Raising the Minimum Wage
The resilient American middle class has weathered two world wars, a Great Depression that almost took out our economy for good, and the 2008 financial meltdown that caused millions of Americans to be laid off, our national debt to multiply, and social inequity to skyrocket. However, four years after that calamitous crisis, American workers and their families are still struggling to succeed and many are questioning if the fortitude of the American people can still overcome the enormous challenges now facing our nation. It’s time that we restore confidence in our nation by raising the minimum wage which will stimulate our economy, repair our fiscal stature, and last but not least, restore social justice, economic mobility, and the American Dream.
Raising the minimum wage would reinvigorate the American economy by creating jobs. While there is a common misconception started by fear mongering corporatists that raising the minimum wage will kill jobs, but actually, in a study from the Times Magazine on September 21st 2014, the 13 states of both Republican and Democratic legislatures that have raised the minimum wage have experienced an average of .85% job growth while states that have chosen not to raise the minimum wage only saw an average of .61% job growth. These numbers just come from common sense. When people have more wage and thus more money in their wallets, they can buy more from small and local businesses. When business have more money, they can hire more workers that get paid more, and consequently, the economy gets the much awaited jolt it needs to continue its recovery.
Also, raising the minimum wage has historically created jobs. According to the Bureau of Labor Statistics, from 1995 to 1996, 2.6 million jobs were created while the unemployment rated dropped by .3%. This was matched by a 50 cents minimum wage increase from $4.25 to $2.75. If job growth coincided with a minimum wage increase, it is clear that raising the minimum wage would not kill jobs, rather create them. Furthermore, the minimum wage was passed as part of the Fair Labor Standards Act by President Franklin Roosevelt in the New Deal. It was implemented during the Great Depression, an era of economic devastation but also of important social reforms. As part of the New Deal package, the minimum wage helped to restore America to the forefront of economic growth and job creation and was a crucial reform that stimulated the economy and created good-paying American jobs.
But secondly, raising the minimum wage would reduce the deficit and act as an effective form of entitlement reform. According to the Center of American Progress on March 5, 2014, raising the minimum wage would “decrease the amount that taxpayers spend on programs such as SNAP”. Specifically, “SNAP benefits decline 30k for every $1 increase in family earnings and phase out entirely at about the federal poverty level”. In that same study, they found that a 10% increase in the minimum wage would reduce the amount of people who rely on food stamps by between 2.5% and 3.2% and decrease the SNAP budget by 4.6 billion. Raising the minimum wage is a less draconian form of entitlement reform that would help lower-income Americans to be able to provide for themselves, rather than traditional forms of entitlement reform that would remove social safety nets and leave millions of Americans in the dust.
Moreover, with a minimum wage increase, workers would pay more in taxes because they have more money. According to the Congressional Budget Office, a nonpartisan group trusted by both parties, “workers with increased earnings would pay more in taxes and receive less in federal benefits of certain types than they would have otherwise”. Also, because raising the minimum wage would give workers more money to spend at retail stores and restaurants, thus increasing the profits of businesses and therefore increasing the stream of revenue through the income tax.
Last but not least, raising the minimum wage would be the first step on the journey to restore the American Dream because today, the system is rigged and the fundamental American principles of social justice and economic mobility are gone.
But after delving into the economics of the mater, let’s talk about the moral question. According to the Washington Post on April 12, 2013, in 2011, more than 10 million American workers spent more than 27 weeks in the labor force but still fell below the federal poverty level in a social class known to many as the working poor. From a March 2014 report from the U.S. Bureau of Labor Statistics, in 2012, more than 14 million Americans were classified as part of the working poor. As we can see from these statistics, hardworking Americans are working more but earning less and are facing challenges just to put food on the table and put a roof over their families’ heads and that is just wrong because if a middle-class mother works fulltime with 12 hours shifts a day, seven days a week, and 52 weeks a year and still manages to pick up the kids afterschool and send them to piano or ballet, she should be able to provide for her family and give her children a better future and a better life.
And that mother who works so hard to provide for her kids deserves more than just $7.25 an hour, the current federal minimum wage. Right now, she earns, according to the Christian Science Monitor, 558 times less than the CEOs of big corporations like AT&T. But the worst example of income inequality is at McDonald’s, where the CEO earns 1,196 times than what the average worker makes. Is it really fair for the CEO to make so much more than what the average worker who goes to work every day to earn a profit for the CEO’s company makes? Is it fair for the worker who does the grunt work of running a business to earn thousands of times less than a CEO that may not even put in as many hours? There is no question that the CEO should earn more than an average worker, but when the difference in wages is in the thousands of times, there is a problem. The system is rigged against the American worker and the income equality and economic justice that our nation was once known for is gone.
These startling revelations of country whose economy is stagnating, whose fiscal situation is less than stellar, and whose core promise is failing should serve as a wake-up call to all those still asleep in the deep slumbers of the past. No longer are the days when people could work and study really hard and expect to climb the proverbial economic ladder. The days where workers could expect a fair, living wage are in the past. But today, we have a clear solution to almost all the economic, fiscal, and moral challenges our country faces. Raising the minimum wage would stimulate our economy, reduce the deficit, and be the first step on a long journey to restoring the American Dream and the principles of social justice, economic mobility, fiscal prudency, and prosperity that our nation was once known for.