Justice, Politics

Minimum Wage- HYAAH!

The last time the minimum wage was raised, I was a teenager. In the following year, during my lobbying intern days in Washington DC, I was part of a campaign to raise it again, as the previous increase still hadn’t closed the gap in purchasing power. Since then, during the second longest stretch of time without a raise since its inception, the minimum wage has shrunk even further in real dollar value when compared to the minimum wage’s value over the decades.
I was heartened to know that not only was it a priority for the 110th Congress, but that our friends over at Jewish Funds for Justice and the Religious Action Center have been working hard organizing rabbis and the larger Jewish community around this important issue. Kudos to their real, serious efforts to get voices from the organized Jewish community out on this key issue- they’ve gotten at least 450 rabbis, cantors, and Jewish seminarians signed on to their statement. And join them in contacting your Senator to push for a minimum wage increase that isn’t riddled with buisness tax cuts and giveaways (come on, Senator Baucus, in power less than a week and already caving in on a bill the House passed with FORTY PERCENT of the Republicans voting for its passage?).
Rabbi Jill Jacobs sums up why this is a Jewish issue quite nicely in the joint press release:
“Jewish labor law rests on the assumption that a full time worker shall earn enough to support his/her family,” said Jacobs. “To begin to realize self-sufficiency for workers as envisioned by Jewish law, we must raise the federal minimum wage.”
For those who wonder where I get some of my hairbrained ideas about how small the minimum wage in the United States really is and how I can be so sure that raising it won’t kill every small business in existance, don’t take my word for it, here are the nice folks from the Economic Policy Institute:

Who are minimum wage workers?
An estimated 14.9 million workers (11% of the workforce) would benefit from an increase in the federal minimum wage to $7.25 by 2008. Of these workers, 6.6 million would be directly affected and 8.3 million would indirectly receive raises due to the spillover effect of a minimum wage increase. Of the total affected workers, 80% are adults and 59% are women. Over half (54%) work full time and another third (30%) work between 20 and 34 hours per week. More than one-quarter (26%) of the workers who would benefit from an increase to $7.25 are parents of children under age 18, including 1,395,000 single parents. The average minimum wage worker brings home over half (58%) of his or her family’s weekly earnings.
Why do we need a minimum wage increase?
A minimum wage increase of $2.10 by 2008 would raise the wages of 14.9 million workers. A minimum wage increase is needed to restore the minimum wage to historic levels. The inflation-adjusted value of the minimum wage is 30% lower in 2006 than it was in 1979. In addition, comparing the wages of minimum wage workers to average hourly wages, we find that the wages of minimum wage workers have not kept up with the wages of other workers. The minimum wage is 31% of the average hourly wage of American workers, the lowest level since 1947.
Congress has not increased the minimum wage in almost nine years—the second-longest stretch of government inaction since the minimum wage was enacted in 1938. Since the min wage is not adjusted for inflation, when Congress does not increase the minimum wage, the minimum wage continues to lose value.
Does the minimum wage cause job loss?
A 1998 EPI study failed to find any systematic, significant job loss associated with the 1996-97 minimum wage increase. In fact, following the most recent increase in the minimum wage in 1996-97, the low-wage labor market performed better than it had in decades (e.g., lower unemployment rates, increased average hourly wages, increased family income, decreased poverty rates). Studies of the 1990-91 federal minimum wage increase, as well as to studies by David Card and Alan Krueger of several state minimum wage increases, also found no measurable negative impact on employment. Finally, a recent Fiscal Policy Institute (FPI) study of state minimum wages found no evidence of negative employment effects on small businesses.

There’s even a great story in a recent NY (jm) Times about the diffence between Washington and Idaho when it comes to the increased minimum wage in Washington:

Nearly a decade ago, when voters in Washington approved a measure that would give the state’s lowest-paid workers a raise nearly every year, many business leaders predicted that small towns on this side of the state line would suffer.
But instead of shriveling up, small-business owners in Washington say they have prospered far beyond their expectations. In fact, as a significant increase in the national minimum wage heads toward law, businesses here at the dividing line between two economies — a real-life laboratory for the debate — have found that raising prices to compensate for higher wages does not necessarily lead to losses in jobs and profits.

A real life example debunking the blustery conservatives. I love it. I also love the awesome working organizing over 450 rabbis, cantors and seminarians that JFSJ, along with the good folks at the Religious Action Center, has done. Contact your senators today!

9 thoughts on “Minimum Wage- HYAAH!

  1. I have yet to caffinate, so I do not have anything intelligent to add to this yet. I just really wanted to say that the headline of this post made my morninig…*adjusts metaphorical nerd glasses*

  2. I have always been puzzled by the value of raising the minimum wage while doing nothing to keep executive salaries from fleeing it. Raising the Minimum Wage gives the poor additional buying power briefly, but when their wages remain static while the wages of top earners increase that buying power is lost. When are we going to do something to ensure that that buying power is not soon gobbled up by inflation?

  3. I don’t have anything to say really except I appreciate the They Might Be Giants reference in the title of the post. I know all the words to that song.

  4. Rich-
    I think indexing it to inflation is something that is critical, and the hope is that that will be tackled once we start with this increase. Mik Moore from jspot touches on this on a post in December while going over a NYTimes piece. Check it: http://jspot.org/?p=813
    Definitely matching it to inflation, a regular schedule of increases, something must be done, because my guess is that 7.25 an hour for a 40 hour week is still below the poverty line in many cities around the country.

  5. I’m glad the advocates of a higher minimum wage don’t mind the obvious results – poor people being fired because their companies can’t afford to pay hire wages. For the most part minimum wages are paid to the young and entry level workers, they soon earn far more than minimum wage. If you really want to help the poor, do away with the minimum wage entirely, more will be hired and start the upward trend to full decent employment – Econ 1.

  6. oh — is that what’s happening in every country that lets corporations pay employees 18 cents a week? an upward trend to full decent employment?
    maybe you missed the fact that capitalist pig scumfucks will rape you for every cent they can squeeze from your bloodstream in a deregulated market.
    maybe corporations need to be forced at gunpoint to treat both employees and consumers with decency because the only thing they care about are their shareholder’s profits and ceo’s bonuses.
    s’why i’m a libertarian socialist and not an anarcho-capitalist. corporations cannot be trusted. never since they’ve existed.

  7. i’m moving up the company ladder…and one day, i’ll even be able to afford a soda at the company vending machine…thank god for a deregulated labor market…if there was a minimum wage, the market would be so competitive, my company couldn’t possibly afford to hire 20 people for the price of 1 and then who would help me make all these awesome sneakers i could never possibly afford to own?

  8. Hi Incorrect,
    those are great neo-econ stories you have, but you did notice that I put up information from the EPI that coutners basically everything you said before you say it. No? Check out the EPI link. Also, read the Times story about how Washington’s raising of the minimum not only caused businesses to thrive, but has forced companies on the border in Idaho to raise their wages as well.

  9. K, there’s nothing neo or con about stating the objective fact that a minimum wage (or raising a current one) puts poor people out of work – it’s Econ 1A.
    And don’t let the NYTimes, the paper of record for anti israelis, anti jews and anti common sense lull you into beliefs that belie reason – their story about Washington and Idaho was nonsense, I suggest you reread it with a rational objective mind – it seemed to say that because Idaho town along the Washington state border were within the economic ambit of the larger Washington mnimum wage economy, the Idaha companies were obliged to pay higher wages to keep competitive with the wages paid in Washington – duh

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