Doesn't it also reduce the incentive to outsource jobs overseas? It's harder for lower-skilled jobs in the US to compete with overseas workers working for less than minimum wage.

If wage is the only cost, sure. But it's not, and hiring a mexican metalworker at $16/hr is still cheaper than hiring an american metalworker at $16/hr

But is it cheaper than hiring an American metalworker at $8/hr?

It also makes American workers start to ask questions about why it's so much cheaper to pay a Mexican worker "the same amount" and whether or not the things that money buys are worth what it's costing them.

The problem is that the $16/hr is an attempt to say 'not mexico!' without being discriminatory, so it doesn't say 'non-US workers at $16/hr' it says, essentially 'workers must be paid $16/hr or more', and the result is you'd have to pay US workers $16/hr to meet the same criteria, or else cars produced 100% in the US would fail to be legal.

That's assuming corporations are too dumb to figure out how to get their other costs counted as part of the $16/hour.

For example, one of the major costs in the US is employer-subsidized health insurance, and employers subsidize it because it's tax advantaged. If they instead paid the employees more only to have the employees use the money to buy health insurance, the employees would pay more taxes. But they could still do it -- pay more and then offer a health plan with no employer subsidy. And then they're paying you "$16/hour" even though you lose half of it to health insurance premiums (and then even more to tax).

And if that got people asking why they pay tax on their health insurance when they buy it themselves, or why health insurance costs so much in the US, all the better.

> And if that got people asking why they pay tax on their health insurance when they buy it themselves, or why health insurance costs so much in the US, all the better.

Or it might just lower the compensation package that autoworkers get and make other industries more attractive by comparison.

Employees that want to know can already figure out what their employer pays for. Health insurance tax subsidies have massively distorted the health insurance markets for decades and there is more access to this knowledge than ever before, but there have been no major efforts to reform this and sever health insurance from company sponsorship.

That said, I think that would be one of the best things we could do to lower health care costs quickly -- force all employers to shift their health insurance to the employees and increase their pay by the cash equivalent.

> Employees that want to know can already figure out what their employer pays for.

That's not how humans work. The fact that information is available on the internet doesn't mean that people are actively going to go out and look it up. But if you send them a huge bill for something every month, they're going to look at it and ask WTF.

> It raises the cost of automobiles (that's why analyses project a reduction in automobile sales by a bit over a million vehicles per year)

What do new cars cost in the US? Does a price difference of $500 or $1000 really make someone say "all right, I'd rather do without a car"?

Yes. Of all the people considering buying new cars, there are some at the margin of buying or not buying.

Beyond that it seems more than reasonable, when the average cost of a new vehicle is in the 30k range or whatever it is these days, a difference of 500 or 1000 dollars like the parent comment gives as an example is a solid couple or few percent of the cost of the vehicle, almost by definition that will make or break around the same percentage of sales.

If you finance the car, that extra cost about extra ~$10/m

It might boost the sales of cheaper cars. Americans buy lots of big cars. Also Americans make use of mostly new cars. In places where cars are expensive, the roads look like an American's cars junkyard.

That's not exactly true. There are always near-substitutes.

If you can't afford a new Honda sedan you can: (1) look towards a Hyundai sedan, (2) look towards financing the same car for another year (which is why 7 year financing plans are common in the USA in the last decade), or (3) look at a used car.

A $500 cost difference between this month and next month means you may consider spending another $500+ on maintenance to keep your existing car running longer, but if you get into a place where your current car is no longer usable, there are several options before you have to forgo having a car altogether.

Yes, when prices rise, demand lowers as a continuous function.

It's not like nothing happens until it's an $800 difference and then there is "quantum leap" change.

> Does a price difference of $500 or $1000 really make someone say "all right, I'd rather do without a car"?

The answer to this is obviously yes if you think about it (assuming you're talking about deciding against buying a new car specifically). The question is how many people?

My guess is no, but it might make someone say "all right, I'd rather get a used car".

And person a getting a used car might make person b who was going to get a used car not get a car at all (or get a lower quality used car making person c...).

Also it might make some families go "all right I won't get a 2nd (or nth) car".

It also changes the math when you have an old car in need of repair and have to decide whether to fix it or replace it.