Elizabeth Warren Wonders: Why Aren’t Employers Paying $22-an-Hour Minimum Wage Rates?
Democrat Senator Elizabeth Warren during a hearing of the Senate Committee on Health, Education, Labor and Pensions last week asked why the current federal minimum wage rate is only $7.25 and not $22 an hour.
“If we started in 1960, and we said that, as productivity goes up — that is, as workers are producing more — then the minimum wage is going to go up the same,” the Massachusetts senator said during the hearing.
“And, if that were the case, the minimum wage today would be about $22 an hour. So, my question … is what happened to the other $14.75?” she asked University of Massachusetts professor of economics Arindrajit Dube:
In her apparent support for an increase in the federal standard, Sen. Warren joins President Barack Obama in suggesting that the current minimum wage rate should be increased.
The president during his State of the Union Address in February called on Congress to raise the federal minimum rate to $9 an hour.
“We know our economy’s stronger when we reward an honest day’s work with honest wages. But today, a full-time worker making the minimum wage earns $14,500 a year. Even with the tax relief we’ve put in place, a family with two kids that earns the minimum wage still lives below the poverty line. That’s wrong,” he said.
“That’s why, since the last time this Congress raised the minimum wage, 19 states have chosen to bump theirs even higher,” he added. “Tonight, let’s declare that, in the wealthiest nation on Earth, no one who works full time should have to live in poverty — and raise the federal minimum wage to $9 an hour.”
However, as many, many economists argue, whether it’s $9 or $22, an exponential increase in the federal standard could have a disastrous effect on the economy (not to mention the deleterious effect the minimum wage itself already has on the free market).
First, a higher rate would force employers to cut back on hiring. Second, do you have any idea what an increase in the cost of labor would do to the cost of products/services? Third, the argument itself for blindly increasing the rate, with disregard for regional cost of living, leaves something be desired: If merely raising the rate from $7.25 to $9 or $22 would solve “income inequality” and unemployment problems, then why not just increase the rate to $50, $100, or even $1,000?
Lastly, if increasing minimum wage is a cure-all for unemployment and “income inequality,” consider this list of the top 10 states with the highest unemployment rates in the U.S. (the states with minimum wages higher than the federal standard are in boldface):
10. GEORGIA (Unemployment Rate/Minimum Wage Rate: 8.7/$7.25)
9. SOUTH CAROLINA (8.7/$7.25)
8. MICHIGAN (8.9/$7.40)
7. ILLINOIS (9.0/$8.25)
6. MISSISSIPPI (9.3/$7.25)
5. NEW JERSEY (9.5/$7.25)
4. NORTH CAROLINA (9.5/$7.25)
3. NEVADA (9.7/$8.25)
2. CALIFORNIA (9.8/$8.00)
1. RHODE ISLAND (9.8/$7.75)
Just some food for thought.
Follow Becket Adams (@BecketAdams) on Twitter
(H/T: Washington Free Beacon). Featured image Getty Images.
- Shock Video Surfaces: Meat Cleaver-Wielding Man Shouts ‘You People Will Never Be Safe!’ Moments After Gruesome London Attack 527 Comments
- Why Were DHS Agents Seemingly Monitoring Multiple Tea Party IRS Protests Across the Country on Tuesday? 466 Comments
- Confusion Erupts in IRS Hearing After Lois Lerner Tries to Plead the 5th — Watch It All Unfold 453 Comments
- The Tense Exchange Between Rep. Trey Gowdy and the Former IRS Head You’ve Been Waiting for…and It Doesn’t Disappoint 338 Comments
- CNN’s Wolf Blitzer Has Awkward Moment With Okla. Tornado Survivor After Asking If She ‘Thanked the Lord’ 324 Comments
- ‘Islamic Jihad, Islamic Jihad!: Michelle Malkin Rips Progressives, Clashes With Lib Radio Host Over Islamic Terrorism and the London Machete Attack Read More
- Ariz. Lawmaker Surprises Colleagues, Comes Out as an Atheist While Delivering Daily Prayer Read More
- This Is How Texas Politicians Are Fighting Against the Atheist-Led ‘War on Christmas’ Read More
- ‘Unbelievable’: Apparent Thief Leaves $140 & Apology Note on Family’s Doorstep — Find Out Why Read More
- Anti-Gay Bias or Fair Punishment? New Details Emerge About High School Student’s Lesbian Relationship With a Minor 274 Comments
- Weekly Unemployment Benefits Tumble Read More
- Why Is This German Company Recruiting Tech Staff With Autism? Read More
- House Votes to Speed up Keystone Pipeline: Here’s Everyone Who Voted for and Against It Read More
- Here are the 7 Most Explosive & Informative Moments from Today’s IRS Hearing Read More
- Foreign Banks Operating on U.S. Soil Have Just Set a Record Read More
- The Incredible Role Facebook Played in the Aftermath of Devastating Okla. Tornado Read More
- Tech Company Demonstrates Remote Disabling of a ‘Smart Gun’ 116 Comments
- Meet the Blind Man Nicknamed ‘Midnight Gunslinger’ Who Has 80% Shot Accuracy Read More
- How a $4.5 Million Network of 181 Sirens Helped Save Lives in Oklahoma Twister Read More
- See the Record-Setting Python a Man Caught With His Bare Hands (and Guess How Much It Weighed) Read More
- 5 dead in Lebanon clash of Assad foes, backers
- AP Interview: Rogge praises wrestling's changes
- Restaurant torched in 4th night of Sweden riots
- Man shot by FBI had ties to Boston bombing suspect
- Ralph Lauren's 4Q profit rises 35 pct
- Father of man shot in Boston probe shares regrets
- Russian court denies Pussy Riot's Alekhina parole
- Britain: Soldier slaying suspects had been probed