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Excerpt: "Today, a worker laboring 40 hours a week nonstop throughout the year for the federal minimum wage could barely keep a family of two above the federal poverty line."

Workers lining up for jobs in Chicago, 06/05/09. (photo: Scott Olson/Getty Images)
Workers lining up for jobs in Chicago, 06/05/09. (photo: Scott Olson/Getty Images)



A Minimum Wage Increase

By The New York Times | Editorial

27 March 11


RSN Special Coverage: GOP's War on American Labor

 

s the nation grapples with a jobs crisis and unemployment hovers near 9 percent, it is easy for policy makers to forget the plight of those who work but earn very little. There are about 4.4 million workers earning the minimum wage or less, according to government statistics. This amounts to about 6 percent of workers paid by the hour. They need a raise.

Today, a worker laboring 40 hours a week nonstop throughout the year for the federal minimum wage could barely keep a family of two above the federal poverty line. Though it rose to $7.25 an hour in 2009, up $2.10 since 2006, the minimum wage is still lower than it was 30 years ago, after accounting for inflation. It amounts to about $1.50 an hour less, in today's money, than it did in 1968, when Martin Luther King Jr. and Robert Kennedy were killed, Richard Nixon was elected president and the economy was less than a third of its present size.

The minimum wage has many opponents among big business and Congressional Republicans. In Nevada, the Las Vegas Chamber of Commerce is pushing to repeal the state's minimum wage, a whopping $8.25 an hour. Representative Darrell Issa, the California Republican, has proposed a bill in the House that would effectively cut the minimum wage in states where it was higher than the federal threshold by allowing employers to count health benefits toward wages.

Opponents argue that raising the minimum wage would inevitably lead to higher unemployment, prompting companies to cut jobs and decamp to cheaper labor markets. It is particularly bad, the argument goes, to raise it in a weak labor market. Yet with unemployment likely to remain painfully high for years to come, this argument amounts to a promise that the working poor will remain poor for a long time.

What's more, we know now that the argument is grossly overstated. Over the past 15 years, states and cities around the country have rushed ahead of the federal government to impose higher minimum wages. Economists analyzing the impact of the increases on jobs have concluded that moderate increases have no discernible impact on joblessness. Employers did not rush off to cheaper labor markets in the suburbs or across state lines for a simple reason: that costs money too.

The most recent research, by John Schmitt and David Rosnick at the Center for Economic and Policy Research, found that San Francisco's minimum wage jump to $8.50 in 2004 - well above the state minimum of $6.75 - improved low-wage workers' incomes and did not kill jobs. An even bigger jump in Santa Fe, NM, the same year - from $5.15 to $8.50 - had a similar effect.

Despite evidence to the contrary, businesses and Republicans may keep pushing against the minimum wage - using the jobs crisis now to clinch their argument. They should be disregarded, because their argument is wrong and the United States is too rich to tolerate such an underclass.

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+22 # in deo veritas 2011-03-27 11:40
I hope that the rest of the world does not consider this the Richest country. We just have the richest 1% or so. In reality thanks to Wall Street and their puppets in DC we are close to being a third world country and if they aren't stopped, we will be.
 
 
+3 # rf 2011-03-28 06:34
If you travel it is abundantly clear that this is not the richest country...FAR FROM IT!!!
 
 
+13 # Karl Smiley 2011-03-27 13:05
Cutting the minimum wage causes job losses because people who earn minimum wage spend all their money. If they have less money to spend, demand falls, sales drop off and lay-offs ensue.
 
 
+9 # Nickolas Johnson 2011-03-27 16:04
Karl Smiley is right; reducing the minimum wage means merchants lose money for exactly the reason Karl cites: Minimum wage earners spend all their money on groceries, rent, work clothing, etc. Cut their wage and they HAVE TO buy less. Business hurts.
 
 
0 # rf 2011-03-28 06:38
Or they have to work more hours. Or both.
 
 
+9 # liberalman 2011-03-27 16:44
The absurdity of wealthy legislators demanding that the working poor be made even more so is astonishing but not surprising. The puppet masters that pull the rights strings want one thing: more.
 
 
+5 # Oligarch 23 2011-03-27 18:03
Barbara Erenreich's book Nickeled and Dimed in The US abput trying to get by on minimum wage, written in 1999 is even more pertinent today-the minimum wage should be at least $20.00 an hour so people could afford rent, food and utilities! for millions the US is a third world country!
 
 
0 # KittatinyHawk 2011-03-27 20:10
I believe it should be no less than $10 an hour, more in cities.
 
 
+11 # Rizerd 2011-03-27 18:20
I might add that the working poor also have unexpected things to pay for-like health care. They often end up going to the emergency room having a huge bill that will have to be picked up by the hospital or government/(US) . This is also causes health insurance rates to increase, Low salaries effect all of us! Everyone should have a livable wage.
I think it would be good if our legislators had their wages cut back too!
 
 
+1 # photonracer 2011-03-27 19:28
I read these comments and each of you act like you are referring to an African or South American or Asian country where the citizens have no voice. Come on people don't just feel good at the keyboard. Get off your butts, get the real enemy out of office. That enemy is the elected officials who want to steal from the citizens and give to the plutocracy. Yell, write letters, protest, start recall actions. Use your freedoms of speech, religion, assembly but act. Convince your misinformed neighbors and relatives of your knowledge and wit. Get them to act. Love your opinions, really detest your ennui. How do I know? Because you are obvious.
 
 
+1 # KittatinyHawk 2011-03-27 20:14
Good for you..I get tired of gripes and no one mentioning the March they were in,. I thought I was the only pain.

I believe that a stoppage of buying products from Companies would be a start, including buying more gas than one needs to go to work for at least one month.

the ones who have money may be surprised beccause these companies won't stop with poor. Poor will no longer be able to pay so who will be footing the bill for the government? Not china, they will take it over,. Not Islam so who will make up for the working man. I am hoping governor walker has the answer becaus he will be unemployed
 
 
+6 # propsguy 2011-03-27 20:52
hate to tell you this, but the "people" only get to vote once every 4 years or so and their choices amount to between bad and worse. the vote has not had any power in this country for years. in fact, it just placates people into thinking they have some freedom, some voice. our "democracy" is all theater.

if you want to do something, cut all your discretionary spending. do not buy anything made by a corporation. find out all the subsidiary owned companies and stop buying their products. think you need that new I-pad? think again.
get rid of your cable, better yet- unplug your television. buy your food directly from a farmer at a farmer's market- pay cash. walk to work if you can. mend your clothes. wash your windows with a vinegar/water solution in a recycled spray bottle. cook your own food. give up soda. stay out of walmart. plant a vegetable garden even if it's just a few plants in a container on your fire escape. shun brand names. trade something with a neighbor.
they tell us that consumer spending drives 70% of the economy. if that's the case, they should treat us a bit better. there's your power- not in the stupid vote, but in the ability to NOT buy things! every penny you don't spend is one that doesn't end up on their bottom lines.
remember, self-sufficienc y is the enemy of capitalism
 
 
0 # Merschrod 2011-03-28 07:07
Kitatinyhawk and Propsguy, present an interesting challenge, but he real challenge is to take back the "system" - Look what the Green party has just accomplished in German. Could we ever have a serious third party even at a state level? That isa real challenge our grandchildrens' children might benefit! It is a multigeneration al challenge.
 
 
0 # lnason@umassd.edu 2011-03-29 11:45
The NYT needs an actual economist on its staff. The consensus among virtually all economists is that minimum wage increases either do nothing (when wages already exceed the new minimums) or have a negative effect on employment. Employers faced with higher costs for labor, mechanize or do without or make other arrangements to avoid increasing their costs of production. And the worst part of the scenario is that minimum wage increases disproportionat ely harm minorities and those without many skills. Witness the disproportionat e negative effect on minority and teen employment when the last national minimum wage increase was enacted.

There is a reason that we no longer have elevator operators and gas station attendants; there is a reason that our fast food orders are being taken by cxustomer service representatives in India and afterschool jobs for teens have disappeared. It is time for the NYT to look at the facts instead of relying on wishful thinking to promote damaging economic policies.

Lee Nason
New Bedford, Massachusetts
 
 
0 # Robert Griffin 2011-03-29 13:40
I wish you weren't so predictable.
I heard the same arguments 25 to 35 years ago at my hard-right fundamentalist Calvinist church.
My son is making minimum wage in Las Vegas. Is there any reason to expect a pay increase if minumum wage is dropped?
I know if no rule that an employer may not lower wages; in fact my wage was lowered in 1981.
Be Well,
Bob Griffin
 

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