the fallacy of a "fair" minimum wage

[HalosPuma]

I have heard this advocated several times by Kerry - raise the minimum wage to give the working poor a "fair" salary. Nonsense. Minimum wage (a) causes unemployment and (b) interferes with the free-market.

To address unemployment - where do these politicians and poor people think the money will come from? Do they think Big Corp, Inc. has wads of cash in the bank? I ran a small business business and can tell you firsthand the very first thing we cut when we have a "rough patch" is salaries. There is only a fixed amount available for salaries and other expenses cannot be shifted over - rent, power, vendors, etc. are all fixed costs. Therefore, if everyone is making minimum wage and it is then raised, some will have to be terminated so their salaries can be split up amongst the others.

Very simply: assume minimum wage is $5.00/hour and Kerry wants to raise it to $7.50/hour; an employee works 2,000 hours/year; annual minimum age salary is $10,000; Kerry's proposed annual minimum wage salary is $15,000. If the budget for salaries is $100,000 then 10 people are currently employed @ $5 minimum wage. If it's raised, then only 6 people keep their jobs and 4 are terminated. This destroys the small business and soon the other 6 will join the unemployed.

As for the free-market - if an employer and potential employee agree that his skill is worth only $4/hour, then that is fair. Neither side is exploited. This was the case when I just started high school and mowed lawns. Paying me minimum wage was too much, but I was happy to work for less. After all, I was making money and, more importantly, learning life's lessons. Unfortunately, by forcing an employer to pay at least $5/hour or $7.50/hour, those with little or no skills remain permanently unemployed. It also encourages hiring of illegal Mexicans - both the employer and "employee" (illegal Mexican) agree on a fair price which is less than Big Government, Inc.'s minimum standard.

 

[3chordcharlie]

raising the minimum wage can increase unemployment, but if you had exactly 'x' dollars to pay for employees, then you ran an atypical business.

More employees should mean you earn more money (gross money; not necessarily after paying the 'last' employee), if it doesn't then you had too many to start with. Based on the output of employees, I doubt if more than 1-2 out of 10 would be laid off if minimum wage were increased even by as much as 50%. It would very likely increase unemployment somewhat though.

 

[HalosPuma]

I ran a dot-com. Actually, we had less than 'X' dollars for employees - we were in the red. Granted, no one was paid minimum wage, but we could not cut any other expense. We were already had redone the hardware leases, the software licenses, the building lease, etc., and cut out all non-essential expenses. The only "variable" expense was salaries. With other firms going under, it wasn't too hard for us to cut salaries and still keep the programmers around. My point is that the salary budget is flexible, but only in one direction: down. Forcing companies to pay the same number of employees more money will force those companies to legally hire less people (thus laying off existing workers), or illegally hire illegals to keep the same number of "employees." Again, consider what jobs are minimum wage and that many illegals will gladly do them for less than that.

 

[gutharius]

A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

 

[gutharius]

Originally posted by: HalosPuma
I ran a dot-com. Actually, we had less than 'X' dollars for employees - we were in the red. Granted, no one was paid minimum wage, but we could not cut any other expense. We were already had redone the hardware leases, the software licenses, the building lease, etc., and cut out all non-essential expenses. The only "variable" expense was salaries. With other firms going under, it wasn't too hard for us to cut salaries and still keep the programmers around. My point is that the salary budget is flexible, but only in one direction: down. Forcing companies to pay the same number of employees more money will force those companies to legally hire less people (thus laying off existing workers), or illegally hire illegals to keep the same number of "employees." Again, consider what jobs are minimum wage and that many illegals will gladly do them for less than that.

You have to remember that most jobs being created are not even starting at minimum wage, unless you are a high school student and taking any job that comes to you. Granted there are economic drawbacks to this. But as I stated above I think this has more to do with balancing the budget more than anything else.

 

[cwjerome]

gutharius, it's not like a wage increase suddenly means there's more money. That money has to come from somewhere... it comes from the guy who's laid off because an employer has to pay his other workers more (or you'll have businesses raising prices which can create a whole host of other problems). If your idea worked we could just raise the minimum wage to $20 an hour and think of all that money the gov't will have to balance the budget! Sorry, it doesn't work like that.

Personally, I don't have a strong opinion on this.

 

[miketheidiot]

Originally posted by: HalosPuma
I have heard this advocated several times by Kerry - raise the minimum wage to give the working poor a "fair" salary. Nonsense. Minimum wage (a) causes unemployment and (b) interferes with the free-market.

a)no it doesn't
b) the free market was abandoned almost a century ago. Stop playing catch-up.

To address unemployment - where do these politicians and poor people think the money will come from? Do they think Big Corp, Inc. has wads of cash in the bank? I ran a small business business and can tell you firsthand the very first thing we cut when we have a "rough patch" is salaries. There is only a fixed amount available for salaries and other expenses cannot be shifted over - rent, power, vendors, etc. are all fixed costs. Therefore, if everyone is making minimum wage and it is then raised, some will have to be terminated so their salaries can be split up amongst the others.

Last time i checked profits were going through the rough.

Very simply: assume minimum wage is $5.00/hour and Kerry wants to raise it to $7.50/hour; an employee works 2,000 hours/year; annual minimum age salary is $10,000; Kerry's proposed annual minimum wage salary is $15,000. If the budget for salaries is $100,000 then 10 people are currently employed @ $5 minimum wage. If it's raised, then only 6 people keep their jobs and 4 are terminated. This destroys the small business and soon the other 6 will join the unemployed.

By cutting 40% of their workforce, they would effectively cut 40% of their revenue. So you are still paying the original $100.000 in wages out of much less revenue. Lets do a quick example.

You have a business with 10 employees with a payroll of $100,000, production costs of $50,000, fixed costs of $50,000 and a $250,000 in revenue leaving a profit of $50,000.

Now we increase wages from $5 to $7.50, which raises wages from $100,000 to $150,000. Production costs and fixed costs stay stable. There is no profit (and no loss either).

Now lets say that you respond to the wage hike by laying off 4 people. Your labor costs fall from $100,000 to $90,000, production costs fall to $30,000 (assuming that production cost are directly related to the number of employees) and revenue falls to $150,000 (again assuming that revenue is directly related to the number of employees). Fixed costs stay stable at $50,000 because they are, well, fixed. We now have $150,00 in revenue and a loss of $20,000.

In the long run you will be even worse off because the new money from who get a raise will be spent on good which will increase the demand for your product.

No rational corporation would cut jobs in a direct reaction to a wage hike.

As for the free-market - if an employer and potential employee agree that his skill is worth only $4/hour, then that is fair. Neither side is exploited. This was the case when I just started high school and mowed lawns. Paying me minimum wage was too much, but I was happy to work for less. After all, I was making money and, more importantly, learning life's lessons. Unfortunately, by forcing an employer to pay at least $5/hour or $7.50/hour, those with little or no skills remain permanently unemployed. It also encourages hiring of illegal Mexicans - both the employer and "employee" (illegal Mexican) agree on a fair price which is less than Big Government, Inc.'s minimum standard.

YOu were happy to work for less than you were legally entitled to? GJ

I ran a dot-com.

Its clear why you refer to this in the past tense.

 

[CWRMadcat]

Originally posted by: HalosPuma
I have heard this advocated several times by Kerry - raise the minimum wage to give the working poor a "fair" salary. Nonsense. Minimum wage (a) causes unemployment and (b) interferes with the free-market.

To address unemployment - where do these politicians and poor people think the money will come from? Do they think Big Corp, Inc. has wads of cash in the bank? I ran a small business business and can tell you firsthand the very first thing we cut when we have a "rough patch" is salaries. There is only a fixed amount available for salaries and other expenses cannot be shifted over - rent, power, vendors, etc. are all fixed costs. Therefore, if everyone is making minimum wage and it is then raised, some will have to be terminated so their salaries can be split up amongst the others.

Very simply: assume minimum wage is $5.00/hour and Kerry wants to raise it to $7.50/hour; an employee works 2,000 hours/year; annual minimum age salary is $10,000; Kerry's proposed annual minimum wage salary is $15,000. If the budget for salaries is $100,000 then 10 people are currently employed @ $5 minimum wage. If it's raised, then only 6 people keep their jobs and 4 are terminated. This destroys the small business and soon the other 6 will join the unemployed.

As for the free-market - if an employer and potential employee agree that his skill is worth only $4/hour, then that is fair. Neither side is exploited. This was the case when I just started high school and mowed lawns. Paying me minimum wage was too much, but I was happy to work for less. After all, I was making money and, more importantly, learning life's lessons. Unfortunately, by forcing an employer to pay at least $5/hour or $7.50/hour, those with little or no skills remain permanently unemployed. It also encourages hiring of illegal Mexicans - both the employer and "employee" (illegal Mexican) agree on a fair price which is less than Big Government, Inc.'s minimum standard.

Well, inefficiency is also dependent on the elasticities of demand/supply, and also on the type of market we're talking about. In a perfectly competitive model, a fixed minimum wage above the equilibrium wage can cause "economic" inefficiency. In a non-competitive model, minimum wages can actually promote greater economic efficiency, so it's a tricky issue. Another aspect that needs to be looked at is "equity". Unfortunately, "equity" isn't something empirically provable, since it's more a matter of opinion than anything else. I am of the opinion however, that we can't be fixated on "efficiency" all the time, we are all human, and not automations.

 

[HalosPuma]

Originally posted by: gutharius
A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

I always wondered how a liberal's mind works - raise taxes. That is HORRIBLE leadership and why I am casting my vote against him and against the socialists and communists who seek to destroy our nation.

 

[jackschmittusa]

I am old enough to have seen many raises in the minimum wage (it was $1.25/hr when I got my first job in high school). I have heard the same stories of doom and gloom as many times. It has yet to come to pass.

 

[ntdz]

Originally posted by: gutharius
A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

if you make minimum wage YOU PAY NO INCOME TAX. Yeah, thats SMART leadership huh, Bush didnt think of it because its simply WRONG.

If you take an econ 101 class you will learn that salaries are an expense just like anything else for a business. If you raise the minimum wage above what they're willing to pay for salary, they are gonna cut jobs. It's very simple supply and demand. It's a fact, undisputable, that raising the minimum wage significantly will result in lost jobs.

 

[HalosPuma]

Ah where to start?

Originally posted by: miketheidiot
Last time i checked profits were going through the rough.

When was that? In 2000? The only "through the roof" profits now are energy firms and financial firms. Hardly the type of companies that have a mass of minimum wage jobs.

Originally posted by: miketheidiot
By cutting 40% of their workforce, they would effectively cut 40% of their revenue. So you are still paying the original $100.000 in wages out of much less revenue. Lets do a quick example.

You have a business with 10 employees with a payroll of $100,000, production costs of $50,000, fixed costs of $50,000 and a $250,000 in revenue leaving a profit of $50,000.

Yes, a PROFIT. That's why we start and run a business - for PROFIT.

Originally posted by: miketheidiot
Now we increase wages from $5 to $7.50, which raises wages from $100,000 to $150,000. Production costs and fixed costs stay stable. There is no profit (and no loss either).

No PROFIT? What the hell's the point of running a business if there is no profit? Further, if it was a publicly traded corporation (i.e. McDonald's hires a lot of minimum wagers), it's stock price would be smashed due to no profits. Additionally, PROFITs allow for R&D. In McDonald's case, that would be R&D for new menu items and healthier foods, etc. that would allow them to increase their PROFITs.

Originally posted by: miketheidiot
Now lets say that you respond to the wage hike by laying off 4 people. Your labor costs fall from $100,000 to $90,000, production costs fall to $30,000 (assuming that production cost are directly related to the number of employees) and revenue falls to $150,000 (again assuming that revenue is directly related to the number of employees). Fixed costs stay stable at $50,000 because they are, well, fixed. We now have $150,00 in revenue and a loss of $20,000.

Even worse, a LOSS.

Originally posted by: miketheidiot
In the long run you will be even worse off because the new money from who get a raise will be spent on good which will increase the demand for your product.

? This sentence doesn't make sense.

Originally posted by: miketheidiot
No rational corporation would cut jobs in a direct reaction to a wage hike.

Every rational corporation would see other ways to cut their costs. For those min wage jobs that do not require a physical presense (i.e. low-end manufacturing), this is a great incentive to OFFSHORE the jobs to Mexico, China, Thailand, etc. Paying an American $5/hour to make a widget was barely acceptable. Now they have to pay that American an additional $2.50/hour to make the same widget when they can pay a 3rd worlder $0.50/hour? Screw it - offshore the job and pay the higher import fees. The combined cost of the 3rd world salary and import fees will still be less than the "fair" minimum wage of $7.50/hour.

Originally posted by: miketheidiot
YOu were happy to work for less than you were legally entitled to? GJ

"Legally entitled to?" What does this mean? My employer and I reached an agreement. Besides I was a 14-year old kid. If I asked for more, they would have either gone to an illegal or a professional gardner. If the issue of "legal minimum wage" was pressed, I would not have had a job at all. Government absolutely does not belong in the regulation of wages.

Originally posted by: miketheidiot

Originally posted by: HalosPuma
I ran a dot-com.

Its clear why you refer to this in the past tense.

I sold the company.

 

[gutharius]

Originally posted by: cwjerome
gutharius, it's not like a wage increase suddenly means there's more money. That money has to come from somewhere... it comes from the guy who's laid off because an employer has to pay his other workers more (or you'll have businesses raising prices which can create a whole host of other problems). If your idea worked we could just raise the minimum wage to $20 an hour and think of all that money the gov't will have to balance the budget! Sorry, it doesn't work like that.

Personally, I don't have a strong opinion on this.

No and I am not that nieve to think there would not be any ecenomic issues with this. (As I already stated) I am by nature a cautious optomist so i see your point but I see a larger picture here that can be the reason why kerry says No New Taxes If You Make Less Than 200K.

 

[HalosPuma]

Originally posted by: gutharius
but I see a larger picture here that can be the reason why kerry says No New Taxes If You Make Less Than 200K.

Take a look at this thread for an analogy of what will happen if Kerry wins and raises the taxes on those making more than $200,000/year.

http://forums.anandtech.com/me...7826&enterthread=y

 

[gutharius]

Originally posted by: HalosPuma

Originally posted by: gutharius
A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

I always wondered how a liberal's mind works - raise taxes. That is HORRIBLE leadership and why I am casting my vote against him and against the socialists and communists who seek to destroy our nation.

Did I say RAISE THE TAX PERCENTAGE??? NO! I apologize that i may not have been clear but this would increase the revenues from taxes without raising the percentage rate you or I are taxed at. A person making 5.25 an hour pays about $1100 in taxes (@ 10%) a person making $7 an hour pays about $1400 in taxes to the government. At 50 million people making minimum wage that means 50 Billion extra dollars that can be used to stabelize our already debt ridden governement.

This is not soicalism nor communism! This is simple and smart math and policy making in action, nothing president Bush's narrow intellect could get even the smallest grip on.

 

[ReiAyanami]

historically raising the minimum wage has always helped the economy, never hurt it.

we should have a topic on the fallacy of "fair" executive compensation

obviously they deserve bonuses for firing people
i think it was US Airways just announced they wanted to cut wages for its workers by a whooping 21% after already winning a 10% cut. that's a staggering depreciation of income.

unfortunately, whenever the gap between the (poor) masses and super-rich becomes overly apparent, the masses ALWAYS rise up and kill the rich.

whether capitalist, communist, mercatilist, imperialist, slavery...

i doubt it would happen in this country because the super-rich can simply fly to Mars, but in a few decades when we're looking at $15-$20 trillion debt and a collapsed dollar all bets are off

 

[gutharius]

Originally posted by: ntdz

Originally posted by: gutharius
A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

if you make minimum wage YOU PAY NO INCOME TAX. Yeah, thats SMART leadership huh, Bush didnt think of it because its simply WRONG.

If you take an econ 101 class you will learn that salaries are an expense just like anything else for a business. If you raise the minimum wage above what they're willing to pay for salary, they are gonna cut jobs. It's very simple supply and demand. It's a fact, undisputable, that raising the minimum wage significantly will result in lost jobs.

There is still withholding taken out of your paycheck. I gues syou must be unemployed or have direct deposit and dont look at your paystub.

 

[ntdz]

Originally posted by: gutharius

Originally posted by: HalosPuma

Originally posted by: gutharius
A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

I always wondered how a liberal's mind works - raise taxes. That is HORRIBLE leadership and why I am casting my vote against him and against the socialists and communists who seek to destroy our nation.

Did I say RAISE THE TAX PERCENTAGE??? NO! I apologize that i may not have been clear but this would increase the revenues from taxes without raising the percentage rate you or I are taxed at. A person making 5.25 an hour pays about $1100 in taxes (@ 10%) a person making $7 an hour pays about $1400 in taxes to the government. At 50 million people making minimum wage that means 50 Billion extra dollars that can be used to stabelize our already debt ridden governement.

This is not soicalism nor communism! This is simple and smart math and policy making in action, nothing president Bush's narrow intellect could get even the smallest grip on.

you are assuming that companies WONT lay off people to offset the minimum wage, which they will. It doesn't matter what you put the minimum wage, companies have a set limit they can pay for salaries and that is what they will pay, period. Raise the minimum wage, jobs are lost, thus losing that income for the govt. The govt's income will effectively stay the same if you raise minimum wage. Raising minimum wage causes the price of wages to go up, inflation. Go look at when the minimum wage was raised in history, and you'll find inflation followed.

 

[ntdz]

Originally posted by: gutharius

Originally posted by: ntdz

Originally posted by: gutharius
A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

if you make minimum wage YOU PAY NO INCOME TAX. Yeah, thats SMART leadership huh, Bush didnt think of it because its simply WRONG.

If you take an econ 101 class you will learn that salaries are an expense just like anything else for a business. If you raise the minimum wage above what they're willing to pay for salary, they are gonna cut jobs. It's very simple supply and demand. It's a fact, undisputable, that raising the minimum wage significantly will result in lost jobs.

There is still withholding taken out of your paycheck. I gues syou must be unemployed or have direct deposit and dont look at your paystub.

you obviously don't know what you're getting taxed for. It is not income tax, its medicare and social security. Sorry bud, you're wrong.

 

[HalosPuma]

Originally posted by: gutharius
this would increase the revenues from taxes without raising the percentage rate you or I are taxed at. A person making 5.25 an hour pays about $1100 in taxes (@ 10%) a person making $7 an hour pays about $1400 in taxes to the government. At 50 million people making minimum wage that means 50 Billion extra dollars that can be used to stabelize our already debt ridden governement.

This is not soicalism nor communism! This is simple and smart math and policy making in action, nothing president Bush's narrow intellect could get even the smallest grip on.

You are missing one very, VERY important piece to the puzzle - where will this money come from? By your rough calculations, the government will increase tax revenue by $50,000,000,000.00. Where does this money come from? If companies only have "X" in their budget for salaries and the minimum wage goes up by "Y" percent, that does not mean that companies will increase their salary budget by "Y" percent. What it means is that companies will lay off people until they can fit the salaries under the "X" cap. Thus, the government will still only be taxing a total quantity of "X*# of businesses" (roughly).

This is simple and smart math and policy making in action, nothing that Senator Kerry's communist agenda would ever accept.

 

[gutharius]

Originally posted by: HalosPuma

Originally posted by: gutharius
but I see a larger picture here that can be the reason why kerry says No New Taxes If You Make Less Than 200K.

Take a look at this thread for an analogy of what will happen if Kerry wins and raises the taxes on those making more than $200,000/year.

http://forums.anandtech.com/me...7826&enterthread=y

* The first four men (the poorest) would pay nothing.
* The fifth would pay $1.
* The sixth would pay $3.
* The seventh $7.
* The eighth $12.
* The ninth $18.
* The tenth man (the richest) would pay $59.

^ ^ ^ ^ ^ ^ ^ ^ ^ ^
This argument is fundementally flawed. To take your example and use it to correct yourself: There are more men in the lower and middle income class so by numbers they pay more in or equally more to those in the more wealthy class. In otherwords individually they pay less but when lumped together they pay more or an equal amount.

 

[gutharius]

Originally posted by: ntdz

Originally posted by: gutharius

Originally posted by: HalosPuma

Originally posted by: gutharius
A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

I always wondered how a liberal's mind works - raise taxes. That is HORRIBLE leadership and why I am casting my vote against him and against the socialists and communists who seek to destroy our nation.

Did I say RAISE THE TAX PERCENTAGE??? NO! I apologize that i may not have been clear but this would increase the revenues from taxes without raising the percentage rate you or I are taxed at. A person making 5.25 an hour pays about $1100 in taxes (@ 10%) a person making $7 an hour pays about $1400 in taxes to the government. At 50 million people making minimum wage that means 50 Billion extra dollars that can be used to stabelize our already debt ridden governement.

This is not soicalism nor communism! This is simple and smart math and policy making in action, nothing president Bush's narrow intellect could get even the smallest grip on.

you are assuming that companies WONT lay off people to offset the minimum wage, which they will. It doesn't matter what you put the minimum wage, companies have a set limit they can pay for salaries and that is what they will pay, period. Raise the minimum wage, jobs are lost, thus losing that income for the govt. The govt's income will effectively stay the same if you raise minimum wage. Raising minimum wage causes the price of wages to go up, inflation. Go look at when the minimum wage was raised in history, and you'll find inflation followed.

Please read the thread:

Originally posted by: gutharius
No and I am not that nieve to think there would not be any ecenomic issues with this. (As I already stated) I am by nature a cautious optomist so i see your point but I see a larger picture here that can be the reason why kerry says No New Taxes If You Make Less Than 200K.

 

[gutharius]

Originally posted by: ntdz

Originally posted by: gutharius

Originally posted by: ntdz

Originally posted by: gutharius
A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

if you make minimum wage YOU PAY NO INCOME TAX. Yeah, thats SMART leadership huh, Bush didnt think of it because its simply WRONG.

If you take an econ 101 class you will learn that salaries are an expense just like anything else for a business. If you raise the minimum wage above what they're willing to pay for salary, they are gonna cut jobs. It's very simple supply and demand. It's a fact, undisputable, that raising the minimum wage significantly will result in lost jobs.

There is still withholding taken out of your paycheck. I gues syou must be unemployed or have direct deposit and dont look at your paystub.

you obviously don't know what you're getting taxed for. It is not income tax, its medicare and social security. Sorry bud, you're wrong.

I was not refering to that. I was referring to the Federal taxes that are taken out of your paycheck. Please go take a look at your paycheck, you may be very surprised to see there is a federal tax on your income that is taken out by your company and reported to the government.

 

[gutharius]

Originally posted by: HalosPuma

Originally posted by: gutharius
this would increase the revenues from taxes without raising the percentage rate you or I are taxed at. A person making 5.25 an hour pays about $1100 in taxes (@ 10%) a person making $7 an hour pays about $1400 in taxes to the government. At 50 million people making minimum wage that means 50 Billion extra dollars that can be used to stabelize our already debt ridden governement.

This is not soicalism nor communism! This is simple and smart math and policy making in action, nothing president Bush's narrow intellect could get even the smallest grip on.

You are missing one very, VERY important piece to the puzzle - where will this money come from? By your rough calculations, the government will increase tax revenue by $50,000,000,000.00. Where does this money come from? If companies only have "X" in their budget for salaries and the minimum wage goes up by "Y" percent, that does not mean that companies will increase their salary budget by "Y" percent. What it means is that companies will lay off people until they can fit the salaries under the "X" cap. Thus, the government will still only be taxing a total quantity of "X*# of businesses" (roughly).

This is simple and smart math and policy making in action, nothing that Senator Kerry's communist agenda would ever accept.

Either

A) you are assuming that this means everyone gets their pay increased by $1.75 an hour. Which I don't think you are but still have to wonder....

OR

B) You fail to realize many jobs are not even paying minimum wage. They are paying at the extreme of "acceptable jobs" $6 an hour. Now I will say yes for McDonalds or cheap labor industry this may or may not lead to a price increase. Inflation happens whether there is a minimum wage increase or not. So, who's to say it really even matters?

And will you please stop with the communisim before you give me a hernia from laughing so hard. :laugh:

 

[ntdz]

Originally posted by: gutharius

Originally posted by: ntdz

Originally posted by: gutharius

Originally posted by: ntdz

Originally posted by: gutharius
A minimum wage increase would increase the taxes from income generated and help balance the budget by increased income tax revenue without increaseing the tax rate. Now that is SMART leadership there is no way in hell bush would have thought of that.

if you make minimum wage YOU PAY NO INCOME TAX. Yeah, thats SMART leadership huh, Bush didnt think of it because its simply WRONG.

If you take an econ 101 class you will learn that salaries are an expense just like anything else for a business. If you raise the minimum wage above what they're willing to pay for salary, they are gonna cut jobs. It's very simple supply and demand. It's a fact, undisputable, that raising the minimum wage significantly will result in lost jobs.

There is still withholding taken out of your paycheck. I gues syou must be unemployed or have direct deposit and dont look at your paystub.

you obviously don't know what you're getting taxed for. It is not income tax, its medicare and social security. Sorry bud, you're wrong.

I was not refering to that. I was referring to the Federal taxes that are taken out of your paycheck. Please go take a look at your paycheck, you may be very surprised to see there is a federal tax on your income that is taken out by your company and reported to the government.

yes, did you not read what i said? The federal government takes out social security and medicare taxes (among other things), but NOT income tax (for minimum wage workers)...This is what we are talking about.