Recently, President Barack Obama addressed a crowd at a fundraising event hosted at the Miami mansion of NBA legend Alonzo Mourning: “How do we make sure that folks who work hard and are taking responsibility for themselves and have dreams about something better for their kids – how do we make sure that hard work pays off?” According to the president, raising the minimum wage from $7.25 to $10.10 is an important step toward achieving this goal.
While right-wing politicians advocate abolishing the minimum wage, the debate over its merits was settled decades ago. Since its creation in 1938, the minimum wage has been raised 29 times, including in 2007 by President George W. Bush. Every time, critics argued the legislation would hurt our economy and cost jobs. The fact that Americans are still having this debate is absurd.
Until the 1970s, increases in worker productivity have been matched by equal percentage increases in the minimum wage. Then conservative economic theory hijacked American politics, and wages have stagnated. Today, an American minimum wage worker earns 30 percent less than they would have in 1968. Had it continued to correlate with worker productivity, today’s minimum wage would be over $21.00.
Today, 3.8 million Americans – the population of Los Angeles – make at or below minimum wage. The stereotype that minimum wage only affects young people working summer jobs is false, as the number of teenagers that fill these jobs is dwindling. In 2013, these people saw their earnings drop in value by 12 percent due to inflation while the average CEO (whose earnings have increased by 875 percent since 1978 alone) got paid 12 percent more.
Politicians on both sides of the aisle understand the need for an increase. Wealthy conservative political activist Ron Unz is pushing for a $12 minimum wage in California. “Why should all taxpayers have to pay for massive hidden government subsidies?” he asks.
The massive subsidies he refers to are made to major corporations like McDonald’s and Walmart, which pay a majority of their employees the minimum wage.
Last year, employees at major fast-food chains received nearly $8 billion in taxpayer-funded welfare because their employers don’t pay them enough money to feed themselves. McDonald’s alone netted more than $7 billion in profits. So on top of allowing them to sell us inedible food, which ultimately is responsible for billions of dollars in public health care costs, Americans now pay their employees’ salaries. Clearly, these companies can afford to pay their workers more.
In the words of Franklin D. Roosevelt, “No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.”
More importantly, a small increase would mean more cash in the pockets of an estimated 27.8 million Americans, all of which would end up being pumped back into our struggling economy.
Matt Pontecorvo is a sophomore majoring in political science.