Archive for June, 2009

I have always wondered why liberals don’t understand that increases in minimum wage cause inflation and therefore are non productive as a stimulus to the economy.  This redistribution effort has no effect on the standard of living of the lower classes because of its effect on inflation.  Companies forced to increase the bottom line will balance that increase with a proportional increase in sale price.  Overall effect is a devaluation of the Dollar.  The graph below is a correlation between minimum wage (Blue) and the value of a dollar compared to its 2009 value (red).  As it is clearly seen as minimum wage increases the value of the dollar decreases.  The end result of increasing minimum wage is the devaluation of the dollar which leaves the intended beneficiaries in the same place while decreasing our global buying power and negatively impacting those of us that have worked hard to move up in the world.  It’s clearly a political scheme to win elections by promising higher wages and distribution of wealth.

Joel Mesa


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