I mean I'm a very conservative guy. The ONLY reason I support a minimum wage law and increasing that to an actual value that is worth something is because it is obvious that doing so will save tax payers money. I'm actually a small government person.
This is an important part of this, and one that those are against the minimum wage generally avoid.
When a person is working full time and yet still needs government assistance, then the government is clearly subsidizing the employer. I don't see how an honest "small government" person can justify that.
And exactly, this is about finding equilibrium. But we just don't seem to have the capacity to put that much independent thought into it. For both ends, it's all or nothing. Intellectual laziness. As usual.
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Subsidizing the employer? You're gonna have to expand on that a little bit. The employer doesn't give a damn whether the employee has enough money to feed and cloth his/her kids and maybe requires some kind of gov't assistance. The employer isn't running a charity or engaged in social engineering, he/she is running a business that has to make enough profit to make it worthwhile to stay open for business. There's no benefit to the employer that I can see, speaking as a small gov't advocate. It's the employee that is getting subsidized, not the employer.
The government, typically through Medicaid and other taxpayer-funded systems, is having to pick up where the employer leaves off.
So, our tax money is being used to supplement the income the person is making from the employer.
Your money, my money. Right now. Undeniable.
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That is still not subsidizing the employer. You think if the gov't wasn't paying the employees assistance through Medicaid or Foodstamps or whatever that the employer would be obliged to do so? Since when? They'll just make sure their employees are all classified as part-timers, right?
Let's go back to the argument about saving the taxpayers money if the M-Wage is raised. That has not been proven at all, some studies suggest that is true but others deny it. It flies in the face of all basic economics to think that when you raise the cost of labor the employers will meekly accept the increase in costs out of their profits. Nuh-uh, it doesn't usually work that way unless the business is already doing very well indeed. The problem is that most other small businesses may not be doing quite so well, and that higher cost of labor has to be offset somehow or the business becomes unfeasible to continue. So, they automate, or they cut hours or benefits, or they raise their prices (inflation!), or in some cases they just go out of business. So, the higher M-Wage will save taxpayer money for those who will get a bigger paycheck, cuz in some cases they won't be eligible any longer for certain gov't benefits that they used to get, and for some it's even a losing proposition because the new wage does not offset the loss of gov't benefits. So from this aspect, the higher M-Wage does result in less taxpayer money being spent on welfare programs.
But a higher M-Wage also means some employers get fired or see their hours and benefits cut. For them the gov't benefits (taxpayer money) will go up, and then there's the young people who are entering the workforce and can't find a job, there's a higher cost to the taxpayers too that could become long term once the boom period is over. And it WILL end sooner or later, it always does. So think about this, at some point the US economy goes into another recession or even a depression. Does anyone here believe that a higher M-Wage at that point in time is going to help the situation any? How many existing businesses will be forced to close because they can no longer afford the high labor costs that they could live with in the good times? New business startups require some investors to put up some money to get the business up and running, right? You know that these investors are going to look at the risks vs rewards, what is the expected profitability of the venture and what are the risks of failure? Let me clue everyone in, higher labor costs in the future does not improve the chances for investing money in any business that uses much labor. And that ain't good for people who will be looking for a job, unless they've got the necessary skills, training, or education to comma a higher income.
SO - for a whole host of reason, the gov't needs to stay the hell out of the wage and price controls business. Different regions and different business sectors can afford to pay different wages, and the locals can decide what they want to do based on their individual and local circumstances. But not the federal gov't, one size does not fit all situations, which is one big reason why they need to concentrate on the issues that ought be faced at the national level.
