Raising Minimum Wage Can Yank Millions Out of Poverty and Jump-Start Economy

[xchrom]

http://www.commondreams.org/view/2012/08/31-7



The federal minimum wage is just $7.25 an hour and hasn't been raised in three years. But a raise is much more overdue than that. If we look at the minimum wage 44 years ago, and simply adjust it for inflation, it would be more than $10 today.

This is another ugly symptom of what has gone wrong in America over the last 35 to 40 years. From 1979 to 2007, about 60 percent of the income gains have gone to the now infamous 1 percent at the top, with the majority of those gains going to the top 0.1 percent - people who made, on average, $5.6 million per year.

But some of the worst effects of giving more to those who have the most have affected people toward the bottom of the income ladder, and there is no excuse for it.

Productivity - the amount that a worker produces in an hour - has more than doubled over the last 44 years. When the minimum wage doesn't rise, or falls in terms of its purchasing power, it means that these millions of low-income workers are not sharing in the gains from improved technology, knowledge and organization.

[MADem]

1. Since this sort of legislation has to start in the House, it will never happen UNTIL we have a

Democratic House that can set the agenda.

[ProgressiveEconomist]

21. State MW ballot initiatives can turn this stumbling block into stepping stones

Initiatives and referenda can get onto ballots in 23 states, including Colorado, Florida, Ohio, Michigan, Missouri, and Montana. Just as anti-LGBT initiatives drew the extreme right to the polls in recent years, minimum wage hike initiatives could maximize poor people's turnout for crucial elections in swing states. See http://ballotpedia.org/wiki/index.php/Missouri_Minimum_Wage_Initiative_(2012) .

But such efforts have to be well funded and have top legal talent, however. This year's $8.25 Missouri minimum wage initiative succumbed to a legal strategy of running out the clock by a Republican governor who withheld essential State co-operation. The initiative was held up in court proceedings for so long that when it finally "prevailed" in the MO Supreme Court, there was insufficient time left to gather enough signatures to put it on the ballot.

[MADem]

25. There's a flip side to that coin, though--be careful what you wish for.

What's to stop the right wing from saying things (like they already do) about minimum wage increases?

Examples:

--Your kids will no longer be able to have summer jobs and save for college!! Business owners don't want to hire a KID for that much money!!!!

--Minimum wage raises will put "small businesses" out of business (read: cut into profits of owners).

--Your groceries/WALMART shit will cost ten times more because they'll have to pay the cashiers "so" much!!!!

These are not new arguments....they came around the last time the minimum wage got raised.

It won't be a simple thing, no matter where it happens.

I also think it's too late to try to make this a ballot issue in swing states for November. The electorate is like an aircraft carrier--slow to turn and slow to get up to speed.

With a Dem legislature at the federal level, it takes a vote in the House, and the Senate, and a signature by the President...and Bob's Yer Uncle, as they say.

[Freddie]

27. And none of these things ever happen

In the past when the minimum wage is raised, after all the RW howling.
If they had their way it would still be $1.70/hr like I made at my first job.

[MADem]

29. Hell, I remember making ninety some odd cents!

I was in a restaurant job, though, and my tips were supposed to make up for the shitty amount!

You're right, though--none of those things ever do happen, but they'll muddy the waters with 'em. Dumb parents who want Junior out of the house in summertime will vote against it, cheap businessmen will vote against it, people who make slightly more than the minimum wage, but don't want "them" getting "almost as much" will vote against it...

It will take awhile to percolate this effort into the public consciousness if we do it state-by-state, and with a bad economy there will be pushback. Way easier to just stick with the Big Issues that have been sketched out for this election, GOTV like mad, get a majority in both houses, and approach it that way.

If we fail to get both houses, two-track the focus for the next election--minimum wage raise AND "Take Back Congress."

[ProgressiveEconomist]

32. Would a state MW wage ballot initiative ever by itself turn out

many NO voters who would have stayed home without its presence on the ballot? I think not. Those Fox "News" addicts would have gotten to the polls in any case. That's the relevance of "that never happens" here.

Meanwhile, there's a big group of poor workers who see their kids doing without every day, but rarely get to the polls on election day. THAT's the group a MW ballot initiative motivates to turn out and vote. Given how close swing-state elections often are, even a 2 or 4 percent increase in Democratic party votes could swing Senate seats and even swing some imperfectly gerrymandered House districts.

I believe minimum-wage ballot initiatives are worth trying in any statewide election where governor's mansions, statehouses, or US Senate seats are in play.
This is a strategy whose use should be limited only by 27 state laws that don't allow them and by solid Red voters who don't make any statewide election close.

[MADem]

33. Yes--I do think it would turn out people who were lied to with CU money.

Vote NO--you'll pay twice as much for groceries! Vote NO--you won't be able to afford kid's your clothes!!!! Expensive ads featuring avuncular old people, crying that they won't be able to afford their dinner if you vote YES.

It's not hard to lie to stupid people, and not everyone who votes is very smart. Those "small businessmen" would pool their cash, make brightly colored ads, and deliver a hearty middle finger to the truth.

We don't need to introduce another issue into this election.

Where are those TAX RETURNS, Mitt?

RMoney-Ryan will roll back women's rights to the dark ages!!!

Got healthcare? You won't under Shit-Mitt and Lyin' Ryan!!!

[ProgressiveEconomist]

35. I disagree. IMO the upside is FAR greater than your downside. Remember,

we're talking about the response of people who otherwise would not vote to a single ballot initiative. IMO all but a few of those who oppose higher wages for poor people would turn out to vote in any case, ballot initiative or no ballot initiative.

[MADem]

36. For every action, there's an equal and opposite reaction.

I am simply not disposed to changing the conversation from RMoney's tax returns, Lyin' Ryan's fibs, medical care/medicare and other issues where RMoney is on the ropes. He could rally his "small business schmucks" to fight a new issue like raising the MW with no trouble at all.

Frankly, the focus needs to be on jobs first, then pay raises. The snark would write itself: "Waaaaah, Obama wants to make small businessmen pay more for labor when (lie about the number) people don't even have a job! Waaaaaah!!!! Obama hates small business!!!! That means he hates America!!! Waaaaaaaah!!!"

And, bottom line is this, too--if you are out of work, a rise in the MW isn't helping you.

I agree with the concept of a rise in the minimum wage, but I think that's a great GOTV tactic for interim year elections. That's a 2014 game plan--not November of this year. We've got plenty on our plate already for this one.

Finally, I think it's way too late in the day for ballot initiatives. We are double-digit-days away from the election--it is closer than many think.

[ProgressiveEconomist]

38. "way too late" for 2012 ballot initiatives. Agreed--this strategy is for 2014 and beyond

[MADem]

41. With proper framing and rollout, it could be a winner in the 'tween' year election.

Partcularly if we're seeking additional seats. POTUS could champion it without having to deal with consequences--the nice bit about Lame Duckery.

[liberal_at_heart]

42. these arguments have less and less of an impact

There comes a point where they push too far. Their lies become ineffective. People already can't find jobs, already can't feed their children and they see the excesses of the rich. I am glad Romney ran for President. It gave us insight into things we had never seen before. Our eyes are opening.

[xtraxritical]

22. Boy do I agree with you MADem.

The most obstructionist filibustering anti-American congress (with a small c) in history. They won't even consider the American Jobs Act, it's more important to tank the American economy to make President Obama look bad. It's more important to republiCONS to refuse to raise the debt ceiling and have this nations credit rating downgraded. No wonder this congress has the lowest approval rating ever recorded. The President has worked miracles considering the obstacles the treasonous republiCONs have put in his, and the American peoples, way. Here's what this Administration has accomplished in spite of this treasonous congress...

http://www.bing.com/search?q=obama+accomplishments&qs=AS&form=QBLH&pq=obama+acc&sc=8-9&sp=1&sk=

btw - are you really going to vote for R&R and more of the same "trickle down" BS that got us here?

[MADem]

37. The GOP legislature's mantra is "Just say NO."

That was their tactic to make Obama a one-termer.

I'd love to see all of 'em thrown out on their asses.

[JaneyVee]

2. Great idea. If minimum wage kept pace with the the rise of CEO pay, minimum wage

Would be $23/hr

[ErtBob]

3. This is the key!

I've been trying to push this point for some years now, but it seems to fall on deaf ears. People simply have no money left to consume with after paying for energy, health care and housing, and this is the root of our economic stagnation. The so called "job creators" are already saturated with money as are many large American corporations. They aren't creating jobs because they don't see demand out there because there isn't any spending power in the middle and lower classes.

The plan:
-Raise the minimum wage (all wages below upper middle class really)
-More money is injected into the base of the economic food chain
-Demand will be recognized by business people, jobs will be created. Simple!

[Fuddnik]

4. Not to mention the additional payroll taxes generated for SS and Medicare.

Take some hypothetical numbers.

Assume we have 100 million workers in this country. I'm not sure of the exact number, and it's too early to dig it up (for me anyway).

Now assume that approximately 30% of those are earning minimum wage. That's 30 million. If those people all had a $1.00 per hour raise. Just using minimal figures here. Assume that each worker works approx. 2000 hrs per year (40hrs x 50 weeks). Each worker would generate an additional $140 per year in SS taxes (employee side only), $280 with the employer contribution.

This would add $4.2 billion per year in SS taxes on the employee side. $8.4 billion total.

That's with just a $1.00 increase, and when you add the effects that the minimum has on raising other wages, it gets much bigger.

Instead of Ryan and Romney trying to turn us all into serfs, this would be a more sensible solution for SS and Medicare. Not to mention economic stimulus.

[xchrom]

5. morning!

[Fuddnik]

8. Good morning!

[OnlinePoker]

9. This is my post yesterday on the same topic

Of the 70 million hourly wage earners in the U.S., only 1.7 million (2.2%) earn minimum wage.

http://www.democraticunderground.com/?com=view_post&forum=1116&pid=21546

[Fuddnik]

14. Well, so much for my figures.

It just seems like Walmart and McDonalds alone have 2 million minimum wage earners.

[icarusxat]

16. AND?

Just because the next level of earners makes 10 cents an hour more that means everyone is doing great?

[reformist2]

19. There are probably 10-20 million just above minimum that will be helped as well. A rising tide...

[ProgressiveEconomist]

34. But what percentage of eligible nonvoters who'd vote "D"

if they could be turned out on election day earn the minimum wage or just above the minimum wage in swing states? That's the percentage that's relevant for a state MW ballot initiative strategy (see post #21 near the top of this thread), and IMO it could easily approach double digits.

Employers have to pay more than the minimum wage to get workers who will "stick" after being trained for their jobs. Where worker turnover is expensive, employers already paying low wages but more than the minimum must react to any minimum wage hike with wage hikes of their own.

[Cleita]

6. Also, hiring more government employees instead of imposing more austerity measures

would also accomplish more of the same thing.

[ibegurpard]

11. yes, one of the reasons for the sluggishness of the employment figures...

...has been the cutting of public sector jobs...that actually pay living wages. the whole repulsive argument that government doesn't create wealth is rubbish. Of course it does...maybe not directly but do the people that make this argument think that government expenditures on public sector employees just gets sucked into some vacuum somewhere?? these people spend their money on private-sector goods and services like everyone else who has a job they can actually make a living at...

[reformist2]

7. Show that big corporations can afford this - point out the mountains of profit they are sitting on.

To wit, Staples: $920 million in profit last year.

Other big employers... McDonald's: $5.5 billion in profit last year. Wal-Mart: $16.3 billion. Home Depot: $4.3 billion.

The list goes on and on, and on.

[ibegurpard]

10. you can't live on $10 an hour either

focusing on increasing the minimum wage is a distraction. we need to focus on using tarrifs to and other means at our disposal to encourage and promote jobs that pay a LIVING wage in this country. there are always going to be businesses that won't be able to make a go of it by paying more than minimum wages...that's fine. that's the kind of work for school kids and part-time people . The problem is all the jobs that people can actually MAKE A LIVING AT that have disappeared...that's not going to be solved by raising the minimum wage for convenience store clerks.

[icarusxat]

20. German auto workers get paid $60+ an hour and the companies are still profitable.

The American dream was never about making the bosses rich, it was about all of us moving upward . Why did this change? Is it a Bain thing?

[ibegurpard]

23. is there a minimum wage in Germany?

and is it $65 per hour?
Because that's what we're talking about here.

[geckosfeet]

12. A minimum wage below $10 an hour (roughly $20k/year) is barbaric.

We put no limits on how much the legalized thievery called upper management can demand for their services. But somehow we can justify putting an upper limit on minimum wage.

It is barbaric. Forcing people to work for slave wages.

[former-republican]

13. There should be two systems not a flat federal minimum wage

I can understand a small mom and pops restaurant or very small business not being able to pay $15 or $20 an hour.

But a large corporation ( Walmart for instance )paying workers minimum is a disgrace.

[Progressive dog]

15. Raise the minimum raise to at least $12 an hour and index for inflation.

We continuously hear from even supposed liberals how an increase in the minimum wage will either hurt small businesses, shift jobs overseas, cost younger workers employment, and not help those slightly above the minimum wage.
None of this has ever proven to be true when the minimum wage has been raised. There is also the simple question of fairness. Why do we care if a business that cannot afford to pay it's employees this small an amount can continue to operate?

[Iliyah]

17. BUT BUT it will take away a small amount of the corporations' profits

and greed is much more important than the American public.

[reformist2]

18. And it might make our mighty "job creators" angry... oh noes!

[reflection]

24. Cue all the right wing whining

about businesses having to fire workers or cut back hours if this is implemented.

[MADem]

26. It's what they do best! Last time the federal minimum wage was raised, they

had plenty of arguments on the same line....doom and gloom!

[liberal N proud]

28. Always say, give money to the guy who has to spend it is better than giving to the guy who doesn't.

The wealthy spend when they want to, the rest of us have to spend to to live.

[Trillo]

30. $10 per hour, or more than double that?

Don't forget ShadowStats inflation calculator
http://www.shadowstats.com/inflation_calculator

Even though his real inflation, vs the BLS inflation, is not answered except via the height in the bar, it is possible to ratio that mathematically and calculate a precise answer.

$1.15 in 1968 is $7.55 in 2012 per BLS stats according to Williams' calculator, and judging visually, very roughly, three times that amount under Williams "shadow stat". So, thats very roughly around $21-23 per hour.

[diane in sf]

31. It should be raised to about $20 per hour.

[MADem]

39. That's not going to happen--not in one legislative move.

These raises are made incrementally.

[lovuian]

40. and give AMERICANS jobs

Decent paying JOBS to AMERICANS would bring this country back to its glory days

[liberal_at_heart]

43. K&R

[chloes1]

44. My experience

living as I do in a state (OR) where the minimum wage goes up every year automatically is that goods and services just up that much more to compensate.

Things like haircuts end up costing usually a dollar or so more; that rise in prices just nulls the raise.

We'd be better off I think, finding some way to have the money we do earn go a little further, or perhaps strengthening the safety net for the people who have to live on minimum wage.

Perhaps we could encourage people to return to college or higher education.

Perhaps encouraging people to start their own business.

Raising the minimum wage however, usually turns out to be futile.

[xchrom]

45. Or banks could extend more credit - you know for

Those wages we don't make.

So we can owe the Company Store - for the basics of living.

[eurekaworkers]

46. Eureka Fair Wage Act - $12.00 an Hour for Large Employers - Small Business Exempt

Media Contact: James Decker [e-mail], [phone]

Eureka residents who filed a peoples’ initiative this summer called the Eureka Fair Wage Act urge you to get involved in the collection of signatures. If passed through a popular vote, the Eureka Fair Wage Act, also called the Minimum Wage Act, would require large employers with 25 or more workers in Eureka to pay a 12 dollar minimum wage. Eureka Fair Wage Act proponents assert that a higher minimum wage, with a small business exception, will improve lives, make Walmart reconsider its presence in Eureka, boost the local economy, bring employment up, and allow individuals who work full time to rise just above the federal poverty level. Fair Wage Act proponents are currently collecting signatures to get the initiative on the ballot and need your help.

http://fairwages.org

[e-mail]