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Reply #11: There is no blanket answer. [View All]

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DefenseLawyer Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Mar-06-10 11:34 AM
Response to Original message
11. There is no blanket answer.
Costs can only be "passed on to the consumer" when the consumer will continue to consume the product at the higher price. Generally speaking most businesses already sell their products for the highest price the market will bear. Thus, in those cases rising labor costs will come from profits rather than being passed on. The cool thing is that higher wages lead to more spending, more demand and ultimately high prices for goods and more profits. That requires taking a long term, big picture look at the economy. Most people in business are only focused on profits next quarter for their own company, not the big picture. So we see companies moving jobs to Mexico in order to immediately see dramatic cuts in labor costs, only to see in the long run higher unemployment and stagnant wages at home means there are fewer consumers who can afford to buy new cars and refrigerators coming back from Mexico.
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  -Is Raising the Minimum Wage a Tax on the Middle Class? alcibiades_mystery  Mar-06-10 09:22 AM   #0 
  - At The Very Least, An Increased Minimum Wage Goes Back To The Lower and Middle Classes  MannyGoldstein   Mar-06-10 09:27 AM   #1 
  - Jeez.  alcibiades_mystery   Mar-06-10 09:42 AM   #2 
     - As To 1: $25 Trillion To Back Bankers So Far  MannyGoldstein   Mar-06-10 11:45 AM   #12 
        - Your answer to #1  alcibiades_mystery   Mar-06-10 12:51 PM   #16 
           - booga booga booga!  hfojvt   Mar-06-10 01:48 PM   #21 
  - The elite have too much power  athenasatanjesus   Mar-06-10 09:50 AM   #3 
  - OMG... you don't think they'd raise it to $8 do you?!?  ChicagoSuz219   Mar-06-10 09:58 AM   #4 
  - If the Korpos are against it, I'm for it n/t  LiberalEsto   Mar-06-10 09:59 AM   #5 
  - CEO bonuses, stock dividends are a tax  safeinOhio   Mar-06-10 10:08 AM   #6 
  - They probably used that excuse to justify slavery.  OnionPatch   Mar-06-10 10:13 AM   #7 
  - The evidence seems to suggest otherwise.  Selatius   Mar-06-10 10:14 AM   #8 
  - +1  blindpig   Mar-06-10 10:56 AM   #9 
  - Why not raise it to $50 an hour then?  metalbot   Mar-06-10 11:16 AM   #10 
  - IIRC, Minimum Wage In Germany Is $20 An Hour Or So  MannyGoldstein   Mar-06-10 11:47 AM   #13 
  - Actually it's around $10.20  Mudoria   Mar-06-10 12:58 PM   #18 
     - I looked it up, and it's actually fairly complicated  MannyGoldstein   Mar-06-10 01:40 PM   #19 
  - minimum wage causes inflation because the corporations choose to inflate prices to compensate nt  athenasatanjesus   Mar-06-10 12:30 PM   #14 
     - Only in an environment of poor competition or even no competition.  Selatius   Mar-06-10 12:53 PM   #17 
     - I don't think your argument here is sound.  Lyric   Mar-06-10 01:59 PM   #22 
     - Except that there is no real world data that demonstrates this 'fact'.  Warren Stupidity   Mar-06-10 02:00 PM   #23 
  - Yes, this is obviously true  alcibiades_mystery   Mar-06-10 12:46 PM   #15 
  - There is no blanket answer.  DefenseLawyer   Mar-06-10 11:34 AM   #11 
  - Not just no, but hell no!  WonderGrunion   Mar-06-10 01:47 PM   #20 

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