Day 90 – My journey to find reasons to vote for Hillary rather than just against Trump.
Hillary wants to raise the minimum wage to help close the inequality gap.
The federal minimum wage has failed to keep pace with both the cost of living and the median wage in the labor market. That means even working full-time at the minimum wage does not allow families to escape poverty or attain economic self-sufficiency.
This issue is not about teenagers flipping burgers, 89% of those who would benefit from a federal minimum wage increase to $12 per hour are 20 or older, and 56% are women.
You may have noticed the word “federal” several times already. The federal government determines the minimum wage for the country; however, municipalities and states may enact their own minimum wages – and many do. Thirty-seven states had state minimum wages exceeding the federal level in 2007 prior to the most recent federal increase. In the debates between Bernie and Hillary, there was some confusion over whether she supported a $12 minimum wage or $15. The fact is, she supports both: $12 federally and $15 for more expensive cities and states, e.g., NY and LA. She also thinks we need to step our way up there from the current $7.25/hour so as not the shock the system.
Why is this important? Wages for the bottom half of the population rose only in the late 1990s during high unemployment. As a result, the top 90th percent’s real wages grew by over 30% between 1973 and 2011, while the median and lowest 10 percent’s real wages grew by less than 5% over the same period – in part, creating the income gap.
Won’t raising the minimum wage kill small business, increase unemployment and hurt taxpayers?
Raising the wage by even small amounts for workers in the bottom three earning brackets, which an Economic Policy Institute report describes as “those who earn up to $12.16 an hour,” could reduce the amount taxpayers spend on government programs. Per the report: “For every $1 that wages rise among workers in the bottom three wage deciles, spending on government assistance programs falls by roughly $5.2 billion. This estimate is conservative, as it does not include the value of Medicaid benefits.”
The Department of Labor kills a few more myths:
Myth: Increasing the minimum wage is bad for businesses.
Not true: Academic research has shown that higher wages sharply reduce employee turnover, which can reduce employment and training costs.
Myth: Increasing the minimum wage is bad for the economy.
Not true: Since 1938, the federal minimum wage has been increased 22 times. For more than 75 years, real GDP per capita has steadily increased, even when the minimum wage has been raised.
In a letter to President Obama and congressional leaders urging a minimum wage increase, more than 600 economists, including 7 Nobel Prize winners wrote, “In recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market. Research suggests that a minimum-wage increase could have a small stimulative effect on the economy as low-wage workers spend their additional earnings, raising demand and job growth, and providing some help on the jobs front.”