- Economic booms are driven, historically, by the poor and middle class having extra to spend. Tie the minimum wage per-county to: 4x (average 1-bedroom rent for the county) / 160 hours.
- Why 160 hours? That’s the number of full-time hours in February, and you have to be able to afford to live in every month.
- Why 4x? 1x for taxes, 1x for rent, 1x for food / gas / insurance / utilities / etc., and 1x for savings / retirement / emergencies / home improvements / disposable income.
- “But the minimum wage is only supposed to be for teenagers and supplemental income!” Nope. Never was. That was a myth created in the 1960s by a group of unscrupulous big business owners who were looking for ways to cut their bottom line, and who didn’t care who they hurt by it. The minimum wage was always designed as the absolute base wage to have a good living. There are tons of quotes from presidents and others on this from around the time the minimum wage was introduced, stating that people couldn’t contribute to their community and be good, constructive citizens, if they were unable to survive themselves. The minimum wage is one of the key reasons for the huge economic booms of the 1950s and 1960s – because everyone could afford to live, and had a little extra to give back.
- “But this puts too high a burden on small businesses!” Nope. Historically, the only businesses that went out of business because of a minimum wage hike were the ones about to go out of business anyway. And not even all of those – many businesses got creative and thrived. Additionally, more money to spend in the hands of consumers makes all businesses have higher revenue, both in the area and abroad, because poor people spend their money on their critical needs (these days, that includes cell phones), and then on a few extras here and there for their emotional health, before any form of saving. So that money goes right back into the economy, primarily to small businesses.
- Small businesses are the backbone of any economy. Everyone agrees on this; it’s hard to find a politician from any party that hasn’t said this in a speech at some point. Create a small business boom by changing business taxes to be progressive, much like how income tax is.
- Smaller businesses struggle largely because of all of the tax and similar hoops they have to jump through that the owners don’t understand well, and that takes away from their being able to focus on building a solid, stable, healthy business.
- The entire tax burden of small businesses (<10 people) is a tiny drop in the bucket compared to even one large business (>10k people). Reducing the tax on small businesses to zero would not seriously impact revenues, and could easily be countered by a tiny increase in larger-company tax rates.
- The larger a company is, the better able to handle and manage taxes. They can afford people to manage this full-time, whereas, with a small business, this forces the owner to wear too many hats, and their business suffers because of it.
It’s not hard. These two items are technically easy to do, would create a solid, stable economic boom that we haven’t seen since the 1950s, and it wouldn’t be a bubble (like the 1990s was). The key problem here is the willpower to go against the massive amount of lobbying money currently being poured into our political system from unscrupulous big businesses and a few key short-sighted billionaires to do the opposite – to get some quick, short-term gains, in exchange for damaging our economy’s long-term viability.
There are some other things we can do to invest in our future, such as tieing the federal poverty rate to 1% below the average minimum wage for the country (because if you’re making less than this, you’re already struggling to survive), switching to a single-payer health system (should save 40% or more right off the top of current health insurance premiums, based on savings from redundancy and removing profits / dividends from the equation, put an end to the runaway medical costs, and provide easier access to health care, especially earlier on when things can be caught and treated more readily), and building a system to cover much of the cost of higher education (a better-educated society makes better democratic decisions, and is better able to grow the economy; the US made this same choice when they became one of the first countries to provide a guaranteed free high-school education for all citizens), etc., just as an example.