Bernie Sanders is again pushing for an increase in the federal minimum wage, which is still only $7.25. He put up a post comparing the minimum wage to the net worth of Musk, Bezos, and Zuckerberg.
I don't see what the net worth of the three richest dudes has to do with the Minimum Wage question. First of all, let's remember that 30 states already have a minimum wage greater than the federal minimum wage. Let's also remember that different states have different costs of living. Hawaii has a minimum wage of $16. I'm not sure it would make sense to make that the minimum wage for Mississippi. Perhaps we should just leave this up to the states. I'm getting a little tired of trying to drag Red States into the modern world.
Besides, the potential problem with raising the minimum wage significantly is that it could cause both Demand-Pull Inflation and Cost-Push Inflation. The first occurs when consumer demand exceeds available supply and the second when production costs increase leading companies to increase prices.
Not only could this inflation wipe out the benefits of the higher minimum wage, it will crucify seniors on a fixed pension, and hurt anyone whose wages didn't increase, leading to demands for higher wages, leading to more inflation and so on and so forth. Welcome to the "Wage-Price Spiral."
Obviously this will damper out sooner or later, sooner is good, but later could lead us into a spiral like we had in the 1970s.
Bernie, your BA is in Political Science; please talk to someone with at least one degree in Economics.
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