Posts Tagged ‘economy’

No minimum wage, just higher wages.


Raising the minimum wage will not alleviate the misery that so many are experiencing.  What is needed is to change the payroll tax laws to persuade employers to pay higher wages. By putting a high tax on low wages, we might be able to get employers to pay decent wages. For instance, if you pay your employees 8.00 dollars an hour, you pay a 40 percent tax on payroll. If you pay them 12.00 dollars an hour, you pay 12 percent tax.  At 20.00 dollars per hour, there is no tax.  Viewing labor as an expendable resource is pure capitalism, which is destroying itself right now.  We are a community, which survives because everyone puts in what they can.

Some workers are not worth high wages; trainees receiving minimum wage is an acceptable practice.  But that wage should be used rarely, with average wages above that by a considerable margin.  We do not want to raise the minimum wage, we want to raise the average wage.  Average wages must be nearly twice minimum wage if there is to be a large consumer class.   Minimum wage has been raised again and again, and it never changes the poverty levels, because it makes it so that you can be broke with more money than ever before.

In order to consume, people need money, more money than basic survival requires.  When people can afford such things as spa treatments, premium beverages, luxury cars, gardeners, housekeepers, the economy will be roaring.  When people spend money on those kinds of things, the money goes through the economy over and over.  Minimum wages take money out of the system, and puts it in the hands of the one percent.  Raising average wages would increase economic activity, generating more wealth.  Don’t raise the minimum wage, raise the average wage.


Building a better beast


The United States economy is a sick puppy right now, reeling after over 1 trillion dollars evaporated.  The driving force of the economy in the past, consumer spending, has fallen drastically, as the middle class has been forced to live within its means.  Credit is almost impossible to get, and has become more expensive.  The declining value of homes has made the home equity loan a thing of the past.  Unemployment is scaring people into paying off credit cards, and building up savings.  Federal stimulus money has kept states from laying large numbers of employees, but the money is running out.

Maybe we ought to think about spending some of our money making the country more efficient.  This would reduce our dependence on foreign energy sources, as well as cutting the emissions of greenhouse gases.  Money would be freed up from energy costs, which could be used to increase spending.  Consider:  Many commercial buildings have no insulation.  That is right.  None.  The average home more than 20 years old is seriously lacking in insulation, and often leaks air copiously.

Putting people to work right now is difficult, because plans have to be drawn up and approved, bids taken, and contracts let.  But retrofitting homes and businesses could commence within weeks, if done properly.  Although President Obama talked about a program such as this a few months ago, little has been said regarding it recently.  Could it be that energy companies don’t want to see consumption reduced?  Could it be that Congress doesn’t like giving money to the average American, although they have provided plenty to the big banks and two of the car companies?

Perhaps we could couple improved efficiency with greater reliance on solar and wind power.  Low interest loans for solar panels and wind farms would probably increase the numbers in use considerably.  We are falling behind the rest of the world in the use of renewable energy, especially in the field of solar.  Building and installing solar panels would employ many people if we were to make a national push to utilize them.

Buses are a good way to save energy, and many parts of America have very few.  Building buses financed by federal loans to local transit operators would create employment in the parts of the country which have been hit so hard by the fall in auto sales.  People who ride buses save money which they can use to take their cars out for recreation, whereas people who drive to work often cannot afford Sunday drives.

There are ways to put people to work, right now, doing things that we would benefit from for years and years.  Some seem socialistic, but saving our society seems a worthy enterprise to me.  If we are going to keep borrowing money from China, at least we ought to do something worthwhile with it.