Where did this idea come from— that if you raise the minimum wage, there’ll be an economic disaster? That if you give poor people money they’ll just hoard it, that the money just disappears into a black hole and everybody stops hiring and unemployment soars because it’s too expensive to hire people…?
You know what happens when you give poor people a bigger cash flow?
Suddenly we’re not living paycheck to paycheck. We don’t have to choose between paying the electric bill and the groceries, we can actually cover both. Suddenly we’re not nervously eyeballing the first of the month, because covering rent is no big deal.
We get that funny noise in the car engine fixed even if it’s several hundred dollars, instead of just putting up with the knocking and driving to work with our teeth gritted and fingers crossed every day waiting for the car to just up and die (and then end up spending several thousand on a new used car— being poor can actually be very expensive). We get the house’s leaky windows patched up and hey, the heating bill just went down, look at that. We’re less tempted to rack up debt on credit cards buying— not luxuries, but essential things like food or medicine.
We’ll pay for nannies and babysitters for our kids so we can show up to work that job flipping your burgers. We’ll pay for after-school programs and extracurricular activities so our kids are happy, socialized, and well-rounded.
We’ll funnel that money into more books, movie tickets, weekend getaways, art supplies, a hobby vegetable garden, community involvement, whatever— things that enrich our lives and take away the stress of the working day, because we’re no longer sinking all our time and energy into two or three jobs just to scrape up enough to make the most meager of ends meet. We’ll buy gifts for our loved ones on holidays. We’ll go out to eat more, shop for clothes more— patronizing the businesses that hire minimum wage workers. (How ‘bout that.)
We might put some money in a savings account, yes, but eventually spend it— on major purchases like college or a house, or spend it when retirement rolls around. But by and large all that extra money gets fed right back into the local economy— by workers who are more likely to be happy, less likely to be stressed and exhausted.
I’m not saying having more income will magically fix all problems min-wage workers have. But it will take care of the biggest ones, and enable us to take care of many more.
And you can be damn sure if you give us more income the one thing we won’t be doing with it is hiding it in a mattress and never spending it.
Rich people do that.

Wear Many Hats: Minimum wage, maximum use  (via miranoire)

"If you teach a parrot to sing ‘supply and demand’, you wind up with an economist." - Unknown

Where did this idea come from (…) [that] everybody stops hiring and unemployment soars because it’s too expensive to hire people…?”

This idea came from a basic understanding of economics. If you raise the minimum wage, you wind up with a surplus of workers who are being looked over in the hiring process to work at the increased minimum wage. Too great of a supply (workers available to work at minimum wage X) for too little of a demand (of workers available to work at minimum wage X without breaking the bank of the hiring company). This over-saturation of the hiring pool results in an increase in unemployment.

That is to say, hiring rates will drop. A company now stands to lose money per employee hired, so to remain fiscally sound they will attempt to find that equilibrium amount of employees to hire against their profit earned. One way they’ll recoup the losses is through imposing higher prices on their goods.

And suddenly, this allegorical wreck of an argument falls apart. Now you’re living without a paycheck, as the company you used to work for has replaced you with a robot.

You know what happens when you give poor people a bigger cash flow?

A great way to embolden the working poor is to not begin by insulting them and referring to them as poor people. Economists (not tumblr users who cite Cracked.com articles) have pointed out that around 2/3rd’s of minimum wage employees are not the primary earners in their family situations. Most of the protesters who Cant Live on $7.25 an Hour! don’t have to, as someone else is already putting food on their table. Many of these earners are already living in households that are making enough money to throw them over the poverty line twice over.

We get the house’s leaky windows patched up and hey, the heating bill just went down, look at that.

The author seems to live in a magical world where their window patch-up job decreases their heating bill enough to offset the spike in it that was caused by City Heating & Cooling paying many of their workers twice their usual wage without a single cut in employment.

You don’t raise people out of poverty by mandating a higher wage be paid by employers. A simple and elegant solution would be to expand the Earned Income Tax Credit.