January 2, 2014

fireshot-screen-capture-068-a-minimum-wage-that-is-too-high-promotes-unemployment_-santos-colombia-news-i-colombia-reports-colombiareports_com_colombia-news_economy_27434-a-miniJust in time for the presidential elections Colombia is raising its minimum wage by 27,000 pesos or 13 to 14 dollars month. That brings the minimum wage to about 657,000 pesos a month or at the present rate of exchange 338 dollars US. Now besides sounding ridiculously low it’s not going to make things better and here why. Colombia like most countries that say they are Democratic are more capitalistic meaning that if you raise the wages of the employees in order for the company to maintain its profit level they will raise the price of their products whether they be manufactured or grown. This in turn raises the cost of living for everybody and by the end of the year the wage increase will have disappeared and you’ll have an increase in inflation which means possibly higher interest rates decrease in available consumer credit and tax increases. So after all is said and done minimum wage earners will be just as bad of if not worse than before. Which of course means the cycle will start again until the economy adjusts itself. That and greed and corruption are what happened to the American economy. Of course it’s a little more complicated that what I’ve stated but you can get the jest of it. Its times like these that I’m really glad I’m a cat this is Flounder saying CIAO from Colombia.

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