Minimum Wage Problems

Decent Essays

If a family in the US belongs the top 40th percentile of income distribution, it would have accumulated wealth over the last two decades; however, if it falls in the bottom 60th percentile of income, the family wealth declined (DeBold et al.)While income is a flow item and wealth is a stock item, the former is needed to survive, and the latter is needed to flourish. After all, earnings from wealth can offset income from employment. Nowadays, more people are struggling to make ends meet because of job loss and minimum wage, and our efforts to solve this issue have been futile. ‘“We’ve been fighting a war on poverty for 50 years and [we have] failed,"’ said Oregon’s District 54 Rep. Jason Conger (qtd. in Kullgren). The issues of minimum wage …show more content…

They argue that an increase in minimum wages result in increased labor costs for the businesses, which in turn reduces their profits, resulting in a lower overall employment. Conventional wisdom suggests that a wage increase by itself increases the labor costs for businesses, thereby decreasing the demand for labor. However, increased incomes for the lower and middle class workers translates into increased aggregate demand for goods and services in the economy, creating more demand for labor. One of the basic premises for Republican arguments is the “Trickle-Down Effect.” The theory purports that creating tax incentives that boost the incomes of rich will create greater demand for goods and services, which increases overall employment and uplifts the lower and middle class population. However, it is important to note that, at the margin, rich people do not spend their additional income but rather save or invest, inflating asset values. On the other hand, at the margin, lower and middle class people spend more of their additional income gained either by increased wages or reduced taxes, uplifting the economy. In fact, the current gas prices at the pump are very low, and we are experiencing a very strong economy and employment because it is helping the lower and middle class …show more content…

Her economic policies and proposals are especially geared towards increasing minimum wages, taxing speculative behavior, and supporting trade policies and programs that benefit domestic workers. Her policies will ensure that the recent economic growth enabled by the Obama’s Democratic policies are sustainable and create a competitive advantage for the United States. Her policy positions and experience makes her the best presidential candidate for the 2016 presidential

Get Access