Democrats think this will help the economy

[eyeeatingfish]

Never mind the fact that people inherently have the mentality of "me and mine" first, let's put your theory to practice. Our company CEO rakes in $13 million in total income and benefits each year. We have 186,000 employees within the company. So let's just take ALL his money, every last penny and give it to everyone else. That gives everyone an additional $69.89 to their yearly salary. So that comes out to less than $0.04-$0.07 per hour, depending on the average hours per week.

But hey, go ahead and eat the rich:

I agree that the theory does not apply to large companies but a company with lets say 10-20 workers would be obviously not be comparable. How about some math to see how it would affect a business owner with 10 employees. Lets say minimum wage is raised by $2 an hour. 1 full time worker works about 2040-2080 hours a week. So one worker would see approximately $4,100 more a year by a $2 an hour pay raise. This would mean $41,000 more in expense to the business owner. It is a decent chunk of change but may be affordable to the business owner. Now the business owner may decide that he either cannot or does not want to afford that loss in income and then compensate somehow but it is not a guarantee. Lets say the business owner can afford the pay cut but simply does not want to, it does beg the question of whether he stands at all responsible for the increase in price or unemployment.

[quietmike]

Instead of liberal backseat drivers telling other business owners how to sell insurance, provide retirement, pay employees, etc., why don't liberals just open their own businesses and do those things? Workers would flock to them, and if their business model works, customers would be more than willing to support them.

[Codger_64]

I think that you might find that the absolute volume of durable consumer goods found in the average America household is ANY time what you would have found in the 50's, 60's and even well into the 70's. With that said, you do make an interesting point about the cost of a car versus the cost of a home. In 1973, the diesel powered base model of what we would today call an E Class Mercedes Benz sold for $7000. What does an E320CDI sell for today?. Now compare that to the 1973 price of a suburban "tract" house and the current price. Oh, wait. The average cost of a new home in 1973 was $32,000. Today it is $263,000!!!!! Average cost of say an AMC Javelin back then was $2,900. The avwrage annual income was $13,900 in 1973. What is the cost of the typical mid-sized American sedan today? What is he average wage? The real question is where has the eight to tenfold increase in some prices in 40 years come from without a corresponding eight tenfold increase in individual income.....or corporate income for thos companies making these products, I suspect? In the case of housing, i think that part of it comes from the idea that we will not accept a 1973 style house these days. In the case of cars, it comes from technology and regulation, IMO.

In 1963 I bought a new econemy sedan, a four-door Ford Falcon for $2,100 (Average Cost of a new car $3,233.00). Bread was .22 cents per loaf and gas was .29 cents per gallon. The average new home cost $12,650 and average income was $5,807. Unemployment rate was under 6%.

In 2011 gas hovers around $3.79, bread $2.36, a new car averages $29,817, a new home $262,900, and average income $26,364. Most of those gadgets that people buy are made overseas. Unemployment rate is over 10%.

While the availability of cheap foriegn made luxury items has increased, the actual cost of living on basic goods has far outstripped the increase in wages. Now look at the average income of CEOs of said manufacturing/importing companies, increased tax loads on families of median income. The average standard of living has dropped by most metrics.

[jdm61]

You cannot compare CEO "salaries" today to back then because much of what they got was not "salary". The still live in the same places and do the same things. As for the average income, my dad told me that in 1963, $5000 a year was a damn good salry for a young professional in most areas of the US.

In 1963 I bought a new econemy sedan, a four-door Ford Falcon for $2,100 (Average Cost of a new car $3,233.00). Bread was .22 cents per loaf and gas was .29 cents per gallon. The average new home cost $12,650 and average income was $5,807. Unemployment rate was under 6%.

In 2011 gas hovers around $3.79, bread $2.36, a new car averages $29,817, a new home $262,900, and average income $26,364. Most of those gadgets that people buy are made overseas. Unemployment rate is over 10%.

While the availability of cheap foriegn made luxury items has increased, the actual cost of living on basic goods has far outstripped the increase in wages. Now look at the average income of CEOs of said manufacturing/importing companies, increased tax loads on families of median income. The average standard of living has dropped by most metrics.

[Noctis3880]

I agree that the theory does not apply to large companies but a company with lets say 10-20 workers would be obviously not be comparable. How about some math to see how it would affect a business owner with 10 employees. Lets say minimum wage is raised by $2 an hour. 1 full time worker works about 2040-2080 hours a week. So one worker would see approximately $4,100 more a year by a $2 an hour pay raise. This would mean $41,000 more in expense to the business owner. It is a decent chunk of change but may be affordable to the business owner. Now the business owner may decide that he either cannot or does not want to afford that loss in income and then compensate somehow but it is not a guarantee. Lets say the business owner can afford the pay cut but simply does not want to, it does beg the question of whether he stands at all responsible for the increase in price or unemployment.

Don't you think it's a bit unfair to cut big business out of the consideration when minimum wage laws apply to them as well? Small business could swallow the cost yes, but it's quite unreasonable when you get into the thousands of employees. And I think it's fair to say that big businesses are responsible for most of the jobs available.

I found it interesting you mentioned that businesses can simply stop expanding when you consider that the expansion means that more manpower is needed to man the new locations or to replace whoever was pulled to man the new location, never mind the manpower it would take to actually plan, construct, and supply the new location. If anything, you should encourage businesses to expand. Once expansion is stopped and more cuts are needed, the business either cuts man hours, lay people off, or close current locations which will inevitably lead to lost jobs and hours anyway.

[Triton]

4. The business owner can take a pay cut is an option that no one here seems to bring up. The owner of a business could potentially keep his prices the same, give the workers a raise, and not fire anyone, by taking a smaller portion of the income of the business. You may argue that now he/she does not have as much money to put into the economy and that would be true, however, his workers will have more money to put into the economy which I would argue could offset his reduced spending. Also I pointed out the positive benefits of workers making more money in terms of the number of jobs to make ends meet.

It could happen but most business owners I know are in business to make money, not to provide jobs. If the rewards are no longer worth their hard work and their risks they will find something else to do... or more likely they will do exactly what we've outlined, that is contract their business and fire workers. This isn't a philisophical debate, look around, it's happening all over the economy and will continue to do so.

Personally I feel a major problem being dealt to our economy is people's choice to buy cheap crap from other countries so they can have more total possessions rather than buying an expensive American product that will outperform and outlast the product imported and sold for up to 1/10th of the cost. Lowering the cost of goods may make American goods a little more competitive but we have too many people who would still look only at the price of the item so they can have more stuff.

I agree this is a problem. So do you think that raising the cost of producing goods will make American products more or less competitive?

[eyeeatingfish]

I found it interesting you mentioned that businesses can simply stop expanding when you consider that the expansion means that more manpower is needed to man the new locations or to replace whoever was pulled to man the new location, never mind the manpower it would take to actually plan, construct, and supply the new location. If anything, you should encourage businesses to expand. Once expansion is stopped and more cuts are needed, the business either cuts man hours, lay people off, or close current locations which will inevitably lead to lost jobs and hours anyway.

You know Ono Hawaiian Food in Kapahulu? It is always crowded with a fairly long wait time and probably...20-25 seats inside. One time I asked the owner why they did not expand since they did such good business. His response was "Why?" He was happy enough with the amount of money he made and the amount of work/responsibility he had. I don't know how much money he makes but he certainly could have made more by expanding.

[hostileuniverse]

Instead of liberal backseat drivers telling other business owners how to sell insurance, provide retirement, pay employees, etc., why don't liberals just open their own businesses and do those things? Workers would flock to them, and if their business model works, customers would be more than willing to support them.

Their business models don't work, that's why they choose to redistribute by proxy govt.

[Noctis3880]

You know Ono Hawaiian Food in Kapahulu? It is always crowded with a fairly long wait time and probably...20-25 seats inside. One time I asked the owner why they did not expand since they did such good business. His response was "Why?" He was happy enough with the amount of money he made and the amount of work/responsibility he had. I don't know how much money he makes but he certainly could have made more by expanding.

And yet if he had expanded he would have had to hire more people to man the new location, do you deny this? He would have made more money yes, but it would also be more work and responsibility as you mentioned, so it's a good thing to keep in mind before we use the "G-word". I wouldn't say that it's never about greed, but it's not always that black and white. Quite frankly I'd like to see it as a mutual benefit. The business owner makes a profit, and I get a nice and steady job over the next few years. Win-win, I don't see why not.

[eyeeatingfish]

It could happen but most business owners I know are in business to make money, not to provide jobs. If the rewards are no longer worth their hard work and their risks they will find something else to do... or more likely they will do exactly what we've outlined, that is contract their business and fire workers. This isn't a philisophical debate, look around, it's happening all over the economy and will continue to do so.

I am not saying it is guaranteed that it will be that way. I am just acknowledging the possibility when others seem to ignore it. Each business will react in its own way and may not follow any guaranteed economic model.

I agree this is a problem. So do you think that raising the cost of producing goods will make American products more or less competitive?

More jobs with less pay doesn't solve the problem either.

[eyeeatingfish]

And yet if he had expanded he would have had to hire more people to man the new location, do you deny this? He would have made more money yes, but it would also be more work and responsibility as you mentioned, so it's a good thing to keep in mind before we use the "G-word". I wouldn't say that it's never about greed, but it's not always that black and white. Quite frankly I'd like to see it as a mutual benefit. The business owner makes a profit, and I get a nice and steady job over the next few years. Win-win, I don't see why not.

He could also expand, make his workers work harder and pocket the money too providing no new jobs.

So is this business owner guilty for hurting the economy because he is not expanding which would provide more jobs?

Lets look at the opposite possibility. Reduce or eliminate minimum wage. How do we know we would not devolve into a sort of indentured servanthood sort of system? Workers getting such low pay they can't afford but a small one bedroom apartment filled with 3 families? Meanwhile the business owners merely pocket the profits of not having to pay their workers as much and pocket additional profits at increased business from a lower cost of items he/she sells? Do you get the picture I am trying to paint? A system with extreme richness and extreme poverty

[not2sharp]

You know Ono Hawaiian Food in Kapahulu? It is always crowded with a fairly long wait time and probably...20-25 seats inside. One time I asked the owner why they did not expand since they did such good business. His response was "Why?" He was happy enough with the amount of money he made and the amount of work/responsibility he had. I don't know how much money he makes but he certainly could have made more by expanding.

That's great! So all you need to do is lunch in a place a few times and you can evaluate the owner's ability and business model, and run the business better than he can. You must have tremendous talent, what's keeping you from starting your own business, so you can show everyone how it should be done?

n2s

[eyeeatingfish]

That's great! So all you need to do is lunch in a place a few times and you can evaluate the owner's ability and business model, and run the business better than he can. You must have tremendous talent, what's keeping you from starting your own business, so you can show everyone how it should be done?

n2s

I was not evaluating his business model I was pointing out that his answer to my question was basically asking me why he needed more money/success. He was content where he was at.

[jdm61]

The difference is that the BUSINESS OWNER decided what he needed/wanted, not the government.

I was not evaluating his business model I was pointing out that his answer to my question was basically asking me why he needed more money/success. He was content where he was at.

[Triton]

I am not saying it is guaranteed that it will be that way. I am just acknowledging the possibility when others seem to ignore it. Each business will react in its own way and may not follow any guaranteed economic model.

Yes, business will react to the circumstance it is presented with, but business is likely to react certain ways to certain conditions, and the way it is likely to react to an increase in minimum wage is exactly what I've outlined.

More jobs with less pay doesn't solve the problem either.

I agree, but artificially constraining the market will cause far more problems then it solves.

[quietmike]

In typical liberal fashion, create the problem, then exclaim you are the only ones who can fix it. The fix can be yours for just a little more in taxes and a little less freedoms.


http://communities.washingtontimes.c...-loans-lawyer/

[dead-eye]

In typical liberal fashion, create the problem, then exclaim you are the only ones who can fix it. The fix can be yours for just a little more in taxes and a little less freedoms.


http://communities.washingtontimes.c...-loans-lawyer/

There you go, Obama forced the banks to make bad loans which crippled the economy. It wasn't GREED on the bankers part that helped create the housing mess, it was Obama and his 186 subprime loans.

[Noctis3880]

He could also expand, make his workers work harder and pocket the money too providing no new jobs.

That will only work to a certain extent until the workers can't keep up with the workload. At that point, the business owner will lose workers, profits, or be forced to close a location.

So is this business owner guilty for hurting the economy because he is not expanding which would provide more jobs?

No, he has no obligation to provide jobs. I'm just saying that expanding is profitable to all sides.

Lets look at the opposite possibility. Reduce or eliminate minimum wage. How do we know we would not devolve into a sort of indentured servanthood sort of system? Workers getting such low pay they can't afford but a small one bedroom apartment filled with 3 families? Meanwhile the business owners merely pocket the profits of not having to pay their workers as much and pocket additional profits at increased business from a lower cost of items he/she sells? Do you get the picture I am trying to paint? A system with extreme richness and extreme poverty

Because such positions(unskilled labor) will oftentimes be taken by illegal immigrants who wouldn't dare unionize or oppose such wages lest they attract the attention of the authorities. Want me to prove it? Just go into a Chinese restaurant with good prices and ask yourself if the folks there are really paid minimum wage for what you pay on the bill. Want me to keep going? Go into the chinatown market and ask yourself if the person you hand your money to for the groceries are really paid minimum wage.

For more skilled labor, it creates competition between businesses. Theoretically, if wages are lowered and unemployment is at 0%, labor will be hard to find. Because all labor is now taken, a company would have to offer better wages and benefits than their competition in order to entice people to quit their current jobs and work for them instead. The "indentured servant" model only works in places like China, Mexico, and India where the population is extremely high and good help is easy to find. With less than 5% of the world population within our borders, you really think that system will work here?

[bobusx]

I have to wonder now, if there were zero illegal immigrants working in this country, and all those jobs were given to Americans, would there be 100% employment? Would all those Americans make enough money to live decently without resorting to crime? Are there actually enough jobs in the USA to employ everyone?

[jdm61]

I don't know how things work where you are, but in the Chinese restaurants down here, I think that you would find that most of the employees are related and the younger ones may not even get ANY kind of wage. That money goes to their parents so that they can pay the bills.

That will only work to a certain extent until the workers can't keep up with the workload. At that point, the business owner will lose workers, profits, or be forced to close a location.


No, he has no obligation to provide jobs. I'm just saying that expanding is profitable to all sides.


Because such positions(unskilled labor) will oftentimes be taken by illegal immigrants who wouldn't dare unionize or oppose such wages lest they attract the attention of the authorities. Want me to prove it? Just go into a Chinese restaurant with good prices and ask yourself if the folks there are really paid minimum wage for what you pay on the bill. Want me to keep going? Go into the chinatown market and ask yourself if the person you hand your money to for the groceries are really paid minimum wage.

For more skilled labor, it creates competition between businesses. Theoretically, if wages are lowered and unemployment is at 0%, labor will be hard to find. Because all labor is now taken, a company would have to offer better wages and benefits than their competition in order to entice people to quit their current jobs and work for them instead. The "indentured servant" model only works in places like China, Mexico, and India where the population is extremely high and good help is easy to find. With less than 5% of the world population within our borders, you really think that system will work here?