The Communists at Bloomberg News call for a Revolution hike in the minimum wage.
Here’s an unhappy observation about the minimum wage: Congress last increased the rate in stages in 2006, topping it out at $7.25 an hour in 2009, or $15,080 a year.
That amount, when adjusted for inflation, is actually lower than what a minimum-wage worker earned in 1968 and is too meager to offer anyone the chance to climb out of poverty, let alone afford basic goods and services.
Not only that, more people with college degrees or some level of college are now forced into these minimum wage jobs.
It’s also becoming clear that many Americans are being forced to take lower-paying jobs and that a low-wage bias is creeping into the economy, as Bloomberg economist Joseph Brusuelas recently put it. In many cases, minimum-wage work is all that’s available, which may explain why such workers are older and better-educated than they were three decades ago. In 2010,nearly 44 percent of minimum-wage workers had either attended or graduated from college, up from 25.2 percent in 1979, according to the Center for Economic and Policy Research, a liberal think tank.
The federal minimum wage was always meant to be a floor, not a ceiling. Today, someone earning the minimum would have to work 749 hours to afford one year of health insurance premiums and 923 hours to afford a year’s tuition at a public four-year college.
The myth that raising the minimum wage will cause inflation has been debunked repeatedly by economists, but remains a popular talking point among the Republican faithful, actual research notwithstanding.
For cross-state contiguous counties, we find strong earnings effects and no employment effects of minimum wage increases. By generalizing the local case studies, we show that the differences in the estimated elasticities in the two sets of studies result from insufficient controls for unobserved heterogeneity in employment growth in the national level studies using a traditional fixed-effects specification. The differences do not arise from other possible factors, such as using short before-after windows in local case studies.
What this means is that changes to the minimum wage have no effect on employment (e.g. employers will hire fewer people) and have a positive effect on earnings (employees take home more money). Again, contrary to the usual GOP talking points, the real world behaves much differently.
Kind of like how labor unions actually help make the whole economy better by improving wages for both union and non-union workers. According to the EPI,
Strong unions set a pay standard that nonunion employers follow. For example, a high school graduate whose workplace is not unionized but whose industry is 25% unionized is paid 5% more than similar workers in less unionized industries.
And let’s not forget, as unionization has declined, so has the overall take-home pay of the middle-class.
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