LL> Hello Bob,   
      
    MM>>> I know the minimum wage makes it harder for small business   
    MM>>> owners to hire employees, but there should be some ways to   
      
   BK>>Which is a short run problem, in the long run it helps employers   
   BK>>by increasing the market.   
      
    LL> How does increasing labor costs help employers?  How does   
    LL> increasing labor costs help companies sell their products?   
    LL> What market is there, if the cost of products are too high   
    LL> for consumers?   
      
    Do you really think increasing the minimum wage will make that   
    much difference? If the cost of labor is 1/4 the cost of the   
    product, a 20% increase in the minimum wage is a 5% in the cost   
    of the product.   
      
    It has long been known that the workers have to be able to   
    afford to purchase what they make for a general public product   
    to be viable.   
      
    LL> The US auto industry found, the hard way, what happens when   
    LL> the price of cars and trucks are beyond what consumers are   
    LL> willing to pay.  As a result, imports won the day.  And our   
    LL> auto industry almost became a part of our history.   
      
    Yet it was the auto industry that originally learned the lesson   
    that higher paid workers became customers rather than serfs.   
      
    LL> Consumers look for the best deal.  The federally mandated   
    LL> minimum wage is the same for everybody, in every state.  As   
    LL> a result, it is a neutral.  No increase in cost relative to   
    LL> other states.  However, that does not mean a state has to   
    LL> keep its own minimum wage the same as the federally   
    LL> mandated minimum wage.   
      
    Which is irrelevant to the discussion.   
      
    LL> According to your definition, the states that win are those   
    LL> states having wages above the federally mandated minimum   
    LL> wage.   
      
    Nope. That gets into the same problem as opening our market to   
    third world manufacturers. When you have that differencial you   
    have a problem. A national minimum wage is the same for all, and   
    that expands the market.   
      
    LL> The reality, of course, if something entirely   
    LL> different.  All one has to do is to look at the red states.   
    LL>  Right to work states.  Where taxes are low. States such as   
    LL>  Louisiana.  The unemployment rate in Louisiana is 3.4%.   
    LL>  What is it in Ohio?  Too embarrassed to tell?  I   
    LL>  understand ...   
      
    You are confusing taxes and wages.   
      
    Pay scales in Louisiana are much lower, poverty is much higher,   
    life expectancy is lower, unmarried pregnancy is higher. All and   
    all they are much more miserable places.   
      
    LL> Even so, a minimum wage is not the same thing as a living   
    LL> wage. The federally mandated minimum wage does is a   
    LL> protection against sweat shops, and makes it more difficult   
    LL> for illegal immigrants to find employment.  If the   
    LL> federally mandated minimum wage is set too low, as it is   
    LL> today, takes us back in time before FDR became president.   
      
    Yep.   
      
    LL> President Obama's proposal to increase the federally   
    LL> mandated minimum wage to $9 per hour is much too low.  A   
    LL> minimum standard in today's economy would be $12 per hour   
    LL> if health care benefits are included, $15 per hour if no   
    LL> benefits are included.   
      
    Health care must be worked out independently of that. $15/hr   
    won't allow them to pay for health care.   
      
    LL> And part time employment should be   
    LL> set at no less than $25 per hour. Bobby Jindal will not let   
    LL> that calamity happen.  Not in Louisiana. Better to do away   
    LL> with the state income tax, along with the corporate tax,   
    LL> and plug the revenue hole by doubling the state sales tax.   
    LL> Or tripling it.  Whatever works.  And do away with medicaid   
    LL> plus ...   
      
    All very bad ideas.   
      
   BK>>A recession is not a failure of production or work, but a failure   
   BK>>of currency availability. With no money people cannot be customers,   
   BK>>so business cannot sell. Increase the amount of money in the hands   
   BK>>of customers and business sells better.   
      
    ...   
      
    LL> I have said many times, in this very echo, that those who   
    LL> benefit the most from the system should pay more.  But if   
      
    True.   
      
    ...   
      
    LL> Europe has solved that problem by having high transportation   
    LL> costs coupled with high wages.  Whenever a country goes   
    LL> bankrupt the other countries bail it out.  Just look at   
    LL> Greece.  And Spain. And other European countries having   
    LL> spending problems.  We need to do the same.  Cut spending   
    LL> without ever raising taxes.  That'll solve all of our   
    LL> problems.  Eventually we will declare bankruptcy and Mexico   
    LL> will bail us out.  See how that works?  You can thank me   
    LL> later, as I accept the Nobel Prize for Economics.   
      
    Which won't happen since they don't give Nobel Prizes   
    posthumously.   
      
    ...   
      
      
      
   BOB KLAHN bob.klahn@sev.org   http://home.toltbbs.com/bobklahn   
      
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