Inflation is out of control. Is minimum wage to blame?

Question

The more you raise minimum wage, the more companies need to charge for goods and services.

The concept that every wage should be a living wage is wrong! Many people earn a smaller wage while going to school then, after graduating, are able to gain better employment with better skills.

Offer student loans and enforce the repayment after graduating.

LOWER THE MINIMUM WAGE, NOT RAISE IT. THEN ENFORCE THE REPAYMENT OF STUDENT LOANS. SIMPLE.

SugarSugarplum · Accepted Answer

You know how every time someone suggests a flat tax, the left calls it a "tax break for the rich"?

That's because the rich pay WAY MORE TAXES than we do, and making it FAIR would mean lowering the UNFAIR burden on the more wealthy. The more accurate way to say it would be that a flat tax is LESS UNFAIR to the high earners.

So, Congress knows they will never get re-elected if they suggest that the poor pay taxes fairly, but they just can't stop spending money for their political donors (the ones REALLY served by the government). So where's the money coming from?

Many sources, including robbing social security, but lately, they tend to favor printing lots of new money. This is what truly causes inflation. Think of it this way: If everyone got a million dollars right now, would we all be rich? Or would prices go up?

Imagine an island where everyone starts out with $10. You own a peanut farm, and you want to sell bags of peanuts. You're gonna price them at around $1.

But what if on that same island, everyone started with $1million. Would you go out and harvest, clean, and package your peanuts for $1? It wouldn't be worth it. That's how adding money to the money supply creates inflation.

Therefore, inflation is really that tax on the poor that politicians are too scared to vote for. If you're struggling, groceries going from $75 a cart to $250 a cart is devastating. If you're wealthy, it's barely inconvenient.

zariahdp · Accepted Answer

Going to college for a better job isn’t guaranteed!! Please stop that narrative!! I know people with Masters in Tech, Math, Science industry & they’re working at Starbucks and Target!!! Those degrees doesn’t mean as much as they use to unless your a freaking doctor! Even then you seen doctors, nurses struggling to make ends meet even with 2 incomes. You older people don’t get it. You won’t be able to live off your retirement for long. You’ll be going back to work like everyone else.

You can be single & not have kids and still struggle. People swear they know the answers with inflation and taxes and honey if you had the answers you’d be living lavish for sure.

You’re also forgetting people are burnt out! People get under paid with little to no benefits but expect to just stay at a job just because. Yes bills are important but I told myself I’m not climbing the career ladder because at my age of 25 none of this matters to me. I own my home thankfully passed down from family but as long as I’m living I’m happy.

I have no interest in going above and beyond for any job that ISN’T paying me my worth. I work to pay bills but also to live my life. None of this bullshit can come with you when you die so manage your day to day but LIVE YOUR LIFE and your life does not consist of paying bills and just working!

Lynx122 · Accepted Answer

Funny how I live in a country where the minimum you'll make is around 25 an hour and we our inflation has been less than 2 % for the last year. Inflation has a lot of causes and wages are not the main one. A big one is when the government keeps spending money they don't have and have to take out loans. And the end of the petro dollar and the American empire that's slowly crumbling is also not helping. The wage is just a story people like to sell.

People who own businesses, people who represent the rich. Then the tax payer has to pay for these workers who work full time or multiple jobs. They still can't survive on their salaries because of greedy scumbags who sell lies like this. So billion dollar companies who easily could pay good salaries, which would also boost the economy, are getting subsidised by the tax payer. And you think that's a great thing?

How are people going to pay back student loans when they're earning 5 dollars an hour at Mc Donalds because you lowered the minimum wage even more? All you're doing is creating a nation of debt slaves. This only benefits employers and not regular people. The workers have to take lower salaries than they're actually worth because they're desperate and have debt that grows every month. It's an endless cycle of poverty and misery and you think this is a positive direction for your country?

genericname85 · Accepted Answer

I think minimum wages take a huge part in inflation. Because if you think logically. You got a company and you're producing a labour intensive product with unqualified labor. Now suddenly minimum wages are introduced and you have to pay your workers way more. Obviously you can't keep selling your products for the same price. You gotta reflect the cost of production in your products sale price. So yeah. People will have more money nominally short term. But then prices increase and everyone gets poorer relatively speaking in the process

TheRealPepperPotts · Answer

No. Look up monetary policy and fiscal policy to get a better understanding of how inflation works. There is a great book called "Whatever Happened to Penny Candy?" that does a great job explaining economic policy in a straightforward manner. It is actually for kids, but I have enjoyed it as an adult, too. I took business in college and wrote a paper on this exact topic, and minimum wage doesn't even enter the picture.

Basically, when Covid hit, there was a recession. The response of the Federal Reserve to prevent economic disaster on top of the existing crisis was to plummet interest rates. What that does is makes money cheaper to borrow. Thus, more borrowing occurs and more money flows to keep the economic Ferris Wheel spinning in times of crisis. That's why we had the historically low interest rates. Whenever there is a national crisis, interest rates will drop to keep the economy afloat and stable.

Initially, low interest rates seem like a good thing. But with so much available money, the price of goods can go up. The only way to stem the inflation is to tighten the flow of money by raising interest rates again. This is how capitalism works. It's a system of boom and bust ad infinitum.

This is the simplistic version; obviously economics is a complex topic and there are more factors to it. But inflation is due to a loosening of the cash supply by the Federal Reserve to stabilize the economy in times of crisis. Until certain markers are met, they will continue to maintain or raise interest rates to stabilize the economy post-Covid.

FreyaRed · Answer

No. Economy of a country is like a bucket filled with water > That water circulates in the bucket, wages are just a part of this circulation > Elites want there is more water in the bucket because it raises their profits, that's why they want export wares which the pleb produces > if national currency is too strong, exports decrease, in case national currency is weak exports increase because wares production becomes cheaper

For the sake of positive export/import balance economies are even willing to sacrifice demand on domestic market due lowering of value of their currencies, that's why there is inflation above the healthy inflation level of 3% annually. Poor pleb means less imports (water leaves slower the bucket), cheaper workforce export raises (water comes in the bucket). However any market manipulation has its limits. Long lasting high inflation or hyper inflation kills domestic market and bank branch (water stops to circulate in the bucket). This becomes a disaster for national economy (see Argentina)

Fireguy17 · Answer

The higher minimum wage is only part of the problem.
How the government runs their budget, need another couple 2 3 trillion dollars, just print more up.
That helps to devalue the dollar so it is not worth what it used to be.
There are many other factors that also come into play that add to the problem, but while the 2 major parties try to blame each other for this mess, I would say they are both pretty even in the who's to blame for this mess, nothing gets done.
The party in power seeks new ways to "buy" votes buy funding popular programs for a select few groups to get their votes, the rest of us that go to work pay taxes are the clear loosers in that game.
Nothing is free.
When the government hands out free whatever, remember, we, you and I are the government.
We are where they get the money from to piss it away.

$100 in 1970 is equivalent to $809.46 today.
So basically what cost $100 back in 1970 would cost you $809.46 today.
That is kind of an eye opener.

Friendlybro79 · Answer

Min wage isn't enough to live in most places so if say every business just raising prices to increase profit leaps and bounds higher than needed to keep up with inflation is mostly to blame. The lowest salaries in the country going up 50 cents or a even a few dollars an hour is not a huge contributing factor but I can't say it doesn't cause inflation at all because literally when things go up that is inflation.

Corporate greed pretending supply chain and covid is still an excuse to keep prices significantly higher than prior to the pandemic are a problem that without regulation, no president, democrat or republican will be able to control. We can't tell shareholders people need lower prices to survive or higher wages. There is very few legal ways to control the corporations and businesses in general from raising prices (which raises inflation). Tell a supermarket they have to sell eggs for less. They'll laugh at you because they don't care and want to make more money. Just some examples

RingOfFire · Answer

Yes wage escalation in general is one of the biggest contributors to escalating inflation which is usually ignited by too much government spending.

Increasing minimum wage is a major contributor to inflation.

I call minimum wage increases the Democrat's full unemployment act. Paying people more than they are worth is not good for anyone even the people who are being paid because they won't have their jobs for long. No employer is going to continuously pay people more than they are worth to their business.

Minimum wage started through a corrupt alliance between the Democrats and the unions. Democrats wanted to keep people out of the workforce in order to create a shortage of workers so they could increase wages for union workers. It was designed to keep poorer unskilled laborers from ever being able to move up the ladder by preventing them from getting on the lower run of the ladder where they could learn the skills they needed to improve their lives and become more independent.

If there is one thing the Democrat party despises it is a poor person who becomes independent and doesn't need their welfare. So by controlling the schools in another corrupt alliance with the teachers' unions and make sure that blacks and other minorities get a terrible education so that they have to depend on government welfare for the rest of their lives. Then they buy their votes by handing out more welfare since they know that those people have no choice but to depend on them.

Minimum wage is part of that corrupt process to ensure that people on the lower end of the wealth curve are never able to escape. The Democrats were founded as the party that represented black slave owners and they are still at it today. Only now they use less obvious means to keep black people enslaved to them.

NaultD · Answer

If my kid (that dosen't exist) today was working minimum wage for 40 or even 80 hours a week.

I would beat the shit out of them and make them play my old video games because that will be cheaper for myself to pay for. It's going to cost me an arm and a leg to uniform them for work and get them there on time to make negative money that cost me 3x as much.

The transportation alone is nonviable for minimal wage. Who the fuck works for negative income. Not even slaves who get fucked up food and housing.

blueonblack22 · Answer

It’s definitely contributed however: Biden’s “green new deal” bullshit particular crushed domestic oil production and energy which skyrocketed inflation. Oil and fuel gets factored into transportation costs of goods and services. Also all the bullshit legislation he passed to spend money on crap most Americans don’t nor can taxpayers can afford (inflation “reduction” act my f’ing ass)

Also if you are getting taxpayer money for student loan “relief” then f*ck you. For real F*CK YOU. You voluntarily took out that debt and you have an obligation to pay it back. And if you majored in some worthless leftist study that a huge f*ck you for expecting taxpayers to bail you out.

I personally sacrificed to pay off my f*cking student loan debt. I paid it off all on my own by riding a bicycle to work everyday for 2 years and budgeting intensely. I never expected anyone personally or the government to bail me out.

rosemilk · Answer

no. even people that make above minimum wage are dealing with inflation. the only people immune and are benefitting from this, is the rich. inflation is out of control because they decided to print more money and pump it into the economy instead just letting the pandemic pan out and do it's own thing with a recession. instead, we are kicking the can down the road.

obviously raising minimum wage can have an impact on inflation, but that's literally such a small percent. it goes way deeper than that. this particular inflation happened before the government told them to raise minimum wage.

BetaBucks · Answer

There is no singular thing to blame. Excessive government spending, rising minimum wages, rising gas prices, the neverending slow trickle of tax increases spread around our lives, increased employee benefits, increased regulations, increased civil lawsuits increasing insurance rates, etc... all contribute.

Corporate profit margins have stayed relatively flat over the decades, so it's not like extra money was going to that. Despite the lie of "record profits" which are being calculated in dollars, not percentages, so obviously there will be new records as time goes on. Ya know, because inflation.

OtterMan68 · Answer

Here is here to blame and the timeline:

1) Congress and Trump passed a $2 TRILLION stimulus package in 2020, flooding the country with cash.

2) The Trump administration printed a record amount of money in 2020: flooding more money into the economy and making the dollar less valuable.

3) The Fed kept saying inflation was "transitory" and failed to take action earlier than they did.

4) Biden admin put out more stimulus, and used "transitory" too.

So here's who to blame: Congress, Trump, Biden, and the Fed.

Also covid screwed up supply chains across the globe, reducing supply and driving up prices. Think autos.

Sasquach · Answer

Government spending on the old and decrepid. About 50% of yearly debt goes toward Healthcare and social security. Neither program, which will be available to younger generations when they get old enough to claim qualify.

- Preventing an economic collapse by essentially giving interest free loans

- Increasing FICA taxes on gross income from 1% in 1937, 9% in 1970 to 15% in 1990 and growing

Keeping wages at now below poverty levels are practices geared toward transferring the wealth of the young to the wealth of the elderly.

If you want the economy to improve significantly elderly benefits must be reduced and not expanded as boomers constantly vote for and finally the economy must fall into an economic depression

thatshydork · Answer

I think you should read the book “Poverty, by America” by Matthew Desmond. It will provide you with a different perspective then your own (unless you outright refuse to open your mind to other pov’s) and you will gain the answer to your question.

CassandraSpender · Answer

There is no correlation between increase of minimum wage and inflation, There is, however, a correlation between CEO salaries and inflation

20 years ago minimum wage was $5.15/ hr, now it's $7.25. There has been a cumulative inflation of 66% in that time. You cannot convince me that a 38% increase in the minimum wage caused 66% inflation. What it does mean is that the money is going somewhere and it's not the pockets of the ones doing the work.

Curmudgeon · Answer

It certainly doesn't help, but printing money in order to pay for "The Green New Deal" (sic), "Build Back Better" (sic) and badly thought out foreign interventions, is a much larger cause of this inflation and currency devaluation.

OfMiceandMen · Answer

The only one that come out on tope by increasing minimum wage is the government. They get you into a higher tax bracket and collect more taxes.

Rather than increase the minimum wage, governments should reduce taxes to leave more money in everyone's pocket - but you won't see that happening anytime soon.

They need a raise too, so they increase minimum wage, is effectively increasing taxes, in a round about way.

sawno · Answer

Partially, minimum wage drives everything up due to employee costs. But anothrr big factor in my eyes is energy cost. ", Green" energy is inefficient thus expensive. And if your energy is expensive the production of everything is expensive. If fuels for transport are expensive everything gets more expensive. Its also why I think this effect is present in the entire west.

HighValue · Answer

The main cause of the inflation is higher fuel prices which was directly caused by Biden's executive orders. The second cause is the increased interest rates that happened at the direction of Biden. Minimum wage does contribute to inflation, but some states increased minimum wage more than others, so not all states have the same inflation now. Some are much worse. (California for example.)

pass_the_celery98 · Answer

Yeah minimum wage is to blame, it’s not the billions of dollars countries like the United States gives to Israel or Ukraine or where capitalism benefits the rich, or that the banking/government system has created a manipulative system, it’s definitely minimum wage 🙄… not sure if anyone can tell my sarcasm and emphasis on minimum wage

bolverk · Answer

No the increase in the minimum wages not the sole reason for the current high inflation rate in the US, a lot of the causes of the current high inflation rate can be laid at the door of the Federal Governments Policies since the the 'Biden' Administration has took office.

Inflation has been far worse during the Biden administration, up 19.9% over the first 41 months of Biden’s term compared to 5.4% during Trump’s first 41 months, according to the government’s consumer price index.

findacure4wokeness · Answer

No It's a supply and demand thing. Open western boarders and flooding countries with useless people thins out resources making them more expensive due to increased demand and a limited supply. Also no country should be supply other countries with foreign aid if it can't even look after it's own people.

BoobMan · Answer

The big downside of aggressive minimum wage laws is that they increase unemployment--especially for people seeking entry level jobs. They are less likely to cause a major spike in inflation directly--more likely they'll cause firms to hire fewer people and aggressively seek labor-saving technology and process changes.

noohair · Answer

Economics 100;

Prices are not going up; the value of your money is going down. What causes the value of your money to go down? That is 100% on our government and deficit spending. Our national debt is 34,800,000,000,000. Money can be printed by governments. Wealth is created by adding value to a good or service and creating profit. Everyone should learn this in high school, sadly no one does.

behnam1999 · Answer

The inflation is increasing because the government borrows money from the banks and that money is created out of thin air!! This is a scam.., but unfortunately people don't get it until it's too late.

BonzoInBitburg · Answer

Minimum wage jobs are entry level jobs. If someone in their mid 20s is still making minimum wage, they have a poor work ethic. You should be out of an entry level job by then. Minimum wage jobs should only be for students and people's first jobs

alexhale23 · Answer

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goaded · Answer

Inflation is far lower than in the 1980's, and how could minimum wage possibly be anything to do with it when it hasn't changed in decades?

Corporate greed is fueling inflation. They're making record profits.

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Surely · Answer

Unfortunately, as wages increase. So does the price of everything else. Usually that means that in the end. Raising the minimum wage, or all blue collar wages. Means that you have less money in your pocket!

handsomelad70 · Answer

ARE YOU ON FREAKIN' CRACK, COKE, METH AND FENTANYL? The $7.25 U. S. minimum wage is far less in 2024 dollars than in 1964 when I was 11 .(What CEO or their butt-kissing employee asked that inane question?)

MaybeTony · Answer

No. The inflation we see today is due to the monetary and fiscal decisions made during Covid.

Sargentcaptain · Answer

It probably doesn't help, but I'd guess that the 'printer goes brrrr' policies did a lot more to fuck up the economy.

ButtNakedMan · Answer

Minimum wage plays a part of the inflation, but so does government spending during COVID, SS to immigrants, and the fact many businesses filed bankruptcy. Banks closed branches, and the list goes on and on

exitseven · Answer

printing more money is the major cause. Declaring war on the energy companies and making gasoline jump in price contributed as well.

chrissykerdock · Answer

joe biden is to blame yes partly among other things

FunkyMonkee · Answer

That's a huge part of it but, you know how democrats are! They just don't think past the end of their nose!! everything is, ME, ME, ME!!

DaBiggestBird · Answer

Vote for Trump 2024. He knows to Make America Great Again, and he do an even greater job with your support.

OhLongJohnsoning · Answer

Actually inflation's gone, down. But, no, it's not minimum wage. It's reganomics or "trumponmics" Lowering taxes for the rich. Trickle down. HAS NEVER, AND WILL NEVER WORK

MacDaddyRico · Answer

The cause of inflation is corporate greed. While inflation skyrockets, corporate profits are at record highs... in the billions of dollars.

Dargil · Answer

No. Democrats are responsible for this inflationary cycle..

the29thhuman · Answer

Not everyone’s gifted to get an education. But they still deserve an opportunity. Ur so narrow minded

jahaims · Answer

A lot of companies are having record profits from price gouging under the guise of inflation

QuietRunner · Answer

That's one factor printing more money also has influenced inflation mostly energy costs

Jason2469 · Answer

Maybe 20% of it. Most of inflation comes from the fact that your fake money doesn't exist it's just a number on your monitor. Bitcoin fixes this.

Astarlessnightsky · Answer

No, nononooooo. Its greedy companies.

DrPepper12 · Answer

2/3 of "inflation" is corporate greed.

normalice · Answer

No, corporate greed.

Hispanic-Cool-Guy · Answer

Nope. Corporate greed is.

Pterodon · Answer

No Biden and his spending is to blame

Pinkandgirly · Answer

Fuck yes

Inflation is out of control. Is minimum wage to blame?

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