Wednesday, February 20, 2013

Why the Proposed Minimum Wage Increase Won't Increase the Unemployment Rate

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Many of us would love to see a minimum wage more like that of the 60s when the $2.15 GOP Rep Marsha Blackburn was making, as she admitted, made her very happy to be learning the retail business, because that would actually be over $12-$14 an hour in today's numbers even in the South, and more likely over $20 an hour in places like big cities in the North East and the Pacific Coast.

But that kind of increase in one jump might actually hurt the economy while the jump to $9 an hour won't according to historical record as shown in video above and is like to boost it in the long run.  And the history has shown that the more Democrats are in power, the more often the minimum is boosted, and a venture capitalist last year showed that getting money into the hands of those who need it most for basic living is a more powerful economy booster than offering tax cuts for fat cats.  That would also be applicable to raising the minimum wage  (see video here of TED talk).

In fact, Clinton raised taxes on the wealthy and cut some for lower income workers while he also got a couple of minimum wage increases through the GOP majority during his tenure.  Tax cuts for lower earners, I believe acted as a minimum wage boost replacement in the first couple of  Clinton's years, and actually helped self employed people, too.   I notice that he GOP now wants that kind of tax cut (and, of course they think they can force more supply side ones at the same time with their Gerrymandered control of the House of Representatives) instead of a minimum wage hike, but, oh wait, their tax cuts for fat cats and the wars started during Dubya's two term tenure precluded that possibility because the surplus that Clinton created is long gone and we are deep into more debt.

This tax cut, tax cut, tax cut, idea of the GOP is all about finally grabbing our Social Security moneys that we have paid into for all our working years and then throwing that at the fat cats. too.

See below for the record of minimum wage increases in standard monetary terms (darker violet) and in today's dollars (lighter violet).  As you can see we have fallen a lot since the 60s.

Source Wikimedia Commons whose illustrations and charts are always available for sharing.

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