Low Minimum Wage vs High

[Jason]

In California, the fast-food wage was risen to $20 an hour. However, as cool as that may sound, what has happened are big layoffs. In that case, what was gained? Well, I really feel that the inflation needs to be dealt with, not the wage.

 

[Tracy]

The more you pay someone, the more the support environment raises costs to support that increase in salary. And that applies across the board and has a cascading effect.
I know it might sound like simple math to some - let's raise salaries so people can afford to live.
Well, the supposition is that those businesses are all fat cats raking in massive profits. Reality is that is not always the case.
I have read several reports of small eating establishments that have had to close their doors because their profits were marginal and the owners no longer could make enough themselves to support the business and themselves.

The problem with inflation in many ways is people are not concerned about "spending money". That is the entire target of the FED right now, trying to make spending money more painful.
You, in another post gave a classic example of that by not recognizing the TCO of an item because you were able to get it cheap on the front end and were not concerned about paying more on the back end.

The FED here in the U.S. tries to make it painful for people to buy stuff, especially on credit (like buy now/pay later). But when people are not that concerned about saving a few bucks here and there, it's harder to get that inflation under control as the businesses have no need to reduce their prices.
If people would quit buying stuff at higher prices and buy lower priced stuff (shop at a Walmart for jeans instead of going in to Nordstrom to buy jeans and buy store brand items) and those high priced item manufacturers will start to feel it in their pocket...and generally those prices then get lowered to a more acceptable (even if they have a slight premium over generic) price.
Inflation currently is kind of a weird issue here in the US. Generally making spending money on stuff painful reduces the spending of money.... so far that has not really occurred.

 

[Ravenfreak]

If people would quit buying stuff at higher prices and buy lower priced stuff (shop at a Walmart for jeans instead of going in to Nordstrom to buy jeans and buy store brand items) and those high priced item manufacturers will start to feel it in their pocket...and generally those prices then get lowered to a more acceptable (even if they have a slight premium over generic) price.

That's easier said than done with lots of people I'm afraid. There's people set in their ways and they want to buy the higher priced clothing. Some things you can get at Walmart are high quality, but some things are questionable too. Clothes are fine though, all my pairs of basketball shorts came from Walmart and I've had most pairs for around a decade now. They have no holes, and they've fit me well and didn't cost much. People want the name brands though, and they're willing to spend money they probably don't even have or could save for other expenses like food, bills, etc.

 

[Cory]

I only make $11.00 an hour, which includes my recent $2.00 raise. That's not enough to survive off of, especially considering I'm also part-time. I used to make $15 - $17 at Walmart and Kroger but couldn't handle the grocery business any longer after being in it for over a decade. The low wage I make is one of many reasons I live with my parents. Inflation sucks, it's like they try and increase our paychecks from time to time to balance with inflation, but everything keeps going up regardless.

 

[Tracy]

hat's easier said than done with lots of people I'm afraid. There's people set in their ways and they want to buy the higher priced clothing. Some things you can get at Walmart are high quality, but some things are questionable too.

But the point remains the same. Until people cut back on their excess spending for "better things" you will continue to see inflation in action. Those people that are set in their ways are the very ones that are driving inflation.
The whole point of the FED (for the US) actions is to curtail the "higher cost" spending that people do to and make it more painful since many buy on credit, with the ultimate result in lowering of prices historically. The buy now/pay later programs are biting many in the butt. They don't think of the ultimate cost because they want the stuff they can't afford out of pocket instead of buying what they can afford. When people see their credit card rates increase by 4%-8% and their payments go up the FED hopes that it will result in them spending less because it costs them more.
Those that continue to expend at what some consider excessive expense are what continue to drive inflation according to many well-known economist. Yes, there are other factors, but one of the main ones is that corporations can continue to charge high prices and make massive profits and people continue to buy the products, because as you said, they are set in their ways. The whole point of the FED action is to force those people out of their set behaviors, which has historically worked.
This period for the US is acting different than other periods of inflation. In past periods of inflation people have curtailed the purchase of what are commonly considered luxuries. Instead of buying a pair of name brand jeans they bought a cheaper pair of Wranglers. The catch-22 is many peoples salary are increasing so they spend more which gives the manufacturers no incentive to lower their costs, in many cases increasing them because of the increased cost in salaries to produce the product and they don't want to hurt their profits so they pass those additional costs downward and people continue to buy them.
Until the manufacturers start feeling pain in reduced purchases which affect their bottom line, they have absolutely zero incentive to lower the price of their product.
The perfect example was the initial post given. The raise in the wages for the workers result in higher costs across the board which then drives inflation and small businesses out of business because they have to raise their prices which then people cannot afford and business drops off and some end up having to close. People think that the increase salary is good, and it can be, but it affects the entire sector of production. It's not just the wait staff that gets raises, but the people that produce the products used in the production of items that the wait staff proffer to customers. Those additional costs are cumulative, and are passed on to the buyers, which drives inflation because of the higher cost.

And your statement of

People want the name brands though, and they're willing to spend money they probably don't even have or could save for other expenses like food, bills, etc.

is exactly what I am talking about. Until those start adjusting their spending habits, you will see inflation continue at a higher rate.
Unluckily most economist do not see a silver bullet to lower inflation with the behavior of consumers prolific spending continuing unabated.