Posted by MoreCowBell (anonymous) on July 25, 2009 at 7:23 a.m. (Suggest removal)

Businesses usually will compensate by raising their prices (or laying off employees), so in the end, the minimum wage earners lose or at best break even and everyone else just pays more.

Posted by countyconscience (anonymous) on July 25, 2009 at 1:26 p.m. (Suggest removal)

There is no evidence to support the previous comment. It sounds more like republican talking points. I have yet to meet someone who was laid off due to an increase in minimum wage. Nor do I recall any significant increases in prices in local stores after the last two wage increases. Broad staements unsupported by facts is the kind of crap out out by Rush Limbaugh and Bill O'Rielly .

Posted by nwcorner (anonymous) on July 25, 2009 at 1:46 p.m. (Suggest removal)

This is good for the ones who work their butt off to barely make it, but on the other hand their is a domino effect of higher wages to higher prices. Therefore this may be beneficial for them for about 2 months until prices go up. Another thing to look at is that the more money they make the more taxes they pay so who is this really for the workers or the government.

Posted by purelogic (anonymous) on July 25, 2009 at 1:56 p.m. (Suggest removal)

countyconscience:
Take your standard fast food franchise for instance. They have their basic expenses which inlude labor. They produce say a hamburger for x dollars and sell for y dollars. The profit would be y-x. When the price goes up to produce that hamburger, the profit drops. They will not sell more hamburgers because the minumum wage went up. To maintain the same profit, they will need to increase the price of the hamburger. This is the basic way businesses are run. Nothing to do with republicans, which I can't say I'm a republican. Just basic business being conducted.

What about employee Bob who was making $7.25 an hour before the wage increase? It's not mandatory that everyone gets a raise. He's more or less back to square one at minimum wage. Bob just got the shaft.

If you don't believe this wage increase will have an effect, just watch the price of the extra value meals at the local fast food franchises here in town in the next 6 months. Watch them increase to compensate for added labor expense. When minimum wage was about $3.35 that was about the price of the combo meal. What is it now? 6$ 7$

Minimum wage does very little to raise the standard of living for the poor. It will only promote inflation.

I can't stand Rush and I don't know Bill O'Reilly. I do listen to Rick and Bubba in the morning sometimes, but they do get on my nerves quite often. I do form my own opinions however.

Posted by WAtidefan (anonymous) on July 25, 2009 at 2:30 p.m. (Suggest removal)

Isn't George Momenpour quoted as saying that prices will go up? Doesn't he talk about not being able to grow business? The employee is even quoted as saying she doesn't expect to see much difference.
I can not speak for minimum wage employees, but every time I get a raise, my insurance costs increase. It never fails.
I would say that unless someone keeps a complete record of the price of every single item they purchase, they may not be aware of price increases. Businesses are not about losing money. An increase does not have to be significant nor immediate.
I am not a business owner so I have to listen to those who are. BTW, I am not a Republican and I don't listen to either one of the afore mentioned talk show hosts. Democrats make tons of statements that can't be backed up with facts. How about Canahan (MO-D) claiming that Obama's healthcare plan will save money. The audience
laughed at him. And Obama himself saying we need a new government run health care plan b/c of the huge cost of medicare and medicaid. Let's see.... we need a new "who knows how many trillion dollar" federal government run plan because the federal government messed up medicare and medicaid. Right!!!!!

Posted by mbishop (anonymous) on July 25, 2009 at 3:02 p.m. (Suggest removal)

well, a minimum wage increase is good but not when people are barely making the scraps anyways. you didn't even have to wait for minimum wage to go up to see prices raised. I eat at Sonic as pretty much my primary source of food (I'm a teenager that live's on my own so) but, prices went up .40 on some combos. I work at Sitel and they had good starting prices and now we're back to square one with the incoming starting price j/ .25 over minimum. And like most places we're not gettin' a cost of living adjusment either so we're not much better off anymore.

Posted by outlaw11 (anonymous) on July 25, 2009 at 3:46 p.m. (Suggest removal)

To put a point on this subject that is factual, in our 'Obama' economy, this raise is pointless...the more money on the market-the more that is printed w/o gold to back it up...years ago, under Regan, we were stable...we had gold to back up every move we made, world-wide,& respected...now, this wage increase will only add to the already overloaded economy...inflation...taxes go up, insurance premiums go up, lay-offs go up, what has this helped? It came when Bill Clinton thought he was God and a lot of people agreed...now, it is/has been proven that he is not God, Obama is...so, the common worker pays the price, once again, and we all live on...next time, people, think before you vote...save my grandchildren...

Posted by countyconscience (anonymous) on July 25, 2009 at 3:59 p.m. (Suggest removal)

One thing is for is for sure is that that minimum wage workers would be a lot worse off in a down economy without a raise. Every bit of their raise will be spent in somewhere here in town. This represents new money in the local economy that will turn several times. Even to buy more combos at the Sonic or McDonalds. That is basic Economics 101. The same thing goes for the super Walmart here in town. Even though the money spent there goes to Arkansas, the new customers that are coming from a wider area outside of Andalusia are also spending money at others businesses while they are in town. Also Walmart employees who are now getting the 70 cent raise are spending it locally.

Posted by MoreCowBell (anonymous) on July 25, 2009 at 4 p.m. (Suggest removal)

Sorry CC, but there is evidence to support my opening comment. You don't have to be Dem or Repub to understand basic economics. Businesses are in the "business of making money", not balancing the book.

If I read the article correctly, Momenpour said "he believes many small businesses will have to pass the costs of the increase to their customers, either through lower quality service or through higher prices". That's right from a small business owners mouth and is being echoed by business owners everywhere. So likewise, unfounded statements such as yours amounts to (using your words) crap.

Our personal feelings about this issue have nothing to do with the reality that simple economics will govern the final price. Personally, I don't have a problem with someone making 70 cents per hour more if they deserve it.

BTW, I don't listen to Rush Limbaugh but I do enjoy Bill O'Reilly and I am neither Repub or Dem. I have claimed my independence from those two.

Posted by lookeyhere (anonymous) on July 25, 2009 at 4 p.m. (Suggest removal)

Obama will go down in history as one of,if not,the worse president this country has ever had.In my opinion ,Jimmy Carter was the worst I ever seen.I remember when Reagan became president he actually made you feel good about being American.

Posted by MoreCowBell (anonymous) on July 25, 2009 at 4:05 p.m. (Suggest removal)

I sure do miss Reagan.

Posted by purelogic (anonymous) on July 25, 2009 at 4:27 p.m. (Suggest removal)

The dollar was not backed up by gold during the Reagan Administration. The dollar hasn't been backed by gold since 1933. The dollar like most other currencies in the world is backed solely by faith.

Reagan wasn't that popular during his administration, but strangely enough has gained significantly as years have passed.

Minimum wage workers are not a lot worse off if they wind up having no job at all. Hopefully this won't happen. Maybe we'll just get another round of inflation like has happened in the past.

Posted by MoreCowBell (anonymous) on July 25, 2009 at 4:44 p.m. (Suggest removal)

You are correct in stating that the dollar was not backed up by gold during Reagan, however I disagree about his popularity. RR took 44 states in 1980 vs. Jimmy Carter and he took 46 states plus DC in 1984 vs. Walter Mondale. That's pretty much "running the board". I sure do miss Reagan.

Posted by andytransplant (anonymous) on July 25, 2009 at 5:13 p.m. (Suggest removal)

With the last minimum wage increase, daycare prices at some places went up...I know that one for a fact. Now with the economy the way it is, the company I work for has decided not to give annual raises this year...from the CEO down. I'd be willing to bet a week's pay (as paltry as that is) that the CEO down to management will still be getting their end of year bonuses. So here I sit, no cost of living raise...yet the cost of living has been increasing, my hours have been cut back and there are few jobs on the horizon for someone of my age (50's) with a high school diploma and no college. I get by trusting that my faith in God's grace will see me through these times.

Posted by walnutwilly (anonymous) on July 25, 2009 at 7:17 p.m. (Suggest removal)

Some business owners will raise prices to compensate for the wage hike, while most will just cut hours until they feel comfortable with the payout. The competition down the road might not have as much overhead and the wage hike won't hurt them as much as others. Gotta stay competitive with the pricing.....

Posted by purelogic (anonymous) on July 25, 2009 at 7:38 p.m. (Suggest removal)

MoreCowBell:

I have to say I love your username. :) I gotta have MoreCowBell! One of my favorite SNL skits of all time.

I guess when I said, "wasn't that popular", it was kind of vague. I just remember the Iran Contra scandal, and it seems like a couple of other things that weighed on his rating near the end of his 2nd term. Without question though, his popularity has increased as years have passed from 88'. I think this happens with most presidents overall.

I think Regan would have definitely done better in the election than McCain did.

Posted by starnews (anonymous) on July 25, 2009 at 8:30 p.m. (Suggest removal)

well its probably overdued for those who are extremely lucky to have a damn job but me ive been unemployed 4 2 yrs. now ive been all over the 3 surrounding counties nearest me and i havent got a job yet all ive seen in all the companies ive been to apply at is mexicans n koreans, now theirs something we americans need to end forever, foreign help that free trade act that hilarys husband bill passed when he was in office has killed our economy. and obama aint no better.

Posted by winkie (anonymous) on July 25, 2009 at 9:33 p.m. (Suggest removal)

Higher the min. wage goes the lower the US$ goes. The dollar bill is worth only about $0.25.

Posted by Estragon (anonymous) on July 25, 2009 at 11:49 p.m. (Suggest removal)

Most economists believe that an increase in the minimum wage causes higher prices and lower employment. This belief rests partly on empirical evidence, but also on the view that labor markets are competitive; if markets are competitive, then increases in the minimum wage should both raise prices and reduce employment. However, a number of studies in the last decade have challenged these beliefs. Some of these studies have argued that the market for low-skilled labor has special characteristics that undermine the traditional economic consensus. They claim that the market for low-skilled labor isn’t competitive and employers have the power to set wages. As a result, an increase in the minimum wage will not necessarily lead to employment loss.
http://www.epionline.org/study_detail.cf...

On April 1, 1992 New Jersey's minimum wage increased from $4.25 to $5.05 per hour. To evaluate the impact of the law we surveyed 410 fast food restaurants in New Jersey and Pennsylvania before and after the rise in the minimum. Comparisons of the changes in wages, employment, and prices at stores in New Jersey relative to stores in Pennsylvania (where the minimum wage remained fixed at $4.25 per hour) yield simple estimates of the effect of the higher minimum wage. Our empirical findings challenge the prediction that a rise in the minimum reduces employment. Relative to stores in Pennsylvania, fast food restaurants in New Jersey increased employment by 13 percent. We also compare employment growth at stores in New Jersey that were initially paying high wages (and were unaffected by the new law) to employment changes at lower-wage stores. Stores that were unaffected by the minimum wage had the same employment growth as stores in Pennsylvania, while stores that had to increase their wages increased their employment.
--Study by Prof. David Card, Ph.D., UC-Berkeley and Prof. Alan B. Krueger, Professor of Economics, Princeton University.
*Published: American Economic Review, Vol. 84, No. 4, pp. 772-793, September 1994.http://www.nber.org/papers/w4509

Posted by Shamrock (anonymous) on July 26, 2009 at 8:31 a.m. (Suggest removal)

As I read the various comments, I have to think of the excellent posting that LoyalAmerican made about minimum wage in the Star News OPINION - Who Are The Real Racists, this week.

It is a most educated and realistic approach to this subject - check it out for yourselves.

We have some amazingly talented and educated folks who take time out from busy schedules to post - they have brought OPINION blogs to a higher level of maturity and truth. Bravo!

Posted by Shamrock (anonymous) on July 26, 2009 at 8:37 a.m. (Suggest removal)

MoreCowBell: Can you take time to explain your definition of "Rebellion" posted on Real Racists, please?
Not to break this thread, you can post on Real Racists.

Posted by purelogic (anonymous) on July 26, 2009 at 9:52 a.m. (Suggest removal)

Estragon, thanks for the informative post. I would believe if employment is not reduced, then the prices must rise.

The money doesn't come from nothing. The business still must turn a profit. The rise in price in turns leads to more inflation.

If prices rise too much, sales will fall, and then employment will be reduced. One particular study in New Jersey will not have the same outcome every time in all situations. There's many more variables that are involved. When the decision to raise minimum wage was made, the economy wasn't in its current downturn.

However, it's true no one truly knows what will happen until it is done, just like playing the stock market. But I'd sink my bet into the prices of things going up to compensate. Which I think is not what we really need in the current economy with layoffs and people unwilling to spend anyway.

Posted by MoreCowBell (anonymous) on July 26, 2009 at 9:58 a.m. (Suggest removal)

Shamrock....done.

Posted by Estragon (anonymous) on July 26, 2009 at 10:34 a.m. (Suggest removal)

Purelogic:

Glad that you enjoyed the post. The relationship between priced goods and labor costs is not a straight line. If we accept the premise that higher wages always equal higher prices, this would be an argument against not only raising the minimum wage, but raising anyone's salary. In fact, a number of independent variables enter the picture, as the cost of labor is only one of many factors that determine the cost of a good. To determine the relationship of higher labor cost to higher prices for a good one would have to perform multiple regression analyses.

In addition to the multiple variables that affect the price of a good, you also have the phenomenon of productivity. If an employer has to pay his employee a higher wage to make hamburgers, instead of raising prices, the employer may decide to become more efficient and increase the higher paid employee's level of production. Thus, instead of his employees making 20 hamburgers an hour, the employer devises a production method that results in his employees making 30 hamburgers an hour. In this way, higher minimum wages, and higher wages in general, discourage a static economic system and encourage innovation, efficiencies, and modernization.

Posted by purelogic (anonymous) on July 26, 2009 at 10:44 a.m. (Suggest removal)

Estragon, I see what you are saying.

If the employer can get his employee to make 30 hamburgers and hour instead of 20, without increased sales he can afford to lay off 1/3 of his work force.

Give it 6 months, and see what if the local combo prices have increased.

Posted by jamthree (anonymous) on July 26, 2009 at 1:40 p.m. (Suggest removal)

Many of you miss the point completely.A man that works 40 hrs a week should make a decent living,period.wether its on the back of a garbage truck or in a factory or whatever.there has for a long time been far too big a gap between management pay and worker pay.If an employer doesnt want to pay us fairly then we should all stop working for them.let him do it himself!Too many people want to go to college and get an office job making six figures a year instead of getting a real job.there is work that needs to be done!Who will do it if the whole country has office jobs?If exec's didnt try to fix it so they will make ALL the money maybe the real workers who deserve it will be able to make it in this world too.Most people earning these big bonuses havent ever done a real days work and arent worth a tenth of their pay.Who built this country?Working men and women or pencil pushers?There is so much more to say.I wish i had all day.

Posted by purelogic (anonymous) on July 26, 2009 at 1:59 p.m. (Suggest removal)

I would say it took both pencil pushers and the general labors to build this country, both working together.

I have to disagree however, if you are saying unskilled workers should make as much as skilled workers. If you are an unskilled worker, you should be working towards acquiring some sort of skill whatever it might be. Once that skill or knowledge is gained, you should be proud of that fact, and should earn more money in that trade. It takes talent, discipline and work ethic to learn a trade, and the pay should reflect it.

Posted by Estragon (anonymous) on July 26, 2009 at 2:16 p.m. (Suggest removal)

Jamtree is correct. We have been focusing here on the bottom scale of wage earners and ignoring the top earners.

In the 1980s, 1990s, and 2000s, top U.S. executives received disproportionate salary increase relative to other wage earners. This can be seen by examining the increased divergence between CEO pay and an average worker’s pay over time. In 1965, U.S. CEOs in major companies earned 24 times more than an average worker; this ratio grew to 35 in 1978 and to 71 in 1989. The ratio surged in the 1990s and hit 300 at the end of the recovery in 2000. The fall in the stock market reduced CEO stock-related pay (e.g., options) causing CEO pay to moderate to 143 times that of an average worker in 2002. This moderation lasted only a short time and by 2005 the average CEO was paid $10,982,000 a year, or 262 times that of an average worker ($41,861).

What this data reveals is that there has been a massive redistribution of wealth in this country to the wealthiest 1%. Instead of building up a middle class, we have further enriched people who were already wealthy. Without a middle class, our country will become, like third world countries, a nation of just the rich and the poor and the social and political institutions in our country that depend on a middle class will disappear.

Posted by nwcorner (anonymous) on July 26, 2009 at 10:17 p.m. (Suggest removal)

When a company pays minimum wage that is their way of saying "If I could pay you less, I would" Let Barrack give those illegals citizenship then tax the hell out of them like everyone else, that would be the way to go, they are not just going to leave. How many times have you seen border patrol or ICE around here. Deport them or tax them. They are sucking the blood out of america by sending 80% of their earnings back to foreign countries. But instead of fixing that problem they try to fool you into thinking you are actually going to benefit from a minimum wage increase. Politics for Dummies!!!! Smooth move exlax!!!

Posted by LoyalAmerican (anonymous) on July 27, 2009 at 7:54 a.m. (Suggest removal)

I prefer the term "entry level" rather than "bottom scale wage earners". The latter has a very demeaning sound. I agree that everyone producing a good day's work should receive a good wage. Purelogic makes a very good point regarding unskilled workers....become skilled and your wages should reflect you increased education. Minimum wages should be a temporary source of income. Do whatever you must to work your way up the ladder. Don't become stagnant and allow your career to remain at entry level. Business owners will always make the most money, as they should. They took the initial risk, putting everything they owned on the line. Save your money and become an entrepreneur. If you look around and listen, you will find a need that has not been met. That is called opportunity, seize it! Perhaps you discover you can do a better job than a business is already doing, that is competition! Both scenarios are the good ol' American way! Minimum wage does directly effect prices. Anyone who truly knows how to arrive a the cost of goods, understands there is a direct line between overhead and the actual cost to the consumer.

Posted by beeinbonnet (anonymous) on July 27, 2009 at 8:54 a.m. (Suggest removal)

Thank you loyalAmerican! Finally someone who knows what they are talking about! In this community I have heard people criticize business owners for being successful. To that I say "get off your butt and better yourself!" No one will do it for you! ( Of course the liberals want to do it for you)

Posted by jamthree (anonymous) on July 27, 2009 at 1:56 p.m. (Suggest removal)

My hat is off to all of you that are far more educated than myself and I do appreciate your knowledge even if I dont agree with the way things are nowdays.I can only tell what I see in my everyday life and I do see a lot of very unfair things in this country concerning people trying to make a living.But above all this I try to never forget to be thankful that even though I'm not wealthy,we poor folks in this country live like kings compared to some other places in this world.We all have to just keep trying.

Posted by Shamrock (anonymous) on July 27, 2009 at 4:53 p.m. (Suggest removal)

Jamthree: Won't you join our Crusade for Truth?

God has certainly blest us, Will He continue to protect our Nation? Or has that protection already lifted from us?

When media refer to the pervert Michael Jackson on worldwide news as THE KING OF KINGS, we've got problem.

There is only one who can claim the title KING OF KINGS and that is Jesus Christ, Son of God and Savior of the world.

The liberal Progressives work tirelessly to eradicate any trace of God in our society and the world. And we have a man who cannot reveal his true birth status leading us down the path to hell on earth.

Join us for the love and glory of God.

Posted by countyconscience (anonymous) on July 27, 2009 at 9:06 p.m. (Suggest removal)

Maybe Shamrock can explain what his/her
comments have to do with raising the minimum wage.

Posted by Shamrock (anonymous) on July 28, 2009 at 7:11 a.m. (Suggest removal)

I am simply commending the people who have posted clear, well written comments, not just on Wages but on other Topics as well, e.g. OPINION: WHO ARE THE REAL RACISTS.
This is where you find a group of folks who do not know each other, but have contributed sensible, truthful comments that bring refreshing ideas and opinions to a high level.
I am encouraging them to continue.
If Progressives can have their troups ready for blogging, so can we.
Best thoughts to you Conscience. See ya 'round about sometime.

Posted by Shamrock (anonymous) on July 28, 2009 at 7:21 a.m. (Suggest removal)

Conscience: I know little about the present subject of wage increases, but after reading LoyalAmerican I now have a better understanding of how this works.
Why post something I know little about? Others should do likewise, don't you think?