The minimum wage: Should it be raised?

last updated 8 January 2015

Americans are waking up to the fact that the minimum wage is no longer a living wage, said Edward Luce in the Financial Times. Voters in SeaTac, a Seattle suburb, last month backed a $15 an hour floor—more than double the $7.25 federal hourly minimum. Legislatures in California and Massachusetts recently lifted their minimum wages to over $10 an hour. “And President Obama last week said he would support legislation to take the federal level to $10.10 an hour and thereafter link it to inflation.” A significant increase is long overdue, said Steve Coll in The New Yorker. Congress has kept the floor at $7.25 since 2009. People supporting families on the minimum wage must get by on $15,500 a year—“far below the federal poverty line.” In order to survive, these poor working families supplement their meager income with food stamps and other government handouts. But by raising the minimum wage to $10 or above, we could lift millions out of poverty, and ensure that “the dignity of work includes true economic independence for all who embrace it.”

Raising the minimum wage won’t fight poverty, said Douglas Holtz-Eakin in HuffingtonPost.com. The reality is that 80 percent of minimum-wage earners are not truly poor, according to the Census Bureau. Many have better-paid spouses, while 46 percent are teens or young adults—many of whom live with middle-class parents. Poor people, meanwhile, will suffer the worst consequences of any wage hike, said Mario Loyola in NationalReview.com. Businesses will slash hours, fire employees, and raise prices to cover higher salaries. Progressives think a higher minimum wage “protects” the poor but ignore the reality that “nobody has an obligation to hire you.” If it’s illegal for supermarkets, fast food franchises, and retail chains to pay salaries dictated by the market, they’ll just make do with fewer workers.

It’s a myth that raising the minimum wage leads to job losses, said Paul Krugman in The New York Times. A study of states that raised their minimum wage found no significant impact on employment compared with neighboring states that didn’t raise the wage. Most economists now support raising the minimum wage, and so do 76 percent of voters—including 58 percent of Republicans. Something that would help hardworking Americans “might actually be politically possible.” Incredible! “Let’s give it a try.”