The financial industry’s 2014 bonuses doubled the combined earnings of all Americans who work full-time at the federal minimum wage, shows a just-released Institute for Policy Studies report.
Each week, millions of dollars are stolen from American families. The perpetrators act with impunity. There are no arrests, few convictions, and meaningless fines. What is this crime wave sweeping the nation? Wage theft. Some communities are now banding together to put an end to it.
Back when I studied economics, we “proved” in class that a minimum wage causes unemployment. But that proof depends on assuming a perfectly competitive market. Big low-wage employers like Wal-Mart have substantial market power; they can deliberately under-staff operations to force down wages. In that case, a minimum wage increase can actually create jobs–if it can be enforced.
It was the perfect “natural experiment:” in April 1992, New Jersey’s minimum-wage was scheduled to rise from $4.25 an hour to $5.05, while neighboring Pennsylvania’s minimum wage remained unchanged.
Call it vote-buying if you want, but when a government effectively buys the votes of 80 or 90 percent of the population, I call that government of the people, by the people, for the people.
We have at least twenty years to rebuild the Social Security trust fund. If we raise minimum wages now, we can start rebuilding the fund now.
For the past forty years American men’s incomes have stagnated, but women’s wages have risen. Unfortunately, the years of catch-up are now over. We need policies to raise wages for everyone.
If America could eliminate most serious poverty in the United States in the 1960s, surely we could do the same today.
Can you imagine Americans of 1968 settling for a minimum wage standard of living that had been set based on 1924 standards? What about 1880 standards? At some point we should expect low-wage workers to start living better than they used to.
Inflation has been steadily eroding the value of the U.S. minimum wage over recent decades. But inflation only explains part of the story why the minimum wage has become such an inadequate guarantor of low-wage decency and justice in the United States today.