I'm pretty sure that increasing the cost of labor will drive the prices of labor dependent goods and services up, while also probably flattening growth or decreasing employment numbers when employers try to maximize the margins on the labor they already employ.
I'm pretty sure that giving lots of people more disposable income will increase demand. Which will in turn increase revenues and allow successful businesses to expand, increasing employment numbers, creating a positive feedback loop.
In reality however things are a little more complicated.
You don't "give" more disposable income, you pay people for work. Pay for work is accounted for by receipts (prices paid for goods or services), causing prices to rise to cover the increased costs, or margins to fall if prices remain inflexible due to market price determination.
The artificial rise in wages will not help, as it will be met with a corresponding increase in prices to cover the costs of the wages.
Bosses don't "give" employees raises? Let's not argue semantics.
Using your line of reasoning it doesn't actually matter whether the rise in wages is "artificial" or not, your argument is simply "wage rises will not help" As a former recipient of wage rises I have anecdotal evidence that they do. :)
Economies are complex systems looking at one aspect of them in isolation and thinking you can apply a high school level understanding of supply and demand and come up with any substantive insight is frankly misguided.
This is a shift of context: the first was in "us" (the non-boss political establishment not responsible for distributing receipts) "giving" raises. The second is "bosses" giving employees raises, now dropping the context of the reason for the wage increase; being compelled by force of law.
The line of reasoning is entirely dependent on the reason for an employer giving more wages. If he needs to give raises to retain talent, it is presumably because the skills he is purchasing can demand a premium, which can be reflected in the prices of the product or service being offered.
If most of the goods and services used by the people most "helped" by the commanded wage raise are themselves wage dependent, then their prices must increase or employment levels must decrease and efficiency of the remaining workers must increase to compensate.
As market prices for goods and services are not that linearly dependent on one factor, this result on employers will inversely affect employers with the least price flexibility; the ones with the least margin, the ones employing the low-income workers.
There are many, but one would be the lack of opportunity to improve ones situation by self-improvement. For example, you might be working two jobs to pay rent and other necessary expenses, so you have no time to learn new skills. Another would be that you cannot afford to send your kids to school (i mean K-12 public school) because you need them to work in the fields, so you can't create inter-generational opportunities.
People working at minimum wage can find themselves in such situations.
At this time, you can get ahead on MW, if you team up with other MW workers to live together and one person can get enough "family" support to get to the next level. However, our society, being very individualistic, doesn't really recognize this.
one would be the lack of opportunity to improve ones situation by self-improvement.
It's not a matter of opportunity, it's a matter of choice.
Time and again I've watched those with opportunity squander it, while others lacking opportunity fight to get it (and got it). I've had a 4AM bus driver take my evening C++ class, passing despite often dozing off therein, finding funding despite not having the steep tuition. I've known a chronically bedridden invalid who managed to run a profitable, um, pharmaceutical service from his gurney. I've worked multiple jobs and still learned new skills, even getting hired despite not having the core skill and learning it sink-or-swim. I've watched kids destroy windows while I was fixing their couch. I've seen eminently capable students with amazing affinity to programming fail a beginning C++ course for lack of effort, not understanding. Opportunity IS there; taking it or making it is up to the individual.
Instances of true "poor for lack of opportunity" are exceedingly rare. They have my sympathy and aid; I'm frustrated by the vast numbers who insist they are and in truth aren't.
Therefore disposable income pays for rent, food, gas... All of which would be needed to alleviate poverty, but I guess that depends on how we're defining poverty.
Increase demand for what? Chinese goods of course, purchased at Costco and Walmart and Target.
How does exporting higher profits to China help America exactly?
I suppose the theory is: pay American service workers more, so that they can buy more Chinese goods, so China can become wealthier and build more factories and employ more production jobs, while America gets poorer by continuing to expand its service sector (consumption jobs). Interesting theory.
It doesn't appear to be supported by anything in reality though. Personally my expenditures go to primarily to housing, utilities, travel and food. I'm not sure how any of those boost China's economy directly - Wells Fargo is probably quite heavily invested in China one way or another though.
It doesn't break down along income lines which is unfortunate, that information would inform discussions around minimum wage much more. I did find the age break down interesting though.
Money is just paper. It's a convenient way to exchange labor for goods in an asynchronous way. Raising the minimum wage, simply means you have to produce more paper for the same amount of labor. It doesn't change anything except temporarily.
If raising the minimum wage made any difference, McDonalds would be 5-star restaurant by now.
