Company Raises It's Minimum Wage to $70,000 and All Hell Breaks Loose

Mist · Aug 18, 2015

Cad_sl said:
I don't think the poor (and by poor, lets define them as the bottom 50% of earners) have enough resources to drive the economy either way. I think the top 20% earn and spend the vast majority of funds in our "consumerist" economy.

That's because the ones who do work, don't get paid enough to drive the economy, and the ones who don't work are either old, sick, or don't have a proper pathway to work, or there just aren't jobs because our economy gets increasingly efficient and needs less and less workers to sustain more and more people. We could turn our welfare system into a proper pathway to work, but it would actually cost more money to do that, and no one wants to spend that. And so we get stuck in these low growth cycles where people try to use all sorts of convoluted partisan logic as to whythe jerb craetersshouldn't have to pay people a decent wage.

Cad · Aug 18, 2015

Mist_sl said:
That's because the ones who do work, don't get paid enough to drive the economy, and the ones who don't work are either old, sick, or don't have a proper pathway to work, or there just aren't jobs because our economy gets increasingly efficient and needs less and less workers to sustain more and more people. We could turn our welfare system into a proper pathway to work, but it would actually cost more money to do that, and no one wants to spend that. And so we get stuck in these low growth cycles where people try to use all sorts of convoluted partisan logic as to whythe jerb craetersshouldn't have to pay people a decent wage.

So sell me on it Mist, how is it going to benefit me to pay any particular group more? How is this not just class warfare by another name?

Mist · Aug 18, 2015

Cad_sl said:
So sell me on it Mist, how is it going to benefit me to pay any particular group more? How is this not just class warfare by another name?

How many people do you personally employ at or near the minimum wage? How many minimum wage employing establishments do you spend significant shares of your income at? Would raising the minimum wage actually cost you anything substantially? I mean, technically it should lower your taxes, because less working poor would need government assistance, but the government would just find something else stupid to spend that money on.

On the flip side, you're probably not going to directly benefit either, as your services aren't being sold to people who would be in the new, growing lower middle class. But that new lower middle class is going to need goods and services from more businesses that might need your services. But yes, you've illustrated the point that the high-upper-middle professional class isso distantly removedfrom this tier of worker we're talking about that it's hard to establish a direct benefit. But it's also hard to establish a direct cost. And so you've actually demonstrated the problem even better, our economy is so stratified and top-heavy now that most of it revolves around servicing the rich and large corporate entities, but there just isn't enough demand generated by that group, even though they have all the money, and the economy can't grow.

The Ancient_sl · Aug 18, 2015

Cad_sl said:
I think something a lot of you guys confuse is the problems of the .01% super rich and the problems of the top 5-10% who are your basic successful engineers, managers at companies, etc. People making $200k a year seem "rich" because they can afford more than average, but they are still just income earning consumers.

I don't really consider people "super rich" until they stop thinking in terms of income and start thinking in terms of capital and holdings and liquidity and cash flow. That changeover does NOT happen in the top 1%, more like in the top .01%.

The top 20% of earners in this country are the "class" of basic white collar workers who have a household income of 98k+. That is not any kind of exclusive super-rich class.

And I don't think anyone is attacking anyone who makes 98k-300k. We are saying it'd be nice if more people were there.

Cad · Aug 18, 2015

Mist_sl said:
How many people do you personally employ at or near the minimum wage?

None

Mist_sl said:
How many minimum wage employing establishments do you spend significant shares of your income at? Would raising the minimum wage actually cost you anything substantially?

Significant shares of income? None. It wouldn't affect me at all really.

Mist_sl said:
I mean, technically it should lower your taxes, because less working poor would need government assistance, but the government would just find something else stupid to spend that money on.

Haha, agreed.

Mist_sl said:
On the flip side, you're probably not going to directly benefit either, as your services aren't being sold to people who would be in the new, growing lower middle class.

The companies who are our clients definitely do employ minimum wage workers in some capacity? If those businesses are hurt, that would directly hurt my business.

Mist_sl said:
But that new lower middle class is going to need goods and services from more businesses that might need your services.

Hard to say, I don't represent any liquor stores or check cashing places or mental health facilities that I know of.

Mist_sl said:
But yes, you've illustrated the point that the high-upper-middle professional class isso distantly removedfrom this tier of worker we're talking about that it's hard to establish a direct benefit. But it's also hard to establish a direct cost. And so you've actually demonstrated the problem even better, our economy is so stratified and top-heavy now that most of it revolves around servicing the rich and large corporate entities, but there just isn't enough demand generated by that group, even though they have all the money, and the economy can't grow.

I guess I'd disagree with the assertion that "the economy can't grow" ?

Khane · Aug 18, 2015

Cad_sl said:
I guess I'd disagree with the assertion that "the economy can't grow" ?

The economy hasn't been growing since the 2008 downturn, it's been doing what Mist suggests. Becoming top heavy. Only the wealthy are earning money and living better right now. The working class is worse off every year because wages have stagnated while inflation keeps moving along.

http://www.nber.org/digest/dec08/w13982.html

U.S._Income_Share_of_Top_1%25_of_Households_CBO_%26_P-S_1979-2011.png

You'll notice that every time the income gap spikes, we are met with a pretty noticeable economic downturn. Both the tech bubble and housing market bubbles line up perfectly with that chart.

There is a really good documentary featuring a very prominent and well respected eocnomist (Robert Reich) called "Inequality for All" that is worth the watch on Netflix that can explain it far better than I can.

Cad · Aug 18, 2015

Khane_sl said:
The economy hasn't been growing since the 2008 downturn, it's been doing what Mist suggests. Becoming top heavy. Only the wealthy are earning money and living better right now. The working class is worse off every year because wages have stagnated while inflation keeps moving along.

Well thats a different statement than the economy isn't growing. All classes aren't getting an equal share of the economy growth? Agreed. The economy isn't growing? False.

Khane · Aug 18, 2015

Cad_sl said:
Well thats a different statement than the economy isn't growing. All classes aren't getting an equal share of the economy growth? Agreed. The economy isn't growing? False.

Well I can see your point but I would argue that the economy is not growing, wealth is growing for a certain class of people who aren't pumping much of it back into the economy while the lower classes earn less and less each year due to stagnant wages and diminishing buying power. The market doing well is like a false positive in these scenarios. People who can afford to invest do very well for themselves, people who can't don't see any piece of the pie, and then the market crashes and the less savvy investors lose everything they kept dumping into it because they were bullish throughout its entirety (if they pull out instead of riding it out, which many people tend to do).

But I suppose that's really semantics and what I said could be summed up as "the economy is growing"

Cad · Aug 18, 2015

Khane_sl said:
Well I can see your point but I would argue that the economy is not growing, wealth is growing for a certain class of people who aren't pumping much of it back into the economy while the lower classes earn less and less each year due to stagnant wages and diminishing buying power. The market doing well is like a false positive in these scenarios. People who can afford to invest do very well for themselves, people who can't don't see any piece of the pie, and then the market crashes and the less savvy investors lose everything they kept dumping into it because they were bullish throughout its entirety (if they pull out instead of riding it out, which many people tend to do).

But I suppose that's really semantics and what I said could be summed up as "the economy is growing"

In that way I guess I'm a horrible consumer, I only spend about $100k a year and save/invest the rest. If you redistribute my income to 6-7 low income families, they will spend it all, I guess in your mind thats "pumping it back into the economy" ? Is that better?

The Ancient_sl · Aug 18, 2015

Yeah, but only if you give them every single dollar that you earn. Socialism!

Sterling · Aug 18, 2015

Cad_sl said:
In that way I guess I'm a horrible consumer, I only spend about $100k a year and save/invest the rest. If you redistribute my income to 6-7 low income families, they will spend it all, I guess in your mind thats "pumping it back into the economy" ? Is that better?

It's certainly better for those 6-7 families and the extra money they're spending is better for people in the businesses that get that extra money.

Cad · Aug 18, 2015

The Ancient_sl said:
Yeah, but only if you give them every single dollar that you earn. Socialism!

How much do you want, I already paid close to 35% in federal income tax, counting sales and property taxes my tax burden is over 40%. How much do you want?

Cad · Aug 18, 2015

Sterling_sl said:
It's certainly better for those 6-7 families and the extra money they're spending is better for people in the businesses that get that extra money.

Well, no fucking shit, thats no kind of answer. The question is whether or not that type of consumerism is better for the economy as a whole. Obviously giving money to people is better for the people the money is given to.

Khane · Aug 18, 2015

Cad_sl said:
How much do you want, I already paid close to 35% in federal income tax, counting sales and property taxes my tax burden is over 40%. How much do you want?

So I understand not wanting to pay a bunch of money in taxes, it doesn't seem fair to have to give up money you've earned to subsidize the less fortunate. But before Nixon started cutting taxes for the wealthy and the trend continued to the point it's at now people in your income bracket were getting taxed upwards of 70% and the middle class was the biggest and most thriving its ever been in this country. The economy was arguably the healthiest its ever been as well. 70% sounds a lot worse than it actually is in reality because of the marginal tax system we use in the U.S. since you've admitted yourself you don't spend the extra money. The theory is your investments will be more secure and you'll come out even, or possibly ahead in the end because the economy is thriving and stable.

Cad_sl said:
Well, no fucking shit, thats no kind of answer. The question is whether or not that type of consumerism is better for the economy as a whole. Obviously giving money to people is better for the people the money is given to.

Economic trends seem to point to a healthier overall economy when those 6-7 families have that money because you're saving it while they would be injecting it back into the economy.

Fifey · Aug 18, 2015

The Ancient_sl said:
And I don't think anyone is attacking anyone who makes 98k-300k. We are saying it'd be nice if more people were there.

I don't think anyone wants people to make less, it's just there will always be people at the bottom. I'd love for my business to pay me more but instead their is no incentive for them too since the tax rate is so low, we had a record year last year and got the smallest bonus ever, but surprisingly the boss bought a million dollar house and a new BMW.

Encourage companies to invest in their company over giving themselves massive bonuses and we likely won't have to artificially inflate the minimum wage.

Khane · Aug 18, 2015

fifey_sl said:
I don't think anyone wants people to make less, it's just there will always be people at the bottom. I'd love for my business to pay me more but instead their is no incentive for them too since the tax rate is so low, we had a record year last year and got the smallest bonus ever, but surprisingly the boss bought a million dollar house and a new BMW.

Encourage companies to invest in their company over giving themselves massive bonuses and we likely won't have to artificially inflate the minimum wage.

How exactly do you "encourage" a company to pay its employees more when they are having record years? You let collective bargaining do the talking or you "artificially inflate" the minimum wage if it's a company that employs large amounts of minimum wage workers. What exactly do you mean by artificially inflated minimum wage anyway? The current US minimum wage equates to ~15k/yr for a 40 hour work week with 2 weeks of vacation. You think that's livable and reasonable?

Cad · Aug 18, 2015

Khane_sl said:
So I understand not wanting to pay a bunch of money in taxes, it doesn't seem fair to have to give up money you've earned to subsidize the less fortunate. But before Nixon started cutting taxes for the wealthy and the trend continued to the point it's at now people in your income bracket were getting taxed upwards of 70% and the middle class was the biggest and most thriving its ever been in this country. The economy was arguably the healthiest its ever been as well.

Given that only the top .01% paid those effective rates and I'm not near that... your assumptions might need adjusting. But how does taxing the rich help the middle class, who get very little if anything from the govt anyway? The poor in the 50's were much worse off than they are now, no?

Cad · Aug 18, 2015

Khane_sl said:
The current US minimum wage equates to ~15k/yr for a 40 hour work week with 2 weeks of vacation. You think that's livable and reasonable?

No but you're talking about the lowest paid 2-3% of all workers. The most useless employees available.

The Ancient_sl · Aug 18, 2015

Cad_sl said:
How much do you want, I already paid close to 35% in federal income tax, counting sales and property taxes my tax burden is over 40%. How much do you want?

I don't have a number, but I do believe in a graduated tax system like the one we have. I certainly don't like that the effective rate for the extremely wealthy is lower than what you are I pay.

I don't think you want to bring up sales tax as a tax burden when we are discussing the income inequality in this country.

Fifey · Aug 18, 2015

Khane_sl said:
How exactly do you "encourage" a company to pay its employees more when they are having record years? You let collective bargaining do the talking or you "artificially inflate" the minimum wage if it's a company that employs large amounts of minimum wage workers. What exactly do you mean by artificially inflated minimum wage anyway? The current US minimum wage equates to ~15k/yr for a 40 hour work week with 2 weeks of vacation. You think that's livable and reasonable?

But before Nixon started cutting taxes for the wealthy and the trend continued to the point it's at now people in your income bracket were getting taxed upwards of 70% and the middle class was the biggest and most thriving its ever been in this country. The economy was arguably the healthiest its ever been as well.

That's how you incentive companies to invest back into the company over just pocketing everything.

Company Raises It's Minimum Wage to $70,000 and All Hell Breaks Loose

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