Minimum wage.

America. I'm going to explain this real simple.

Your economy is fucked because no one has any money anymore.

Raise the damn minimum wage to $12 an hour and watch the Economy boom.

Just watch it BOOM.

 

Maybe...or maybe the prices of everything would go up again just like they do every time minimum wage is increased...
What I'd prefer to see is companies getting their heads out of their asses without being pushed to do so by big brother and start paying employees a living wage instead of the absolute minimum allowed by law.

 

You left out the part about massive inflation out, someone was asleep in economic class

 

No I wasn't asleep maybe you need to attend an economics class.

Wow - fucking-brilliant original idea you there. Prices would go up-no-fucking-shit. By how much ?

Not enough for anyone to care.

 

BoredGeorge,

I'm not disagreeing with you, but I do note that the experts (they know more than me, they've been working in this area longer), the experts all say that the answer to our current situation is not for there to be more money, but more credit (= more debt).

The experts keep saying that the country needs to go deeper in debt in order to get the economy happening.

I'm not saying your wrong, and I'm definatly not following the advise those who think I need to be deeper in debt than I am.

 

yeah, they would.

raising minimum wage to 12 dollars is a HUGE increase, as much as by 7 dollars in some states. that would be a process that would have to take years.

such a huge increase so quickly would cause prices to inflate so much it will be really like people aren't making any extra money, if not as if making less money.

sure, 12 minimum wage would be nice, but it would be a long slow process, as if you just up it to 12 bucks in less than say, 5 years, the economy would probably fail. as i was taught.

 

Raising the Minimum Wage Hurts Vulnerable Workers' Job Prospects Without Reducing Poverty
by James Sherk
WebMemo #1176

When the government changes the law, individuals respond to those changes. Because of this, the true effects of a law often differ radically from its authors’ intentions. For example, Congress created welfare to help the poor in times of need, but instead it created a cycle of dependence trapping low-income Americans in poverty.

Similarly, raising the minimum wage brings with it unintended consequences that run counter to lawmakers’ aim of helping the working poor. Like anything else, when the price of labor rises, businesses buy less of it. The role of the minimum wage in raising unemployment is well known and well documented.[1] But even worse, recent research has shown that higher minimum wages reduce teenage education levels and decrease workers’ long-term earnings. Studies also show that the minimum wage does not reduce poverty. As always, Members of Congress should look beyond their good intentions and consider the full effects of proposed policies. If they do, they will reject raising the minimum wage.

Minimum Wages Reduce School Enrollment
Contrary to the rhetoric of those who favor raising the minimum wage, most people affected by the minimum wage are actually young workers. Individuals between the ages of 16 and 24 accounted for 53 percent of all minimum wage-earners in 2005.[2] When the minimum wage rises, it increases the incomes of teenagers with minimum-wage jobs, making entering the workforce more attractive. This, in turn, can be expected to cause some students to spend less time in school and more time working. While the overall number of minimum-wage jobs might decrease, if employers prefer to hire teenagers to low-skilled adults, the number of teenagers enrolled in school would drop.

Recent research has confirmed exactly this effect. David Neumark, professor of economics at Michigan State University, and William Wascher, a researcher with the Federal Reserve, found that minimum wage hikes decrease the proportion of teenagers enrolled in school.[3] In states which allow students to drop out of school before they are 18, a 10 percent increase in the minimum wage caused teenage school enrollment to drop by two percent. In states which require students to stay in school until they are 18, raising the minimum wage had no effect. In sum, when students have the option, higher minimum wages motivate some to leave school and start working.

Another recent paper confirms this conclusion. Duncan Chaplin of the Urban Institute, Mark Turner of John Hopkins University, and Andreas Pape of Michigan State University examined teenagers’ continuation ratios—the proportion of a school’s students in any year who either graduate or progress to the next grade level.[4] They found that higher minimum wages decreased continuation ratios and led teenagers to drop out of school. Again, this result was present only in states where teenagers could drop out of school at younger ages.

Workers need skills and education to get ahead in the economy, and workers without a high school diploma face difficult career prospects. Raising the minimum wage actually motivates teenagers to make choices that may push them into poverty later in life.

Long-Term Effects of Minimum Wages
The fact that minimum wages reduce educational attainment suggests examining their long-term effects. In a recent study, Neumark and Olena Nizalova, of Michigan State University, examined the incomes of adults who had been teenagers when minimum wages rose in their states.[5] They found that minimum wage hikes reduced both the probability of holding a job and the incomes of workers exposed to them over a decade later. They also found that this negative effect is larger for African-Americans than for whites, perhaps because more African-Americans hold jobs that pay near the minimum wage.

Raising the minimum wage has these negative long-term effects because it alters the choices that people make today in ways that have long-term consequences. It induces some students to drop out of school, reducing their long-term employability. By raising unemployment and eliminating entry-level jobs, minimum wage hikes also eliminate opportunities for workers to gain valuable experience and skills that prepare them for future jobs. These unintended consequences severely hamper low-income workers’ future job and earning prospects.

Minimum Wage Increases Do Not Reduce Poverty
For all the negative unintended effects of the minimum wage, it is perhaps not surprising that the minimum wage does not reduce poverty.[6] Neumark and Wascher found that minimum wage hikes increased the probability that poor families escaped poverty but also increased the probability that previously non-poor families fell below the poverty line. Overall, poverty rates did not change. Neumark and Wascher conclude that raising minimum wages does not reduce poverty:

On balance, we find no compelling evidence supporting the view that minimum wages help in the fight against poverty. Rather, because not only the wage gains but also the disemployment effects of minimum wage increases are concentrated among low-income families, the various tradeoffs created by minimum wage increases more closely resemble income redistribution among low-income families than income redistribution from high- to low-income families.[7]

On balance, then, the minimum wage leaves low-income Americans no better off in the short term and far worse off in the long term.

Conclusion
Due to unintended effects, a law can achieve the opposite of its supporters’ intentions. The minimum wage is such a law. It is intended to reduce poverty, but it does not. Instead it encourages teenagers to drop out of school and reduces low-income workers’ future job prospects and earnings. Good intentions are not enough. Congress should not pass a destructive minimum wage hike that will harm the most vulnerable American workers.

James Sherk is a Policy Analyst in the Center for Data Analysis at The Heritage Foundation.













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In a way I agree. Republicans would like you to think income disparity has nothing to do with it. But if a small segment of the population owns the majority of the money. They can be sated by only spending a small portion of their income on new goods. They have a tendency to view economics as a game and participate in games of manipulation and greed. They create bubbles, which burst when they become sated, or the dupes that play into the game run out of funds.

For all the policy/financial wonks saying they are smarter today than when the depression occurred. They got caught up in the greed and the same thing that happenned then is happenning now.

http://wonkroom.thinkprogress.org/2008/03/17/1928-resemblances/

http://economistsview.typepad.com/economistsview/2008/10/does-wealth-con.html

 

And my personal view on what lead to this crisis....it wasn't the mortgage crisis, that certainly fed it because the market was now based on debt instruments.

What caused this mess was the manipulation of the oil market. Huge spikes in fuel costs, lead to a constriction in consumption. And since consumption is what our economy is currently based on something had to give.

The workers either had to eat or drive and pay their mortgages. The Bush/Cheney administration could have minimized the harm if they had used some of the federal oil reserves, but that would have driven the fuel prices down...and they couldn't have that could they. Not while their friends were reaping huge returns.

 

or we could start serious transfer of wealth.

and corporation, and trust busting.

 

Have any of Barack's advisors suggested a futher increase in the mininum wage to boost the economy?

 

You increase minimum wage when the GDP is stable, and you increase in small increments, $1 every 2 years for example.

Besides, the Federal Government has no judicial or legislative authority to increase minimum wage. It's left up to the individual state legislatures to increase/decrease wage laws.

 

There's a federal minimum wage (in the US).

 

There is?

So why is there State Minimum Wages?

 

Because the federal one is around $5 an hour and I assume most states realize that's not enough to live off of, however some states use the federal minimum wage (mississippi is one Ii think) and when california was in a budget crisis this year they temporarly demoted state workers to federal minimum wage, not state minimum stating they could because the people were government employees.

 

That doesn't make a lick of sense.

I mean, not you, but the circumstance.

 

When was the last time how a law was used made sense?

 

Today.

 

Then you saw a serial ax murderer arrested today? wow

 

if the state wants it higher.

or if the state wants detail on it.