The Bitter Lesson From Seattle's Minimum Wage Hike

In comments that sounded as if they came straight out of an Econ 101 text, the Post concluded that "Increasing the minimum wage increases the costs of hiring workers. As a result, employers must accept reduced margins or customers must pay steeper prices. If employers cannot stay in business while paying their staff more, they will either hire fewer people or give their workers fewer hours. As a result, even if wages per hour increase workers' total earning could decline."

Dead on. That's exactly what happened. And as University of Washington economist Jacob Vigdor, one of the authors of the Seattle study, noted, some businesses simply avoid paying the minimum-wage tax altogether by automating and letting low-end, unskilled workers go — as is now happening in some fast-food chains and at supermarkets.

Yet, such foolishness seems to have infected the Democratic Party, with its now near-ubiquitous "Fight For $15" campaign. As a piece in IBD highlighted right after the Democratic Party Convention's call for a massive hike in the minimum wage, forcing sharply higher wages on troubled local economies where the median wage is low can have a devastating effect.

"The most absurd plank to appear in either party's platform this year is the Democrats' call to 'raise the federal minimum wage to $15 an hour over time and index it,' " wrote Oren Cass, a senior fellow at the Manhattan Institute and author of "Is A $15 Federal Minimum Wage Appropriate?" "It is policy written for the nation's very wealthiest enclaves, but incoherent for economically distressed regions."

The tragic irony of this is that those who are worst hurt by a higher minimum wage are those with little education or training, mostly minorities, immigrants and the young. They get priced right out of the labor market by the well-meaning nanny-staters who want to impose a one-size-fits-all minimum wage on the entire country — regardless of the damage it does.

http://www.investors.com/politics/commentary/the-bitter-lesson-from-seattles-minimum-wage-hike/

The jackwagons just don't comprehend,
$15. an hour, means the cost of their happy meal
just skyrocketed.


For the small businesses, closure and layoffs,
equaling an even suckier economy.

yeah, but the cellphone business there is good.

its gradually rising, just like minimum wage always has

the full out application of 15 dollars isnt in effect until 2021

LARGER companies have begun paying 13


a different perspective,,,on a still newly scheduled policy

http://www.dailydot.com/via/minimum-wage-myths-poverty-seattle/

Will never be learned by people who think they are "helping" others by exercising their power and control and simply won't face economic reality in the face of "b..b..b..but...it's for the children and poor people!"



That was interesting.
Did you read the article and the links provided for where they got the things to dispel the "myths?"

Such as myth #2.
"A 2013 study by the Chicago Fed found that increasing the minimum wage even just to $9 would increase consumer spending by $28 billion. When spending—i.e. demand—increases, manufacturers and other purveyors of goods and services can actually charge less or at least avoid increasing their prices, because they’re increasing overall revenue."

From the Chicago Fed report supposedly busting "myth" #2:
"We conjecture that other (nonrestaurant) firms employing minimum wage workers or using intermediate inputs requiring minimum wage labor also pass close to 100% of the higher labor costs on to
consumers in the form of higher prices... under the assumption
of no disemployment effects....Workers who earn above the minimum
wage may decrease their real spending as a consequence of a minimum wage hike because they typically face higher product and service prices without the benefit of an earnings boost"

How about myth #3? Busted by
"Beyond simple supply and demand theory,” reads a comprehensive report on the economics of raising the minimum wage, “increasing the minimum wage may also spur businesses to operate more efficiently and employees to work harder.”

Also from the comprehensive report that supposedly "busts" the myth:
"employers may respond to a minimum wage increase by:
hiring fewer workers, reducing the number of hours their employees work, passing on some of the cost of higher wages to their customers in the form of higher prices, and/or absorbing some of the cost of higher wages in the form of lower profits.
... empirical studies suggest that the effects of minimum wage increases on employment have historically been slightly negative, negligible, or sometimes even positive."

Which also influences myth #2...because remember when it said they can charge less due to increased revenue?

Crap that was long. I wanted to do all of them but that would seemingly take forum pages.

So nice job on the article author for cherry picking through "there are 99 negative things for every 1 possible maybe positive thing!" information.

...So not really a different perspective. Just an either naive, ignorant, or willfully disingenuous one.

its a different perspective BECAUSE there are points that go to both sides in the actual resources, and both sides pick and choose which points to use


the word 'may', makes a difference that both sides tend to conveniently overlook


as well as the different effects on different sized employers,, and industries

http://www.americanthinker.com/articles/2016/04/minimum_wage_maximum_stupidity.html

not really

its 1 dollar a year,,,its not six dollars all at once

The Walmart in a major US city or metropolis might be able to afford an increase in wages with little to no effect based on volume per capita, but Joe's Hardware or Hanks Food Mart, already suffering under this failing economy, Oblowmecare requirements, regulations, and yearly changes to a bloated tax code, can barely stay afloat, much less competitive, as it is.

One size does NOT fit all! It creates monopolies as the big fish eat the small ones right out of business!

Globalization and corporatism are NOT friends to national sovereignty, local economies, or main street, but Wall Street, the banks, corporations and the politicos that profit from their lobbyists check books thrive at the expense of a slave based economy.

There is no math that works for small business forced into a standard set by globalized corporate interests with the $$$ to lobby a corrupt political cesspool like DC for changes that work only for them. All it creates is a hostile economic environment where all failing small business (caused by these actions and policies) is bought for pennies on the dollar or forced to close to "make way for progress".... as it is sold to the public..... when the reality is in truth quite the opposite!

Seattle is a petri dish of what might happen under a $15/hr min. wage. It's an experiment that has demonstrated failure. Seattle is bearing the consequences of what will happen when the minimum wage is increased while large global companies like McDonald's are toying with the idea of using kiosks and robots to replace actual humans.

awful amount of Hash you'll have to sling to pay yourself,pay the other Costs,like Insurance,Social Security etc,and enable to have the Boss who gives you the Job make a profit as well!

I'm all for it....hopefully the robots can grasp the concept of "and no pickles please" ....the overpaid geniuses used now sure don't.

time will tell

one year is hardly enough to know long term effects

yep,all the small Mama and Papa-Stores will miraculously go back into Business after having been bankrupted by the Stupidity of the Libturd-Officials!

small businesses will see an increase of 25-75 cents per year

on par with the increases in federal minimum wage,,,

with the exception of 2019 and 2020(if they haven't enacted a different minimum wage law, which they can always do if the current rollout is yielding negative results)

when there will be 1.50 increase each

Economics not one of your strong suits I see......

reading numbers is though

Perhaps.... but Govt has proven they are great at fudging those in their favor to fit an agenda or desired result