Out of the many issues that President Barack Obama mentioned during last week’s State of the Union address, a solution to provide more income for poverty-stricken Americans, was among the more controversial.
He proposed a plan to raise the federal minimum wage from $7.25 to $9 an hour as a means to, hopefully, defeat the continuing growth in income inequality. Obama mentioned that a family with two kids earning a minimum wage is still going to be living below the poverty line as an example of why the minimum wage should increase.
While his plan certainly won’t bring an end to poverty in America once and for all (according to the New Yorker, the minimum wage annual salary will rise from $15,080 to $18,720, which is still not enough to elevate a person out of poverty), it is definitely a step in the right direction. Also, keeping the minimum wage where it’s currently at is simply unfair to those that are forced to live off of it.
When Obama announced the proposal, roughly half the people in the room watching his speech erupted into applause, while the other half sat quietly. U.S. House of Representatives Speaker John Boehner was a part of the latter.
“When you raise the price of employment, guess what happens? You get less of it,” said Boehner.
However, a little research proves that this isn’t necessarily the case.
Studies done by the Center for Economic and Policy Research found that since the early ‘90s, the minimum wage has little to no impact on the employment prospects of low-wage workers. This is quite the opposite from the claim that Boehner had attempted to make.
Another issue is the question of who the increase in the federal minimum wage affects. Certain stereotypes exist that perpetuate minimum wage workers as teenagers with part-time jobs. Opponents of the proposal use this as a counter argument, claiming that raising the minimum wage isn’t going to reach lower-income Americans like it’s intended to do. However, this assumption is a bit of a slap in the face to those that are doing their best to make ends meet with the low salaries that they make.
The fact of the matter is that there are other demographics that work at minimum wage jobs that aren’t just trying to save up their money for prom.
According to the New Yorker, “nearly nine out of ten workers who would benefit from a rise in the minimum wage are at least twenty years old. More than half of them work full time; over a third are married; more than a quarter are parents.” It seems necessary, then, to raise the minimum-wage, at the very least to help provide these families with additional funds to get by in such a tough economy.
And while we’re on the subject of our faltering economy, raising the federal minimum wage could be one of the answers that might help improve it.
A 2012 study by the National Women’s Law Center found “most minimum wage workers need this income to make ends meet and spend it quickly, boosting the economy.” It is morally reprehensible not to allow those who make such low income the additional cash to help them provide more necessities for themselves, especially if it could have a positive effect on the way our economy functions.
The desire for this change is long overdue for those struggling to get by, since, as the New York Times reports, “The $1.75 increase in the minimum wage would be enough to offset roughly 10 to 20 percent of the increase in income inequality since 1980.” If this ends up being the case, then this is a wholly necessary step in the right direction, especially when we look at an increasingly yawning gap in income inequality.
If the federal minimum wage ends up getting the increase it deserves, then the families that Obama mentioned as scraping by might finally be able to get ahead.