published Friday, March 15th, 2013

A minimum wage boost has broad public support

It's ironic that debates are forming on the pro and con sides of raising the minimum wage at the same time that the Dow Jones industrial average is recording its longest winning streak since 1996.

In fact when the index rose for the 10th day in a row Wednesday, it became only the fourth time in history for such a bullish run. Remember, too, that the Dow broke through its previous all-time high on March 5th, and it has kept on going.

But to hear conservatives tell it, President Obama's recent proposal to raise the minimum wage from $7.25 an hour to $9 an hour would be bad for business.

"In the wealthiest nation on earth, no one who works full-time should have to live in poverty," Obama said in announcing the proposal during his State of the Union address.

America has 75.3 million workers who are paid hourly rates, and only 3.6 million of them -- about 4.7 percent -- earn at or below the federal minimum wage.

Here's what they looked like in 2012:

• Half are young -- under 25 -- and a fifth of those are teens.

• Six percent of all women paid hourly had wages at or below minimum, compared with about 3 percent of men.

• Five percent of white, black, and Hispanic hourly paid workers earned min- imum wage or less, while 3 percent of hourly-paid Asian workers earned the minimum wage or less.

• About 60 percent of workers earning the minimum wage or less were employed in service occupations, mostly in food preparation and serving.

• An estimated 2.1 percent of all salaried workers earned exactly minimum wage, while 2.65 percent earned less than minimum wage

• About 196,000 minimum-wage-and-below earners lived and worked in Tennessee, Alabama and Georgia.

Congress hasn't raised the minimum wage since 2009, and if the local delegations of Tennessee and Georgia's congressmen have their way, things may not change despite the fact that more than 70 percent of Americans support the proposed increase, according to a USA Today/Pew Research Center poll.

Among Republican poll respondents, 50 percent said they back Obama's measure, and 47 percent oppose it.

Our GOP lawmakers say they are looking out for business: They see the move as an impediment to employers and economic growth.

You know, that poor sky-rocketing Dow ...

"You hurt the people you're trying to help," U.S. Sen. Johnny Isakson, R-Ga., told the Times Free Press last week. "As you raise the wage level, you reduce the number of individuals that employers can hire through expansion."

And Tennessee's U.S. Sen. Lamar Alexander pulled out the specter of decreasing jobs.

"Minimum-wage mandates knock people off the economic ladder because they destroy jobs for low-income, largely minority young people such as those who work in restaurants," he said. "Getting one of those jobs is a good way to get started."

Or it could just be that keeping that entry wage low is a way of government subsidizing -- with rent assistance and food stamps to people who are underpaid -- the restaurant industry and other minimum-wage paying businesses.

One conservative argument against raising the minimum wage is that expanding the earned income tax credit is a better way to steer money to low-income households.

That would be an argument worth entertaining if this were a perfect world. But we don't live in a perfect world.

We can see that every time hear the newest comments of the day from Congress as they mouth out their squabbles over the sequester versus new revenue.

By the way, that new revenue would come by eliminating tax breaks for the rich.

And the Dow is up.

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EaTn said...

The past fifty years inflation has increased a factor of ten, therefore the minimum wage should be ten dollars per hour just to maintain the same living standards we had fifty years ago.

March 15, 2013 at 7:26 a.m.
flyfishooltewah said...

So what will this do? Raise the price of everything! Now your trip to Micky D's or BK will cost more for the same poor service. The poor will not benefit because of the inflation that will come when everyone has to raise their prices to cover the service industry employees. Minimum wage jobs should not been seen as careers and if you continue to work minimum wage jobs maybe you should look to get some training or skills that will help you make more. The average salary in Chattanooga is 48k- so now MW workers will make $9 for just showing up and people who have made multiple career moves to get to their career level- will get $23. Do you think that will go far at Mickey D's now?

March 15, 2013 at 9:14 a.m.
Rickaroo said...

The figures the editor cites might seem rather low and insignificant but the fact is that there are millions more workers - at places like Walmart, Target, and most of the other service industries - who are stuck at making $8/hr., which is still not even close to being enough to eke out a modest living. Most of the employees at those places have worked there for years and still have not cracked the $9/hr. mark. Of course, if anyone I ambitious enough and wants to become something other than a Walmart cashier or a burger flipper, they can do what is necessary to attain the skills and education, but there are many people who, for whatever reason, do not have the ambition or the mentality to do anything other than service oriented jobs. At any rate, as long as those jobs are filling a need in our society, they should be paid enough for one to be able to at least put a modest roof over their head and be able to pay for the basic necessities of life. We have lost the true value of work when we think it's perfectly acceptable for a CEO to make over 300 times what the average worker makes. That is not only not acceptable, it's insane.

Conservatives have always made the argument that raising the minimum wage will force employers to lay off workers or hire fewer people and likewise force them to raise the costs of goods and services, thus affecting the economy adversely. But of course that is BS. We have had countless minimum wage increases throughout the decades and not once has any one of those raises been shown to affect the economy adversely. If the minimum wage had kept pace with inflation, it should be, as EaTn pointed out, $10/hr. today. That is more in line with what the true value of unskilled labor ought to be. It is unconscionable to even think of paying someone $7.25/hr. with today's cost of living as high as it is. Anyone who works a full-time job, no matter what that job is, should be afforded the dignity of being able to get by without requiring food stamps or welfare to make ends meet.

March 15, 2013 at 10:49 a.m.
Rickaroo said...

An afterthought: I like to go to the Waffle House about once or twice a week. Their food is by no means gourmet standard but what you get is decent and their breakfasts are especially good. Anyway, I have gotten to know most of the workers and two of the cooks have been there for a year-and-a-half and two years respectively. They are both making $8/hr. Now, I know that being a Waffle House cook is not on par with being a gourmet chef but those guys/girls who do the cooking there work hard and it takes a lot of concentration to do what they do. They are called upon to be not only consistently good cooks but, when business is slower, to be courteous and affable customer greeters. I dare anyone to tell me that they are worth only $8/hr. to that company. I'm sure the CEO and others at the top are pocketing millions or more annually but they cannot manage to pay their cooks at least $10/hr. to do what they do? It is the people doing the day to day grunt work that help most businesses thrive yet they are the least appreciated and most underpaid.

March 15, 2013 at 11:12 a.m.
nucanuck said...

Wide economic disparity is the mark of a poor country. Take a look around the world and you will see a direct correlation between the poorest places on earth and income disparity. The US has been on the wrong road for 40 years, pushing the middle class down while advantaging the more affluent.

The graduated tax structure of America's greatest years seemed to keep a better balance between rich and the rest. Maybe we should go back to what worked before.

March 15, 2013 at 11:42 a.m.
Rickaroo said...

JR, your flippant response is typical of the conservative mindset. Nobody is asking for more than what is fair. $10/hr. would be more in line with the cost of living and that is why that figure is often mentioned. You act as if we're just coming up with random dollar amounts just because it sounds good. But that is how you and others like you don't really pay attention to the argument being made, you just come up with your liberal bashing knee-jerk responses that have nothing to do with the issue at hand.

March 15, 2013 at 12:09 p.m.
LaughingBoy said...

Raise the amount to $10 per hour then what happens with the worker already making $10 per hour with more qualifications and duties?

March 15, 2013 at 12:52 p.m.
timbo said...

I am in conflict here. I believe that employers have the moral responsibility to pay a living wage. Those who don't make it hard for the rest of us and open themselves up for criticism.

The fact that some employers don't pay a living wage, gives liberals ammunition to try to legislate that morality (in regards to pay) just like they accuse social conservatives of doing on other subjects.

On the other hand, I am absolutely opposed to the government mandating what people pay or what workers accept as wages.

In this case a compromise might be a moderate increase. That wouldn't bother me much and from a conservative view, it might just get some people off food stamps and welfare and save tax revenue.

This is a hard one that wouldn't be an issue if employers would just pay what a job is worth without trying to squeeze every penny they can. In the long run, my philosophy is to get good people, train them, and pay them well enough to keep them. It costs a lot more money in mistakes and training over time than paying decent wages and not having employee turn over. At least in my business.

March 15, 2013 at 12:58 p.m.
joneses said...

Raising the minimum wage will cause higher unemployment and inflation. It is that simple. This is just another failed feel good policy from the mentally challenged liberals. Obastard will use it to spread his hate of corporations. The highest cost to any company is labor. You raise that cost you raise the cost of the products and services. Also the UAWs pay is based on how high the minimum wage is. If the minimum wage rises so does the pay for the UAW thugs. Obastard is only paying back the socialist unions and destroying our country in the process. Anyone who thinks raising the minimum wage is in the best interest of America is a fool.

March 15, 2013 at 1:37 p.m.
timbo said...

nucanuck...The US is not a poor country. That statement is just dumb. I don't know what planet you live on but your world only turns to the left.

Wage disparity is because of supply and demand. If illegal immigration were curtailed, there would be more work for citizens and the employers would have to pay more wages. Illegals keep wages down. Your enemies, the mean old business men, love that cheap labor.

The other problem is modernization and computerization have made industry more efficient and individual employees more productive. Again, this has caused more unemployment and those workers are competing for fewer jobs. Again, supply and demand keeping wages down. This is our economic system which is the best in the world.

Your own liberal policies, that on the surface try to help, are actually the cause of the problem.

So, your answer really is that two wrongs, illegal immigration and raising the minimum wage which liberals support, make one right. Of This is your usual stupidity. It never ceases to amaze me just how bizarre liberal thinking really is.

March 15, 2013 at 1:38 p.m.
flyfishooltewah said...

"R, your flippant response is typical of the conservative mindset. Nobody is asking for more than what is fair. $10/hr."

So, from a liberal mindset what is fair? I suppose we should leave that up to the government right? You mention that anyone who does not agree with you is not paying attention to the argument- but from what I can tell, most people on here understand basic econ 101.

March 15, 2013 at 1:59 p.m.
Easy123 said...

timboner,

"I don't know what planet you live on but your world only turns to the left."

The earth really does rotate to the left (east).

March 15, 2013 at 2:05 p.m.
Leaf said...

Amazing how many people learn the law of supply and demand from the back of a cereal box and deem themselves an economist.

If raising the minimum wage umpteen times in the past to keep up with inflation has never had a detrimental effect before, why would it do so now? Because the President is black?

March 15, 2013 at 2:24 p.m.
Easy123 said...

Leaf,

"Because the President is black?"

Almost. It's because the President is not 100% white and he's a Democrat.

President Obama is only half-black, yet most Republicans don't see it that way.

March 15, 2013 at 2:29 p.m.
nucanuck said...

timbo,

While the US is not poor, the direction is, and has been, south for several decades. Those decades run parallel to the widening of the income disparity gap in the US. Income disparity is the hallmark of a poor country and we are headed there. Government needs to set up reasonable ground rules to facilitate income differentials that keep the middle class strong. We used to do that. We don't do that now. The US was not a radical leftist country when we had those policies in place. Returning to what works is only sane and reasonable.

Because the US has been falling in most catagories in relation to other leading countries, one could assume that our system may not be the best or at least need change. To say that liberals are the cause of the problems in the US is juvenile at best. Both parties share the blame for the excesses that have occurred. Any contention otherwise is simply indefensible.

Our government in their wisdom has targeted 2% inflation as the norm. If we had zero inflation there would be no need to raise the minimum wage, but by increasing the money supply to create inflation (a backdoor tax), we disadvantage all, but with the worst affect at the bottom. It might be fairer to say that we shoud readjust the minimum wage because we are only aligning it with where it was before.

Re: illegal immigration, I have never supported it. I have spoken out about US business duplicity in seeking out illegals to fill their job needs and I don't blame anyone for seeking a better life when they are both wanted and needed. The US has been sadly dificient in providing sufficient guest worker programs to supply US needs. None of the above means that I support illegal immigration.

Your whacked out blame game just muddies the water.

BTW, most of my beliefs are conservative in the true sense of the word.

March 15, 2013 at 4:30 p.m.
rick1 said...

There’s the cycle of poverty, and then there’s the cycle of minimum wage idiocy

Government says raise the minimum wage.

Workers now have a living wage. (yay)

Business cuts workers hours to maintain a profit margin so they can stay in business.

Now workers no longer have living wages. (boo)

Then some idiot says “For businesses across the country, it would mean customers with more money in their pockets.” Barack Obama

Thelookingspoon.com

March 15, 2013 at 6:43 p.m.
timbo said...

nucanuck....... You accuse me of playing the blame game, and then you proceed to play the blame game. Is your blame somehow superior to my blame?

I wasn't blaming anyone just giving you an economic reality. You obviously didn't read my first post.

March 15, 2013 at 7:35 p.m.
timbo said...

Leaf.... You are so obviously ignorant you may need to read the back of the cereal box.

March 15, 2013 at 7:38 p.m.
patriot1 said...

Why not let market forces determine wage rates?

March 15, 2013 at 9:54 p.m.
Leaf said...

timbo said... Leaf.... You are so obviously ignorant you may need to read the back of the cereal box.

You're right, timbo. I am ignorant in many areas. I am not an economist. However, when the great majority of all the economists say that raising the minimum wage won't hurt the economy, I believe them instead of you.

patriot1 said... Why not let market forces determine wage rates?

patriot1, that's a good question. Market forces do determine wage rates. But as I understand it (I'm not an expert, as timbo gently reminded me) the invisible hand of the market factors everything, not just simple supply and demand.

For example, and please forgive me if my lack of expertise in this area causes me to impart false information, if you work full time for the current minimum wage - which hasn't kept up with inflation - you can still be on welfare. Your family won't starve, but the taxpayers supplement your income instead of your employer. The result of this is a de-facto government subsidization of the industries that employ many minimum wage employees. A true fiscal conservative would favor raising the minimum wage and lowering the welfare rolls, in my humble opinion. It is more efficient and more humanising.

March 15, 2013 at 10:51 p.m.
conservative said...

Sometimes, the caption says a lot.

The caption could have said more if it had included the fact that there is broad support for 4 weeks vacation, longer breaks, health care and a company funded retirement plan as well. Yikes!

March 18, 2013 at 10:27 a.m.
conservative said...

Or it could just be that keeping that entry wage low is a way of government subsidizing -- with rent assistance and food stamps to people who are underpaid -- the restaurant industry and other minimum-wage paying businesses.

Now that is so phony that it is laughable. Why? Simply because these workers either now or will only work enough hours to still be eligible for rent assistance and food stamps.

March 18, 2013 at 2:49 p.m.
patriot1 said...

leaf....why, if $10 per hour is good, wouldn't say, $20 per hour be better. $10 per hour for a family of four would still leave them below the poverty level, while $20 per hour would put them at around 40K per year.

March 19, 2013 at 9:55 p.m.
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