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Comment by mjevans | Hacker News Reader

It would be really nice if EVERYONE not in the 1% got a raise of some sort. An extra 1-2 an hour or whatever...

However then the prices of everything would go up for everyone, just like they are everywhere.

When the 'living wage' 15 USD/whatever minimums are passed don't the prices of everyday living just rise to meet that extra cash in the market?

Meanwhile everyone who was previously making a little above minimum wage, mostly the (lower/mid) middle class, get shafted, because they do not get raises.

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This argument comes up every time raising the minimum wage and its just bad math and bad economics.

Around 3% make the federal minimum wage raising the minimum wage to say 10 would barely move the needle as far as the available money supply. If most people have the same amount of money then rational actors aren't going to raise the prices much.

On the other hand a person going from 7 dollars an hour to 10 will have 43% more money in their pocket.

It ought to be intuitively obvious that the benefit to the poor is not related in a linear fashion to prices.

If you were to graph an expected increase in price based on minimum wage they would expected to become close to proportal when an increase in minimum wage was also the average wage.

One can also argue that rising minimum wages directly benefit the economy as this money will be immediatly consumed.

Giving $10 to a poor person will result in $10 more goods and services demand. Giving $10 to a very rich person will probably make 1/10th of a share change hands and have no effect on the real economy whatsoever.

This argument is a fallacy because it implies that money not spent is wasted somehow, but that is opposite of the truth, that savings underpin investment and thus growth.

Well I would argue that currently the economy is limited by consumption and not investment.

Google "asset price bubble" and compare this to the general inflation.

Considering that the largest economic problem of the last 20 years (well all human history really, but it's been a keystone of economic strife recently) is the dramatic difference in the wealth growth between the wealthy and the wage increases of the remaining population, that whole "trickle down economics" myth has been sorta shorted out.

"Growth" can represent too many things and is thus a great slippery beast that can be used to obscure helping the wider population. We continue to see economic "growth" but wage increases has been stagnant for decades. Owners need fewer workers to amass revenue due to changes in the type economy as well as automation. You can grow a business without benefiting as many people as you used to. Look at how many people Bell Labs had working for it when it was in it's heyday vs how many people work for Google now.

Might as well break some windows too to cause $100 of demand

Their must be a name for the rhetorical trick of conflating the transfer of wealth with the destruction of wealth.

Both have the potential to increase economic activity, it’s true, but that’s about all they share, from a moral perspective.

Which is why I'm in favour of a profit sharing scheme. You get rewarded the productivity of your work.

> Which is why I'm in favour of a profit sharing scheme.

But... but that's socialism! /s

Such corporation types exist - in Germany they're called "Genossenschaften". They're very limited in actual usage, though.

It would be really nice if EVERYONE not in the 1% got a raise of some sort.

It’s happened before. But that was when Bush was president, and on the internet we’re supposed to pretend that he didn’t do anything good.

https://en.m.wikipedia.org/wiki/Economic_Stimulus_Act_of_200...

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