Reply #3: NO - Other [View All]

I should have probably answered "NO - it causes illegal immigration, etc". My reasoning is about the same.

While this policy helps a teeny, tiny percentage of American investors overseas, it hurts the other 99.999% of us. Whether the work is in-sourced (illegal immigrants) or out-sourced, the result is the same: depressed wages. For the vast majority of us who work for a living, the affect of depressed wages is obvious.

But wage increases help investors as well over time. I purchased an apartment building last year and am rehabbing a portion of it. So right at this moment I would benefit greatly from reduced wages among construction workers. However, even before borrowing the extra money for rehabbing, I was already losing money on this investment. The only way I will ever make a profit is if rental prices increase. And rental prices will only increase when people are able to afford higher rents.

In other words, I will only see a profit when wages have increased enough for the worker to give this investor enough of those wages.

Even when I am making a profit, even when my capital investment is completely paid for so that labor becomes my primary cost (loss), I would still be surprised to see a situation in which increases in labor costs outbreast increases in consumer prices. But where capital investment is concerned, future increases in wages is an absolute must for any investor.

What I can't figure out is how so many business owners are able to do the risk analysis required to take the gamble on mortgaging everything they own, yet are incapable of seeing that wage increases across the economy will maximize their profits.