Bad news all around
From Fred at Slacktivist:
The next story on the news last night was that I won’t be getting a raise any time soon. The Republican minority in the U.S. Senate prevented a vote on the matter because preventing votes is their idea of democracy and because screwing over workers is their idea of celebrating May Day.This is an important point. Big companies can't sell stuff to poor people. And if they can't sell stuff, they won't make stuff. And if they can't sell and won't make, well then, they don't need to have so many people working for them. And if people aren't working, they aren't buying. And if they aren't buying...
That’s bad news for me because the proposed new federal minimum wage of $10.10/hour is more than my employer is paying me now. And it’s disastrous news for my employer — a massive chain of home-improvement stores — because tens of millions of their customers also won’t be getting a raise. Those would-be customers thus will keep deferring those home-improvement projects they’ve always wanted to get to some day, and instead of selling them all the things they need for those projects, we’ll just sell them another roll of duct-tape. (The smaller, $2.70 roll, not the giant, $8.28 roll. That’s for rich people like U.S. senators — you think I’m made of money?)
As a friend of mine once said:
The private sector will not create jobs before the demand for goods and services is there. It doesn't matter how much surplus cash they have or how many tax breaks they're given. The private sector is not in the business of providing charity. They won't create jobs for workers to produce and sell what people are not buying. That's not how a free-market economy works.