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Politics : Formerly About Advanced Micro Devices
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To: SilentZ who wrote (206519)10/14/2004 3:09:34 PM
From: Tenchusatsu  Read Replies (1) of 1574054
 
Z, I just linked to an article where in 1994, economic experts thought 6% unemployment was the line below which inflation would become a factor:

Message 20641703

That theory, of course, was challenged by the article, but the article itself was written and revised during the "New Economy." And we all know the "New Economy" turned out to be nothing more than a classic bubble.

The point is that there is no agreement on where the line should be drawn. Besides, how do you sell the notion that unemployment has to be at a certain minimum level? Tell that to the poor blokes looking for work.

The $3 was hypothetical... would you say that many more people would be employed in the U.S. if the minimum wage were $3 than is the case now?

I thought about a more extreme hypothetical, like what would happen if you simply eliminated the minimum wage. The answer I came to was that employment would not increase all that much, given that very few people would be willing to work at, say, $3/hour. The labor market has already determined that for themselves. But raise the minimum wage, and you'll be creating upward pressures on that level set by the labor market. That in turn will create all of the negative effects I described earlier.

In other words, the free market is king.

Tenchusatsu

P.S. - And we haven't even discussed the impact of open borders and illegal immigration, which IMO is doing a lot to counteract the "benefits" of California's higher minimum wage set by former Gov. Gray Davis.
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