In the last two State of the Union addresses by President Barack Obama, the raising of the minimum wage has been brought up. Obama urged the nation to vote on and be in support of proposed legislation that would raise the minimum wage from the national level that it is now at $7.25/hour to a more reasonable sum of $9.00/hr in his 2013 address, and $10.00/hour in his 2014 address. Since January of 2014, the Democrats in general have left little to the imagine on what will be a major talking point during the mid-terms and even on through to the next Presidential election in 2016: minimum wage, and the need for raising it. It will be a major issue the Dems hope to champion and promise to the people in hopes of gaining votes, and ideally, in hopes that it actually happens, and soon. So, in light of that near future landscape of discussion, I thought I would bring up some of the better stats and talking points you are likely to hear from those in favor to make the simple case that yes, the minimum wage should be raised; it's only fair.
First off, lets look at the history of the minimum wage rates, adjusted for inflation, since its mandated inception back in 1938. Note that it took several years to reach a water mark that is above our own of today at $7.25/hour, but there were several years that the national minimum wage rate was considerably higher than todays. 1968 saw the highest wage minimum at $10.69/hour (at adjustment). Unless the argument is that during several times in the minimum wage raising history we have simply paid people too much, why aren't we more consistent with this minimum rate? Why were people making a minimum of 47% more in 1968 than in 2014?
Month/Year - Hourly Wage
(adjusted for current inflation rates)
October, 1938 $4.06
October, 1939 $4.88
October, 1945 $5.04
January, 1950 $7.25
March, 1956 $8.49
September, 1961 $8.73
September, 1963 $9.27
February, 1967 $9.69
February, 1968 $10.69
May, 1974 $9.39
January, 1975 $9.18
January, 1976 $9.41
January, 1978 $9.67
January, 1979 $9.67
January, 1980 $9.07
January, 1981 $8.77
April 1990, $6.84
April 1991, $7.31
October, 1996 $7.00
September, 1997 $7.45
July, 2007 $6.58
July, 2008 $6.94
July, 2009 $7.89
November, 2013 $7.25
Since 1938, the minimum wage has been raised 22 times by Congress. Why so randomly? Why is minimum wage raised so arbitrarily? Why isn't it raised every year, in very small amounts to keep up with the ever increasing rate of inflation and cost of living in this country? Does anyone have a good answer for this? ... These are the questions that I continue to hear from the left, and to be honest even some for the right.
If Congress were to simply have it written into the law that the minimum wage were to follow the inflation rates since the peak of the real value paid out, (being 1968 at $10.69) according to an extensive study by the Center for Economic and Policy Research, the current national minimum wage rate in this country should automatically be increased to a rate of $10.52/hour. So, assuming that they weren't economically crazy in 1968 and they were indeed paying a minimum wage that by many accounts allowed a person to live without the need for much (or any) social safety programs like food stamps, section 8 housing, etc., we should be able to do the same now. By this view alone, I am decently convinced that the minimum wage rate in this country needs to be increased to a standard that would allow for the people at the bottom to live and work at a full time basis WITHOUT the need for social programs that ultimately increase everyone's taxes and create all kinds of division and contention in this country.
On top of just keeping with inflation though, there are other arguments for those in favor of to consider before you make up your mind. Next up, labor productivity rates. For quick reference, wiki describes labor productivity as
: Labor productivity is the value of goods and services produced in a period of time, divided by the hours of labor used to produce them. In other words labor productivity measures output produced per unit of labor, usually reported as output per hour worked or output per employed person.
The same study that I pointed out from the Center for Economic and Policy Research for inflation also ran the numbers for keeping up with the increases in worker productivity. And that data reveals that if our country were to pay minimum wage employees at a constant rate (based on the highest value back again in 1968) and given that productivity has increased steadily for decades, that rate would be $21.72/hour. Yeah, productivity has gone up considerably in the last 40 or so years. Americans on average are working harder, producing more, but as the data I first presented shows, are getting paid less.
Another convincing piece of data, whats called "the wage freeze". In a graph on a Mother Jones article (that is source cited to show its legitimacy) cite these statistics:
The increase in real value of the minimum wage since 1990 is 21%
The increase in cost of living since 1990 is 67%
One year's earnings at the minimum wage is $15,080.
The income required for a single worker to have real economic security: $30,000.
These values that make up what they dub "economic security" are factored by the national average cost of living in this country, our current poverty thresholds, the rising cost of health care, and many other factors of consideration. Basically any and all factors that would exempt you from qualifying for the large number of social safety net programs (that have subsequently been enacted to help the millions of Americans that do not make enough to survive based upon income alone).
So, those are the most compelling arguments and data points that I have come across that, especially when presented together, leave me to draw no other conclusion than the minimum wage in this country should be raised. I do not believe in arbitrarily giving people more money an hour simply because raises make folks feel good, or because they protest over it. No. But, I do believe in a national minimum wage. I do believe in that piece of government regulation. And if you are going to have a minimum wage, it needs to maintain a level of consistency on par with its most effective time of enactment. That would be 1968. So, unless someone comes out with incredibly damning info as to why folks were simply making too much in the late 60's to make economic sense, I see zero issue with raising the rate to reflect that water mark.
Inflation exists, and we should raise the minimum wage (if we are to have it) so that citizens make at least enough money as to not be a drain on our already over-taxed system. We need less dependent upon social programs. Oh yeah, one last point of contention: Wal-Mart should pay out more employee income and get less government subsidies for allowing SNAP (food stamps) to be viable income in their retail stores. That's one example of how large corporations are playing the system in place, and are profiting more than they ought to. It smells like a scam to me. Slate lays out why brilliantly here
. I will not pretend like its my idea or insight, just one that I happen to completely agree with.
Raise the minimum wage to the 1968 threshold number of $10.52/hour. It's the right and fair thing to do.
The month, year and inflation adjusted hourly wage for every year the minimum wage was raised:
Inflation and the Real Minimum Wage: A Fact Sheet 1/8/2014
The Mother Jones article that cites the "the wage freeze" stats, along with 11 other "charts that will make your blood boil":
Huffington Post article citing the productivity rate increases that arrived at the $21.72/hour figure: