It’s a truism of politics that the people, parties, or organizations you choose to support will inevitably do something to betray your trust. Regardless of partisan allegiances or mission statements, the intersection of money, opinion, and cause is always a messy one, fraught with missteps and gaffes and broken promises. However, knowing this does little…
Fast food workers are on strike in cities nationwide today, advocating for a $15/hr minimum wage, more than double the current Federal minimum wage of $7.25/hr. Today’s strikes are the latest in months of protests among low-wage workers, who are more numerous than ever since 2008’s recession, which cut many “middle-class” jobs and replaced them with low-wage jobs. Although raising the minimum wage to $15/hr would provide a better chance at economic security for thousands of workers and their families, even people who would benefit from such an increase nevertheless argue against it. Here are some of the most common arguments against raising the minimum wage that I have heard, with handy, data-filled responses. Go forth and tweet in solidarity!
“We can’t afford to raise the minimum wage.”
Actually, we can’t afford NOT to. Doubling the minimum wage increases the tax base and stimulates the economy by giving poor people more money that they desperately need for food, rent, child care, transportation, and other necessities. Raising the minimum wage even a little, from $7.25 an hour to $8.50 an hour, would increase household spending power by $9.5 billion dollars. Businesses can certainly afford to pay workers more: they have reported record profits in the years since the 2008 recession.
“Where would that money come from?”
Re-allocating executive compensation. Corporate profits and CEO pay have skyrocketed since the 1980s; in fact, where CEOs used to make about 48 times what the average worker made in 1980, by 2010, CEOs made a staggering 340 times more than the average worker! In 2012, the median salary for executives of large, publicly-traded companies was $9.7 millions dollars, an increase of 6.5% over the previous year. Part of the reason for this increase is that the source of CEO pay shifted over the past 3 decades. Ever-increasing CEO pay is bad for workers in corporations, and it’s bad for the economy as a whole. First, a high portion of CEO pay now comes in the form of stock options, ostensibly to link a CEO’s pay to his performance. In practice, however, CEOs game this system by increasing the value of stock with incredibly short-sighted moves like slashing pay, benefits, or jobs. Although these tactics may increase quarterly profits, they create serious long-term costs associated with employee turnover. Second, the more pay a CEO receives in stock options, the less taxes he pays on his salary overall, since capital gains are taxed at about 15% while income at the highest level is taxed at about 36%. The Dodd-Frank financial reform law of 2010 mandated that CEO pay be set at a proportion of average worker income, but that rule has not yet been implemented. Doing so would give corporations a lot more money to use to pay workers fairly.
“I can’t afford to pay more for things.”
Even if corporations do not put their record profits back into their business to pay for the increased minimum wages as they should, prices would only need to rise .01% per month more than they have in recent years to pay for an increase in wages. Prices rose 0.20% per month from June 2010 to December 2012. If they rose .021% instead, they could have paid for a minimum wage increase that, as shown above, has widely beneficial stimulative economic effects. Not to mention that, in a better economy, workers like you can afford a lot more things!
“Raising minimum wage means job losses”
“What about small businesses, who can’t afford it?”
Actually, states with a higher minimum wage than the federal minimum saw more small business growth than those that mandate only the federal minimum wage rate. Every business does better when the economy improves. Small businesses need customers, after all.
“Only teenagers work minimum wage jobs, and they don’t need the money.”
This argument is based on the idea of a teenager from a financially secure family earning pocket money with a minimum wage job. Actually, about half of all minimum wage workers are full-time employees over age 20. A quarter of minimum wage workers are raising families (24%). Even the teens working minimum wage jobs are increasingly doing so to help their families make ends meet. Moreover, the rising cost of college means that teenagers who can earn more money working have a better chance of getting an education without graduating deep in debt.
“Minimum wage jobs are shit for a reason; you’re not supposed to keep them forever, and if you do, then you don’t deserve more.”
This isn’t an argument, it’s “fuck you, I got mine.” So those of you who “got yours” are prepared to give up the robust stimulative economic effects of raising the minimum wage? You’re that invested in believing you’re better than poor people? Not so fast: the systemic redistribution of wealth to the super rich, together with stagnant wages and poor employment numbers, mean that 4 out of 5 Americans will experience poverty in their lifetimes, and about three-quarters of Americans are living paycheck-to-paycheck. We’re long overdue to replace “sucks to be you” with “I could be you,” and permanently retire the argument that some jobs don’t deserve a living wage.