Well okay, but then I'm going to claim that lowering the minimum wage raises employment linearly the whole way down to 0, when everyone is employed, and all social problems are cured.
Prove me wrong?
Well actually I could prove you wrong easily on that one.
Of course, because I was being terribly facetious. But the argument that higher minimum wage causes unemployment is based on ideology, not math.
The exact same concept would be true if average wages went up. Not completely linearly, of course. because the poorest workers tend to spend more of their income on necessities, while the wealthiest tend to save or invest more.
But the argument, when reduced to it's basics, is that the higher the average wage, the higher the unemployment rate. Utter bullshit. At least in my case, the more I made, the more I spent, and the more I saved. I'll bet it's the same for other people.
Which argument, oddly enough, completely ignores that the consumer is the largest driver of the economy. How can the largest driver of the economy dive the economy when they don't have the money to do it. The early 2000's credit fest probably won't be repeated, as people tried desperately to hold on to their standard of living by going further into debt.
This is not complicated math. If on average, people buy new cars every 5 years, there will be more cars bought than if they bought on average every 10 years.
Another very simple example - My sister has bought exactly 1 computer since 2001. I've bought 10. Who has pumped more money into the economy? Even if the fact that a lot of that goes to China, it still helps with the employment of the sales people at the store. I used that example for that reason.
Call it the trickle up theory if you like. People making money buy stuff. The more stuff bought, the more people work.
Even more, with Government inefficiencies, does it make any sense to allow businesses to pay a wage that requires it's workers to be on the government dole?
I might have much better things to do with my decreased taxes.
This is what I've been preaching for years. What is pushed as "modern capitalism", is pretty much slash and burn. Make no mistake, the real beneficiaries of the working poor are their employers. Via a socialistic program that takes money from you and me, and redistributes it to the employers profit.
Amazingly enough people put up with it.
I am against wage restrictions in general. If you look at Europe, the countries with stronger economies tend to have the fewest working restrictions,
I am against them in principle. Problem is, the minimum wage has been kept artificially low for a long time now. That has created a completely skewed economy, and when a company is allowed to direct it's employees to the welfare system, that just isn't right. The existence of that is a serious symptom of an underlying problem. SO they might be a necessary evil.
such as Germany which has no official wage floors, overtime rules, etc. Likewise, the one with more restrictive policies tend to do worse, e.g. France.)
You think that Germany's economic system isn't very restricted? The only country among the top ten with a triple-A rating (they are number 4) utilizes a "social Market economy, which is very interesting, but completely impossible in the USAat present. Parts of it are in line with what I preach as the best way to run an economy. It's Capitalism with a moral underpinning.
It's a great read: http://en.wikipedia.org/wiki/E...
Rhine Capitalism. is pretty active in regulatory measures, considered the direct highway to hell in our system. And no one plans and implements with greater precision and effect than the Germans. It also takes the people in it's country into account. Yet another great read here:
Basically, it doesn't require it's citizens to be the main enemy of the economy. And damned if it isn't working well. In a system like that you don't need to force employers to pay their employees. They are all pretty much pointed all in the same direction. I think it is a good model. Any "ism" - socialism, capitalism, communism, fascism, will fail and fail big when people try to make it pure. It's because no 'ism is perfect.
But capitalism tempered with moral underpinnings? Pretty much the best thing going in my book.