Has opebo been vindicated on the $15 minimum wage? (user search)
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  Has opebo been vindicated on the $15 minimum wage? (search mode)
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Question: Has opebo been vindicated on the $15 minimum wage?
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No
 
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Author Topic: Has opebo been vindicated on the $15 minimum wage?  (Read 939 times)
muon2
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« on: May 13, 2016, 07:33:12 AM »

Vindicated - no, supported by politicians who ignore real economic data - yes. Here's my post about the CA minimum wage increase.

I find the inflationary aspect of this issue to be fascinating. In the 2013 SOTU Obama called for the federal minimum wage to rise to $9.00 by 2015. In 2014 Obama called for it to rise to $10.10 and backed it up with a federal order for $10.10 effective in 2015. That's 12% inflation in one year for the President's request.

Later in 2015 Seattle passes its increase in the minimum wage starting at $11 in 2015 and rising to $15 in 2019. $15 seems to be the rallying cry, but note that's a 67% increase over Obama's original request. Furthermore these increases become adjusted for inflation after they reach their target. So presumably that target should make some economic sense.

CNN/Money has an interactive graph of the inflation adjusted federal minimum wage. Its peak was in 1968 at $10.68 in 2015 dollars. Between 1961 and 1980 the inflation adjusted minimum wage was between $7.67 and $10.68. Only one year was under $8.00 and only two over $10.00. The median during those 20 years was $9.28. I was even a minimum wage earner during part of that period. Tongue

After the 2014 SOTU I looked up the federal data on the positive impact of minimum wage based on additional money spent by those wage earners vs the negative impact based on money lost due to job losses. The break even point in 2013 was about $9.00 which is consistent with the high range from the 1960's and 70's. Accounting for inflation since 2013 would put the point at $9.16.

The two pieces of actual economic data suggest that the federal minimum wage ought to be around $9.25. That's actually very much in agreement with Obama's original request in 2013. It's also reasonable to expect that localities with high costs of living might also have a higher minimum wage. I'd just rather see it derived from actual economic studies rather than a gut feeling for what is right.
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