[quote=The-Shoveler]I respectfully disagree, If we calculated the CPI today the same way we did in 1970, inflation (CPI measurement) would be significantly higher. I think 15 is much closer to the real inflation rate,[/quote]
I guess you could use the big mac index. A big mac in 1970 was $0.45 today it’s about $3.50 so 1.60 in 1970 turns into about $12.50 today under that measure. Of course liability insurance, workers comp, and other restaurant costs have gone up faster than CPI measures of inflation too and McDonald’s has to make a profit.
Part of the problem is that we don’t see a lot of the hidden costs that come with employing somebody. While minimum wage might be $7.25/hour by the time you add in employer’s social security, medicare, worker’s comp, unemployement insurance, Obamacare penalties, and/or coverage the out of pocket to employ somebody is much higher than what they see on their paycheck. It probably cost close to $12/hr to employ somebody with today’s regulations.
