

You take someone working at Big Box Store working 26 hours a week. (so they aren't offered insurance) and making $9. That same worker has to pick up at least one other similar job to make around $380 per week, which means they can just afford rent and utilities in most places. Kids aside, hospitals are going to eat the medical bills when that person is sick, which means taxpayers are paying it. The person can't afford school, so taxpayers are paying it. If there is a kid? Wic, medical card, daycare, etc.

Which wouldn't be as big an issue if companies today paid taxes like companies did pre-1980s. But companies today pay less than a third of the taxes they did up until reagan/congress decided to trickle down. Instead, it's up to middle class taxpayers to pay for companies making billions off low wage labor and paying less in taxes.

[NATI BENGALS]

Atta boy Joe. Fight for the working class.

Businesses will continue to replace workers with technology whether the minimum wage is increased or not.

Not everybody is cut out to be a computer programmer or manual laborer, doctor, or plumber. Bunch of the kids given lead poisoning in Flint Michigan will probably never amount to much. And there are flat out just a bunch of stupid people who will never amount to much more than an entry level job.

I’m all for a living wage. If you work 40 hours a week you should be able to get by and not need welfare to support a family.

[Au165]

People are funny, they value the job enough that they want to call you "essential" during a pandemic but they also don't think you should be able to live on the pay of that job. They think you should require a degree if you want to make a living wage, but they also don't think the wage you earn while getting that degree should be above the poverty line. In reality, all the lies people have told you over the years about why minimum wage can't be a liveable wage is just that, a lie. We see it in other developed countries and it works out just fine, and many also get free healthcare to go with it too. The threats of lost jobs, inflation, etc. are propaganda that is spread to turn the relatively poor on other poor people.

I make far more than minimum wage and support the increase to it. I understand that it will result in a cost of goods increase that gets passed through to consumers but I believe people should be able to work 40 hours a week and survive. I also understand, even looking at my own company, it's relatively minimal if we are truly just passing through the cost of the labor increase. I would suspect however they will use the minimum wage increase to simply add some fluff in for more profit like most other companies will and blame it on labor cost increases.

All that said, the minimum wage should be tied to the cost of living in an area. A blanket increase like that doesn't appropriately fix the issues with living in San Francisco versus Athens Ohio. The general ideal of "$15" is good but it needs to be adjusted up and down based of the actual cost of living to make sure we don't use a superficial number that sounds nice but still leaves a large portion of populace screwed.

[GMDino]

(01-18-2021, 10:28 AM)Au165 Wrote: People are funny, they value the job enough that they want to call you "essential" during a pandemic but they also don't think you should be able to live on the pay of that job. They think you should require a degree if you want to make a living wage, but they also don't think the wage you earn while getting that degree should be above the poverty line. In reality, all the lies people have told you over the years about why minimum wage can't be a liveable wage is just that, a lie. We see it in other developed countries and it works out just fine, and many also get free healthcare to go with it too. The threats of lost jobs, inflation, etc. are propaganda that is spread to turn the relatively poor on other poor people.

I make far more than minimum wage and support the increase to it. I understand that it will result in a cost of goods increase that gets passed through to consumers but I believe people should be able to work 40 hours a week and survive. I also understand, even looking at my own company, it's relatively minimal if we are truly just passing through the cost of the labor increase. I would suspect however they will use the minimum wage increase to simply add some fluff in for more profit like most other companies will and blame it on labor cost increases.

In PA the minimum wage has not changed since 2009...and I don't remember prices holding steady.

Nor do I remember the outrage over executives getting large bonuses or raises out of fear of rising prices.

It probably doesn't have to be $15 where we live but even a proposal in 2019 to move it to $9.50, by 2022, in four steps, never came to pass.

We are brainwashed in this country that you just have to "work harder" to get ahead.  That is true for some...not most.  

[Forever Spinning Vinyl]

(01-16-2021, 02:32 AM)BFritz21 Wrote: One major thing that I took away from the economics classes I have took in college was that raising the minimum wage to $15 leads to 2 things:

(1) 

(2)
 
(3)

Trump University?

[Mer]

What if our government started giving the American people the money they claim is going for aide to other countries?

[Au165]

(01-18-2021, 12:36 PM)Mer Wrote: What if our government started giving the American people the money they claim is going for aide to other countries?

$39.2 Billion in foreign aid for 2019...$686 Billion in military spending. 

Imagine what we could do if we weren't beholden to the big defense contractor lobbyists!?

Random tangent aside, this really isn't about what the government spends on either. The idea is if you force employers to pay their employees a real wage, we the tax payers won't have to subsidize that wage as we are doing currently. Recent studies have shown we are subsidizing the workforce of some of the biggest companies in the world because they don't pay their employees enough to live while raking in record profits.

[Benton]

I've said before, I think the federal minimum wage needs to be low, but at the same time, I think wages are dependant on area. $15 an hour where I live is pretty decent because of the low cost of living. $15 an hour in nashville won't get you an apartment, utilities and food.i know several folks who make the 1-2 hours commute to nashville because wages are higher, but live here because the cost of living is much lower.

[Arturo Bandini]

What a strange idea to be able to feed your family with one job while having also time for yourself and not having 2 or 3 jobs for a living ??

What a strange idea to treat everyone decently.

Not everyone is still living at daddy's home ...

[Arturo Bandini]

(01-18-2021, 12:36 PM)Mer Wrote: What if our government started giving the American people the money they claim is going for aide to other countries?

WHat if you don't spend trillions on military while being unable to defend your own capitol ??

USA defense budget is bigger than all the other countries combined ... 

For what ?

Losing in Iraq and Afghanistan, where is this money going ?

[GMDino]

(01-18-2021, 01:13 PM)Benton Wrote: I've said before, I think the federal minimum wage needs to be low, but at the same time, I think wages are dependant on area. $15 an hour where I live is pretty decent because of the low cost of living. $15 an hour in nashville won't get you an apartment, utilities and food.i know several folks who make the 1-2 hours commute to nashville because wages are higher, but live here because the cost of living is much lower.

Our area is the same.  In fact I proposed a few years back that we invest in housing and get people who want to work elsewhere and don't mind a 30-60 minute drive.  Once people moved back the amenities would pop up to support the community which would bring jobs to the area.

[Belsnickel]

So, all of those assumptions in the OP are actually not borne out in the research. That is the economic theory, but there is a lack of significant evidence that says raising the minimum wage causes job losses, increasing prices, or small business closures. There is anecdotal evidence, sure, but when there has been actual economics papers on the subject with statistical modeling being done, the evidence isn't there.

[Dill]

(01-18-2021, 12:36 PM)Mer Wrote: What if our government started giving the American people the money they claim is going for aide to other countries?

Excepting maybe aid to Israel and Egypt, the bulk of foreign aid brings a significant economic and "peace" dividend to the U.S.  It's not like giving a beggar a dollar on the street. It's more like an investment that brings returns, like bigger markets and the stable trade relations needed to milk those markets.

A Republican administration will never "give" the American people any money saved by cutting foreign aid. Their first thought would be how to translate budget cuts into tax cuts. Keep in mind their arguments against the recent pandemic subsidies. They believe that large numbers of working people must be motivated to work by want of resources, and so they favor policies designed to keep that "want" in place.

Democrats, on the other hand, are generally all for plowing money back into the economy with government spending to create jobs. Instead of "giving" people money they would spend it on things like infrastructure, generating well-paying construction jobs.

[Benton]

(01-18-2021, 02:03 PM)GMDino Wrote: Our area is the same.  In fact I proposed a few years back that we invest in housing and get people who want to work elsewhere and don't mind a 30-60 minute drive.  Once people moved back the amenities would pop up to support the community which would bring jobs to the area.

Yeah back several years ago (more than a decade I think), I tried to get some lawmakers interested in a passenger rail system from stl to nashville. It would open up hundreds of thousands of workers between the two cities. But there wasn't any interest from lawmakers, which I understand given the cost. But I think we need infrastructure like that if we're going to create more jobs, especially in rural areas.

[CJD]

I honestly don't understand what the thought process behind Trumpism even is. If it truly is a form of populism, then why is it so fervently against unions and raising the wages of the working class?

As far as the actual number, I personally am of the belief that every city (or at least county) should have a commission whose sole job is to track the average cost of living in that area and dynamically update the minimum wage to make sure that no one who works a 40 hour work week would still require federal assistance to live.

This would do several things:
1. It would ensure that no corporations or businesses are exploiting their workers, requiring that they work more than 40 hours a week to live a basic human existence in any given city.
2. It would lighten the load on the welfare system, allowing for the money to be allocated more appropriately or, Heaven forbid, get people off of the "government teat," like Republicans always claim they want to do.
3. It would increase the quality of life of thousands if not millions of people without creating a situation where someone is making "too much" money (or too little, as 15 dollars an hour is still likely not a living wage in some parts of the country where cost of living is incredibly high).
4. It would not completely ruin small businesses that work on slim margins and can't afford to pay workers a full 15 dollars per hour.

If a small business can't even afford to pay that living wage, then I agree with FDR. That business probably shouldn't exist.

No one should be forced to work for poverty wages simply because the alternative is starvation and homelessness. There's a better way to run a society and increasing the minimum wage is the first step towards that better functioning society. Is increasing it to 15 dollars an hour for the entire country the answer? I'm not sure. But it's better than not increasing it at all and just letting people continue to wallow in poverty despite working a full work schedule.

Just because making fast food is "easy" doesn't mean the people doing it don't deserve basic human needs and comforts. Especially in today's world where internet (which is expensive) is quickly becoming a necessary utility.

[CJD]

(01-16-2021, 02:32 AM)BFritz21 Wrote: (2) Inflation: to compensate for the lowest wage being paid being nearly doubled, jobs that currently pay $15 per hour will have to up their pay for employees as well. This simply just leads to the dollar being worth less. (Say hello to $10 for a gallon of milk & $12 for a McDonald’s cheeseburger combo!)

The McDonald's cheeseburger combo example is interesting. Let's explore that a little bit.

Let's say the average staffing is 6 people working minimum wage or near minimum wage on any given shift. That means that you're paying ~44 dollars an hour for your daily operation (I know that they may amp it up to 8 or even 10 people during busy periods, but I think 6 people is your standard staffing, with skeleton staffs of 3 or 4 operating in non-peak hours assuming it didn't change drastically from when I worked in fast food ~15 years ago.)

Let's also say that a Big Mac combo costs about 7 dollars (that's how much it is per their app at my local McDonalds, this number obviously changes based on where you live to some extent.).

In order to break even on the cost of labor, at least 6.2 Big Mac combos must be sold per hour. This is not counting the cost of the ingredients and machinery to make those big macs, but we're going to be doing a cost delta here soon, so those costs will, for the most part, cancel out.

Now, let's say that the minimum wage is increased to 15 dollars an hour. The cost of wages for those 6 people will then increase to 90 dollars per hour. 

So, in order to break even on the cost of labor, that means that 12.86 Big Macs must be sold. Or, alternatively, those same 6.2 Big Macs must be sold at 14.52 rather than 7 dollars.

Now, this is assuming that the business only sells enough big macs to break even on the labor they employ, which is obviously silly. No McDonalds would staff 6 people per hour if they only sold 6 Big Macs and no McDonalds that only sold 6 big macs per hour would functionally operate today, regardless of the wages they pay their workers.

The more you increase the number of big macs sold per hour, the less you'd have to increase the cost of the Big Mac to account for the increase in wages of the workers. For example, if a McDonalds existed that sold, on average, 20 Big Macs per hour, they're currently raking in 140 dollars per hour in Big Mac sales. Subtract the current $43.50 for the minimum workers' wages and you have $96.50 in profits (disregarding the cost of ingredients). In order to make that same exact profit margin with a 15 dollar per hour minimum wage, the cost of those 20 Big Macs would only need to increase to $9.32 from $7.00.

If they average 30 Big Macs per hour, the increase would only need to be to $8.55. 40 Big Macs = $8.16 and so on.

Since the cost of labor has increased on a static level, the cost of the food will not increase at a proportional rate. No matter how many Big Macs those employees sell, they will only ever make 90 dollars per hour. So the more successful a McDonald's is, the lower they can price their food and remain mostly unaffected. Alternatively, they could make the food fractionally smaller to account for this change in wages (I don't know about you, but I know for a fact that Cadbury cream eggs have gotten smaller over the years but the price hasn't followed the same trendline. Hmmm....)

This article, published in 2015, estimates that increasing the minimum wage to 15 dollars per hour would increase the cost of a Big Mac by approximately 17 cents. 

Now, the interesting part of this whole thing is that when this article was written, a Big Mac cost $3.99 (this study examined only the Big Mac itself rather than the combo). They estimated that increasing the minimum wage increase would only increase it to $4.16.

Well, I just checked McDonald's app and, surprise surprise, the cost of a Big Mac right now is $4.19! And that's without the minimum wage increase!

These ***** are increasing the cost of their food to account for the inflation that has occurred in 5 years, but they have not had to increase the cost of the labor that generates those Big Macs! This is the utter absurdity of Capitalism. Prices will continue to go up and up and if you try to fight for higher wages for the poorest people, they'll threaten you with the increase in cost of goods that they're already doing anyway.


Don't let the corporations brain wash you into fighting your common man. People deserve a living wage. If it raises the price of a burger by a dollar, we'll survive. And, in the case that we do raise the minimum wage, the workers will too.

[Benton]

(01-18-2021, 04:50 PM)Crazyjdawg Wrote: The McDonald's cheeseburger combo example is interesting. Let's explore that a little bit.

Let's say the average staffing is 6 people working minimum wage or near minimum wage on any given shift. That means that you're paying ~44 dollars an hour for your daily operation (I know that they may amp it up to 8 or even 10 people during busy periods, but I think 6 people is your standard staffing, with skeleton staffs of 3 or 4 operating in non-peak hours assuming it didn't change drastically from when I worked in fast food ~15 years ago.)

Let's also say that a Big Mac combo costs about 7 dollars (that's how much it is per their app at my local McDonalds, this number obviously changes based on where you live to some extent.).

In order to break even on the cost of labor, at least 6.2 Big Mac combos must be sold per hour. This is not counting the cost of the ingredients and machinery to make those big macs, but we're going to be doing a cost delta here soon, so those costs will, for the most part, cancel out.

Now, let's say that the minimum wage is increased to 15 dollars an hour. The cost of wages for those 6 people will then increase to 90 dollars per hour. 

So, in order to break even on the cost of labor, that means that 12.86 Big Macs must be sold. Or, alternatively, those same 6.2 Big Macs must be sold at 14.52 rather than 7 dollars.

Now, this is assuming that the business only sells enough big macs to break even on the labor they employ, which is obviously silly. No McDonalds would staff 6 people per hour if they only sold 6 Big Macs and no McDonalds that only sold 6 big macs per hour would functionally operate today, regardless of the wages they pay their workers.

As you increase the number of big macs sold per hour, the less you'd have to increase the cost of the Big Mac to account for the increase in wages of the workers. For example, if a McDonalds existed that sold, on average, 20 Big Macs per hour, that means they're currently raking in 140 dollars per hour in Big Mac sales. Subtract the current $43.50 for the minimum workers' wages and you have $96.50 in profits (disregarding the cost of ingredients). In order to make that same exact profit margin with a 15 dollar per hour minimum wage, the cost of those 20 Big Macs would only need to increase to $9.32 from $7.00.

If they average 30 Big Macs per hour, the increase would only need to be to $8.55. 40 Big Macs = $8.16 and so on.

Since the cost of labor has increased on a static level, the cost of the food will not increase at a proportional rate. No matter how many Big Macs those employees sell, they will only ever make 90 dollars per hour. So the more successful a McDonald's is, the lower they can price their food and remain mostly unaffected. Alternatively, they could make the food fractionally smaller to account for this change in wages (I don't know about you, but I know for a fact that Cadbury cream eggs have gotten smaller over the years but the price hasn't followed the same trendline. Hmmm....)

This article, published in 2015, estimates that increasing the minimum wage to 15 dollars per hour would increase the cost of a Big Mac by approximately 17 cents. 

Now, the interesting part of this whole thing is that when this article was written, a Big Mac cost $3.99 (this study examined only the Big Mac itself rather than the combo). They estimated that increasing the minimum wage increase would only increase it to $4.16.

Well, I just checked McDonald's app and, surprise surprise, the cost of a Big Mac right now is $4.19! And that's without the minimum wage increase!

These ***** are increasing the cost of their food to account for the inflation that has occurred in 5 years, but they have not had to increase the cost of the labor that generates those Big Macs! This is the utter absurdity of Capitalism. Prices will continue to go up and up and if you try to fight for higher wages for the poorest people, they'll threaten you with the increase in cost of goods that they're already doing anyway.


Don't let the corporations brain wash you into fighting your common man. People deserve a living wage. If it raises the price of a burger by a dollar, we'll survive. And, in the case that we do raise the minimum wage, the workers will too.

Plus, presumably, more people will be able to afford a big Mac, so mcdonald's should sell more. 

[CJD]

(01-18-2021, 04:53 PM)Benton Wrote: Plus, presumably, more people will be able to afford a big Mac, so mcdonald's should sell more. 

Exactly. And, I didn't know where exactly to fit it in to my post about the cost increases, but Big Macs operate on a supply and demand curve just like every product in existence. If they become too expensive, they will simply not be bought. This means that McDonalds can't increase the cost of a Big Mac by a number that would make the product undesirable (I would never spend 12 dollars circa 2020 for a Big Mac combo, the value is not there) and therefore they would need to lower the price and *gasp* make slightly less profits.

I know it terrifies conservatives to think that a corporation might make slightly less money, since the objective of Capitalism is to make more and more and more and more money every single year (and the CEO gets fired if you ever make less money in a subsequent year), but I personally think prevention of human suffering is more important than mega corporations' bottom line. At least some times.

[Belsnickel]

All of this discussion and we haven't really talked about the way in which we, the taxpayers, subsidize companies that don't pay their employees a livable wage. When companies aren't compensating their employees in a way where they can support themselves, the people make up for that difference with SNAP/EBT, Medicaid, etc.