QS Quotes:


"We should raise minimum wage because the cost of living is higher." Where do the costs for goods and services come from? Factors of production...such as labor. Forcibly increasing a factor of production results in higher prices for goods and services. If a binding price floor is higher than the equilibrium point. At that forced price level more people are willing to work (Supply for low skill jobs) but less firms are willing to hire at that given price (Demand for low skill jobs). This is called surplus (AKA unemployment).

If you forcibly increase a factor of production this translates to higher prices of goods and services. Australia is a prime example with a $16 minimum wage which seems like a great solution on the surface, but beneath it is 90% of the iceberg. Australia also has increased costs: Basic (Electricity, Heating, Water, Garbage) for 915 sq ft Apartment $204.92 Monthly. 1 Pair of Nike Shoes $153.69. Domestic Beer 0.5 liter $6.15. Movie Ticket (1 Person) $17.42.


And excuse the brevity but in summary higher public spending takes away from the private pool of financial markets, simply meaning that the more the government spends the less firms (small or large) have loans available to them.

Also in regards to higher taxes. Taxes no matter how they are spent or applied lead to dead weight loss. The burden between the demand or supply is distributed based on the elasticity of their associated curves. For example yachts. When there was a luxury tax imposed on them it was intended to put more burden on the buyers. But yachts have an elastic demand since it is a luxury that is easily replaced (with planes, cars, etc) and an inelastic supply since firms that produce them are specialized which means they cannot quickly change to produce something else. All of this results in a tax burden on the firms and ultimately the workers. The elastic demand means that buyers are sensitive to any increase in price. They will switch to some other luxury which means firms will suffer. If workers have less yachts to produce they will be out of the job.

Response to a person opposing the libertarian position to defund the FDA (or other government organizations).

 His comment: "I know the libertarian position on the FDA. The libertarian assumption is that businesses will product safe products or they'll go out of business. This is a HUGE assumption which is very obviously wrong when put to even the most cursory scrutiny."

  My response: You have somewhat hit one point while conveniently leaving out another. Your failed assumption is that the FDA is looking out for our health more than private companies. While the fallibility of both private companies and the FDA are fundamentally the same. People in organizations in position of power can be corrupted by self interest and leverage their power, this occurs in private organizations and government entities.