You continue to make this argument, I continue to disagree with it.
You seem to be arguing that because inflation over time eventually negates the relative purchasing power of the MW, that there is no benefit to the MW, based upon the assumption that the increase in MW causes an equivalent increase in inflation.
disagree all you want, but keep in mind that when there was a stable MW and all factors of the supply chain were allowed to adjust, prices for goods and services remained stable for a long period, it wasn't until around the late 60's/early 70's that tax increases, spending problems, and other economic tinkering started to increase the cost of goods, inflation, and created an eventual recession, buying power was reduced as costs increased.
I disagree. The MW has at most a minor effect on inflation, and significantly increases the purchasing power of those earning the MW.
On it's face, maybe, the problem comes along when all the subtle factors shift to accomodate the new increases in cost. In almost everything we buy, someone is making at or just over the minimum wage at some point, each increase will increase the cost to provide supply to the market, hence each step in the process will create a multiple increase effect.
I agree that if the MW is not indexed for inflation, then over time, general inflation negates the value of the MW, as it does any other fixed income. But that does not negate the value of the MW. After a 40% increase in the MW, it might take 15 years before inflation would erase that increase.
Indexing for inflation adds another step to the process, it is further tinkering with the natural flow of the market, it can work, but it can fail as well, I don't know about you, but I like to play it safe when indexing, if you're right, then yes, MW value would stabalize for a time, but eventually the cycle would perpetuate itself again. As far as the increase and percentage go, it
might take up to 15 years for the value to decline, it also might take only 6 months, the problem isn't the time frame, it's the system.
The answer is not to say the MW is meaningless because it eventually is diminished by inflation, but to raise it to match inflation.
Why not stop the cycle then by doing these things:
1) eliminate withholding taxes to maximize gross earnings, replace with consumption tax.
2) replace income tax with above as well
3) create a deflationary trend by allowing companies to slowly pay less to new hires after the prevailing wages become sufficient, thus creating a more valuable dollar.
4) have a commodity based standard for money, thus increasing the value of a dollar further and making fewer required, allowing for further reductions in hourly minimums and increasing buying power.
Most might not, yet many do. If they aren't below the MW level then the MW law doesn't affect them.
The overall point is that yes, everyone feels the effects of reduced buying power, it is felt more by people who aren't at the bottom Tier, exactly because they don't get an automatic raise, and more descretionary money is lost to basic needs after price increases reduce the value of take home pay.
Exactly right. They are not at all. Their job is to maximize profit. They do that in part by minimizing the cost of input, including labor. That means paying low end labor just as little as possible.
It is not a business' duty to pay a decent wage to the worker. That is why you need the law.
This is contracictory, it is not the government's job to create wages, only to form the currency allowing said wages to be paid, it is a businesses job to pay wages, and to determine what their human capitols labor is worth, eventually, less valuable employees will be either terminated or will move on naturally when they do not see raises based on merit. What the MW does is to give an automatic raise to all at the very bottom tier, among new hires, the worthless and the meritorious are both set at the same minimum value, thus removing the natural mechanism to deal with labor relations.
Are you trying to contend that was caused by the MW increase, the last of which was '97?
It's not the only factor, but it is a contributor, '97 MW increased, '98 Dot.com crash, '99 fallout from said crash, meantime, buying power in process of depreciation, further complicated by market losses and hiring freezes/labor reductions.
Not stupid at all. You signficantly increase the 10%, which is the goal, while the 80% decrease is marginal.
The 10% will still only be able to buy basic goods and services as needed, since there exists no mobility, while the other 80% will LOSE buying power, basic goods/services will cost more and thus reduce descretionary income for those on higher tiers, this translates to less overall market sales of products and services, creating unfavorable market conditions for growth. Sorry, but the 10% does not justify the ends.
An "incomprehensible" loss caused by a 26 billion increase in low end wages? Don't think so.
I've already explained how this will happen, when it happens again, I'll keep your words in mind.
Thousands of dollars per individual for the relatively few that are at the very bottom, versus some billions of losses spread among 90% of the population that is far less than 1% of GDP that is hardly noticeable.
If you phrase it in the linear, as a short term absolute, you're right, but think in the long term using the natural cycles of economics, and the overall losses eventually become astronomical.
For thosewho care at all about those at the very bottom, it is great.
And for those who care about everyone, it's not.
Now *that* is partisan bullshit. Yes you absolutely can improve economic inequality by providing better wages to those at the bottom.
Nope, all you do is create great feelings for people who can only afford the basics, while spreading the misery of economic depreciation to all. If you can improve economic equality with a MW increase, where is the proof? where are all these suburban MW earners that are moving up? Why isn't everyone working middle class? Show me some examples and we'll discuss it further.
Absolutely false. Why do you have to "print more money"?
IF, you somehow maintain full employment after the shock of a minimum wage increase AND the maximum are working for more money THEN the demand FOR more money is increased to keep up with payroll requirements, THUS more supply of money devalues itself because there is less backing capital behind more money.
Great. I'd love to hear your explanation about how the non-inflation in the 90s was really inflation caused by the MW increases in the 90s.
Where exactly did I say inflation, I said inflationary factors, meaning once everything settled, the economy finally found it's equilibrium and the end of the cycle completed itself, this is when the value of each dollar earned becomes less than the last MW increase, this is where the last raise flattens out, instead of raising it again, let the market do what it always has and correct itself.
Raising the MW does not make the cost of gas go up. But maybe you can explain why the MW increases in the 90s didn't cause the inflation you insist will occur.
Gas increases are all part of a bigger problem created by interfering with the markets natural state. Inflation or devaluation will happen, as they always do, why do you keep insisting on the 90's as the only example, first off, we ARE feeling the effects of the last increase, that's exactly why the donkeys, sorry, democrats are asking for another one, because the cycle is completing itself and the next step is devaluation, they are trying to cover it up by throwing more money in the front end to counter the effects, this has happened in the 60's, 70's, and 80's, and is now happening. You keep using a ten year plan, I guess the forty year trend doesn't mean anything to you.