Fifteen years ago, in 1994, the real Entry Level wage was $12.35/hr. In 2004, it was $13.00 / hr. Ten years…sixty-five cents.
Yesterday, President Obama suggested a surgical spending freeze to reign in deficit spending. This outraged the Left, and the Right has been mostly silent; if not a bit gloating. There has been some further debate whether we should include with this legislation a direct tax-cut for jobs creation.
While I agree with such a tax cut, I think further hiring without addressing the pathetic state of wages in this nation will have minimal impact on the economy.
I suggest that along with a Surgical Spending Freeze and tax cuts, we also take a gigantic leap with the Federal Minimum Wage, and increase it to $12.00 / hr. It now sits at $7.25 / hr., which, as I stated, is pathetic. Stretched out to Full-time employment for a year, $12.00/ hr would earn just under $25,000 / year. Again, that’s hardly wealth, but it is significant. Due to the fact that about 1.8 million people earn minimum wage, and many others earn less than $12 /hr., the impact this would have on our economy would be huge. If we used some of the money we cut out of the budget to help businesses fund this increase to overcome concerns over the loss of jobs, we could potentially stimulate the economy while paying higher wages.
Consider for a moment what a $10,000 increase in wages for a year would mean to a Single mother, or a family of four? Would it be enough to get one of them off of welfare aid? Would it allow them to buy health insurance, or to eat better food? Would it give them hope, and maybe spur them to go to night- school, something they might not have been able to afford previously? Would it allow college students to borrow less for their education?
There are many things that need to be addressed in this current economy, but I believe that if you are looking for the thing with the biggest bang for your buck, nothing will do it like increasing the minimum wage while subsidizing part of the cost increase. Getting people off of welfare, or reducing the amount of money being borrowed for college cannot help but have a positive impact on America, now and in the future. People who earn more will spend more, increasing consumer demand, which, not coincidentally, is one of the roadblocks to job recovery.
$12.00/ hr. is not a wealthy wage, but $7.25 / hr. is a guarantee of poverty. If this nation truly is a Right – leaning nation, then no excuse is good enough for continuing the growth of poverty, which requires an ever-growing Social Services sector. Righties believe in a fair wage for a fair days work. They believe in tax cuts and spurring economic growth through the private sector. Nothing would accomplish that like a spike in the minimum wage.
There are so many more reasons to raise the minimum wage, and to help businesses pay for it, but the number one reason is to spur the economy while increasing the average wages of a vast number of Americans.