Tapsearch Com EditorMinimum wage hike bad for Democrats?
December 21st 2006 19:13
My friend Jeremy Lott answers "yes" in Real Clear Politics:
"[S]everal Democratic strategists spoke of the minimum wage hikes as their very own version of gay marriage before the election. They were right. It proved to be a popular issue...
"But here's the rub: Democrats can continue to hike minimum wages on a state-by-state basis or they can hike the federal minimum wage, but probably not both. A federal raise will relieve pressure to hike state minimum wages and rob Democrats of future political gains."
It's a very interesting and counterintuitive argument, that Democrats can do better for themselves politically by failing to deliver on promises they've made.
But there are ways to get around it, even though Pelosi has promised action and Bush said he'd pass it if small business regulations are simultaneously relieved:
"They can encourage Republicans in the Senate to filibuster it or, failing that, pass a bill so ridiculous that even President Bush will have to veto it. Then tell voters the Man is keeping them down."
"[S]everal Democratic strategists spoke of the minimum wage hikes as their very own version of gay marriage before the election. They were right. It proved to be a popular issue...
"But here's the rub: Democrats can continue to hike minimum wages on a state-by-state basis or they can hike the federal minimum wage, but probably not both. A federal raise will relieve pressure to hike state minimum wages and rob Democrats of future political gains."
It's a very interesting and counterintuitive argument, that Democrats can do better for themselves politically by failing to deliver on promises they've made.
But there are ways to get around it, even though Pelosi has promised action and Bush said he'd pass it if small business regulations are simultaneously relieved:
"They can encourage Republicans in the Senate to filibuster it or, failing that, pass a bill so ridiculous that even President Bush will have to veto it. Then tell voters the Man is keeping them down."
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Comment by The Daily Sonnet
The Daily Sonnet
Lots of Sonnets
Comment by Damo
Comment by Robert V
Comment by Damo
US$ 5.15 calculates to $6.57727 AUD
and
US$ 7.25 calculates to $9.25926 AUD
Minimum wage in Australia is $14 AUD with a lower cost of living.
This calculates to $10.9619 USD
How the hell does anyone manage to live on $5.15USD per hour.
Comment by Robert V
Two, people don't live off minimum wage often, at least not here in the USA. Minimum wage workers are frequently teenagers, or married people pulling in some extra money.
Three, regardless of whether it's livable, minimum wage does little if anything to help the poor. The philosophy is that you force employers to pay more, and they reach in their big bags of money, do so and keep on as before.
But in fact, it's undeniable that minimum wage hikes cost people their jobs. Rather than pay people more, business owners have to fire some of them -- especially small business owners who operate at slim profit margins to begin with. If an employee creates $6 in value per hour, it's worthwhile to hire him at $5.15. It's not at $7.25.
So the tradeoff is between some people getting fired and others getting paid a little more, with most of these people not even living on the jobs they're in. For a long time the consensus was that job losses far overcame the wage increases. But now there are some economists who make the argument that the wage increases outweigh the job loss in terms of poverty reduction, so I'm not saying either side is right.
It's completely irrelevant, however, whether you can "live on" $5.15. It's a lot harder to live on nothing.
Most of the facts I discussed here are in this article, hat tip Andrew Sullivan:
http://gregmankiw.blogspot.com/2006/12/can-600-economists-all-be-wrong.html