Re: [DMCForum] Re: The Constitution Is an Illusion Part II

[Bob Brandys <BobB@xxxxxxxxxxxxxx>]

Ryan,

Your minimum wage arguments are the typical disinformation you hear from 
right wing media.

You need to do some real research.   Here are the facts.

Since WWII, when the congressional budget office and the Federal Reserve 
have been studying the effect of increases in the minimum wage, here is 
what ALL of their studies have shown.  


1. People at the low end of the economic scale spend 100% of any 
increase in wages.  This money has a 6 times multiplier. (See 
Macroeconomics texts)  What this means is that they buy consumer goods, 
which generates sales jobs, which generates manufacturing jobs, which 
generates advertising jobs, which generates raw material supplying jobs, 
which generate distribution and supply jobs.

2. Moneys given to high income people are not spent.  They are saved to 
increase net assets or to accumulated  more assests.  AKA buy rental  
properties, stocks, etc.
This money is not reinvested in the economy and has no multiplier.  SOme 
economist actually say it has a negative multiplier.   NOT THEY DO NOT 
INVEST IT IN NEW JOBS.  THAT's NOT MY OPINION  IT IS THE ECONOMIC FACT 
OF THE CBO and the FRB. !


3.  Ever heard of the Earned Income Credit?   What this is tax money 
given to people whose wages as so low they are below the poverty level 
 AKA a family of four -wife and 2 kids.    Well, if the minimum wage was 
raised, the need for the EIC would disappear.  

This would save money because you would not have the government 
bureaucracy set up to distribute and monitor this system. It also means 
an overall lower tax cost. BUT PEOPLE END up with just as much money.   
But the economy does better because these people spent their money.


4. As for the cost of running a McDs.  You need to do a little research 
in this area too.   The main cost of running a McD (I just did some 
consulting for them earlier this year)
is the capital expenses of the equipment, building and energy.  Very 
energy intensive processes.  Labor is less than 25% of the cost.  For 
large volume restaurants it is less than 10%.  PS  I am also a McD 
stockholder.



NOT RIGHT, NOT LEFT   JUST THE FACTS.


BOB

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