A $15.00 minimum wage

President Biden’s proposed $15 minimum wage is a key part of setting the economy right. Predictably, however, critics pounced on it as soon as it was announced, making the usual arguments against paying folks decently. This time, however, because we’re  in the middle of a pandemic, these critics are also trying to argue that providing a liveable wage just isn’t possible during the COVID crisis and accompanying recession.

The reasons why they are wrong are as follows: 

The federal minimum wage, $7.25 per hour, hasn’t been raised since 2009, since when  the cost of living has risen all over the US.  Millions  of people couldn’t pay their bills even before COVID struck, and inflation has made what was already nowhere near enough in 2009 downright laughable in our modern economy. Nobody should be working full-time and living in poverty.

A $15 minimum wage is targeted COVID relief. An estimated 40 million workers would get a raise if the measure is passed. That’s a whopping 26.6 percent of the workforce and a full two-thirds of the working poor. With little to no savings and a labor market that has disproportionately cut low-wage jobs, this group has suffered the most during the pandemic and stands to benefit most  from the change. 

Consumer spending drives about 70% of the economy and creates the lion’s share of our growth every year.   If almost half of the population is earning less than $15 an hour, they frankly don’t have any extra money in their pockets to spend on anything but necessities like food, rent, and bills. If we make sure millions of people have just a little bit more cash, then they’ve got a lot more to spend in their local economies, helping American businesses thrive and jumpstarting the entire economy. 

We’ve actually already seen the benefits of a $15 minimum wage play out. When Congress gave out $1200 stimulus checks and approved a $600/week unemployment assistance boost last year, they ensured that millions of those low-wage workers who lost their jobs were making the equivalent of $15 an hour. The result? Poverty was a full 2 points lower in April and May 2020 than it was at the beginning of that year, and consumer spending grew for the first time during the pandemic. 

Despite what the critics might say, raising the wage won’t force tons of businesses to close. There is plenty of research that debunks this oft-cited myth, including an official scoring from the nonpartisan Congressional Budget Office that stated raising the wage to $15 would have little or no impact on employment

A federal minimum wage is the floor – not the ceiling – for what states and localities should do with their wages. Many folks on the left wing rightly point out that for many places in America, $15 an hour is simply too low. The thing is, the federal minimum wage was always intended to be the bare minimum that an employer could pay a worker anywhere in the US, so states and localities can and MUST raise their minimum wages to accommodate for regional differences. Biden’s proposal helpfully makes this a bit easier by indexing the minimum wage to inflation, so that the federal minimum never stays so woefully behind the times as it is now.

Biden’s proposal eliminates the tipped minimum wage, a vestige of slavery that we should all be glad to get rid of. The tipped minimum wage began as a way to justify under-paying Black former slaves  in the post-Civil War economy, and it’s left millions of workers vulnerable to abuse, sexual harassment, and financial precariousness ever since. The tipped minimum wage has been stuck at a shocking $2.13 an hour for nearly 30 years, and it’s encouraging to see the Biden administration commit to phasing out this horrible practice. 

Simply put, raising the wage to $15 is good for workers, good for the economy, and good for our society. We think it’s a no-brainer for the new administration, and we’re delighted beyond measure that they seem to agree. Of course, the proposal will have to make its way through Congress before the President-Elect gets to make good on his promise, but we remain hopeful and ready to make sure this bill gets passed as soon as possible – because we know that millions of our neighbors can’t wait.

(The Patriotic Millionaire, a lively organization comprising very rich people with a conscience, bless them!)

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