29-05-2005 10:58									#61
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quote: Originally posted by Zkribbler Putting a few more bucks into the hands of the working poor means they'll spend it on stuff, sales go up, eveyone wins.

	29-05-2005 10:59									#62
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to meaningless number games to make ourselves feel better

	29-05-2005 10:59									#63
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Go on.

	29-05-2005 11:02									#64
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Let's simplify this. There's one company and it produces the one good that represents all the commodities people buy. It decides to raise the wage it pays its workers (= all of society). Therefore, they can afford more of the commodity - so business is better! Except wait a second, we actually haven't increased production at all, we've just given everyone more pieces of paper, so the exchange rate of paper for the commodity increases and everyone gets exactly the same amount of it as before, just with larger numbers of pieces of paper circulating around to represent the same transfer of goods and services.

	29-05-2005 11:05									#65
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That doesn't even make sense.

Production will increase if people buy more of the product.

	29-05-2005 11:07									#66
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Ted, don't you get it - why didn't production increase before? Money isn't even paper anymore, just a bunch of bits in a computer. The inherent value of that bunch of bits is ZERO. So increasing the rate of flow of those bits basically accross the board does nothing to increase the rate of flow of goods and services that wouldn't occur normally.

By your logic, if the government had simply declared that all $1 bills now were worth $2, production would increase to meet the new demand.

	29-05-2005 11:11									#67
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That doesn't even make sense. If people have more money they will spend it somewhere.

That's like saying money is worthless after the gold standard was abolished.

You're trying to be too fancy.

	29-05-2005 11:14									#68
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quote: That doesn't even make sense. If people have more money they will spend it somewhere.

Yes. They will spend it. But the fact that every person now has $2 instead of $1 doesn't change the underlying economics of the sitution, which is that there is still exactly the same capacity to produce supplies. Ask yourself: if everyone crossed out the 1 on dollar bills and replaced it with a 2, would the economy be affected at all?

quote: That's like saying money is worthless after the gold standard was abolished.

No. Money was worthless before the gold standard was abolished, too, since at that time gold had pretty much no inherent value (except as jewelry).

	29-05-2005 11:18									#69
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Kuci, don't forget also, that the money paid to the lower wage workers will be reflected in increased prices, thus making it unsure how much more lower wage workers will indeed purchase (not even counting how much less others will purchase when the prices rise).

	29-05-2005 11:20									#70
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Your argument makes absolutley no sense.

I've gotten big raises the past two years. Do you think I'm buying more stuff than before? HELL YEAH I'm buying more stuff. Way more stuff.

Taxes are cut so people can buy more stuff.

Supply moves up and down to meet demand. That's basic economics.

It's like that punk kid that comes into philosophy class the first day and says, "like, duude, how do we know we're like, actually here? I mean, we just THINK we're here, but how do we KNOW we're here?"

	29-05-2005 11:24									#71
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quote: Originally posted by Imran Siddiqui Kuci, don't forget also, that the money paid to the lower wage workers will be reflected in increased prices, thus making it unsure how much more lower wage workers will indeed purchase (not even counting how much less others will purchase when the prices rise).

That's my entire point.

	29-05-2005 11:26									#72
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You're basically trying to say that it will make inflation go out of control, so it's a wash.

The problem with that is that the money is already distributed before it is reallocated to workers. It's just going to them instead of stockholders, upper level executives, etc.

	29-05-2005 11:27									#73
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quote: Originally posted by Ted Striker Your argument makes absolutley no sense. I've gotten big raises the past two years. Do you think I'm buying more stuff than before? HELL YEAH I'm buying more stuff. Way more stuff.

OK. Apply that big raise accross the board - which is the (desired) effect of raising the minimum wage, AIUI. The net effect is simply multiplying the total supply of money by some factor, which results in no actual change. It's called inflation.

Now, because the change from increasing the minimum wage is not universal, it doesn't have exactly this effect. But it is a close approximation.

	29-05-2005 11:28									#74
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Private companies don't print money. They are not the Federal Government nor the Central Bank.

They just reallocate what they already have.

	29-05-2005 11:28									#75
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quote: Originally posted by Ted Striker You're basically trying to say that it will make inflation go out of control, so it's a wash.

Not out of control. It will cause a one-time burst of inflation, and the value of the dollar will set at some new, arbitrary level.

quote: The problem with that is that the money is already distributed before it is reallocated to workers. It's just going to them instead of stockholders, upper level executives, etc.

But if, as you contend, this money is simply "hoarded" and "not doing anything" then the net effect is to simply expand the money supply (as this money wouldn't really be in the money supply if it wasn't doing anything).

	29-05-2005 11:30									#76
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quote: Originally posted by Ted Striker Private companies don't print money. They are not the Federal Government nor the Central Bank. They just reallocate what they already have.

But the money was, according to you, not doiong anything previously, therefore it wasn't really part of the money supply, it was just a bit in a computer. So once it is doing something, it's the same as if the government had printed more money.

It's just like how China could cause a massive devaluation of the dollar, despite the fact that none of their mints actually print them. They have a large number of dollars that aren't in circulation; if they decide to put these dollars in circulation, they've increased the money supply.

	29-05-2005 11:33									#77
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quote: The problem with that is that the money is already distributed before it is reallocated to workers. It's just going to them instead of stockholders, upper level executives, etc.

Don't forget that those stockholders and upper level excutives are gonna want pay rises as well. They wanna keep profits up and if people have more money to spend then people can pay more for the things they really want.

	29-05-2005 11:39									#78
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Ted, you don't need any sort of fancy economics for this, you just have to look at the situation before and after the raise in wages and ask, what has changed?

	29-05-2005 11:40									#79
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Nah, you are looking at it in too much of a simplified view. It depends more on the larger economic conditions rathar than the meager effects of minimum wage on the overall economy.

In the 1980s, the minimum wage was frozen, and inflation was still going up, and the purchasing power of minimum wage earners went steadily down.

It just hurts the little guy.

	29-05-2005 11:41									#80
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Ted, at most, this results in a bit of redistribution of goods and services from the wealthy to the poor. It cannot drive economic growth.

	29-05-2005 11:43									#81
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quote: Originally posted by Kuciwalker Ted, you don't need any sort of fancy economics for this, you just have to look at the situation before and after the raise in wages and ask, what has changed?

Sure, I can do that.

http://www.epinet.org/content.cfm/issuebriefs_ib195

By the way, alot of states have decided to step in and raise the wage when the Fed would not. It makes absolutley no sense whatsover to have an across the board wage in states where living expenses are much higher.

	29-05-2005 11:44									#82
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quote: Originally posted by Kuciwalker Ted, at most, this results in a bit of redistribution of goods and services from the wealthy to the poor. It cannot drive economic growth.

That's not the point. It's about getting poor people the money they need to LIVE.


There are other WAY MORE IMPORTANT factors in driving economic growth than trying to keep poor people from getting more money.

	29-05-2005 11:44									#83
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Good job at being completely off the point.

xpost

	29-05-2005 11:45									#84
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quote: Originally posted by Ted Striker That's not the point. It's about getting poor people the money they need to LIVE. There are other WAY MORE IMPORTANT factors in driving economic growth than trying to keep poor people from getting more money.

Eh, no, the whole argument in this thread was that increasing the minimum wage would drive economic growth because people would be buying more stuff.

	29-05-2005 11:49									#85
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quote: Originally posted by Kuciwalker Eh, no, the whole argument in this thread was that increasing the minimum wage would drive economic growth because people would be buying more stuff.

That's YOUR point, son, not mine. What are you, DANISH????

I could care less about the overall economic situation, nor have I even touched upon it. There are way more important factors involved in the health of the economy. All I care about is poor people having more money to buy the things they need, and I know that them getting more money isn't going to cause inflationary panic, nor is it going to cause massive job loss, so it can only be a good thing.

	29-05-2005 11:50									#86
	Got spare money?

Bullshit. Your original post (to which I responded):

quote: Originally posted by Ted Striker quote: Putting a few more bucks into the hands of the working poor means they'll spend it on stuff, sales go up, eveyone wins.

emphasis mine

	29-05-2005 11:53									#87
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This is the very first post I made in this thread. DUH:

quote: Originally posted by Ted Striker In my opinion it can only be a good thing. It does undercut net profits for business, but will redistribute more wealth among the lower classes. Reactionaries will tell you that the sky is falling and that businesses won't hire as many workers as they did before. They will tell you that business won't have as much money to reinvest into themselves to create more jobs. But I don't think that's the case, especially among the big corporations, where the extra cash just goes into stockholders bank accounts and upper level executives salaries and stock options anyway. Where it would hurt the most is small business, and this is often cited in sound byte news reports. But those businesses will adjust.

	29-05-2005 11:55									#88
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Did I quote and respond to that?

(no)

Did your post I quoted and responded to support a position that increasing the minimum wage would create growth?

(yes)

	29-05-2005 12:01									#89
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I could care less what Kuciwalker posts about.

Does the thread revolve around Kuciwalker? No, it does not. Your post is some sideshow that is a minor detail in what I wanted to talk about.

The main point I am making (which I opened up with) is that the purchasing power of poor people has gone down. Give them more money to buy stuff that they need to live, and they will purchase more stuff. Sales go up in the neighborhoods that they live in.

Does that equate overall economic growth? I don't know. NOR DID I EVER SAY IT WOULD. Nor do I even care.

So go build yourself another strawman to knock over.

Or draw a frame around it and declare yourself Danish Thread Police.

	29-05-2005 12:02									#90
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Now, you tell me why it is a good idea to have poor people have less purchasing power?