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From the CBO, we have it outlined like this… If we raise minimum wage to 10.10, we lose 500,000 jobs. If we raise it to $9.00 we lose 100,000 jobs…
Is it better to work and receive more money, or is it better to have more people working for less, but at least they are working….
Great question. There were 3.3 million people making minimum wage in 2013…. The wage will jump from $7.25 to $10.10 or jump from $7.25 to $9.00. The first is an increase of $2.85; the second is an increase of $1.75… The impact of that increase on 3.3 million people are as follows.
3.3 million X $2.85 = $9.405 million/hour increased purchasing power
3.3 million x $1.75 = $5.775 million/hour increased purchasing power
3.3 million X $0 (no change) = $0.00 No change; same as it every was.
But wait. Job losses are bound to occur. If we take the CBO’s estimate, we get the first minus 500,000; the second minus 100,000.
(3.3 million -500,000) X $2.85 = $ 7.98 million/hour economic benefit
(3.3 million -100,000) X $1.75 = $ 5.60 million/hour economic benefit
(3.3 million- 0) X $ 0 (no change) = $0.00 no change from the past
There you go… We get more economic push by going with the $10.10 number despite the possible loss of jobs. .We got an answer. Gee. What was so hard about that?
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Appendix:
Someone else brought up the idea that those people put out of work, have a negative influence upon the equation… To be honest prior to their mentioning it, at first, I really hadn’t thought about it. It never occurred to me, because mathematically they would be zeros. Interesting, huh? How the brain works? My focus was on how much positivity a minimum wage increase would generate… And because of my positivity I have trouble accepting that there is a negative influence for letting those people go. But just in case there is, let me put it down here as well since someone brought up the fact that those leaving the work force would be decreasing the total pool of potential earnings by their future estimated earnings with which had they been previously working. Which in this case, would be the minimum wage rate… applied at both the levels of 500,000 and 100,000….
((3.3 million -500,000) X $2.85) – (500,000 X $7.25) = $ 4.355 million/hour economic benefit
((3.3 million -100,000) X $1.75) – (100,000 X $7.25) = $ 4.875 million/hour economic benefit
(3.3 million- 0) X $ 0 (no change) = $0.00 no change from the past….
That changes the impact. There are several problems with this last model. One, is that its total, is a theoretical rate representing everyone working per hour. Those being laid off can’t really be a negative against this because everyone who is still working, IS making that much… This is the net increase amount which will be reported, earned, and taxed. Secondly, if you are out of work you are making zero dollars, and not an actual negative amount which challenges whether the principle is sound to deduct a cost away from the benefit when making this particular comparison. One could do so, if one was expostulating a potential benefit which would have to be benchmarked against full employment, and not against the incremental amounts. For example if we had access to the number of hours worked at minimum wage in this country over a set time period, we could actually make that comparison by plugging in these two rates..
As it stands we can already compare these totals to the status quo, and there is a definite positive bump in economic activity… Plus, if those temporarily laid-off people get other jobs, ones that actually pay more than minimum wage, then they are off the chart, and that negative is not there at all. The underlying assumption for there to be an existing negative, is that these people losing their jobs, immediately and forever stop contributing to the economy…
Therefore probably the best comparison to achieve that would be painted like this…
3.3 million X $2.85 = $9.405 million/hour increased purchasing power – (.5 million X 7.250 = $9.405 – $3.625 = $5.78)
3.3 million x $1.75 = $5.775 million/hour increased purchasing power – (.1 million X 7.250 = $5.775 – $0.725 = $5.05 )
3.3 million X $0 (no change) = $0.00 No change; same as it every was.
That probably is the best description since it contrasts against the potential possibility of earnings.
But as policy this shows Delaware’s Tom Carper to be very wrong when he was quoted as saying that the lower amount of increase would be best for this country…
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One Republican vote is standing in the way of 1.7 million Americans getting unemployment benefits. Reid is making an emotional appeal now…
One Republican vote is standing in the way…..
Yet 60 votes were needed. Proving once more we need a filibuster proof Senate where the majority does not get undercut by a minority….. Deadlock continues in the worst Congress ever… as usual.
Hung up at 58-39 the final vote was cast by,,,, Harry Reid, in the negative… making it 58-40…
A procedural vote to end the filibuster was undertaken immediately thereafter.
1. Increase Taxes on Top Echelon at a 60/40 split. They keep 60; they pay 40.
2. Allow capital improvement inside the geographical USA to be written off the year it is expensed.
3. Return Federal Jobs to levels before 2008.
4. Return State jobs to levels before 2008.
5. Return Local jobs to levels before 2008.
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The arguments have been long expounded as to how, as to why, and as to the details of when. I’ll save time by not repeating them. …
Every county in America would get a jump on their own unemployment immediately.
Here is a list of states and the breakdowns of how much of a hit to their economies this immediate cut will cause…
Delaware small as it is, stands to lose $875,852… between last Saturday and this past one. By next week, if benefits are not restored by Congress, it will be double that, or around $1.7 million dollars of economic activity that just disappears….
That fails to consider the multiplier effect. Because the unemployed reliably spend all the benefits they get, they create a “multiplier effect” in the economy. Mark Zandi, chief economist at Moody’s Analytics (MCO), estimates that every dollar of unemployment benefits generates about $1.55 in economic activity.
Applied to Delaware the loss of economic activity jumps to $1.35 million per week, or a total $2.7 million dollars lost by this upcoming weekend.. or the equivalent one summer week’s loss of 900 New 5 BR Bethany Beach House Rentals. with Huge Kitchen & Deck, Comm. Pool & Beaches each week!… or the geographic representation of the loss of every house in Bethany Beach, East of the Coastal Highway between the National Guard Base (north entrance to town) to the high rises of Sea Colony….
Don’t let anyone tell you unemployment benefits are insignificant…
kavips 