Social Question

SQUEEKY2's avatar

Why is raising the minimum wage bad for economy, but the people at the top have seen multiple raises and nothing is said?

Asked by SQUEEKY2 (20024points) 1 month ago

The Fright wing always claim the sky is falling when it comes to raising the wage for people at the bottom, but again nothing is said when the top get fairy tale salaries , how come that isn’t bad for the economy as well?

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40 Answers

RedDeerGuy1's avatar

Because they are hypocrites?

Zaku's avatar

Because it’s a lie propagated by the media companies and economists the ultra-rich own, who define “good for the economy” as something functionally equivalent to “rich people getting richer.”

kritiper's avatar

….....................It’s not exactly the same thing….........................

SQUEEKY2's avatar

^^ Why? Because the top deserve it and the bottom do not?
I understand different pay scales and such, but even bottom level workers need a wage that they can at least pay the bills and put food on the table after a forty hour work week ,and NOT need Government welfare to supplement their income.

stanleybmanly's avatar

It’s a matter of “I’ve got mine. Let me pull the ladder up behind me.”

Kropotkin's avatar

It isn’t. They just hate the poor. It’s a form of sadism.

SQUEEKY2's avatar

Well they seem to love to exploit the poor.^^^ For their greedy gain.

ragingloli's avatar

Oh, they will say that they deserve all that money because “tHeY aRe CaRrYiNg AlL tHr RiSk”.
When in reality, they are not personally liable for any losses, and when they run a company into the ground, they still get a multi-million dollar “bonus” when they leave and probably will still be able to get a CEO position at another company, while everyone else just gets fired.

jca2's avatar

The poor get their raises, 25 cents an hour, 50 cents an hour, and they’re supposed to be grateful for that. At that rate, they’ll never get ahead but the CEO is so far removed, living in his mansion, having a condo in a hot climate and a ski lodge in a winter resort, spending his afternoons on a golf course, he has no clue what it’s like for the “little guy.”

chyna's avatar

I have to agree with Stanley.
My company was going through bankruptcy and the employees didn’t get a raise in 3 years. Yet administration got bonuses and raises. All the while making 400–600k a year.

si3tech's avatar

Considering for instance a job at McDonald’s.This job is not intended to provide
“a living wage” for anyone. We have people working at fast food places, for instance,
who are demanding a living wage for them/family who also get unemployment working
part time! They refuse to work more hours because they’ll “lose their unemployment.”
What ever happened to “work ethic”, responsibility, supporting ones self being a
contributing member of society? Just one example of scamming the system.

Response moderated (Flame-Bait)
Nomore_lockout's avatar

Now now, can’t expect J.B. Bigbux to go broke paying his people a living wage, can we? If every one made fair money, how could we bitch and moan about government hand outs to moochers? I mean, the folks we outsource to are perfectly content with a slave wage in abominable working conditions. Move on, nothing to see here. Hey look! The Dems are trying to get your guns, and let those funny folks get married! And all you think about is supporting your family! How uninformed and selfish! Got to run, have to attend a 2,000 dollar a plate fund raiser for my Republican politico.

KRD's avatar

Because the higher people have to pay their employees; the higher they have to charge people.

ragingloli's avatar

It really is quite simple:
If your employees have to rely on government assistance because you do not pay them enough for their work, then the tax payer is subsidising your company, and if you make the argument that your business would not be profitable if you paid your employees a living wage, then your business is not viable in the first place.

KNOWITALL's avatar

I feel like some see minimum wage jobs as stepping stones while others see them as a career. That may be part of the miscommunication in ideologies.

@si3tech I think more people are staying in PT jobs at McDonalds as our seniors age. We always were told Boomers would change things due to the sheer number of them.
A neighbor in her late 50’s works at our local McD’s, as well as a senior with disabilities. I know they’d appreciate more money since one is a single parent and uses the local food bank as well. In fact her teenage daughter also works at that same McD’s. So if they both got a raise perhaps they wouldn’t need the food bank.

stanleybmanly's avatar

That’s the fallacy in the conservative argument against the minimum wage—slave wage jobs are stepping stones for teenagers entering the workforce. All of us can cite examples where this is no longer the case. I cannot count the number of jobs and trades in my lifetime that have fallen from solid middle class occupations to hallmarks of penury and destitution.

gorillapaws's avatar

@KRD “Because the higher people have to pay their employees; the higher they have to charge people.”

If you own a cookie shop that bakes cookies and you’re forced to double your wages, Would you double the price of the cookie? or is the labor only a small percent of the overall price of the cookie: e.g. the cost of the raw ingredients, the depreciation of the equipment, the rent, utilities, marketing costs, business insurance, accounting and legal fees, cleaning supply costs, etc.

Furthermore, in an area where the local people now have much higher wages, do you think there will be more demand for cookies, or less demand? If your demand increases significantly, do you hire more workers or just give your customers a bad experience? In fact the increased volume means you may not need to increase the price of your cookies at all AND you have to employ more people. Not only that, you’re now ordering more flour, eggs, sugar, etc. That means those suppliers have to hire more workers to produce more raw goods. That’s why unemployment doesn’t go up after minimum wage hikes (unless we’re in a recession).

ragingloli's avatar

And they would only “have” to raise prices, if they would start losing money.
Since McDumb came up, they could literally double all their employees’ wages, and still make a tidy profit.

SQUEEKY2's avatar

@gorillapaws that is not what frightening propaganda teaches.

gorillapaws's avatar

@SQUEEKY2 You should check out this podcast episode that discusses ‘Economism’ which is what you’re talking about.

hello321's avatar

70% of food stamp recipients work full-time.

gondwanalon's avatar

Raising the minimum wage is not necessarily bad for the economy up to a point. If the minimum wage is raised too high then stores a companies will be forced to lay off workers, used more automatic systems (robots) or simply close and out out of business.

People “at the top” earn their raises through their skills, talent, experience and hard work. While those getting minimum wage lack experience, skills and likely have not yet shown that they’re contrition to a company is worth a higher wage.

gorillapaws's avatar

@gondwanalon Companies will replace all labor that is feasible with robots whenever possible regardless of how cheap the wages of the workers are.

gondwanalon's avatar

@gorillapaws When the workers become too expensive manage a profit then robots will suddenly be possible. And robots never call in sick. Also look for cashier free stores.

gorillapaws's avatar

There are no robots that are cost prohibitive when wages are $7.xx/hour but are cost effective when wages are $15/hour. That’s nonsense. Companies are automating as much as possible regardless of wages.

gondwanalon's avatar

You are probably right. The cost of fast food generating robots has come way down. 10 years ago I watched a demonstration of a huge robot making hamburgers, eggs and hash browns. It cost $90K. Looks like a much more compact and more versatile fast food robot can be bought for $30K.

One robot can be purchased with the yearly salary of one full time $15/hr worker. I won’t be surprised if that high of minimum wage results in a lot of fast food robots edging out fast food workers.

hello321's avatar

@gondwanalon: “I won’t be surprised if that high of minimum wage results in a lot of fast food robots edging out fast food workers.”

Automation is replacing jobs where possible regardless of labor costs. There is no (as in zero) connection between minimum wage and automation. In jobs where real wages have consistently held steady or gone down, automation has increased.

stanleybmanly's avatar

We are going to be forced to reckon with technology eliminating the feasibility of manual labor. Or rather we must remedy the current dictate that all innovations improving efficiency reward only employers. If capitalism by definition is now a system where the elimination of the workforce is the model for success, it is obvious that Marx is correct in his prediction that capitalism will self destruct due to its own contradicting inconsistencies.

KRD's avatar

If robots take over the fast food places I think I know what the next job will be after that.

KRD's avatar

It will be taking care of the robots doing the fast food stuff.

gorillapaws's avatar

@gondwanalon At $30k, depreciated over 5 years (or however-long the expected lifetime is), that’s the equivalent of a $2.88/hour wage, and that’s before the cost of benefits, payroll taxes, PTO, absences, productivity, and the costs of human error are taken into account. Another advantage is that it goes on your balance sheet as a long term asset instead of a cost of goods sold expense. Factor all of that in and it’s likely less than $2/hour. If we set that as the Federal minimum wage floor, you’re going to see Americans leaving the suburbs and sneaking into Honduras to look for a better life.

When the computer was invented, it wiped out entire classes of jobs such as clerical and analytical tasks (imaging hand-calculating spreadsheets and reports). It also opened up a tsunami of other jobs too.

gondwanalon's avatar

@hello321 I suspect that if you told a fast foods restaurant owner that the minimum wage has nothing to do with automation that (s)he would likely disagree.

“In jobs where real wages have consistently held steady or gone down, automation has increased.” Really?

I noticed just the opposite in my experience. Back in the olden days (1970’s) when I first became a med tech in a large hospital lab it took 6 med techs to operate the chemistry part of the lab. Due to high tech computers and robotics nowadays it only takes one med tech to run the chemistry lab (testing far more specimens and generating far more test results far quicker). After 38 year of working in my profession my salary has consistently increased up to when I retired 5 years ago.

hello321's avatar

@gondwanalon: “I suspect that if you told a fast foods restaurant owner that the minimum wage has nothing to do with automation that (s)he would likely disagree.”

They could not disagree. They might lie to you, but it has nothing to do with the fact that the minimum wage has been $7.25 (peanuts) for so long, and McDonald’s has been rolling in their automated cashiers for a really long time. Target and most grocery stores have been relying on eliminating cashiers in favor of self-checkout.

You know what else has been happening this whole time? These corporations have been making a large profit. They do so because they underpay their employees.

If the company cannot pay its employees and is being effectively being subsidized to under-pay these people, there are only a few options:

1. It’s not a viable business and they should close.
2. The profits are too high, and someone is getting paid too much at the top.
3. Capitalism doesn’t work.
4. all of the above

You are implicitly arguing that #4 is correct.

Automation is happening everywhere and eliminating jobs. A robot doesn’t attempt to unionize. A robot doesn’t need benefits. A robot doesn’t need a living wage and doesn’t complain. There is much theoretical work being done now in the area of the post-work economy. That is, what happens when most jobs become obsolete and production is the same? There are those in the tech industry that support UBI specifically because they can’t move forward with their plans if the population ends up unable to earn a wage once there are very few jobs, etc. It’s a side-step to avoid a revolution, and I don’t support this. But it emphasizes the problem that is on the horizon.

gorillapaws's avatar

CORRECTION: ”...that’s the equivalent of a $2.88/hour wage…”

I miscalculated by using a standard 40 hour workweek. If the robot were to run continuously 24/7 with a 5 year lifespan the equivalent wage would be $0.685/hour. Including the other benefits of robots, I don’t think there’s a single labor market on the planet where human labor would be a better choice than such a robot.

gondwanalon's avatar

@hello321 I think that I agree with you about 25% of what you’d have written.

The last year that I worked I felt sorry for the new med techs just coming into the field as automation will likely push them out well before they will be eligible for retirement. Point of care testing in doctor’s offices will pretty much eliminate the clinical lab before long. I think that advances in nuclear magnetic resonance will one day eliminate the use of drawing blood with needles. A wand like apparatus like the one used on Star Trek will analyze the blood flowing through patient’s veins/arteries and quickly give cell counts and analyze a wide range of important chemistries. How sweet that will be. I hope to live long enough to see that for sure.

SQUEEKY2's avatar

The people so against raising the minimum wage seem to be mostly fright wingers, saying OMG it will devastate small business, or are they being puppet controlled by big business that could easily afford to pay the increase?
And as one member pointed out any automation will be done regardless of the wage cost.

SQUEEKY2's avatar

These low end workers DO deserve a wage that can pay the bills at the end of a 40 hour work week without depending on Government welfare to subsidize them.
In the end who is more guilty of using Government welfare, the low end worker that needs it to put food on the table after working 40+ hours?
Or the corporations that don’t pay a living wage?

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