by Gray Graham
Fight for $15 has taken much of the country by storm. People across the nation are fighting for a minimum wage of $15/hour. It has passed in states like New York and California and in cities across the nation. The question is will it actually help people?
The thing that most people that champion $15 hour are missing is that any change you make to an economy will affect the economy in seen and unforeseen ways. You can not change just one thing and then expect everything else to remain the same.
Most proponents of the $15 minimum wage believe that the minimum wage is a living wage but when you translate $15/hr into $31,200/yr you will be hard pressed to find anyone that believes this is enough to live.
The problem in America is that we have a minimum wage of $7.25 for hard working people while also having CEO’s that make 20 million a year running companies into the ground. This seems quite unfair to the average person and it probably is unfair if you look at it from a morality point of view, but are companies supposed to be moral or are they suppose to maximize profits?
The truth is that $15/hour is nowhere close to enough to live. Add to that they people that are trying to take care of a family by themselves and you will quickly see how it just is not going to help. I don't even think people understand that a living wage means enough to provide for your basic needs and nothing more.
And what happens to the people currently earning $15 or more? Are their wages suppose to increase too? Some say yes, others say no. What about the cost of living? $15 goes alot further in Texas than it does in New York or California.
I really don't believe people understand that the most companies are going to adjust their business models to reflect the increased labor costs. Many businesses have already done this which is why manufacturing left the United States decades ago. We live in a time where labor cost in China are too high for some companies.
It is not 1934 anymore. Companies today are international not national. They don't feel loyalty to their founder's nations anymore. They exist to maximize value for their shareholders. If that means that they will move their operations to a third world nation to pay someone $3/year then that is what they are going to do. The truth is that the people in that third world nation need them to come there to improve their lives and the only reason a company will go there is because of low wages.
If businesses nationwide are going to be forced to increase the minimum wage to $15/hour you can rest assured that they are going to recoup that money somewhere. It will come first from a reduced workforce and then increases in the cost of their products. Don't expect too many raises either.
Also with the increase of the minimum wage all of a sudden that 2 bedroom apartment that used to cost $800 a month now cost $1000. If people know you have more money then they are going to increase their prices to get a piece of it. Increase profits is at the heart of just about every business.
Fight for $15 is a catchy campaign slogan and rallying cry but it is an unrealistic proposition that any business person knows all too well. It is going to take a lot more than $15/hour to bring economic equality to the world. The truth is that in the long run it will probably hurt more people than it helps.