Minimum Wage Outrage

[DGS49]

Suppose we were to pass a new law that provides as follows:

Every business owner in the country is required to register with the Government and then to pay a "fine" of a thousand dollars a month for every minimum-wage employee employed by the business (pro-rated for wages between MW and $12/hr). That money would then be distributed in cash by the government to everyone in the country earning less than $12/hr (net of taxes, of course).

Is there any doubt that many businesses - especially food businesses - would simply go out of business due to their becoming either non-profitable or actually losing money?

Is there any doubt that business owners would do everything possible to reduce or eliminate low-wage positions - either forcing others to be more productive, moving to automation where possible, or eliminating services that had been heretofore been provided for "free"?

Is there any doubt that many employees would be forced to resign their employment and begin doing the same work as "independent contractors," at net wages that were no better than what they were making before?

Is there any doubt that many small businesses (bars, restaurants) would be more likely to employ people "under the table" to avoid having to pay the fine?

Is there any doubt that prices to the customers of these businesses would increase?

Of course, there would also be a large number of people whose wages would be increased by employers seeking to avoid having to pay the fine. And if you focus on those workers only, and ignore everyone else affected by the fines, the new law seems just fine and dandy.

But would that benefit to those people offset the cost to society of the shuttered businesses, confiscated profits, reduced employment, and higher prices?

You be the judge. Obviously, this whole fictitious scenario is simply an alternative presentation of an increase in the Minimum Wage law.

But riddle me this: How is it that Democrat politicans can flog this horse, year after year, and people are just too stupid to realize that there is nothing "compassionate" about stealing money from one set of citizens and giving it to another set of citizens. And if you state the obvious fact that an increase to $25 would be catastrophic, they still can't see that even smaller increases have the same sorts of impacts, only they are less noticeable.

The Federal Minimum Wage itself is clearly unconstitutional, and is amazingly stupid to boot. And today's Democrats, reeling from the public's FINALLY realizing what an "obama-nation" the ACA is, are jumping on a campaign to increase the minimum wage, in the hope that it will take voter's minds off of their higher health insurance premiums, deductibles, and so forth.

As always, betting on the stupidity of the American voter.

 

[TemplarKormac]

Calling people stupid does not a point make.

 

[healthmyths]

Calling people stupid does not a point make.

You are right.. but that doesn't negate the points being made and one other point added to the above OP...

NO one ever correctly states the true cost of minimum wage.
They use "$7.25" current minimum or as pointed out $12.00" proposed minimum wage.

But they ignore the ADDED costs to the employer BESIDES the increase to $12.00!

1)The 6.2% social security is also paid by the employer which adds another $1,574 a year paid by employer!
2)The 1.45% Medicare tax paid by the employer or another $350 paid by employer!
3)Then there is the FUTA and workman's comp costs based on wages paid...

So when people talk about raising minimum wage for 40 hour 52 week employee Nearly $1,900 TOTALLY ADDED cost per employee!

 

[iamwhatiseem]

Calling people stupid does not a point make.

You are right.. but that doesn't negate the points being made and one other point added to the above OP...

NO one ever correctly states the true cost of minimum wage.
They use "$7.25" current minimum or as pointed out $12.00" proposed minimum wage.

But they ignore the ADDED costs to the employer BESIDES the increase to $12.00!

1)The 6.2% social security is also paid by the employer which adds another $1,574 a year paid by employer!
2)The 1.45% Medicare tax paid by the employer or another $350 paid by employer!
3)Then there is the FUTA and workman's comp costs based on wages paid...

So when people talk about raising minimum wage for 40 hour 52 week employee Nearly $1,900 TOTALLY ADDED cost per employee!

It is amazing how many people do not know this.
As a general rule, generally speaking - Full-time total compensation is between 30-40% above their wage...so if you make $16 an hour - your real cost to the employer is roughly $21.50 an hour. For a Part-time employee the cost is between 10-15% above the wage. So $7.25 is more like $8.10 an hour.
So to increase minimum wage to $12 an hour would make that $13.60 an hour. HUGE increase in labor cost. Huge.

 

[TemplarKormac]

Calling people stupid does not a point make.

You are right.. but that doesn't negate the points being made and one other point added to the above OP...

NO one ever correctly states the true cost of minimum wage.
They use "$7.25" current minimum or as pointed out $12.00" proposed minimum wage.

But they ignore the ADDED costs to the employer BESIDES the increase to $12.00!

1)The 6.2% social security is also paid by the employer which adds another $1,574 a year paid by employer!
2)The 1.45% Medicare tax paid by the employer or another $350 paid by employer!
3)Then there is the FUTA and workman's comp costs based on wages paid...

So when people talk about raising minimum wage for 40 hour 52 week employee Nearly $1,900 TOTALLY ADDED cost per employee!

Of course.

 

[SwimExpert]

Calling people stupid does not a point make.

You are right.. but that doesn't negate the points being made and one other point added to the above OP...

NO one ever correctly states the true cost of minimum wage.
They use "$7.25" current minimum or as pointed out $12.00" proposed minimum wage.

But they ignore the ADDED costs to the employer BESIDES the increase to $12.00!

1)The 6.2% social security is also paid by the employer which adds another $1,574 a year paid by employer!
2)The 1.45% Medicare tax paid by the employer or another $350 paid by employer!
3)Then there is the FUTA and workman's comp costs based on wages paid...

So when people talk about raising minimum wage for 40 hour 52 week employee Nearly $1,900 TOTALLY ADDED cost per employee!

You must show your work to receive credit for your answer.

 

[NoTeaPartyPleez]

Calling people stupid does not a point make.

You are right.. but that doesn't negate the points being made and one other point added to the above OP...

NO one ever correctly states the true cost of minimum wage.
They use "$7.25" current minimum or as pointed out $12.00" proposed minimum wage.

But they ignore the ADDED costs to the employer BESIDES the increase to $12.00!

1)The 6.2% social security is also paid by the employer which adds another $1,574 a year paid by employer!
2)The 1.45% Medicare tax paid by the employer or another $350 paid by employer!
3)Then there is the FUTA and workman's comp costs based on wages paid...

So when people talk about raising minimum wage for 40 hour 52 week employee Nearly $1,900 TOTALLY ADDED cost per employee!

It is amazing how many people do not know this.
As a general rule, generally speaking - Full-time total compensation is between 30-40% above their wage...so if you make $16 an hour - your real cost to the employer is roughly $21.50 an hour. For a Part-time employee the cost is between 10-15% above the wage. So $7.25 is more like $8.10 an hour.
So to increase minimum wage to $12 an hour would make that $13.60 an hour. HUGE increase in labor cost. Huge.

Yeah, so fuck 'em if they can't pay their rent when we pay the stupid lazy butts $7.25 an hour. Let 'em do what Walmart employees do...go on federal assistance.

You've got two choices: Force the EMPLOYER to bear the cost of THEIR employees or pass it on to YOU, the TAXPAYER.

Something's gotta' give and I'd rather leave it to the individual business and their ability to acquire and obtain and retain quality help than pass their problems on to me.

If you literally can't afford an extra couple of bucks over the hourly wage, then you shouldn't be in business.

 

[healthmyths]

Calling people stupid does not a point make.

You are right.. but that doesn't negate the points being made and one other point added to the above OP...

NO one ever correctly states the true cost of minimum wage.
They use "$7.25" current minimum or as pointed out $12.00" proposed minimum wage.

But they ignore the ADDED costs to the employer BESIDES the increase to $12.00!

1)The 6.2% social security is also paid by the employer which adds another $1,574 a year paid by employer!
2)The 1.45% Medicare tax paid by the employer or another $350 paid by employer!
3)Then there is the FUTA and workman's comp costs based on wages paid...

So when people talk about raising minimum wage for 40 hour 52 week employee Nearly $1,900 TOTALLY ADDED cost per employee!

You must show your work to receive credit for your answer.

YOU are right! I didn't calculate correctly!
I said "nearly $1,900 totally added"... that was wrong.
Here is how I did it.
$7.25 X (6.2%+1.45%) equals $0.554 per hour per employee or 40 hours x 52 weeks a total of $1,153 per year..
$12.00 less $7.25 equals $4.75/hour increase times (6.2%+1.45%) equals $0.36/hour employer increase or yearly total: $755/year.. not $1,900.
$1,900 was total paid by employer.

So I was wrong. Sorry.
Doesn't though negate the gross ignorance of most americans when they think increasing $7.25 to $12.00 has NO Direct Affect on businesses!

Plus the ONLY major argument is cost of living seems to have forgotten $7.25...
Minimum wage was boosted to $7.25 Minimum wage set to rise to $7.25 on July 24 - Jul. 24, 2009
So July 2009 to July 2013 what was the cost of living??? 8.6% increase.
Inflation Calculator | Find US Dollar's Value from 1913-2013
But raising to $12/hour is a 40% increase.. WHY???

 

[NoTeaPartyPleez]

Calling people stupid does not a point make.

You are right.. but that doesn't negate the points being made and one other point added to the above OP...

NO one ever correctly states the true cost of minimum wage.
They use "$7.25" current minimum or as pointed out $12.00" proposed minimum wage.

But they ignore the ADDED costs to the employer BESIDES the increase to $12.00!

1)The 6.2% social security is also paid by the employer which adds another $1,574 a year paid by employer!
2)The 1.45% Medicare tax paid by the employer or another $350 paid by employer!
3)Then there is the FUTA and workman's comp costs based on wages paid...

So when people talk about raising minimum wage for 40 hour 52 week employee Nearly $1,900 TOTALLY ADDED cost per employee!

It is amazing how many people do not know this.
As a general rule, generally speaking - Full-time total compensation is between 30-40% above their wage...so if you make $16 an hour - your real cost to the employer is roughly $21.50 an hour. For a Part-time employee the cost is between 10-15% above the wage. So $7.25 is more like $8.10 an hour.
So to increase minimum wage to $12 an hour would make that $13.60 an hour. HUGE increase in labor cost. Huge.

What is the take-home pay for someone, say a single person, no kids, who makes $7.25 an hour?

Based on a 40-hour work week (which doesn't exist for min wage workers anymore)

Gross income: $290
Minus Medicare and Social Security Deductions: $22.18
Total take-home pay: $267.82

That ain't jack.

 

[Sallow]

Suppose we were to pass a new law that provides as follows:

Every business owner in the country is required to register with the Government and then to pay a "fine" of a thousand dollars a month for every minimum-wage employee employed by the business (pro-rated for wages between MW and $12/hr). That money would then be distributed in cash by the government to everyone in the country earning less than $12/hr (net of taxes, of course).

Is there any doubt that many businesses - especially food businesses - would simply go out of business due to their becoming either non-profitable or actually losing money?

Is there any doubt that business owners would do everything possible to reduce or eliminate low-wage positions - either forcing others to be more productive, moving to automation where possible, or eliminating services that had been heretofore been provided for "free"?

Is there any doubt that many employees would be forced to resign their employment and begin doing the same work as "independent contractors," at net wages that were no better than what they were making before?

Is there any doubt that many small businesses (bars, restaurants) would be more likely to employ people "under the table" to avoid having to pay the fine?

Is there any doubt that prices to the customers of these businesses would increase?

Of course, there would also be a large number of people whose wages would be increased by employers seeking to avoid having to pay the fine. And if you focus on those workers only, and ignore everyone else affected by the fines, the new law seems just fine and dandy.

But would that benefit to those people offset the cost to society of the shuttered businesses, confiscated profits, reduced employment, and higher prices?

You be the judge. Obviously, this whole fictitious scenario is simply an alternative presentation of an increase in the Minimum Wage law.

But riddle me this: How is it that Democrat politicans can flog this horse, year after year, and people are just too stupid to realize that there is nothing "compassionate" about stealing money from one set of citizens and giving it to another set of citizens. And if you state the obvious fact that an increase to $25 would be catastrophic, they still can't see that even smaller increases have the same sorts of impacts, only they are less noticeable.

The Federal Minimum Wage itself is clearly unconstitutional, and is amazingly stupid to boot. And today's Democrats, reeling from the public's FINALLY realizing what an "obama-nation" the ACA is, are jumping on a campaign to increase the minimum wage, in the hope that it will take voter's minds off of their higher health insurance premiums, deductibles, and so forth.

As always, betting on the stupidity of the American voter.

Wait what?

You've obviously never owned a business..or started one.

You have to "register" with the government.

In my case, I had to get a tax id, and get a liquor license and a license to operate a restaurant. I had to go a state office and get fingerprinted, fill out a crap load of forms, and get photographed. Then you have get insurance. And submit to health inspections. I was also one of the lucky ones, as I got hit up by the local police for "guard" jobs.

What you guys know about business could fill a thimble.

 

[SwimExpert]

Abolish the minimum wage.

 

[Vox]

you pass this crap and people will lose jobs and/or hours.

 

[iamwhatiseem]

Yeah, so fuck 'em if they can't pay their rent when we pay the stupid lazy butts $7.25 an hour. Let 'em do what Walmart employees do...go on federal assistance.

You've got two choices: Force the EMPLOYER to bear the cost of THEIR employees or pass it on to YOU, the TAXPAYER.

Something's gotta' give and I'd rather leave it to the individual business and their ability to acquire and obtain and retain quality help than pass their problems on to me.

If you literally can't afford an extra couple of bucks over the hourly wage, then you shouldn't be in business.

"Something has to give."
You are on the wrong track here. You want to carry a sign...carry the one about corporatism. Corporatism and the ensuing oligarchy that we now live in because of it is a helluva lot more of a problem than minimum wage.
Corporatism has now just about taken over every industry and business type you can think of. The American dream of starting a new business is becoming almost impossible because you will have to try and compete with an entity 10,000 times bigger than you - and you will have to overcome a mountain of regulations designed and sometimes EVEN WRITTEN BY corporations sponsoring a bill that makes it very expensive and requiring herculean effort and sometimes YEARS to get past.
Small and medium businesses, especially manufacturing, paid reasonable wages. Now if you want to make a living building something - the only way to do it is to license your patent over to a large company who will build them overseas.
Minimum wage is but a tiny dot on the mural of problems facing low to middle class Americans.

 

[Edgetho]

Calling people stupid does not a point make.

It does if they really are stupid

 

[healthmyths]

You are right.. but that doesn't negate the points being made and one other point added to the above OP...

NO one ever correctly states the true cost of minimum wage.
They use "$7.25" current minimum or as pointed out $12.00" proposed minimum wage.

But they ignore the ADDED costs to the employer BESIDES the increase to $12.00!

1)The 6.2% social security is also paid by the employer which adds another $1,574 a year paid by employer!
2)The 1.45% Medicare tax paid by the employer or another $350 paid by employer!
3)Then there is the FUTA and workman's comp costs based on wages paid...

So when people talk about raising minimum wage for 40 hour 52 week employee Nearly $1,900 TOTALLY ADDED cost per employee!

It is amazing how many people do not know this.
As a general rule, generally speaking - Full-time total compensation is between 30-40% above their wage...so if you make $16 an hour - your real cost to the employer is roughly $21.50 an hour. For a Part-time employee the cost is between 10-15% above the wage. So $7.25 is more like $8.10 an hour.
So to increase minimum wage to $12 an hour would make that $13.60 an hour. HUGE increase in labor cost. Huge.

Yeah, so fuck 'em if they can't pay their rent when we pay the stupid lazy butts $7.25 an hour. Let 'em do what Walmart employees do...go on federal assistance.

You've got two choices: Force the EMPLOYER to bear the cost of THEIR employees or pass it on to YOU, the TAXPAYER.

Something's gotta' give and I'd rather leave it to the individual business and their ability to acquire and obtain and retain quality help than pass their problems on to me.

If you literally can't afford an extra couple of bucks over the hourly wage, then you shouldn't be in business.

Again.. we are operating our country on the few i.e. the exception rather then the majority or rule!!!
For example HOW MANY people do you feel are at minimum wage or less?
FACT:
In 2011 1.7 million earned exactly the prevailing Federal minimum wage of $7.25 per hour.
About 2.2 million had wages below the minimum.

Together, these 3.8 million workers with wages at or below the Federal minimum made up 5.2 percent of all hourly-paid workers.
Characteristics of Minimum Wage Workers: 2011

How many of those had a family paid rent,bought food???



Of the above chart from the US Census Bureau,
of the 3.8 million nearly 2 million are under 24 years old.
How many of those 24 year olds probably still live at home or have a 2nd job?

So again... please explain WHY ALL of us must PAY MORE for people who probably live at home, and if they are over 24..
probably can take advantage of these FREE SERVICES:

People in poverty in the USA get:

a) Free Cell phone (my cell phone I PAY is about $100/month)
if the poor person receives just one of the below FREE entitlements:
* Food stamps * Medicaid * Section 8 * Supplemental Security Income * National School Lunch Program

b) 40 million Americans on food stamps get $200/month in free food.

it cost $75.7 billion in 2011 compared to $35 billion in 2008; and enrollment has hit an all-time high of 46.7 million recipients. Meanwhile, the number of children receiving free school lunches has inflated from 18 to 21 million — an unprecedented jump —
about 2.1 million households (6 million) use Section 8 the Housing Choice Voucher program, pays a large

c) portion of the rents and utilities of or the Housing Choice Voucher Program up to $1,000 /month in FREE housing...

So these people get
=== $ 5,666 in EIC cash,
=== $12,000 free housing ,
=== $ 2,400 free food,
=== $ 1,200 in free cell phone plus
=== $ 5,000 a year in free health care from Medicaid.
So this is about $26,000 a year in FREE MONEY, free goods and free services...


So again.. why are we raising these less then 2 million when they get the above for FREE???

 

[Derideo_Te]

The fallacy of your OP is all in the assumptions. And no, I am not going to waste my time nitpicking my way through them.

Instead I am going to explain why those who believe that capitalism is the answer should be 100% behind the concept of paying everyone who works a Living Wage With Benefits (LWWB).

Right now you are already subsidizing those who are earning less than an LWWB. Your taxes are paying for their foodstamps, subsidized housing and healthcare. That is coming out of your pocket irrespective of whether or not you buy a burger or shop at Walmart.

However if all of those minimum wage employees were earning an LWWB you would no longer be paying for their foodstamps, subsidized housing and healthcare. What is even better is that they will now be paying taxes too. This is a Win-Win. They are no longer a tax burden to you and they are helping pay down the deficit/debt.

Your kneejerk response is that the cost of those burgers and junk at Walmart will cost more. Yes they will but not as much as you imagine because all of those people who are now being paid an LWWB will also be able to afford to go out for a burger and shop at Walmart so there will be a larger pool of consumers. And since the bottom tier of minimum wage earners can do so everyone above them also has their incomes raised and therefore they have more disposable income too. This additional disposable income will more than make up for the cost of raising the wages of the lowest earners.

A rising tide lifts all boats and that was proven to be true during the economic boom during the Clinton era. The math works so why not embrace it and reap the benefits for everyone?

 

[Edgetho]

Yeah, Australia tried that....

Indices Difference Info
Consumer Prices in Australia are 45.38% higher than in United States
Consumer Prices Including Rent in Australia are 50.71% higher than in United States
Rent Prices in Australia are 62.85% higher than in United States
Restaurant Prices in Australia are 44.14% higher than in United States
Groceries Prices in Australia are 33.50% higher than in United States
Local Purchasing Power in Australia is 23.48% lower than in United States

Cost Of Living Comparison Between United States And Australia

 

[ClosedCaption]

Either the employer pays or we do.

Pick one

 

[SwimExpert]

Yeah, so fuck 'em if they can't pay their rent when we pay the stupid lazy butts $7.25 an hour. Let 'em do what Walmart employees do...go on federal assistance.

You've got two choices: Force the EMPLOYER to bear the cost of THEIR employees or pass it on to YOU, the TAXPAYER.

Something's gotta' give and I'd rather leave it to the individual business and their ability to acquire and obtain and retain quality help than pass their problems on to me.

If you literally can't afford an extra couple of bucks over the hourly wage, then you shouldn't be in business.

Here's an idea: Charge back the cost of welfare to the employer. If a full time employee needs welfare to survive, let's just charge it back to the company. This way, taxpayers are not subsidizing corporate payrolls.

 

[NoTeaPartyPleez]

It is amazing how many people do not know this.
As a general rule, generally speaking - Full-time total compensation is between 30-40% above their wage...so if you make $16 an hour - your real cost to the employer is roughly $21.50 an hour. For a Part-time employee the cost is between 10-15% above the wage. So $7.25 is more like $8.10 an hour.
So to increase minimum wage to $12 an hour would make that $13.60 an hour. HUGE increase in labor cost. Huge.

Yeah, so fuck 'em if they can't pay their rent when we pay the stupid lazy butts $7.25 an hour. Let 'em do what Walmart employees do...go on federal assistance.

You've got two choices: Force the EMPLOYER to bear the cost of THEIR employees or pass it on to YOU, the TAXPAYER.

Something's gotta' give and I'd rather leave it to the individual business and their ability to acquire and obtain and retain quality help than pass their problems on to me.

If you literally can't afford an extra couple of bucks over the hourly wage, then you shouldn't be in business.

Again.. we are operating our country on the few i.e. the exception rather then the majority or rule!!!
For example HOW MANY people do you feel are at minimum wage or less?
FACT:
In 2011 1.7 million earned exactly the prevailing Federal minimum wage of $7.25 per hour.
About 2.2 million had wages below the minimum.

Together, these 3.8 million workers with wages at or below the Federal minimum made up 5.2 percent of all hourly-paid workers.
Characteristics of Minimum Wage Workers: 2011

How many of those had a family paid rent,bought food???
View attachment 28752


Of the above chart from the US Census Bureau,
of the 3.8 million nearly 2 million are under 24 years old.
How many of those 24 year olds probably still live at home or have a 2nd job?

So again... please explain WHY ALL of us must PAY MORE for people who probably live at home, and if they are over 24..
probably can take advantage of these FREE SERVICES:

People in poverty in the USA get:

a) Free Cell phone (my cell phone I PAY is about $100/month)
if the poor person receives just one of the below FREE entitlements:
* Food stamps * Medicaid * Section 8 * Supplemental Security Income * National School Lunch Program

b) 40 million Americans on food stamps get $200/month in free food.

it cost $75.7 billion in 2011 compared to $35 billion in 2008; and enrollment has hit an all-time high of 46.7 million recipients. Meanwhile, the number of children receiving free school lunches has inflated from 18 to 21 million — an unprecedented jump —
about 2.1 million households (6 million) use Section 8 the Housing Choice Voucher program, pays a large

c) portion of the rents and utilities of or the Housing Choice Voucher Program up to $1,000 /month in FREE housing...

So these people get
=== $ 5,666 in EIC cash,
=== $12,000 free housing ,
=== $ 2,400 free food,
=== $ 1,200 in free cell phone plus
=== $ 5,000 a year in free health care from Medicaid.
So this is about $26,000 a year in FREE MONEY, free goods and free services...


So again.. why are we raising these less then 2 million when they get the above for FREE???

Because those are faulty figures based on anecdotal data, according to the webpage you directed to.

"Source: U.S. Department of Labor, Bureau of Labor Statistics (BLS). These data on minimum wage earners are derived from the Current Population Survey (CPS), a monthly nationwide survey of households. Data in this summary are 2011 annual averages."

Walmart ALONE employs 1.3 million hourly workers. Want to start adding in Target, McDonald's, Taco Bell, Sears, Home Depot, etc. etc. etc.?