Back to the Future–Raise the Minimum Wage!

Raise the Minimum Wage (pic)Last week in her blog post my colleague Carol Garvan suggested some fanciful New Year’s resolutions.  Like Carol, I too would like to go to that exotic resort in Thailand which would pamper me with limitless chocolate and ice cream.  But that’s wishful thinking and it’s not going to happen anytime soon.

So here’s a resolution that’s a little less quixotic and is something that we can try to make happen in 2014.  It’s time to make the minimum wage a living wage for all hard-working Americans.  It’s time for a real increase from the current national level of $7.25 per hour and even from the slightly higher level here in Maine of $7.50

This week marks the 50th anniversary of President Johnson’s War on Poverty.  Within three years after LBJ announced his plans to guarantee all Americans economic security through programs like Medicare and food stamps, the minimum wage was worth $10.56 in today’s dollars—or $3.25 more per hour than what is guaranteed today nationally and $3 more than here in Maine. 

In her seminal 2001 book Nickel and Dimed: On (Not) Getting By in America, Barbara Ehrenreich wrote that most American low wage workers are forced to live paycheck to paycheck and are a single economic setback from disaster—an unexpected health care bill, the loss of a job, an unexpected bill Ehrenreich herself worked for minimum wage in Maine for the Merry Maids housecleaning service and was unable to make ends meet. 

Indeed, the poverty line for a family of four today is $23,550, or almost $6,000 above what an individual earning minimum wage makes in a year.  Back in 1965, some 19% of American families lived below the poverty line; despite the War on Poverty programs instituted by LBJ, the rate today is only slightly better, about 15%.  Some 46 million Americans (!!!) live in households with scarcely adequate income with many relying on public assistance to subsist.  In the meantime, corporations paying workers at or near the minimum wage like McDonalds and Wal-Mart rake in record profits and CEO pay has skyrocketed. 

So what is Congress’s response to this tale of two Americas?  Last week Congress let unemployment benefits expire for tens of millions of Americans and as part of the recent budget deal cut food stamps, not to mention pensions for veterans. 

How do we get out of this mess?  Some would say education is the answer—but even that has proven to be no magic elixir.  Roughly 40% of low wage workers have attended some college, and 80% have completed high school. 

Rather, the quicker—and simpler—answer is to raise the minimum wage.  Raising the minimum wage by as little as $2.85 an hour to $10.10—still .40 below where the minimum wage stood almost 50 years ago—would lift some 5 million Americans out of poverty.  Better still, enacting a living wage, to $15, as some municipalities like Seattle have done or plan to do, would improve the lives of millions more. 

No doubt some will argue that business can’t afford it.  I say—can we, as richest nation in the world—afford to do anything less?  We are not talking here about people looking for a government handout; we are talking about the fact that 70% of those receiving government assistance are members of working families.  Can we afford to allow our brothers and sisters remain mired in poverty?

This new year, let’s resolve to go back to the future.  Let’s renew the War on Poverty, beginning with a substantial raise in the minimum wage.

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