Sunday, February 23, 2014

The Temporary $10.10 Job Loss*

This past week the official government word on increasing the minimum wage was released.  Although raising it to $10.10 would bring 900,000 people out of poverty, it could cost Americans 500,000 jobs.

Right?  Certainly business owners want us to believe that.  More certainly, conservatives who favor business concerns want us to be afraid of it.  And it could be that this would happen for a brief period of time.  But how could it possibly be more than a temporary glitch?

Congress and federal financial experts understood some years ago that feeding more money into the country could increase jobs and improve the economy.  They did, after all, approve two stimulus packages.  The first was for taxpayers and seniors.  The second was a taxpayer refund.

I used my senior stimulus money for such non-essential items as a 12-pack of wash cloths, a pair of jeans and print cartridges.  Did I fail to mention food, that wasteful usage?

But, Congress was a little disappointed in the results.  People so long without sufficient funds tended to hang onto the tiny glimmer of hope.  Their experience dictated that a rainy day was a surety, not a possibility for them.  How much more effective a permanent increase in wages would be for 900,000 people and their families.  How much more it would mean in the long run for the business owners themselves.

Sure, the increase should first be used to decrease debt.  Certainly most people with their heads on straight will do just that.  But as people begin to see the light at the end of the tunnel, they will start to eat out more.  They will upgrade from used VCRs and used videos to blue ray DVD players.  They will exchange their old televisions with conversion boxes for high definition flat screens, or maybe even 3D versions.  Their Tracfone prepays might even be abandoned for I Phones.  People who work at McDonalds might be able to afford to feed their families there -- or maybe even at Red Lobster.

These burgers won't cook themselves, folks.  Employees who were let go will have to be called back.  They might actually find better jobs during the layoff.  (Perhaps you employers might want to avoid the knee jerk dismissals so you don't lose your employee pool to other companies.  You are going to need them in a heartbeat).

As has been stated in this blog before, American business owners shot themselves in the foot when they outsourced their jobs and failed to increase wages at home in step with inflation.  That may have temporarily increased business abroad but they lost business at home.  In fact, the low wages have forced people to buy cheaper goods made in China, Sri Lanka and the like, thus harming Made in America companies.

Get with the program folks.  Getting America out of the downward slide toward becoming a third world economy would be good for all of the U. S. A.  Remember you can increase your income in more ways than one.  You can do it by over charging and under paying, or you can do it by volume sales, that almost forgotten concept that underscored the Industrial Revolution.  Why not try the latter approach for a while.  Think how much $15.00 per hour  -- what the minimum would be if it had kept up with inflation -- would  line everyone's pockets.

*Thank you for your patience during the hiatus.  I also want to thank the citizens of Russia, Chechnya and the Ukraine for their recent high volume attention to this blog.