The debate about socialism and minimum wage has been on, since the mid-1990. Starting from the state of Baltimore, the capitalist groups that have long held the country with tales and continue to send news and fight that, raising the minimum wage is a socialistic effort and that is not what the United States is about.
The progress of minimum wage
Before president trump came as the president, there became Obama care and some states had also increased the minimum wage for low-paid workers. In fact, 80 cities in America have passed into law living wage for workers. The campaigners for this movement are hoping that all the states would join in this movement to liberate the American poor, thereby enriching individuals instead of enriching the system which is mainly composed of a few rich people.
First is important to site their argument so that we can very well understand what our position in why we continue to insist on the progress of efforts that improve general lively hood especially for the poor.
The Effects of pro-capitalist approach on the economy; looking at a more holistic view than a more detailed impact:
The pro-capitalist, argue that if wages are raised, more companies would be forced to lay off workers since they can’t meet the minimum wage and they would also export jobs to other countries where they can get work for cheap. This would in-turn weaken the economy and also turn to affect the poor that is been helped because jobs would be lost.
The focus here is on the strengthening of the system so that it can continue to give jobs, no matter how small that job might be to the worker. However, history has shown even recently, when institutions are strengthened with the main focus of making the benefits trickle down on the worker or the poor, this is often not the case.
It is because, these organizations are out to make a profit, which means that they would never paying workers much more money, just because you cut their tax or bailed them from a very bad loan. This instance is seen clearly in the move of president trump when he cut down co-operate taxes and he estimated that it was going to increase jobs wages by a whopping 90%. At the end of the day, the survey showed that only 4.3% of American experienced a wage increase from Americans top companies. Where did the money saved on tax go to? Probably to shareholders, this explains why a company for profit, would never be willing to pay a worker for what he thinks he isn’t worth.
This shows that the system isn’t built to work for the poor and low-income earners by for the owners of top companies.
Why the minimum wage movement is more than socialism
How can the economy grow by going from the ground up? Campaigning for a living wage and free education is not the advent of a socialistic economy, but rather a proposal to run an economy that can manage and run both ways of living for holistic prosperity. When you strengthen systems that are built to keep the poor poorer and the rich richer, the rule can never work against the rich.
When wages are increased, jobs might be dropped, but would not be so much if the workers are unionized. This is the backup effect that can take place to put employers in line. This makes it difficult for employers to carry out labor cuts without going through very important and checked processes. The truth is that a vibrant national economy does not really translate to the welfare of the people in that country.
By increasing the minimum wage, there would be more consumption, increasing tax flow and more self-sufficient people. There would also be a better working environment that would even further strengthen the institutions because the individuals are consuming and taking advantage of the business.
In education, putting together a system that makes it difficult for a college graduate that has gotten a degree, to come out and become independent. This greatly slows the process of individual prosperity and hard work, which is supposed to a mantra in America under the statement of freedom.
If you are held back by student loans, the adequate material that is needed for one to set up a business or finding a life becomes even more difficult and unrealistic If they can have free education or have student loans written off, it would make available more time and opportunity to build a business which is also boosting the capitalist economy.
Also, if the government focuses on getting individuals off bad loans, this would inadvertently go back to the system. This means the impact if running from bottom to top now. Because they are the consumers and they need them to build assets. This makes organizations like banks and business a direct beneficiary of the citizen, which are their customers.
The foreclosure crisis that happened recently gives us a better view of a highly negative impact of capitalism and what the effect of an economy focused on helping the poor can do. A lot of people were not paying their loans, so it turns out that the banks needed to be bailed. In this scenario, the government needs to assist. What if they had helped the individuals who didn’t have enough money to pay their loans instead of the banks?
The banks were bailed, and the foreclosed all the homes, leading to homeless people and also a plummeting real estate market. Houses everywhere, so prices went down, and a lot of people cried about their real estate investment. If individuals where helped, they would have simply given the banks, back their money and remained in the homes. Keeping more people in the shelter and also strengthening institutions.