I love asking them to explain what negative consequences raising minimum wage would have for inflation and the economy, then asking them to explain how lowering income taxes wouldn’t be even worse.
Imo there is an issue if you do nothing but increase minimum wage. You also need to limit price inflation and make sure the companies don’t just return the increased cost to the consumer. Then you’ll have gained nothing.
Example.
Burger grill pays their workers 10$/hr - burger costs 4$. Now you force the burger grill to pay workers 15$/hr, a 50% increase and they go, alright, burgers now cost 6$. Most places do this and the worker, even though they now earn 50% more, can’t actually buy more because cost of living has increased equally.
We need regulations on how companies operate their profit or actually get back to a point where competition would punish pricing like that. But somehow with only a handful owning everything that is kinda fucked.
Why does the cost of living go up by the same amount though? Yeah some domestic industries that rely on low income workers like food and agriculture would have increased payroll costs, but how are other major living costs like rent, foreign made goods, and transportation tied to minimum wage?
because if they can charge you more for that ramshackle hut they will, housing is tied to who will pay for it, if the hypothetical burger flipper makes more, he or she is also willing to spend more of that on housing, as is every other hypothetical burger flipper, meaning the hut-lord can increase his price, as there is now more funds in the system, and more competition due to those funds, no new huts are built, so the price of all previous huts will just rise. Without regulation, this is how it goes.
I love asking them to explain what negative consequences raising minimum wage would have for inflation and the economy, then asking them to explain how lowering income taxes wouldn’t be even worse.
Imo there is an issue if you do nothing but increase minimum wage. You also need to limit price inflation and make sure the companies don’t just return the increased cost to the consumer. Then you’ll have gained nothing. Example. Burger grill pays their workers 10$/hr - burger costs 4$. Now you force the burger grill to pay workers 15$/hr, a 50% increase and they go, alright, burgers now cost 6$. Most places do this and the worker, even though they now earn 50% more, can’t actually buy more because cost of living has increased equally. We need regulations on how companies operate their profit or actually get back to a point where competition would punish pricing like that. But somehow with only a handful owning everything that is kinda fucked.
Why does the cost of living go up by the same amount though? Yeah some domestic industries that rely on low income workers like food and agriculture would have increased payroll costs, but how are other major living costs like rent, foreign made goods, and transportation tied to minimum wage?
because if they can charge you more for that ramshackle hut they will, housing is tied to who will pay for it, if the hypothetical burger flipper makes more, he or she is also willing to spend more of that on housing, as is every other hypothetical burger flipper, meaning the hut-lord can increase his price, as there is now more funds in the system, and more competition due to those funds, no new huts are built, so the price of all previous huts will just rise. Without regulation, this is how it goes.