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>53 million people earn low wages, with a median of just $10.22 per hour. That’s nearly half of the 18 to 64 workforce. 10.22 is just a number. It wouldn't be

>53 million people earn low wages, with a median of just $10.22 per hour. That’s nearly half of the 18 to 64 workforce. 10.22 is just a number. It wouldn't be better if they earned $20.44 per hour because costs would double, too. It's like the SF housing market: people spend what they have. SF residents could live luxurious lives if they wouldn't outbid each other and kept prices low. Likewise, the lower half of the workforce could buy more if they stopped spending it all. Middle income people are not better with money. They just profit off the poor people who set the base line prices for mass-produced goods. *edit: To add to this: Purchasing power parity [1] shows that at least poor people in the US don't get the most for their Dollar. Goods can be sourced cheaper on the world market. In other words: they could drive prices down if they started paying less. [1] https://en.wikipedia.org/wiki/Purchasing_power_parity https://en.wikipedia.org/wiki/Purchasing_power_parity

MH15 7y ago
Doubling the minimum wage does not cause costs to double. This is a very flawed analysis- the minimum wage doesn't affect the entire population (less than half!) so raising that wage only raises the costs of things a small, proportional factor, if at all. I find we tend to apply microeconomic theorems to macroeconomic activities far too often.
- toohotatopic 7y ago
  You have overlooked a key part of my argument: Costs are low because the lower half cannot afford to pay more. Vendors have to keep low prices to compete for the hard earned Dollars. Give the lower half more money and things will simply cost more because they are able to spend the money. This alone will start a demand for higher wages which will end in a situation where everything will cost proportionally more for everybody. The only losers will be those with bonds and cash because inflation will eat away the value. Additionally, I don't think that you can ignore the supply chains. If you have a maid and you have to pay double, do you stomach the increased cost or are you going to ask for a rise yourself? And don't forget that you have to pay taxes. So you don't ask for her increase but you double it. Low wages are not for those who operate machines, where the wage doesn't matter because the value is created by the machine. Low wages exist where a huge part of the value is directly created by the person. So double that cost and you increase the prices of those goods. I don't know how big the low-wage part is relative to the entire economy. If it is minuscule, increasing minimum wage doesn't matter. But as the article says, it's almost 50% of the workforce, so I doubt that costs will only rise a small, proportional factor, if at all.

MH15 7y ago

Doubling the minimum wage does not cause costs to double. This is a very flawed analysis- the minimum wage doesn't affect the entire population (less than half!) so raising that wage only raises the costs of things a small, proportional factor, if at all. I find we tend to apply microeconomic theorems to macroeconomic activities far too often.

toohotatopic 7y ago
You have overlooked a key part of my argument: Costs are low because the lower half cannot afford to pay more. Vendors have to keep low prices to compete for the hard earned Dollars. Give the lower half more money and things will simply cost more because they are able to spend the money. This alone will start a demand for higher wages which will end in a situation where everything will cost proportionally more for everybody. The only losers will be those with bonds and cash because inflation will eat away the value. Additionally, I don't think that you can ignore the supply chains. If you have a maid and you have to pay double, do you stomach the increased cost or are you going to ask for a rise yourself? And don't forget that you have to pay taxes. So you don't ask for her increase but you double it. Low wages are not for those who operate machines, where the wage doesn't matter because the value is created by the machine. Low wages exist where a huge part of the value is directly created by the person. So double that cost and you increase the prices of those goods. I don't know how big the low-wage part is relative to the entire economy. If it is minuscule, increasing minimum wage doesn't matter. But as the article says, it's almost 50% of the workforce, so I doubt that costs will only rise a small, proportional factor, if at all.