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28. Re: Morning Metaverse Mar 5, 2014, 17:02 Pigeon
Verno wrote on Mar 5, 2014, 15:40:
xXBatmanXx wrote on Mar 5, 2014, 15:31:
Well....the CURRENT issue with increasing min wage is that the small businesses just pass off the increased costs to their customers. So you are robbing from peter to pay paul. I have a lot of friends (service industry) who own/work/etc small biz, bars, restaurants, service companies, etc., and they have flat out said "the increase in vegetables has forced me to increase my food costs" and "Obamacare has forced me to increase prices" and "if min wage goes up my prcies go up" and "gas prices has increased my prices from vendors and I pass that on to the consumer".

Fair enough. Personally I don't think it's a simple net zero and I would like to see it only applied to corporations at a certain income threshold rather than all companies equally. I agree that minimum wage jobs are supposed to be a life stopgap and not a career but the current economic climate isn't helping much in that regard. People aren't just going to spend 30% more for everything across the board, that money goes to a lot of different places, many of which serve to enrich those workers in other areas like education.

Unfortunately there is no silver bullet, a minimum wage increase by itself is a bandaid on a larger problem where top income earners are not reinvesting enough wealth back into the economy. This is something Buffett recognizes that most of his ilk do not.

This is certainly where my argument for increasing minimum wages stems from. Currently wealth is being damned up at the top, they have more money than they can reasonably spend. The poor on the other hand have less than they can spend. Anything they get will be put towards living expenses; food, housing, clothing, etc. Essentially its not removing money from business, but putting more money in flow (I'm sure there's a better economic term for that). So while they're paying more out, their business should also increase because their customer base has more money to spend at their establishments.

My worry is business would react to the short term situation, i.e. having to pay employees more, by laying off employees before the longer term benefits can be reached, i.e. increased customer base/spending.
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