• MrVilliam@lemmy.world
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    6 months ago

    I was talking with a coworker the other day and they were talking about how raising minimum wage causes inflation because businesses will raise prices to offset to rise in labor costs. I asked if he thought inflation had gotten bad in the past 5ish years in particular. He said of course. I said well federal minimum wage hasn’t risen since 2009, which was 15 years ago, so it sounds like inflation is gonna happen regardless of wages and is based on the capitalistic goal of infinite growth, so maybe we should raise minimum wage so lower income people have a shot at affording basic necessities.

    He just said no, then inflation just would’ve been worse. It’s maddening.

    • themeatbridge@lemmy.world
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      6 months ago

      The response to this is that inflation is a market force working against the downward pressure of demand. There is a limit to the amount prices can go up before people stop buying altogether.

      Another inflationary force is greed, funneling additional profits into the pockets of the 0.1%.

      Let the inflation due to minimum wage be X, and the inflation due to greed be Y, and the maximum total inflation be Z. X+Y=Z

      Of course there are other variables, but in a general sense, if X goes up, Y must go down. If X does not go up, Y does.

      So yes there will be inflation, but increasing wages takes more money from the ownership and puts it into the pockets of the bottom 99.9% where it will do far more good.

      And in case it wasn’t clear, this is precisely why the oligarchy opposes increasing the minimum wage. It has nothing to do with inflation, and everything to do with they make less money.