raising federal minimum wage to $10.10

[AggregateDemand]

Has the stagnation of wages relative to productivity done anything to prevent or alleviate recessions? No evidence suggests this as far as I know.

If you (or Keynes for that matter) were concerned with aggregate demand, why wouldn't you lament the downward pressure on purchasing power of lower class consumers - which does have a big impact on overall economic health.

because the demand problem is caused by unemployment not low wages. Unemployment reduces demand via income effect, and it often scares people away from spending (cash hoarding). Raising wages puts pressure on employment rates, which is self-defeating. Furthermore, American consumers are notorious for shipping their money overseas for oil and imported goods, so it's basically a stimulus for the rest of the world.

The perceived wage problem is actually inflation caused by government policy.

It's a sad situation. Politicians understand demand is important, but they aren't focused on demand for labor. People hoard that which they perceive to be valuable. Businesses need to see workers as a value proposition, not a liability with inherent vulnerabilities to bad regulations that cause long-term inflation in housing, education, and healthcare.

[PiMp DaDdy FitzGerald]

Has the stagnation of wages relative to productivity done anything to prevent or alleviate recessions? No evidence suggests this as far as I know.

If you (or Keynes for that matter) were concerned with aggregate demand, why wouldn't you lament the downward pressure on purchasing power of lower class consumers - which does have a big impact on overall economic health.

because the demand problem is caused by unemployment not low wages. Unemployment reduces demand via income effect, and it often scares people away from spending (cash hoarding). Raising wages puts pressure on employment rates, which is self-defeating. Furthermore, American consumers are notorious for shipping their money overseas for oil and imported goods, so it's basically a stimulus for the rest of the world.

The perceived wage problem is actually inflation caused by government policy.

It's a sad situation. Politicians understand demand is important, but they aren't focused on demand for labor. People hoard that which they perceive to be valuable. Businesses need to see workers as a value proposition, not a liability with inherent vulnerabilities to bad regulations that cause long-term inflation in housing, education, and healthcare.

Firstly, a small increase like this will only have a marginal effect on employment. Secondly, poor people spend a lot more of their money than rich people do, so transfering money to them is a great way to increase monetary velocity and thus demand.

[Small Business Owner of Any Repute]

Businesses are experiencing record profits, so I hardly think that they're on such a precarious ledge such that a modest increase in the minimum wage would send the economy into a tailspin. If anything, a nice boost in low-income wages will have a trickle-up effect, where people earning close to the minimum wage will get raises too.

And I'd be OK paying an extra $0.10 for my McMuffin if it meant a livable wage for the grown adult who served it to me, not that there's any need to increase prices to compensate for higher wages given current profit levels.

[RogueBeaver]

No

[AggregateDemand]

Firstly, a small increase like this will only have a marginal effect on employment. Secondly, poor people spend a lot more of their money than rich people do, so transfering money to them is a great way to increase monetary velocity and thus demand.

Doesn't matter how you try to rationalize it. You're treating the symptoms. Not going to work.

[H. Ross Peron]

$10.10? Yes. Unconditionally to that level. A bit higher wouldn't hurt either.

[Okay, maybe Mike Johnson is a competent parliamentarian.]

$10.10? Yes. Unconditionally to that level. A bit higher wouldn't hurt either.

[ajackson]

Has the stagnation of wages relative to productivity done anything to prevent or alleviate recessions? No evidence suggests this as far as I know.

If you (or Keynes for that matter) were concerned with aggregate demand, why wouldn't you lament the downward pressure on purchasing power of lower class consumers - which does have a big impact on overall economic health.

because the demand problem is caused by unemployment not low wages. Unemployment reduces demand via income effect, and it often scares people away from spending (cash hoarding). Raising wages puts pressure on employment rates, which is self-defeating. Furthermore, American consumers are notorious for shipping their money overseas for oil and imported goods, so it's basically a stimulus for the rest of the world.

The perceived wage problem is actually inflation caused by government policy.

It's a sad situation. Politicians understand demand is important, but they aren't focused on demand for labor. People hoard that which they perceive to be valuable. Businesses need to see workers as a value proposition, not a liability with inherent vulnerabilities to bad regulations that cause long-term inflation in housing, education, and healthcare.

Unemployment is a symptom of suboptimal demand, not the cause. By increasing the minimum wage, you are increasing the purchasing power of consumers - which is to say you are creating demand and therefore jobs.

Manufacturing has been a diminished share of our workforce for years, both during good and bad economic periods. Whats the difference if money is spent in American for Chinese products vs in American stores for American products?

We agree on inflation, at least. If we enacted monetary reform and achieved the desired deflationary effect, the minimum wage would need to be lowered.

[AggregateDemand]

Unemployment is a symptom of suboptimal demand, not the cause. By increasing the minimum wage, you are increasing the purchasing power of consumers - which is to say you are creating demand and therefore jobs.

Manufacturing has been a diminished share of our workforce for years, both during good and bad economic periods. Whats the difference if money is spent in American for Chinese products vs in American stores for American products?

We agree on inflation, at least. If we enacted monetary reform and achieved the desired deflationary effect, the minimum wage would need to be lowered.

The suboptimal demand in the economy for the last 30 years is suboptimal demand for US labor. Companies doing leveraged buyouts so they can lean the labor force. Outsourcing every job possible. Firing union workers and replacing them with automation.

Raising minimum wages is not going to solve this problem. As long as education costs and healthcare costs continue to inflate, minimum wage increase is a stop-gap political stunt in an election year

[ajackson]

Unemployment is a symptom of suboptimal demand, not the cause. By increasing the minimum wage, you are increasing the purchasing power of consumers - which is to say you are creating demand and therefore jobs.

Manufacturing has been a diminished share of our workforce for years, both during good and bad economic periods. Whats the difference if money is spent in American for Chinese products vs in American stores for American products?

We agree on inflation, at least. If we enacted monetary reform and achieved the desired deflationary effect, the minimum wage would need to be lowered.

The suboptimal demand in the economy for the last 30 years is suboptimal demand for US labor. Companies doing leveraged buyouts so they can lean the labor force. Outsourcing every job possible. Firing union workers and replacing them with automation.

Raising minimum wages is not going to solve this problem. As long as education costs and healthcare costs continue to inflate, minimum wage increase is a stop-gap political stunt in an election year

Unemployment has been low at various points in the last 30 years. What is consistent in that same period is the stagnation of wages and the diminishing of low income purchasing power. Consumer spending is the main driver of job creation in our economy, stimulating it is the only practical recourse in a recession.

Education and health care inflation are problems with separate solutions.

[NewYorkExpress]

Oppose without a maximum wage being set. Such as 1000 x $10.10 as a hypothetical.

[🐒Gods of Prosperity🔱🐲💸]

Oppose without a maximum wage being set. Such as 1000 x $10.10 as a hypothetical.

[NewYorkExpress]

Oppose without a maximum wage being set. Such as 1000 x $10.10 as a hypothetical.

Basically I'm saying people in general make too much money, and a hypothetical maximum wage should be set as a (relatively) high multiple of the minimum wage.

[TNF]

Sure are a lot of trust fund assholes in this thread.

[ajackson]

Oppose without a maximum wage being set. Such as 1000 x $10.10 as a hypothetical.

Basically I'm saying people in general make too much money, and a hypothetical maximum wage should be set as a (relatively) high multiple of the minimum wage.

What benefit does a wage ceiling provide to the economy? In a free market economy, wealth accumulation is essential to the formation of new businesses and ultimately job creation. To put it another way, our problem is people on the bottom making too little, not people on the top making too much.

[Randy Bobandy]

Support, although it still needs to be quite a few dollars higher.

[AggregateDemand]

Unemployment has been low at various points in the last 30 years. What is consistent in that same period is the stagnation of wages and the diminishing of low income purchasing power. Consumer spending is the main driver of job creation in our economy, stimulating it is the only practical recourse in a recession.

Education and health care inflation are problems with separate solutions.

There was no stagnation of wages until the dawn of the 21st century. Prior to the new millennium, real wages and real median income were on a relatively steep incline, but during Bush presidency and the recession, we've given back all of our gains.

The problems are obvious. Healthcare costs. Education costs. Imports (particularly oil). Prolonged weakening demand for skilled labor thanks to LBOs and global competition. You're never going to fix these problems with a minimum wage, and that's why none has been proposed until now, when Democrats need to find some constituents to buy.

[WalterMitty]

Sure are a lot of trust fund assholes in this thread.

honestly they dont make me half as sick as the teen leftists who 'oppose' the minimum wage increase because it isnt 'big enough.'

as a low wage worker, i will take 10.10.  i know that 15 is a political non starter.  dont try to ruin the 10.10

[ajackson]

Unemployment has been low at various points in the last 30 years. What is consistent in that same period is the stagnation of wages and the diminishing of low income purchasing power. Consumer spending is the main driver of job creation in our economy, stimulating it is the only practical recourse in a recession.

Education and health care inflation are problems with separate solutions.

There was no stagnation of wages until the dawn of the 21st century. Prior to the new millennium, real wages and real median income were on a relatively steep incline, but during Bush presidency and the recession, we've given back all of our gains.

The problems are obvious. Healthcare costs. Education costs. Imports (particularly oil). Prolonged weakening demand for skilled labor thanks to LBOs and global competition. You're never going to fix these problems with a minimum wage, and that's why none has been proposed until now, when Democrats need to find some constituents to buy.

When adjusted for inflation, mean household income has been stagnant dating back to the mid 60s...we can argue about whether raising the minimum wage is appropriate in the short term ( I think we agree that monetary reform is the long term solution)...but we shouldn't be pretending that it's long term inflation depressing wages when the stagnation started well before said inflation (and before we left the gold standard in the 70s).

[IceSpear]

Sure are a lot of trust fund assholes in this thread.

Why is minimum wage exempt from the "gradual progress is worse than no progress" philosophy?

[TNF]

Sure are a lot of trust fund assholes in this thread.

Why is minimum wage exempt from the "gradual progress is worse than no progress" philosophy?

Because raising the minimum wage is progress, period. I don't buy into the idea that forcing everyone to buy private health insurance is a step toward socialized medicine because I'm not deluded.

[AggregateDemand]

When adjusted for inflation, mean household income has been stagnant dating back to the mid 60s...we can argue about whether raising the minimum wage is appropriate in the short term ( I think we agree that monetary reform is the long term solution)...but we shouldn't be pretending that it's long term inflation depressing wages when the stagnation started well before said inflation (and before we left the gold standard in the 70s).

Feel free to measure in any year-dollar you choose, and you'll see that real median household income was rising until about 2001, right after the dotcom bubble burst. Real wages have also grown if you count benefits (public and private), which most liberal economists are anxious to exclude. Look at real compensation if you have doubts. The PPP numbers are much less pretty, and that's why I harp on inflation.

The inflationary problems and the stagnation of labor productivity against real compensation is not a mystery to Beltway economists. Minimum wage was at the bottom of the Obama administration's to-do list. First was healthcare reform. Then EPA fracking and CAFE. Then a half-assed attempt at education reform. Now, with the party in dire straits, they throw minimum wage to the base. It's politically motivated, not economically motivated.

[AggregateDemand]

It's funny because this didn't happen after prior minimum wage increases.

because they were done the correct way--after years of economic boom to keep real min wage about 25% above the poverty line.

[IceSpear]

Sure are a lot of trust fund assholes in this thread.

Why is minimum wage exempt from the "gradual progress is worse than no progress" philosophy?

Because raising the minimum wage is progress, period. I don't buy into the idea that forcing everyone to buy private health insurance is a step toward socialized medicine because I'm not deluded.

Maybe not, but it still changes the paradigm from "health insurance is a privilege" to "health insurance is a right", which is essential if socialized medicine will ever become reality.

[NewYorkExpress]

Sure are a lot of trust fund assholes in this thread.

Why is minimum wage exempt from the "gradual progress is worse than no progress" philosophy?

Because raising the minimum wage is progress, period. I don't buy into the idea that forcing everyone to buy private health insurance is a step toward socialized medicine because I'm not deluded.

Maybe not, but it still changes the paradigm from "health insurance is a privilege" to "health insurance is a right", which is essential if socialized medicine will ever become reality.

Um, not quite, Health Insurance is a right for everyone but the rich (+10 million total wealth), who really should be forced to go without health insurance of any kind (because the medical bills ostensibly would be a drop in the bucket for them)