Well to be fair, it also creates unemployment for people who's marginal labor productivity is below the mandated minimum and also makes it illegal for people with this lower level of productivity to work. But we won't let these issues get in the way of American "do-gooders" trying to "help" those people.
Unless, of course, fewer products get sold at the higher prices. Then there might be a problem.
One of the fundamental mistakes that people make is that they limit their analysis to the immediate parties and the immediate time frame. Many people also suffer from a situation we could call "static assumption blindness" where every other thing remains static except the variable they change. In this case the assumption is that employment levels, product purchase levels will all remain the same and all that will happen is that everyone's wages will be a little higher. The affects on profits, higher product prices, etc. are virtually ignored are dismissed as being insignificant. This is usually a major error.
Henry Hazlitt put it very succinctly in his great book "Economics in One Lesson" this way:
kingofsomewherehot wrote: »
If $2/hour is good, then $20/hour should be even better!
Why not make the minimum $20/hour ???
I mean, if you're not going to let the market set the rate naturally... if you're going to interfere, you might as well make life really nice for those "workers"!!!
Too low. I admire the start but that's only 6RM/hour, 60Baht/hour, 12CNY/hour, etc. It's time to look at the structural, systematic corruption and chaos in developing countries and how developed countries can contribute across the board. Increased money is worthless if the worker has to pay higher medical fees due to lack of government and private health coverage, or if the worker has to bribe more cops on the way to work because of dodgy cops (like Kuala Lumpur, if you are pulled over by the police it's the equivalent of USD $20 or so each time, usually for very minor or no reason... which I refused to do, and they just gave up on me after 5 minutes and focused on the other cars they pulled over).
Also, pointless if a worker has USD $100 more per week, opens his own Apple Reseller shop, only to go out of business and not be able to feed his family because of asshole corrupt Chinese officials seizing his legitimately obtained iPads so said official can give them to his children (sound familiar?).
Do you see what I'm getting at?
The thing is though, there is no market, especially with all the unemployed people, plus companies greed would result in a barely livable existance. no one would be able to afford housing or food at all, let alone anything nice.
Having this rate is better than being unemployed. What you think? We keep on nagging but you must see the brighter side once in awhile.