colourwheel Posted January 28, 2014 Author Share Posted January 28, 2014 (edited) @TRoaches Without an actual study done that holds to your "theory" how you think the economy works, I will just have to disagree with you. A majority of the nation is in favor of an increase in the minimum wage. Over 70% of the nation wants the minimum wage to be increased. A majority of economist think it's the right thing to do to raise it. If you don't want the minimum wage to be increased I can't change your mind but you have hardly given any good argument to not have it raised.... You said yourself earlier... I'm no economist.... If you were an economist maybe your "theories" would hold more weight..... Edited January 28, 2014 by colourwheel Link to comment Share on other sites More sharing options...
TRoaches Posted January 28, 2014 Share Posted January 28, 2014 Questioning my credentials is an absurd deflection from the mathematical reality that I am demonstrating. I am not an economist. I am a self-employed business owner who looks at a balance sheet every single day and, though I have no minimum wage employees, I understand what it could mean for a business to have a sudden increase in payroll expense. If you own a business and employ minimum wage workers, and your payroll per employee suddenly increases by law what would your response be? Would you be content to make less profit, perhaps even operate at a loss? Would you trim your staff? Would you sell the business to cut your losses? What would your course of action be? Link to comment Share on other sites More sharing options...
colourwheel Posted January 28, 2014 Author Share Posted January 28, 2014 Questioning my credentials is an absurd deflection from the mathematical reality that I am demonstrating. I am not an economist. I am a self-employed business owner who looks at a balance sheet every single day and, though I have no minimum wage employees, I understand what it could mean for a business to have a sudden increase in payroll expense. If you own a business and employ minimum wage workers, and your payroll per employee suddenly increases by law what would your response be? Would you be content to make less profit, perhaps even operate at a loss? Would you trim your staff? Would you sell the business to cut your losses? What would your course of action be? But you see the Economy is more complex than just simple mathematics. But I see your point, you being a small business owner would be worried. Yet just because you are worried about having to pay your employees more doesn't mean your profits are going to decrease... Who knows, maybe since people have more money to use will even increase your net income... If a law is passed you would just automatically start firing people and close your business? just seems you look at paying your hard working employees a bit more as a bad thing and not look at the positive things that can come from it.... usually in general thinking people having more money in their pockets means more people are likely to spend... Link to comment Share on other sites More sharing options...
Vagrant0 Posted January 28, 2014 Share Posted January 28, 2014 If you pay people more, they will buy more, raising demand for a finite quantity of goods. With the rising demand of goods you have rising prices since those people making those goods will want to earn as much as they can and be able to pay that increased wage of their workers. As the price increases it will eventually become more than what can be easily afforded, so things just end up equalizing. Meaning that nothing is accomplished. Meanwhile if you start producing 20% more goods, and decrease the cost of those goods proportionately, more people will be able to buy those goods and will gain a small boost to their quality of life even through they are technically still earning the same amount of money. Given that as much as 80% of the cost of everything is just the cost of the time and energy involved with shipping those goods, the solution is simple... Get access to cheaper and more reliable energy sources. Proof of this sentiment is all around you and is evident by the fact that every time the price of oil goes up, so does the price of just about everything else soon after. Link to comment Share on other sites More sharing options...
colourwheel Posted January 28, 2014 Author Share Posted January 28, 2014 (edited) If you pay people more, they will buy more, raising demand for a finite quantity of goods. With the rising demand of goods you have rising prices since those people making those goods will want to earn as much as they can and be able to pay that increased wage of their workers. As the price increases it will eventually become more than what can be easily afforded, so things just end up equalizing. Meaning that nothing is accomplished. I see your logic but that is if you are to increasing "everyones" income.... by just increasing minimum wage to the level of inflation won't have that kind of dramatic effect you are trying to stress according to the study done by Alan Krueger. By raising minimum wage doesn't necessarily mean product prices will go up and hardly to the point where it will be more than people can afford... Remember the idea behind raising the minimum wage is so no matter who your are you won't be living in poverty while working a full time job.... I doubt any of you could live alone working full time on minimum wage.... and a lot of people who live in this nation, that is the best they will ever be able to make.... Edited January 28, 2014 by colourwheel Link to comment Share on other sites More sharing options...
TRoaches Posted January 29, 2014 Share Posted January 29, 2014 But I see your point, you being a small business owner would be worried. Yet just because you are worried about having to pay your employees more doesn't mean your profits are going to decrease... Who knows, maybe since people have more money to use will even increase your net income... If my business sells a product that is consumed to a significant extent by minimum wage earners then I could see an increase in sales. But what if my business does NOT cater to minimum wage earners? People who live on minimum wage do not hire a landscaping company to tend their lawn. They do not pay someone else to wash their car. They do not hire someone to wash their windows or empty their garbage cans. None of those types of businesses are going to see an increase in sales because of a minimum wage increase. If a law is passed you would just automatically start firing people and close your business?No, but if a law is passed that increases my expenses to the point that my profits are reduced I may be forced to fire people. If the law increases my expenses so much that I can't earn a profit at all then I will be forced to close the business. It is not about my feelings about the law. It is about that balance sheet that you refuse to acknowledge, and what that balance sheet means to my creditors, and how all of that influences the viability of the business. Link to comment Share on other sites More sharing options...
colourwheel Posted January 29, 2014 Author Share Posted January 29, 2014 (edited) But I see your point, you being a small business owner would be worried. Yet just because you are worried about having to pay your employees more doesn't mean your profits are going to decrease... Who knows, maybe since people have more money to use will even increase your net income... If my business sells a product that is consumed to a significant extent by minimum wage earners then I could see an increase in sales. But what if my business does NOT cater to minimum wage earners? People who live on minimum wage do not hire a landscaping company to tend their lawn. They do not pay someone else to wash their car. They do not hire someone to wash their windows or empty their garbage cans. None of those types of businesses are going to see an increase in sales because of a minimum wage increase. You are looking at this in a very narrow minded way of thinking... What about those who do cater to low income earners? don't you think money changing hands can eventually end up in your hands? Just because you are not directly seeing this money coming your way doesn't rule out that it won't indirectly... Many others who benefit directly to an increase in minimum wage will most likely over time increase your business profits in the long run due to how our economy works... Edited January 29, 2014 by colourwheel Link to comment Share on other sites More sharing options...
TRoaches Posted January 29, 2014 Share Posted January 29, 2014 Just because you are not directly seeing this money coming your way doesn't rule out that it won't indirectly... What is more important is what the bank sees. When the loan payment is due and all of the other bills are due you can't call up your creditors and say "yeeeeah so you remember how my business was barely scraping by, right? Well the funny thing about that is since the minimum wage hike went into effect that slim profit that I was earning before has been reduced to zero. I can't lay anyone off because I am so compassionate towards my employees and concerned with their welfare. So I was thinking maybe you could just not reposess my business for awhile, because it is going to take some time for my business to indirectly profit from the wage increase. Don't worry though, because as soon as I indirectly profit from the wage increase then I will pass that indirect gain straight over to you when I start making payments on my loan again. Then you, then bank, will also indirectly profit!". Link to comment Share on other sites More sharing options...
kvnchrist Posted January 29, 2014 Share Posted January 29, 2014 It would seem to me that by doing things the way you suggest it would place an undue burden on the economy without any benefit to it . Just placing more money in the hands of others doesn't guarentee anything other than the money being in their hands. It doesn't guarantee that anyone would use the income to access better education. It would be more feasible to lower or remove the price of education offered and let the public decide wither they want to make the personal choice to better themselves. You are correct there wouldn't be any guarantee that people would use the money to pursue a higher education. But it's not like these people would be hoarding this money either by putting it in offshore accounts or not spending money at all... most likely this extra money they would have would put billions back into the economy yearly. Some would use the extra money to pursue a higher education though... Reducing the cost of education where as anyone can afford it, I would think would only degrade the system and lower the cost of teachers and educational employees and the resources needed. Socializing education all together would probably work better if the goal is to give everyone equal opportunity... @TRoaches Do you believe anyone who works full time shouldn't be living in poverty? What needs to be done is to revamp the social rewards and the public seem to follow. I think athletes and movie actors are getting far to much attention for what they actually do. They get paid outrageous sums to do what they do and in the end how do they benefit the rest of humanity. I think the adulation should be concentrated on those who educate and preserve society, not some modern day muscle mass trying to break every bone in another man's body simply to have the honor of saying we ran past your goal more times than you did ours. Both athletes and actors are constantly acting out like kids on a grade school yard and the masses love them. WTFlip? Also I think that there are more ways to reduce the cost of education and at the same time reduce the burden of student loans. Students could be placed into a category where they can tutor younger students in high and grade school and be paid at a 3/4 to 1/2 the rate of teachers and the remainder of that wage be set against their student debt. The percentage would solely be the students decision. They could also aid civil servants to reduce the burden on them and the student might just find something that interested them and they aren't out the fee of training them. They would be fully familiarized with the job before they were hired. OIn a nutshell I thing the wrong professions are getting immortalized and with this reality, the normalo everyday person will never get the adoration they deserve. Link to comment Share on other sites More sharing options...
colourwheel Posted January 29, 2014 Author Share Posted January 29, 2014 (edited) What is more important is what the bank sees. When the loan payment is due and all of the other bills are due you can't call up your creditors and say "yeeeeah so you remember how my business was barely scraping by, right? Well the funny thing about that is since the minimum wage hike went into effect that slim profit that I was earning before has been reduced to zero. I can't lay anyone off because I am so compassionate towards my employees and concerned with their welfare. So I was thinking maybe you could just not reposess my business for awhile, because it is going to take some time for my business to indirectly profit from the wage increase. Don't worry though, because as soon as I indirectly profit from the wage increase then I will pass that indirect gain straight over to you when I start making payments on my loan again. Then you, then bank, will also indirectly profit!". 1st off TRoaches, if your business is doing so bad where as your are worried about loans due, you must be doing something wrong or living way beyond your means to begin with. 2nd if I owned my own "landscaping" business and the minimum wage was increased I would just try to raise the cost to my customers a bit. People who pay people to do landscaping are usually making well more then enough to afford the cost of landscaping to be hiked up on cost if it is slapped on them. Most people I know who pay for landscaping make at least 6 figures anyways... It's unfortunate your business isn't doing as well as you wish but I am looking at the bigger picture here as a country.... Edited January 29, 2014 by colourwheel Link to comment Share on other sites More sharing options...
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