{"id":43327,"date":"2012-01-01T09:41:45","date_gmt":"2012-01-01T14:41:45","guid":{"rendered":"http:\/\/media.lclark.edu\/content\/hart-landsberg\/2012\/01\/01\/the-minimum-wage-and-capitalism\/"},"modified":"2012-05-04T20:01:41","modified_gmt":"2012-05-05T01:01:41","slug":"the-minimum-wage-and-capitalism","status":"publish","type":"post","link":"https:\/\/thesocietypages.org\/socimages\/2012\/01\/01\/the-minimum-wage-and-capitalism\/","title":{"rendered":"The Minimum Wage and Capitalism"},"content":{"rendered":"

On January 1st,\u00a0the minimum wage increased in Arizona, Colorado, Florida, Montana, Ohio, Oregon, Vermont and Washington. These eight states\u00a0all have laws which\u00a0require them to automatically increase\u00a0their respective minimum wages by the rate of\u00a0inflation. Nevada also indexes its minimum wage but its\u00a0increase\u00a0takes\u00a0place\u00a0in July.<\/span><\/p>\n

The state of Washington has\u00a0the highest state minimum hourly wage at $9.04.\u00a0 Oregon has\u00a0the second highest at $8.80. <\/span><\/p>\n

Eighteen states plus the District of Columbia have minimum wages above the federal minimum wage which\u00a0remains at $7.25 per hour.\u00a0 A full-time worker making the federal minimum wage\u00a0earns just $15,000 a year. <\/span><\/p>\n

There are those who argue against state laws requiring an inflation adjustment to the minimum wage. \u00a0Their most common argument is that such government mandated increases are a threat to business profitability and the health of our capitalist, free-market economy.\u00a0 This is an interesting argument.\u00a0 At one time, the conventional wisdom was that capitalism was a means to an end, the end being a better standard of living.\u00a0 Now it appears that capitalism has become the end itself, and to sustain a healthy capitalism workers will have to make sacrifices.\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span><\/p>\n

Actually,\u00a0those\u00a0arguing against increasing the minimum wage are really arguing for the necessity of a declining real wage.\u00a0 The minimum wage has not kept up with inflation. This is true even in states that currently index their minimum wage.\u00a0 The reason is that indexing began after years of real wage decline.\u00a0For example<\/a>, Oregon\u2019s January 2012 increase to $8.80 from $8.50 still leaves the real inflation-adjusted Oregon minimum wage below what it was in 1976.\u00a0 In 2011 dollars, Oregon\u2019s 1976 minimum wage was $9.09. <\/span><\/p>\n

The federal government does not automatically index the federal minimum wage and the chart\u00a0below<\/a> highlights the extent of the decline in its real value. The blue\u00a0line shows the actual or nominal dollar value of the federal minimum wage; increases are the result of a vote by Congress.\u00a0 The red line shows the real value of the minimum wage in 2010 dollars.\u00a0 In real terms the federal minimum wage remains considerably below its value in the 1970s.<\/span><\/p>\n

\"wage-trend.png\"<\/p>\n

A second common argument against inflation adjusted\u00a0increases in the minimum wage is that\u00a0it\u00a0is just\u00a0a training wage for young teens and therefore not important to\u00a0family survival.\u00a0 This argument\u00a0misses the mark for several reasons, the most important being that, as the chart below<\/a> shows, 80% of minimum wage workers in the eight states with mandated increases are over the age of 20, and\u00a0more than 75%\u00a0work more than 20 hours per week (just over half work\u00a0full-time). In fact, according to an Economic Policy Institute study<\/a> of national data, families with a minimum-wage worker rely on their\u00a0earnings for nearly half\u00a0the family income.<\/p>\n

\"table-on-increase.png\"<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

On January 1st,\u00a0the minimum wage increased in Arizona, Colorado, Florida, Montana, Ohio, Oregon, Vermont and Washington. These eight states\u00a0all have laws which\u00a0require them to automatically increase\u00a0their respective minimum wages by the rate of\u00a0inflation. Nevada also indexes its minimum wage but its\u00a0increase\u00a0takes\u00a0place\u00a0in July.
\nThe state of Washington has\u00a0the highest state minimum hourly wage at $9.04.\u00a0 Oregon has\u00a0the […]<\/p>\n","protected":false},"author":1853,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-43327","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/posts\/43327","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/users\/1853"}],"replies":[{"embeddable":true,"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/comments?post=43327"}],"version-history":[{"count":7,"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/posts\/43327\/revisions"}],"predecessor-version":[{"id":43367,"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/posts\/43327\/revisions\/43367"}],"wp:attachment":[{"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/media?parent=43327"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/categories?post=43327"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thesocietypages.org\/socimages\/wp-json\/wp\/v2\/tags?post=43327"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}