On May 4, 2014 at 12:09, Fiasco said...
The data is incomplete. I don't know if the conclusion is right or wrong.
As a jobs program, raising the minimum wage is a real loser. Congress raised the minimum wage 10.6% in July, 2009 (know of anyone else getting a raise then?). In the ensuring 6 months, nearly 600,000 teen jobs disappeared, even with nearly 4% growth in the economy, this compared to a loss of 250,000 jobs in the first half of the year as GDP growth declined by 4% Why? When you raise the price of anything, people take less of it, including labor. The unemployment rate for teens remains unacceptably high. Workers of all ages that are relatively unskilled are adversely impacted by this policy.
Hmmm, what else was going on in 2009? Could it be the Great Recession and the collapse of major Wall Street firms in late 2008 may have some influence? But don't let those pesky facts get in the way.
The other thing to look at is what people are getting paid now compared to before. I was working a retail job in the 70's while in college and getting paid $ 4.50 to start. In 2014, my daughter is working an equivalent job making only $ 7.75. Gas was under $ .90 for me, now $ 3.80. I rented a 3 bedroom house for $450. A small studio apartment is now over $ 800.00 in a decent neighborhood. The pay to those on the lowest rung has gotten smaller and smaller. Profits for the largest companies are at record highs. Their tax bill are at all time lows.
I was listening to a person from the Heritage Foundation the other day saying we should expand the earned income credit for those earning under poverty wages. So the gov should in effect subsidize Walmart being a cheap ass instead of raising the minimum wage. Every study shows that whatever increase wages those at the low end receive are instantly spent and goes to economic growth. That is because they live paycheck to paycheck.
