To the non-thinkers out there, raising the minimum wage would make a lot of sense. But that’s because they’re not “thinking” about the problem. They’re not taking into consideration the cost of doing business.
Why minimum wage is a waste of time
What is an employee to a employer? An asset, right? Also, an expense, isn’t that true? Employees cost the employers money. It doesn’t matter if the work makes the business money. Employee wages cost the business money. Sure, businesses make money off of certain employees, but not all employees, and there’s still a cost associated with an employee.
What happens when you raise the cost of a business to do business? It hurts the business, doesn’t it? Then what do businesses do? They raise their rates for their services or products.
Essentially that’s what will happen when minimum wages are increases. The cost of business will rise, and so will prices. You’ll never be able to force the wages to match the cost of living. Socialism has tried to re-distribute money, and has failed every time. Meanwhile, capitalism raises the ceiling, and lifts up the poor. What, you don’t feel good knowing that your homeless have $600 cell phones?
But why can’t minimum wage compete with cost of living increases?
There are so many factors that go into why a business would raise its rates. Insurance, rent, taxes, raw material costs, employee compensation, etc. All those and more raise the price of the product or service that a business profits on. If there’s a drought, or a war, then prices for raw materials will shoot up 50% or more; some years, probably just 5%. How are you going to match employee wages with that? Simple answer: you can’t.
You can complain all you want about minimum wage. You have some sort of free speech, at least, in America. But why waste the time? Why not focus on things you can do to help? Minimum wage is not the same as a living wage, it’s the lowest wage “anyone” can be paid.