Quote:
Originally Posted by Some Guy
Raising the minimum wage only leads to inflation. Pay somebody more and the shopkeeper will just raise his prices. It's simple economics.
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No. What is simple is:
1. Labor costs are not 100% of the cost of manufacturing products or running businesses. Thus, anyone who thinks there will be a dollar-for-dollar increase in goods after the minimum wage is raised probably listens to Limbaugh.
2. Businesses charge what the market will bear. (Why do I have to convince people of this?) Prices won't go higher than consumers are willing to pay. If businesses could raise prices AFTER a hike in the minimum wage, then why wouldn't they do it BEFORE one? Wouldn't they make more money? That's what businesses want to do, right?