Quote (Valhalls_Sun @ Mar 18 2015 04:00am)
middle income earners of course, the great consumers.
do you think low income and poverty level human beings can afford Walmart and Mcdonalds? please check your privilege sir.
look at the dollar store and the salvation army store, and Aldis and food wharehouse people living on low income can't afford to eat fast food what are you thinking?
The poor definitely shop at Walmart, as do the working class. Regardless, these aren't increases being paid by the wealthy, but by the middle class and a handful of stockholders.
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One thing I think you should look at this in fairness is the value that you are placing on labor as it factors into the entire gross profit margins that a company sets, I know margins are wildly different depending on the type of business and we can be speaking about a variety of business when we discuss the minimum wage. When you talk about manufacturing labor really won't have a very big voice by the time items hit retail and if a couple points increase in labor is all it takes to send a company south then it's in constant danger as is. As we all know the Commodities will have a direct affect on the price of the raw materials used in manufacturing and those are on a constant rollercoaster ride. Any good company will have cushion in it's gpm for these hitches. And the slow steady rise of the minimum wage is what I would be talking about not some crazy all or nothing doubling of it. Fast Food has crazy high margins and can easily squeak out higher wages.
Manufacturing has country hopped throughout all of Asia, so labor costs are a defining factor.
I don't think you've addressed the point. Lowering profitability below economic "normal profit" discourages investment in the particular industry. Increasing the cost of labor either increases prices (driving down net productivity as employees reap the resulting rent), decreases employment (as employers seek to cut increased labor costs), or decreases profit (resulting in less investment in the industry). All three are intermixed, but they all result in less employment, more rent, and higher prices.
If we want to help the poor outright redistribution is a more effective policy, but increasing opportunity in education is probably more effective than both.
This post was edited by bogie160 on Mar 19 2015 12:20am