Uncivil Rights
A BLOG rife with wit, sarcasm, and the endless joy which comes from taunting the socialistic and unpatriotic liberal left. Logical thoughts and musings ONLY need reply...unless you're really, really funny. You have the Uncivil Right to be an IDIOT.
"Give me LIBERTY, or give me DEATH!"
Friday, December 03, 2004
Supply, Demand, Wages, and Prices
Supply and demand economics works. When there is an overabundance of something, the demand for that something goes down, as does its value. If there is a scarcity of something, the demand for that something goes up, as does its value. So, lots of “widgets” in the marketplace, the demand and price (value) of those “widgets” goes down. Few “widgets” in the marketplace, the demand and price (value) goes up. It is simple supply and demand economics.
The same economic philosophy applies to jobs and workers. More workers than jobs mean demand for workers is low; hence the wages for those workers will be low (without government intervention). More jobs than workers mean demand for workers is high; hence, the wages for those workers will be high (without government intervention).
The caveat is government intervention. Government can intervene by implementing minimum wages. Minimum wage legislation will artificially increase the wages of workers, thereby reducing demand for those workers. The intent of government is NOT to increase unemployment rather it is to give the worker a “living wage” (another post for another time). I do not question the INTENT of the government to do what it believes is good. What I question is the UNINTENDED CONSEQUENCES that are the result of those good intentions.
These unintended consequences are overshadowed by the political rhetoric of the politicians garnering votes by touting the good intentions. Unfortunately, those that do not understand the reality of economics and the actual consequences of those policies, or worse, those that don’t care about the consequences, allow themselves to be swayed by the political rhetoric and promise of higher wages. This encourages politicians to continue to make such policies.
Minimum wage does not help the “working poor.” It artificially raises the prices of goods and services, which hurts the consumer and the economy. Minimum wage also limits the number of jobs for teens and those entering the workforce for the first time.
For a free market economy to work effectively and efficiently, government intervention must be reduced or eliminated, for the benefit of everyone.
The same economic philosophy applies to jobs and workers. More workers than jobs mean demand for workers is low; hence the wages for those workers will be low (without government intervention). More jobs than workers mean demand for workers is high; hence, the wages for those workers will be high (without government intervention).
The caveat is government intervention. Government can intervene by implementing minimum wages. Minimum wage legislation will artificially increase the wages of workers, thereby reducing demand for those workers. The intent of government is NOT to increase unemployment rather it is to give the worker a “living wage” (another post for another time). I do not question the INTENT of the government to do what it believes is good. What I question is the UNINTENDED CONSEQUENCES that are the result of those good intentions.
These unintended consequences are overshadowed by the political rhetoric of the politicians garnering votes by touting the good intentions. Unfortunately, those that do not understand the reality of economics and the actual consequences of those policies, or worse, those that don’t care about the consequences, allow themselves to be swayed by the political rhetoric and promise of higher wages. This encourages politicians to continue to make such policies.
Minimum wage does not help the “working poor.” It artificially raises the prices of goods and services, which hurts the consumer and the economy. Minimum wage also limits the number of jobs for teens and those entering the workforce for the first time.
For a free market economy to work effectively and efficiently, government intervention must be reduced or eliminated, for the benefit of everyone.
totalkaosdave, 5:28 PM
|
