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Comments about ‘The great minimum wage debate: how Obama's proposal to increase the minimum wage will impact the economy’

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Published: Tuesday, Feb. 19 2013 11:05 p.m. MST

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Demisana
South Jordan, UT

I find it interesting that the economists in favor that they quoted were from a liberal think tank and Berkeley. Why not quote Thomas Sowell or Walter Williams?

Studies show that most people who have minimum wage jobs don't stay there. As they gain experience and skills, they move on to better paying jobs. If their skills aren't worth $9 an hour, nobody will hire them. The unskilled will be crowded out of the job market. We already have high unemployment, with college graduates taking anything they can get in some areas. This will only exacerbate the problem.

As for restaurant servers, yes, their hourly wage is well below minimum wage. I work for a payroll service. With tips, almost all of them make over $10/hour, some well over. Again, the difference is skill and experience (and probably personality too). Raising their wages will only raise costs for the restaurants, who will be passing on the cost to customers, who will then cut back. It's not a high profit margin industry anyway, and this won't help.

Blue
Salt Lake City, UT

Brave Sir Robin, you say my comment contains logical fallacies, yet you don't establish that, and then go on to create your own fallacies. Amazing.

If my "high paying" minimum wage job in 1970 had more buying power than today's minimum wage, why is that a bad thing? Do we _want_ entry level workers to live below the poverty line?

"State-by-state unemployment is not correlated to the minimum wage." If you accept that there is no correlation, then why do you continue to press the myth that higher minimum wages are bad for workers?

"There is no evidence that the current minimum wage is perpetuated by businesses' desire for cheap labor." That's complete nonsense - of course there's evidence. Listen to the business owners talk about their fear of having to pay a living wage to their entry level workers. Look at the "think tanks" that produce opinion pieces opposing raising the minimum wage.

jskains
Orem, UT

This is stupidity at it's finest. Basic logic dictates increasing minimum wage increases production and service costs. Even if it did not drive up unemployment, the money has to come from somewhere. The net effect is that everyone's buying power goes down as the price of goods and services is driven upwards. So that $9 will simply be the new $4.25... Yes, when I was a kid, it was $4.25 an hour. How well did driving it over $7 help? Obviously not at all. But we go back to this same stupid idea of hitting our heads against the same wall.

vdubbin'
Ogden, UT

Listen to people! Does a dishwasher or fry cook actually deserve nearly 10$/hour? It would be nice if everyone made enough money to live while only working a 35 hour week, but it's not practical. Every day we move just a little farther to the left. "Dishwashers are entitled to x". Well, I must disagree. Ideally, kids work these jobs (documented kids who actually are entitled to work here), save for a couple of years, and then get better paying jobs after they've become experienced. But saying that people deserve that much money for doing something that requires nothing more than a warm body is just insane.

Anyone who knows anything about economics will understand how forcing employers to pay $9/hour for digging ditches is going to have negative consequences. Raising the minimum wage would make us feel all warm and fuzzy, but when our economy is already on the brink of depression, does it make sense to upset the tray further by paying top dollar for unskilled work?

JWB
Kaysville, UT

Minimum wage is a bargaining tool that unions use for their contract negotiations to always be at least twice the minimum wage for the lowest end of their process.

Brave Sir Robin
San Diego, CA

@Blue

You are missing the point completely.

1. Of course we don't want workers living below the poverty line. The point is, raising the minimum wage is not the way to change it, and the example provided by you yourself is proof! Poverty is based on purchasing power, not money.

2. We are talking about minimum wage, not unemployment. You attempted to make a straw man argument about a correlation between minimum wage and unemployment which I blew out of the water. If you want to talk about unemployment, then talk about unemployment. If you want to talk about wages, then talk about wages. But don't talk about one and pretend that it has an effect on the other.

RBB
Sandy, UT

It is amazing how people can simply ignore common sense. If you raise the minimum wage, the money has to come from somewhere. If a company has 20 employees, the raise will cost the business $50,000 per year. This is on top of the $40-50,000 that Obamacare is adding. Where does the money come from? If the company is successful, the owner just got a large tax increase and now has to find another $100K. If the company is less successful, a profitable business is now in the red.

While some companies are stuck in their locations, others are free to move. If a business owner can save $100-200K a year by moving their operations to Mexico, So. America or Asia, kiss those jobs goodbye. If not, the owner will have to cut costs - such as getting rid of less productive employees and shifting to 29 hour work weeks to avoid Obamacare. Europe has gone down this road and their young adult unemployment is more than 50% higher than the U.S.

Raising the minimum wage will not cost jobs - it will just move more of them to China.

RockOn
Spanish Fork, UT

There should be NO minimum wage law. Employees should be free to negotiate terms and conditions making them more attractive to hire than someone else. If you go to the grocery store and prime rib and hamburger sell for the same price, which are you going to buy?

In Utah the minimum wage law is pretty much irrelevant anyway. Few, if any jobs, pay less than $9 an hour as it is.

Dictatorial government policies always create more harm than good.

JoeBlow
Far East USA, SC

Geez Chris B. You act like Obama is the first politician that made a statement that came up false.

You harp on it daily.

Lets see.

Obama said
"I will cut the deficit in half during my first term"

"We need to act quickly in passing this stimulus package(FIRST of many) of 787 billion to prevent unemployment from reaching 8%"

Neither happened. So, what was the ramification of this?

Now, I seem to recall someone saying

"Simply stated, there is no doubt that Saddam Hussein now has weapons of mass destruction."

And this one

"the cost of the occupation, the cost for the military administration and providing for a provisional [civilian] administration, all of that would come out of Iraqi oil."

Wanna compare the ramifications of the mis statements?

Newsflash Chris. Politicians make statements that turn out false. Sometime they make mistakes, and sometimes they purposely lie.

Liberal Ted
Salt Lake City, UT

This is a reason why companies go overseas and outside of this country to do business. Why be forced to pay a wage that economics is not able to support, when you can go outside of this country find labor that is cheaper, then ship those products out and make more profit than you would have being here in the first place?

Mitt Romney had this right when he was explaining about making the playing field level with all countries. Instead baracks counter argument was why get in a trade war with China? Mitt's reply is why not? We are the ones importing all of their products. We have more leverage than they do. Why not compete and use that leverage to bring more jobs back to this country?

The trouble is, baracks vision for this country is that wealth comes out of the thin air and evil business grabs all of the wealth and keeps it out of the hands of the poor. So, now it's his purpose to force those evil businesses to release that wealth that they never earned and redistribute it to all of the poor in the world. $12 Trillion later we stillhavepoor

Fern RL
LAYTON, UT

It seems like the only thing Republican and Democratic lawmakers can agree on is that their own paychecks can remain inflated. What would they do if they had to live on the average income of their constituents?

Eric Samuelsen
Provo, UT

Actually, the assertion that "85% of all economic studies" agree that raising the minimum wage increases unemployment is disingenuous. Most peer-reviewed studies of this issue conclude just the opposite.
Think about it. The working poor, if they get a little extra money, spend it. They increase economic activity. If you say to a small business owner "you have to pay your employees more," that sounds bad; they'll oppose it. But if you say "you have to pay your employees more, but in exchange, your business volume will increase ten percent," that's a trade-off that works. And that is what the data show happens.

A Chem Engineer
Pocatello, ID

A great analogy illustrates the faulty logic of instituting a minimum wage.

Money is a representation of labor output, or productivity; it is much superior for trade over a barter system (which more directly connects labor output to the goods bartered).

Example: Johnny and 3 other cooks work at a local burger joint that is always busy, where in one hour he is able to flip 1000 hamburgers. Johnny gets paid $5.00 per hour. Then one day, a minimum wage law goes into effect, stating that $10.00 per hour is now the minimum wage. But Johnny still is only able to flip 1000 hamburgers an hour.

So what has changed? Johnny is at his maximum labor output - he physically cannot flip 2000 hamburgers an hour. All that has happened is the value of the $10.00 has been cut in half - it still only represents (to Johnny's employer, and later, the customers) 1000 hamburgers per hour. But economies have long response times; it will take 4-6 years for this devaluation to settle out (just in time for the new president to get blamed...).

Remember - money only represents labor output (i.e. productivity), nothing more.

atl134
Salt Lake City, UT

@SME
"Where is this money coming from? "

From poor people (if you make 9 dollars an hour you're probably poor) basically having to spend all the money they make into the economy just to get by.

TOO
Sanpete, UT

Wage should be determined on a person's ability to perform. What if I HAVE to pay a person $7.25 because it's the law, but he only does work that merits $5? I can't lower his wage so I have to probably fire him.
Whereas if I have the choice to pay someone what I want, I can pay them based on performance. If they don't like the salary, they can look elsewhere. I have NEVER been paid minimum wage in my life because my bosses thought I was worth more than that to them. Many people think they are entitled to a good job, despite a poor work ethic.
Raising the minimum wage will do nothing but decrease employment. My father started his own business, I have worked for small businesses all my life. I have seen people fired because employers cannot pay them. If employers are required to pay higher amount, then layoffs will increase, and hiring will decrease.

Chris B
Salt Lake City, UT

@JoeBlow,

Yes, and what should we do when someone has shown a clear history of serious MISunderstanding(at least) or lying(more likely) when it comes to the economy?

Answer:

We stop listening to them.

Just as you wouldnt trust Bush to start making important military questions,

I do not trust barack to make important economy decisions.

In fact, his track record suggest that when he says something,

we should do the opposite.

I will continue to remind people that barack's understanding and track record

in handling of the economy is no better than a first graders.

If someone believes what barack says will come to pass,

I will keep reminding people that it will not happen.

Invisible Hand
Provo, UT

Obama is so smart only he knows what an hour of unskilled labor is worth. We should be thankful that he has sprinkled his knowledge from on high that $9.00 is the good and proper wage for someone with no skills. So stop negotiating amongst yourselves. If you need to know the answer to economic questions there's no need for messy free markets when we have such a smart president that can tell us everything. Now we should all stop complaining and go hire people.

KC Mormon
Edgerton, KS

Here is what people like Obama do not take into account, many companies with lower wages operate on such low profit margins they can not afford to raise their pay. I will take the lumber industry for an example. When go to your local lumber store and buy a 2x4x8 they make about $.03 on that board. Now take into account all that are stolen and lost to damage and they make even less. They do make up for it through hardware items that have a higher profit margin but that still covers very little of a profit when you take out all overhead. Now if you raise the minimum wage from $7.25 to $9.00 you must raise wages for much more than just new hires because those who have worked for years to get to say $12.00 will not be happy with a new employee making almost what they are. You now have not only no profit but a loss so you must raise your prices. Now the $9.00 is equal to the $7.25 because you have inflated the economy. You are back to square one.

sportfan65
ORANGEVILLE, UT

The thing that people don't realize is that if you raise the minimun wage in a grocery store for instance, you not only affect the bag boy who just started, but you now have to pay the clerk who has been there for a year or so who is making $9.00 an hour a increase in wage also. This affects the whole company. Where does the store get this money? They charge YOU more for YOUR groceries. Bad idea Obama!

Anti Government
Alpine, UT

Raising the minimum wage. This is the equivalent of getting a chair with a better view....on the deck of the titanic.

The other purpose of course is to buy votes and enslave the poor.

Anyone who knows basic math (excluding liberals obviously) knows this minimum wage increase is window-dressing.

Keep the poor poor and deluded them into thinking they have been "given" something.

The socialist-in-chief wants as many poor, powerless, uneducated free loaders as possible. Take a look at the veritable army of "takers" he has created since he has taken office. They can't print the food stamps fast enough.

Record high food stamp recipients with free obama cell phones.

What a legacy to be proud of.

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