Minimum wage vs the poverty line (The White House) Minimum wage vs the poverty line (The White House)

Greg Sargent’s blog post from this morning addressed the argument over minimum wage. It was nice of him to headline it: “Bring It On,” given that was going to happen, invitation or no. Whether backing up or knocking down the president’s argument to raise the minimum wage, commenters wasted no time on preambles or any other throat-clearing.

Dan999 argues that not raising the minimum wage is the same as decreasing it, given the constant rise of the cost of living. And actively lowering minimum wage has, Dan says, been very bad for everyone:

How about this. We vote to reduce the minimum wage by a couple percent a year and see how that works out 10 years down the road. Oh wait. We did that. People got poorer and then the economy collapsed.

DocAwesome applies medical knowledge to the dollar-circulation discussion:

A select few hoarding the vast majority of the wealth in America does our economy as much good as most of the blood in the body being constricted into a big toe. Money needs to flow throughout the economy, like blood through the body.

Grant Johannessen argues that an across-the-board minimum wage increase brings us all closer to the minimum and decreases our wages in comparison to the new minimum:

What if you make $9/hour now, if the minimum wage is increased, do you think your pay will be too? or will your purchasing power simply decrease? Raising the MW just makes everything we do more expensive.

Oscar_R says that the places employing people at minimum wage tend to be places where people who make minimum wage do business, so money the companies give out in wages will come back to them via increased prices:

Most of the businesses impacted by this will be retail or service related so it will impact many more people than some want to admit. Businesses impacted the most would include Walmart, Sears, McDonalds, Safeway, Giant, etc.
The impact will be little if any. $2 more an hour won’t now make you be able to afford a house or any thing significant. Since goods your buying may go up, because the cost of them doing business increases, it may make even less of a difference.

Dan999 (hi again!) uses the same situation to argue FOR minimum wage increases:

If you pay them more money … they will spend it. If you are Walmart … they will spend it there.

truthwillout says, well, look at places that have hiked the minimum wage. What effects did it have, and how did they do it?

The minimum wage in Washington State is now up to $9.19. It’s been linked to inflation for over a decade already. And, Walmart, McDonalds, et al are still building stores and hiring new employees. Unemployment is no worse than the rest of the country (and better than about half of the other states, many of which have only the federal minimum wage). Prices haven’t gone through the roof. The sky has not yet fallen.
But none of this was the result of our legislature. Every minimum wage change up to 1998 was a big fight with the Republican side, and they mostly managed to block the increases. Finally, the voters , having had quite enough, passed Initiative 688 in 1998 that set the minimum wage at the then current Federal wage rate, and required that it be indexed to CPI-W. It was the sensible way to handle it.

swan_502 argues that if the goal is less overall inequality, don’t set an arbitrary number as a minimum wage but rather use a proportion for the top and the bottom rungs’ pay. That makes the CEO more invested in the average worker’s welfare:

Why not rule that the gap between CEO pay and the bottom rung in a corporation be not more than 100x? We had tons of economic growth through the 50’s, 60’s and 70’s when CEO pay was less than 30x the bottom. Now we have CEO pay averaging 500x the bottom, record profits and record unemployment.

cato says don’t start with the wage — make it easier for workers to become more valuable:

If people want higher wages they should develop the skills where they can earn higher wages. Huge amounts of government funds are available for training/retraining. Four percent of hourly wage earners receive minimum wages. Let’s help them develop the necessary skill levels needed to boost their wages. Let’s not inflate consumer costs across the board for a feel good law that has proven ineffectual for the past 75 years. If you want a good paying job you have to have the skills to fulfill that job. That doesn’t mean college degree. Most people with degrees don’t work hourly jobs and minimum wage laws only effect hourly workers. Everyone deserves a livable wage, but not everyone has developed the skills to earn one.

But productivity has surged, and wages have not, making PostScript doubtful that increased worker “value” does much necessarily for the worker’s wallet.