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> The cost of labor is an input into the production of basically all goods we consume. True but most products are not produced in America, the products that ar

> The cost of labor is an input into the production of basically all goods we consume. True but most products are not produced in America, the products that are made in America, are made by robots, the cost of labor on goods in America is just not significant. In contrast to services which are all done in America by American people this is huge. > This is good for ALL consumers. However at the end of the day, labor’s gotta eat. This is where welfare comes in. You got your classes mixed up the working class are the consumers not the rich. A rise in wages for workers means consumers have more money to spend which is good for consumers and business.

bhupy 7y ago
> True but most products are not produced in America, the products that are made in America, are made by robots, the cost of labor on goods in America is just not significant. > In contrast to services which are all done in America by American people this is huge. This is becoming less true, as we speak. As standards of living in developing countries increase, the cost of labor also increases, until it more or less matches minimum wage in developed countries[1][2]. > You got your classes mixed up the working class are the consumers not the rich. A rise in wages for workers means consumers have more money to spend which is good for consumers and business. A rise in CASH for workers means consumers have more money to spend. The disagreement here is in how we deliver that cash to the worker. It's definitely beneficial for workers to have more money, but forcing businesses to pay them inflated wages (i.e. greater than their market worth) simply causes the cost of that business's output to be inflated by a commensurate amount. You're correct that it gives workers more spending power, but it also distorts the market downstream by increasing the price of their output for people that buy the good/service that the worker in question uses their labor to produce. In contrast, providing workers with some minimum cash (let's say, whatever the desired minimum wage is multiplied by 8 hours of work minus their existing daily wage), will provide workers with the same amount of cash on hand as a minimum wage, which as you say is "good for consumers and business", while still keeping the cost of their own output low, and therefore, accessible to consumers (rich, middle class, and poor). Today, using minimum wage as a way to ensure workers enjoy a minimum standard of living just so happens to distort the market that impacts the rich in America slightly more than the poor, but that's only temporary. In the long run, it has the same effect of increasing prices across the board. Using welfare/UBI/EITC (paid for by the rich) in lieu of minimum wage achieves the same goal, while avoding the market distortion caused by inflated wage prices, while ensuring that goods/services are cheap for the middle class and the poor, regardless of the state of the labor market in developing/developed countries. [1] https://tradingeconomics.com/china/wages-in-manufacturing https://tradingeconomics.com/china/wages-in-manufacturing [2] https://www.cnbc.com/2017/02/27/chinese-wages-rise-made-in-china-isnt-so-cheap-anymore.html https://www.cnbc.com/2017/02/27/chinese-wages-rise-made-in-c...

bhupy 7y ago

> True but most products are not produced in America, the products that are made in America, are made by robots, the cost of labor on goods in America is just not significant. > In contrast to services which are all done in America by American people this is huge. This is becoming less true, as we speak. As standards of living in developing countries increase, the cost of labor also increases, until it more or less matches minimum wage in developed countries[1][2]. > You got your classes mixed up the working class are the consumers not the rich. A rise in wages for workers means consumers have more money to spend which is good for consumers and business. A rise in CASH for workers means consumers have more money to spend. The disagreement here is in how we deliver that cash to the worker. It's definitely beneficial for workers to have more money, but forcing businesses to pay them inflated wages (i.e. greater than their market worth) simply causes the cost of that business's output to be inflated by a commensurate amount. You're correct that it gives workers more spending power, but it also distorts the market downstream by increasing the price of their output for people that buy the good/service that the worker in question uses their labor to produce. In contrast, providing workers with some minimum cash (let's say, whatever the desired minimum wage is multiplied by 8 hours of work minus their existing daily wage), will provide workers with the same amount of cash on hand as a minimum wage, which as you say is "good for consumers and business", while still keeping the cost of their own output low, and therefore, accessible to consumers (rich, middle class, and poor). Today, using minimum wage as a way to ensure workers enjoy a minimum standard of living just so happens to distort the market that impacts the rich in America slightly more than the poor, but that's only temporary. In the long run, it has the same effect of increasing prices across the board. Using welfare/UBI/EITC (paid for by the rich) in lieu of minimum wage achieves the same goal, while avoding the market distortion caused by inflated wage prices, while ensuring that goods/services are cheap for the middle class and the poor, regardless of the state of the labor market in developing/developed countries. [1] https://tradingeconomics.com/china/wages-in-manufacturing https://tradingeconomics.com/china/wages-in-manufacturing [2] https://www.cnbc.com/2017/02/27/chinese-wages-rise-made-in-china-isnt-so-cheap-anymore.html https://www.cnbc.com/2017/02/27/chinese-wages-rise-made-in-c...