Phillip Tilley

Raise wages, lower unemployment

August 5, 2010 |  20 comments
Image Credit: sxc.hu The Nation is stuck in a recession with a jobless and houseless recovery declared by the President. Just saying it does not make it so. We need real tangible changes we were promised. One thing I believe may help to lower unemployment is to raise wages. Some people may think this is crazy talk, but most people think I am crazy anyway so here goes.

Retailers say if they had to pay higher wages they would have to raise prices. That is a lie. The funds to pay higher wages are already in the system. The decision just needs to be made not to pay exorbitant bonuses to executives that are already overpaid to do a poor job. Instead those monies should be paid to the everyday workers, the ones like you that actually do the work!

Consider that in a consumer driven economy, if 2% of the people have 90% of the money that means 98% of the rest of you have only 10%. That does not stimulate the economy. Two thirds of the economy has traditionally been driven by the consumer market. Last year the Government spent so much in stimulus that only 59% of spending was from consumers. Consumers have less money so they spend less. Consumers without money are not all consuming. Low consumption leads to lower profits, which leads to layoffs, which increases unemployment which leads to lower consumption. Now that is crazy talk but that is where we are.

Consider those unemployed that do not take low paying jobs because they are being paid more in unemployment benefits. When you pay someone more not to work, why would they work? I had a brother-in-law that worked construction for big money seven months out of the year. The off months he got more in unemployment than I made working. He had job offers, but they paid less than his unemployment. Higher wages would have stimulated him to go to work.

Consider the minimum wage should be $22.50 per hour. If it were, a husband and wife that each work a job paying $11.00 would not need one of them to work because the other would be making $22.50 an hour at the very least. You would no longer have to work two jobs to make ends meet. Fewer people seeking jobs because their spouse earned enough would mean lower unemployment, possibly even as low as .5%.

Consider welfare and food stamps provided by the Government for those people who do not earn enough to survive. If workers were paid more, two obvious things would happen. First they would be paying more in income taxes by virtue of the fact they would have more income. Second, the Government would pay out less in entitlements like food stamps because people would earn so much they would not qualify for them. Deficits would automatically be lower.

Why should the Government, which is funded by the workers, have to pay to subsidize low paid workers so executives can get their obscene bonuses? That is a poor economic model. The Government should make corporations pay the workers so the Government, which is you and I, do not have to. Where is your bonus? Why should an executive get a bonus for doing their job? They should do their job or they will be replaced, just like you and I.

Earning enough money in the first place is tantamount to solving the world’s problems. It cannot really be that simple can it? Yes it can. Wake up people, the money matrix has you.

Phillip Tilley is author of The Money Matrix of the New World Order and other articles.[!gad]The Nation is stuck in a recession with a jobless and houseless recovery declared by the President. Just saying it does not make it so. We need real tangible changes we were promised. One thing I believe may help to lower unemployment is to raise wages. Some people may think this is crazy talk, but most people think I am crazy anyway so here goes.

Retailers say if they had to pay higher wages they would have to raise prices. That is a lie. The funds to pay higher wages are already in the system. The decision just needs to be made not to pay exorbitant bonuses to executives that are already overpaid to do a poor job. Instead those monies should be paid to the everyday workers, the ones like you that actually do the work!

Consider that in a consumer driven economy, if 2% of the people have 90% of the money that means 98% of the rest of you have only 10%. That does not stimulate the economy. Two thirds of the economy has traditionally been driven by the consumer market. Last year the Government spent so much in stimulus that only 59% of spending was from consumers. Consumers have less money so they spend less. Consumers without money are not all consuming. Low consumption leads to lower profits, which leads to layoffs, which increases unemployment which leads to lower consumption. Now that is crazy talk but that is where we are.

Consider those unemployed that do not take low paying jobs because they are being paid more in unemployment benefits. When you pay someone more not to work, why would they work? I had a brother-in-law that worked construction for big money seven months out of the year. The off months he got more in unemployment than I made working. He had job offers, but they paid less than his unemployment. Higher wages would have stimulated him to go to work.

Consider the minimum wage should be $22.50 per hour. If it were, a husband and wife that each work a job paying $11.00 would not need one of them to work because the other would be making $22.50 an hour at the very least. You would no longer have to work two jobs to make ends meet. Fewer people seeking jobs because their spouse earned enough would mean lower unemployment, possibly even as low as .5%.

Consider welfare and food stamps provided by the Government for those people who do not earn enough to survive. If workers were paid more, two obvious things would happen. First they would be paying more in income taxes by virtue of the fact they would have more income. Second, the Government would pay out less in entitlements like food stamps because people would earn so much they would not qualify for them. Deficits would automatically be lower.

Why should the Government, which is funded by the workers, have to pay to subsidize low paid workers so executives can get their obscene bonuses? That is a poor economic model. The Government should make corporations pay the workers so the Government, which is you and I, do not have to. Where is your bonus? Why should an executive get a bonus for doing their job? They should do their job or they will be replaced, just like you and I.

Earning enough money in the first place is tantamount to solving the world’s problems. It cannot really be that simple can it? Yes it can. Wake up people, the money matrix has you.

Phillip Tilley is author of The Money Matrix of the New World Order and other articles. Comments (20)

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