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Author Topic:   Economics 101

Posts: 9857
From: Madeira Beach, FL USA
Registered: Apr 2009

posted June 27, 2017 02:28 PM     Click Here to See the Profile for jwhop     Edit/Delete Message   Reply w/Quote
June 27, 2017
A 'minimum wage' that kills wages
Silvio Canto, Jr.

Perry Como once recorded a very popular song called "Seattle." It goes like this:

The bluest skies you've ever seen in Seattle
And the hills the greenest green in Seattle
Like a beautiful child growing up free and wild
Full of hopes and full of fears Full of laughter full of tears
Full of dreams to last the years in Seattle In Seattle

Nobody is talking about blue skies or green hills in Seattle these days. Instead, people are getting a serious lesson in Economics 101, or what happens when you raise wages to pander for votes and end up hurting the people you were trying to help.

It goes like this:

As cities across the country pushed their minimum wages to untested heights in recent years, some economists began to ask: How high is too high?

Seattle, with its highest-in-the-country minimum wage, may have hit that limit.

In January 2016, Seattle’s minimum wage jumped from $11 an hour to $15 for large employers, the second big increase in less than a year.

New research released Monday by a team of economists at the University of Washington suggests the wage hike may have come at a significant cost:

The increase led to steep declines in employment for low-wage workers, and a drop in hours for those who kept their jobs.

Crucially, the negative impact of lost jobs and hours more than offset the benefits of higher wages – on average, low-wage workers earned $125 per month less because of the higher wage, a small but significant decline.

Why is anybody shocked? This is so obvious that it makes you wonder about the people who keep voting for these charlatans.

In the real world, reality always has the last word. You cannot pay someone $15 an hour just because a city council member wants a talking point. Wages are a byproduct of economic reality, not political pandering. Politicians are no more qualified to tell employers what they must pay than to force them to provide health care they can't afford.

As my old economics professor used to say, "the employer does not have to pay you what you want to get paid. He writes the check, you know."

Indeed, he does! In Seattle, many employers have decided they can't write those checks anymore. So they have cut back employee hours or simply stopped hiring or closed the business.

Another great day for socialism, but terrible for the workers!

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Posts: 10194
Registered: Apr 2009

posted June 27, 2017 07:21 PM     Click Here to See the Profile for teasel     Edit/Delete Message   Reply w/Quote
You expect people to go without healthcare, and a living wage. How gross.

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Posts: 81441
From: From a galaxy, far, far away...
Registered: Apr 2009

posted June 27, 2017 07:28 PM     Click Here to See the Profile for Randall     Edit/Delete Message   Reply w/Quote
The minimum wage was never intended to be a living wage. Jobs such as McDonalds were intended as interim positions. Due to $15 an hour increases, less money is actually being paid to those who need it. Upper level management is doing more of the tasks the lower levels would have done, and employers are finding other ways to maximize profit, including the use of robots. And it puts a number of companies out of business that can't afford to compete. It hurts the cause for which it was promoted for.

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