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And you are making the bad assumption that creating the living wage won't hurt the people that need it. If raises costs to business have no impact, then we should have no problems raising the living wage to a million dollars.
That is ridiculous. We aren't talking about increasing wages to increase costs and there is no reason that increasing wages slowly over time would have any harmful effects to employment. What we are talking about is increasing wages and cutting profits, that is all. Increasing the amount of income that goes to the 99% by decreasing the amount of income that goes as profits to the 1%.
Profits and wages are both costs of production. We simply want more money to go to wages and less to go to profits. All of the inflation that we have had since 2009 has been due to increased profits.
Strawman. He's not saying the purpose of raising wages is to increase costs, but rather that the effect of raising wages is to increase costs.
And you're not going to accomplish your objective in most markets. When you shift money away from profits the field looks less inviting--more players leave, fewer enter. Eventually profits come back to the normal level. (And the reverse also happens--when a field has too much profit you get new players driving down the price. You can only sustain excess profit if you have a monopoly.)
Or they just raise the price of the service / product in order to adjust to the increase in Labor costs. You keep talking as if this isn't an option. If all low wage corps have to do this, the increase will be across the board.
How do you think that prices are set? If the producers could raise their prices after the wage increases why didn't they raise them before to make more profits? Were they being magnanimous toward their customers?
I will ask you the same question I asked Loren. (no fair comparing answers.) In 1970 the profit level in the whole economy was 5% of GDP. The latest level is 11%. The share of GDP that goes to wages has dropped by 6%. It looks to me as if profits have more than doubled by reducing wages.
In 1980 we instituted economic policies to do that very thing, to increase profits by suppressing wages. It seems to me that those policies worked, they increased profits and decreased wages. This isn't a very big leap in reasoning, is it?
But all of a sudden the very same people who told us in 1980 that these economic policies would do this, increase profits and decrease wages, have seemingly forgotten it now and are off for any other possible reasons that profits have increased by reducing wages.
The profits have bounced around and now are higher than normal, but you can have a lot of contributing factors that explain it. The government has in recent decades put in a lot of supply-side deterrents that have slowed down growth and allowed profit margins to creep up, even though you want to blame tax rates.
But you can't explain the other contributing factors? But you know that the government has put a lot of supply side deterrents into the economy that explains part of the reasons that profits have gone up and wages have gone down. You do realize that this is a contradiction? The supply side is the side that rewards capital, these rewards are called "profits." Supply side deterrents would suppress profits.
Supply side economics, Reaganomics, neoliberal economics, trickle down economics, whatever you call it was more than just increasing the effective income of the very wealthy by decreasing their taxes. They also increased the taxes of everyone else. They also intentionally suppressed wages by suppressing labor unions, by keeping the real minimum wage low, by changing trade policies to expose the labor in the US to competition from low wage countries, etc.
The supply side economists said that doing these things would increase profits and decrease wages. More precisely, they said that doing these things would increase the percentage of the national product that goes to profits and decrease the part of the national product that goes to wages. In the language of economists these are refer to as the capital share and the labor share, respectively.
This is what they said that was needed to be done to generate more money for investment, that is for more profits. And these are all things that we did.
And these measures worked, profits went up and wages went down.
And they said that providing more money for investment would result in more growth in the economy, because the economy is lead by investment and profits. This is why they call it "supply side economics.
But growth didn't go up. In fact, it decreased from what it had been before.
These are demonstrable facts. That they were part of the theory of supply side economics. That they do increase profits and decrease wages. That they were instituted as economic policies of the US.
And you say that unnamed, supply side deterrents were enacted by the government that decreased growth and increased profits. And, presumably, decreased wages.
So the question in my mind is what do you think that all of the supply side economic policies that were instituted did? The ones that I listed above. Do you believe that they didn't work to increase profits and to decrease wages as the supply side economists said that they would do? Which ones failed?
