California Democrat calls for $50 minimum wage

[Brickjectivity]

Its common sense.

When companies have to pay more to produce their product, they raise prices to offset the cost.

When restaurants and fast food places have to pay more to produce their product, they raise menu prices to offset the cost.

When owners of property have to pay more to maintain their property(apartments for example), they raise rent to offset the cost.

When stores have to pay more for a product and pay more to have their shelves stocked, they raise their prices to offset the cost.

I think these words wrongly imply a linear correlation between profits and wages. Lower profits adds a convenient lever for businesses to claim costs and to lower wages, but increased profits do not create any pressure to raise wages. The function between prices and wages is probably not linear. I'd say its shaped more like the left side of a skewed hyperbola. As profits rise wages will increase then decrease, unless you have power to negotiate your wages. Who does though have such power to negotiate?

Not much counts as skilled labor. We all graduate from high school, and that is almost worthless. Diplomas are good for kindling, and master's degrees are great for wrapping fish. HVAC is an entry level accomplishment.

So what does increase one's wages? Almost nothing except for negotiation. If you can refuse to work for less than a given amount, then you can get a wage increase. Higher prices, higher profits and higher revenues mean nothing and do not increase hourly wages.

Therefore it is not useful to imply a linear correlation between profits and wages. It is better for workers if prices rise a little but not too much, since as the business becomes more profitable it will decrease wages, fire workers and merge with other such businesses. Struggling businesses benefit workers.