More money = more spending = better economy, no?
Every item they spend money on, assuming we do that bat guano insane $11, will cost an extra $3.75 per hour/per employee of production, then an extra $3.75 an hour for shipping, and an extra $3.75 for sales. Ever hour it is actively going from mined raw materials to you buying it is an extra $3.75. Lets assume 100 widgets are made an hour. That's $0.04 per item, rounded. Sounds minimal, but everything that is made at a minimum wage goes up that much. Add in that not only the minimum wage stuff goes up. The $9 an hour goes up too. And do you think the guy making $11 an hour now is suddenly happy being demoted to entry-level unskilled pay? No. You have to raise their pay. Then the guys making $12 complain. And it ripples all the way up the line, because where do you draw the line at the point where you tell the newly disgruntled employee too bad? So then nearly all wages rise and is noted in the price of everything. This is all overly simplified too. It would take pages to explain the exact cost effect.
And shouldn't we all want this universal pay raise to end poverty? Sure, except poverty is a relative term. It is impossible to eliminate the lower class, middle class, etc. Those are all terms based on what everyone else makes. Poverty will become over $11 an hour.
But there is one way to avoid the cost of living increase. Less workers. A 50% pay increase means 50% less people doing the same total amount of work to avoid needing to raise prices.
Just a couple of weeks back fast food employees went on strike, demanding $15/hr. I make that. I do budgets and program contracts for the Department for Public Health. If I make a mistake some sick, poor person won't get their medicine. Is the fry cook at McDonald's worth the pay I make? When I worked in minimum wage jobs I was in school and looking for the least responsibility possible. I could just turn my brain off. $7.25 an hour seems about right for brainless work.
And here is the real kicker: The ACA goes into effect next year. There are already employers reducing full-time employees to part-time to avoid the new expenses. If they have to do that now, what would they do if pay jumped $3.75 an hour?
