Sorry if I'm misinterpreting your point OP, but I took away something like this:
The current cost of living is being held artificially low by government aid programs that are paid for indirectly by tax payers and our increasing national debt. By hiking minimum wage we remove the dependence on social welfare programs, reducing taxes and national debt and offsetting the increase in product prices.
It seems like most of the people against a raise in the wage have been avoiding the issue of government spending, but it is a pretty important one. As Will pointed out, there are already exceptions to the minimum wage for small businesses and young people who don't need a "living wage", so raising the minimum wage should not even effect mom and pop stores. I've yet to be presented with a reason as to why Walmart employees should receive food stamps when Costco is able to offer very similar prices while paying their cashiers 45k a year.
This isn't an attack on anyone, of course, I'm legitimately interested in hearing other points of view!
Those are good questions. My short answer is because it costs less taxpayer dollars to provide a minimum wage worker with food stamps and EITC, than it cost to provide benefit for someone without a job. Secondly, why isn't Costco hiring more workers?
The government subsidy for min. or near min wage workers is relatively modest. For example the average SNAP (food stamp) beneficiary receive just under $2,000/year, while a mom with young kids may get as much as $7,000-$8,000/year it is still much less than she earns. So what if the wage increase to $10.10 as the President propose or $15/hour as many our advocating. One of the consequence will be employees will hire less workers, they will be replaced by automation, or they will simply offer less service, for example self check out replace 4-8 jobs with one. Now there are lot of conflicting studies about the impact on minimum wage rise on unemployment. But it is important to understand that virtually all of the studies involved modest increase in the minimum wage of say <$1/hour. We simply don't know what the impact of a $2.85 or more than doubling of the wage will be. It will certainly result in some unemployment, either firing of existing workers or more likely primarily a hiring freeze.
Unemployment averages about $290/week (Q1/13 data) after the unemployment is exhausted, then they sometimes they can get TANFL (welfare). A key component of TANFL is a jobs training program. Jobs training is generally money well spent, but it is also not cheap, typically at least $20K/year. Meaning we can provide 10 folks foods stamps for the cost of putting one person in jobs training. More over much of the jobs training involves basic work skills, show up every day on time, treat the customers well, respect your boss. All those skills can be learned just as well at McDonalds or Walmart on their dime instead of on the governments. So it only takes a small increase in the unemployment rate to complete cancel the savings we get by moving people off SNAP, EITC due to higher wages.
Now this is the route the many young people who can't find job will follow. However for a significant minority of young people especially for those who come from poor families they are likely to stay screw the system. I tried to find job nobody would hire me and dealing drugs or stealing is much better way of making money. Obviously the cost to society for those folks far exceeds subsidizing McDonalds and Walmart employees.
I am huge fan of Costco. I shop there at least once a week, my basic attitude is if I can't buy at Costco I don't need it. However, people who think Costco pays people good wages why can't Walmart,Target or McDonalds do the same, are not understanding the difference between Costco. Megan McArdle has written many articles this here is one.
http://www.bloombergview.com/articles/2013-08-27/why-walmart-will-never-pay-like-costco First Costco customer are upper middle class (median income >$80K) who spends over $200 at time. Costco makes most of their profit from their $55/$110 membership fees and generally go once or twice a month. Walmart customers are lower middle class (median income <$40K), many would have a hard time coming with $55 membership, the average Walmart purchase is less than $30 and typically customer shop their twice a week. I go to Walmart about every other month.
Costco has only 1/2 as many employees/square foot as Walmart, and has 3 times the revenue/per employee and 50% more profit per employee. While I love Costco, I wish they'd bag my groceries rather than just give me a big box if they haven' t run out. I also wish they had wider selection. We have a big problem with unemployment so why doesn't Costco be a good American company and hire more workers? Somebody to bag my purchases and few more guys to stock a wider selection, Costco prices are very low they could raise the a little bit, and people will still buy them, and so what if the earn a bit less profits? More people need good jobs like Costco provides.
As other have noted there is a significant difference in the quality between Costco and Walmart employees (Obviously this is a generalization). By virtue of higher pay Costco does hire smarter folks with a better attitude and are able to take the initiative to make customers happy. (I still remember the Costco employee who spent 30 minutes looking for a 25 lb turkey for me near Xmas).
But as constantly tell my friends remember that 1/2 the country as an IQ below 100 and/or below average work skills. Wallmart and McDonalds provide important step to acquiring these skills for the other half.
