But higher wages means more spending, typically discretionary (our economy depends on a lot of this type spending, agreed?).
Agreed to a point - I think we disagree on the matter of degree.
When you're talking wages this low, however, we're not talking a lot more spending, and the spending is offset by the other distortions it causes. If you're giving everyone an extra 50 cents an hour, the ripple is going to have an impact close to, if not exceeding, that amount depending on a number of factors.
Kind of like squeezing a balloon or fighting drug wars, Jeff. Mash down one place and another pops up on the other side.
Right. The fight to find an artificial basement for wages is a losing proposition - it's not helpful to those who might actually need it, it's not helpful to those who don't need it, it doesn't do a good enough job working itself out for cost of living differentials from area to area.
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Date: 18/3/12 16:01 (UTC)Agreed to a point - I think we disagree on the matter of degree.
When you're talking wages this low, however, we're not talking a lot more spending, and the spending is offset by the other distortions it causes. If you're giving everyone an extra 50 cents an hour, the ripple is going to have an impact close to, if not exceeding, that amount depending on a number of factors.
Kind of like squeezing a balloon or fighting drug wars, Jeff. Mash down one place and another pops up on the other side.
Right. The fight to find an artificial basement for wages is a losing proposition - it's not helpful to those who might actually need it, it's not helpful to those who don't need it, it doesn't do a good enough job working itself out for cost of living differentials from area to area.