Skip to comments.Gingrich: Romney’s Minimum Wage Proposal Potentially A Catastrophe
Posted on 02/03/2012 9:33:35 AM PST by sheikdetailfeather
Newt says that with the way the Fed is printing money, Romneys proposal for an automatic minimum wage increase based on inflation could be potentially catastrophic. Newt remembers the Carter years and how inflation was rampant by 1980, setting the nation toward collapse. He says with the Fed printing so much money, inflation could potentially soar if the economy begins to recover which could send minimum wage soaring with it:
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He can win. People need to wake up and stop listening to the talking heads. Go Newt!
The idea that the minimum wage should be enough to live on is ridiculous.
For a guy who is supposed to be a great businessman, Romney’s knowledge of economics is horrendous. Even dangerous.
They are trying to make these main stream jobs rather than entry level jobs.. Try buying a house on MD’s wages!!!!
Newt gets it. What the hell is wrong with America? GO NEWT GO!
OMG this along with his statement on wanting to fix Obamacare is enough to force him out of the race.I do not want Mitt in the oval office.
I don't think he ever worked a day in his life using his hands except to write checks to himself.
The closest thing he had to having a job was when he was pedaling around France trying to sell his false gospel to French Catholics. From his own admission he never closed a single deal on that scam.
3 reasons I can think of for having a mimimum wage off hand. Benefits Unions , Benefits Ilegals, and perpetuates the false notion one cares about the poor.
It seems like our economy needs a reset button. I can’t think of a better reset button that the elimination of the minimum wage.
Consumers are clamoring for cheap products and services.
Companies can lower prices if they can lower labor costs.
Meanwhile, teenagers and college-age kids are on Mommy and Daddy’s sofa when they could be acquiring skills that will make their labor worth more. Companies are willing to provide this training in exchange for lowering their labor expense.
The minimum wage is a travesty.
The consumer is always forgotten when discussing this topic. In the end, consumers pay for this distortion of the market.
Someone let him know to use the media every day.
The minimum wage is NOT a cause of inflation at all. The minimum wage is an attempt to deal with the results of inflation and it does not work. Saying that the minimum wage causes inflation is like saying that rising rivers cause heavy rains.
Except that heavy rains are a natural cause of flooding. The minimum wage is more like huge firehoses or pipelines emptying vast amounts of water into the river, causing it to rise.
OK, technically, inflation is the debasement of the currency caused by government and the minumum wage causes rising prices. But the proposals for indexing the minimum wage are tied to rising prices, not, technically, inflation.
If you measure the price of labor in real terms rather than currency the effects are clear. When I was 16, an hours' labor at minimum wage could have bought me about 2 - 2.5 Big Macs. It is the same today - the net result is zero. In the mean time, the price increase has rippled through the entire economy.
The minimum wage also causes unemployment - or is that also caused by heavy rains?
Actually I consider it possible that the minimum wage may cause some unemployment in some areas but I don’t think it causes a lot as some seem to believe. I don’t think the minimum wage serves any purpose, if it did then it should be raised to some huge figure like a hundred dollars an hour so we could all drive new vehicles and live in big houses. I turned nineteen in 1963 when the minimum went to $1.25 an hour and that was well above the current minimum in real terms. In this area someone who made twice the minimum then could marry and support a family on one income and WITHOUT GOVERNMENT HELP. Try that now on double the current minimum. I am all for dropping the minimum altogether but I doubt that if it was done there would be a lot of people taking five or six dollar an hour jobs. I live in a relatively low wage area and not many seem to be working for the minimum now. Mostly they either earn more or just don’t work. I don’t know when you were 16 but when I was 16 the minimum was $1.00 and that definitely bought a lot more food than the current $7.35 does, it would buy on average four gallons of gasoline, the current minimum will get you just a little more than two gallons here and now.
There were plenty of jobs then and the actual value of the minimum wage was well above what it is now so I think we need to look to other factors to account for the bulk of the unemployment problem.
I agree with everything you said - except the above. The original purpose of the minimum wage was for unions to keep cheaper competition out of the workforce. In the early days, that meant blacks and immigrants. These days, the unions are in favor of illegal immigration (even though it undercuts their own members) because they believe the illegals will eventually become unionized and start paying dues.
The minimum wage causes unemployment (temporarily) because unskilled workers simply aren't worth that much until the economy catches up and other prices rise enough to absorb the increase (i.e. the cost of a Big Mac). But that's the whole point - by the time that happens, nobody's life has been improved. The net result is zero or, as you say, even worse. If the minimum wage was $100.00 per hour, a Big Mac would cost about $40.00.
BTW I turned 16 in 1968. My first job at a Burger Chef paid the minimum of $1.80 (I think).
By the way, see what Thomas Sowell has to say on this subject here: http://www.freerepublic.com/focus/f-news/2843083/posts
I have a brother your age. You turned 16 in 1968, I turned 24 in 1968. I was a young single man, driving a new car which was my second new car, I lived with my parents but I was helping them, not the other way around. I had had an honorable discharge from the Navy for three years already and I was enjoying my money. I made 500 a month! Things were so different then that people had decided that I would never marry! They thought anyone who was 22 or older should have a wife and at least one child already! Can you even imagine that now? By the way my new car had cost me about 3400 dollars, it was full size with a V-8 engine, automatic transmission, air conditioning and a radio, “loaded to the limit” for those days. You could only finance a new car for 36 months then.