The destruction of the country is officially under way and, of course, the Democrats are in the lead and overjoyed. It all seems innocent enough, a hike in the federal minimum wage, but it serves to prove the colossal lack of understanding of how a complex economy functions. Since all of these Democrat "hero's" have more money than they know what to do with it affects them not. No matter how screwed up things get for us, they will blissfully sail on completely unaware of all the havoc in their wake.
Okay..... So what's the big mistake with raising the minimum wage. After all... We all need a "living wage" right? Wrong! The minimum wage is expressly designed to give the entry level worker a base platform from which to progress. As skills, education and length of employment increase so does the wage the employee earns. For the most part it is intended for first time job holders which, typically, are still in school and still living with mom and dad. To assume that everyone working for the minimum wage is supporting a family, paying rent, buying groceries and all that stuff is far from the mark. Granted there are some in that category as there always will be, however, most of those are here in violation of federal law.
What we have now is a government mandated (thank you Democrats) unbalancing of the economic scales. Economies tend to come into natural balance when left alone to work as intended. Ours was in balance and working fine. But now we have this unnecessary tipping of the scales. On the surface it sounds just fine but ponds are deeper than the surface. Who has to PAY this higher minimum wage? It's damn sure NOT the people who say it has to be paid! Nope it's the average small business owner. (Large corporations rarely have anyone working at the minimum wage) So the first effect is to increase the operating costs the small business owner must bear to stay in business. Secondly that business owner also has to pay greater taxes on this higher salary so it's also a stealth tax hike. More money off the bottom line means less tangible income so the cost of goods and services must increase for him to break even. It's either that or cut staff. But let's just assume that he passes along the higher mandated wage in the form of a price increase. That takes more money out of the pockets of the typical consumer and means, once again, higher taxes. (We DO pay taxes on the things we buy, remember?) The other thing it does is give "BIG LABOR" (the unions) a higher base wage upon which to argue for their members. Thus the union wage goes up and that pass through effect kicks in again to elevate the cost of all union produced goods and services. (Oh... and more taxes paid too) So now let's see what has happened.
Tammy was making minimum wage working for Ed and saving money to buy her first car while living at home with mom and dad. The loving Democrats raise the minimum wage and Tammy is pleased to see this! When she gets her first new check she also sees that more money has been withheld for taxes so the increase isn't quite as much as she thought it would be. Blow number one. Still she continues to save for that new car she dreams about nightly. A year later she thinks she has enough for a down payment and will be making enough for the monthly payments so she and her parents head for the dealership. Tammy has been wanting a sane little economy car and had priced it out last year but is now shocked to see that the car now costs $2500 more than it did a year ago! What she thought was enough for the down payment isn't and they leave dejected. Blow number two. Perhaps the Democrats will be kind and raise the minimum wage again! Only this time perhaps Ed runs the numbers and decides he can't stay in business with all the increased costs so he sells out and retires, leaving Tammy unemployed. See how much the Democrats have helped her? Isn't it great?
The economy does not operate in a vacuum. Tweak something somewhere and it affects the entire system. One can mandate a higher wage but someone has to pay that wage and it's not the law makers. One can freeze a price on a finished good but that doesn't freeze the costs of materials or production. All these things tend to float along until they reach a balance that best serves the most people. Notice I did not say ALL people because that is impossible. It is up to the individual to increase their education and elevate their worth to an employer in order to progress up the wage scale. THAT is the natural order of things, NOT government mandated increases. All this amounts to is pandering to a minority whom the democrats hope to sway into voting for them. It's shrouded in the usual smoke and mirrors and supported by the compliant and bias liberal media. No one is being told the true economic impact of this increase and they never will be. To do that would be to educate and open the eyes of the population and that would make this sort of grandstanding impossible in the future. The Democrats fear an informed and educated electorate. That's why they control public "education".
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