Oh there’s more. When the minimum wage goes up- do you think everyone else’s wages go up too? So take someone working in an industry where they spent years or decades struggling and are finally making enough they are starting to be able to live decent- let’s say they worked up from $6-8 an hour to $15. You raise minimum wage to $15. Now any high school drop out with a pulse is making the same as them. Their spending power goes down. They want a raise too- they earned more than an unskilled entry level employee- there’s no budget for it because we just gave raises to thousands of minimum wage employees in the company. Whoops. Instead of “saving” the middle class you just took the bottom rung of it and lumped it in with the lower class- and now neither an afford shit because the prices went up on consumer goods.
It gets better. With higher minimum wage and mandatory healthcare expenses- it’s now cheaper to automate or outsource more jobs. Uh oh. That means more money leaving the country. It sure will help the lives in whatever place the business ends up- but not here. In short- it’s not a solution to just raise minimum wages. Comprehensive reform is needed to ensure that jobs and money are kept inside communities. When the people who own everything have no stake and enough money to go somewhere better when things get bad- they’ll chase the money wherever it goes and find new people to exploit.
It's not a lie, it's the consequences they don;t think about. If you force the wages up, the cost of labour will go up, but not the value, and companies will fire as many people as they can to cut down on costs. So yes, you now get a 2-3 dollar raise at the price of other people losing their jobs and further flooding the market. It baffles me that people still haven't caught on. But the left has never been good with economics, have they.
This is literally the reason why de-regulation of wages by the government is the answer, along with fixing the other economis holes. Cut down the immigration, limit the workforce pool, and make the value of labour go up. Scarcity breeds competition, and competition breeds success. If there are less people out looking for a job, they will have more chances of getting the job, and they have much better chances of getting a raise, because if they leave, there is a demand for them in other places.
It's the natural growth of wages that we should be striving for, not the artificial inflation that gives an impression of growth, while wreaking havoc on the economy and skyrocketing unemployment.
And to address automation and outsourcing, as @guest_ has correctly pointed out. Automation is ultimately a good thing, but should be controlled and directed. NOT stifled or suppressed, but controlled in the sense of providing the dispossessed workforce with a pathway. A security net for retraining or financial support in the short-term, until they can find a job in a different field. There are obvious difficulties here, since this is creating another welfare system, but leaving it unchecked is even worse.
As for outsourcing, the only viable option I see here is protectionism. Jack up the tarifs on sales of goods manufactured outside the country slightly, and majorly if those goods are produced in a third-world country. This will force the companies to bring their business into the developed world, and make tax evasion as it happens now, much harder to accomplish, since they are taxed through metrics different than income, which is easy to hide.
Now, I am no expert here, and there are definitely better solutions, but the idea is simple. Make exploitation of the third world workforce more costly than it is viable. Force the companies to either improve the working conditions in the third world countries, or bring their business into a controlled medium.
Neo-liberals will screech about restriction of free market, and the fact that international corporations will lose money, but fuck them. They are the ones exploiting people to keep the costs down, and private corporations being beholden to no law cannot be tolerated.
But muh private business, they will say, ignoring that even private businesses must abide by basic laws of treating their worker like people. The argument I hear a lot from the other side is that what they are doing is growing the economy, but it ain't worth shit if they are destroying lives and countries in the process.
I mostly agree. Some sort of system is required to make sure people can afford to live, historical precedent and the thrust of this discussion tell us that we can’t trust corporations to provide for employees without requiring it, and the market rate is largely controlled by companies themselves and can be “gamed” meaning that we can’t trust a “free market” to set fair living wages since the market is primarily in the control of corporations.
Tariffs are a good tool but a dangerous one. They can have the opposite effect- driving business away. There are billions of new consumers in emerging markets. “Velocity model” is the new wave- selling many many things for a small price and profit. While higher tariffs can work if we up domestic manufacturing- that can create an economic bubble where our goods are too expensive for export. That means that in a vacuum- we are hiring and creating and selling locally and keeping the money close to home, but we need the raw materials and other things to- so whenever we need to import something like titanium, we are at a disadvantage. With so many emerging markets we have less pull since a company can easily go elsewhere. It becomes a catch 22 where consumers buy less, companies leave which means less jobs and trade, so people have less money...
.... if we aren’t careful we can destroy our domestic market while making it unattractive to foreign trade and business development. As a country we are losing our leverage.
I can acknowledge that my judgment on the solutions here is limited, and I can only spitball ideas of what might work, rather than saying with certainty. I'm no economist, only an interested outsider, and any solution will require thinking 3-4 steps ahead, to predict the reaction and impact of the companie's reponse. But I can surely point out the goal in question, and tick off some of the formerly proposed solutions as ineffective.
No ones a fortune teller, nor is anyone always right- and I’m not saying tariffs WILL do xyz, just that they CAN if we aren’t careful- but as said overall I agree with you on this one, just saying we do have to be careful not to buy to hard into a single solution, so play on player.
This is literally the reason why de-regulation of wages by the government is the answer, along with fixing the other economis holes. Cut down the immigration, limit the workforce pool, and make the value of labour go up. Scarcity breeds competition, and competition breeds success. If there are less people out looking for a job, they will have more chances of getting the job, and they have much better chances of getting a raise, because if they leave, there is a demand for them in other places.
And to address automation and outsourcing, as @guest_ has correctly pointed out. Automation is ultimately a good thing, but should be controlled and directed. NOT stifled or suppressed, but controlled in the sense of providing the dispossessed workforce with a pathway. A security net for retraining or financial support in the short-term, until they can find a job in a different field. There are obvious difficulties here, since this is creating another welfare system, but leaving it unchecked is even worse.
Now, I am no expert here, and there are definitely better solutions, but the idea is simple. Make exploitation of the third world workforce more costly than it is viable. Force the companies to either improve the working conditions in the third world countries, or bring their business into a controlled medium.
But muh private business, they will say, ignoring that even private businesses must abide by basic laws of treating their worker like people. The argument I hear a lot from the other side is that what they are doing is growing the economy, but it ain't worth shit if they are destroying lives and countries in the process.