Thirty years ago, I earned minimum wage working for the school computer lab and took home about $600 a month. My newly wed wife did the same, but less hours, and earned about $300. We shared an apartment with another couple with similar situation. Between classes and jobs, we enjoyed simple parties and weekend activities common to young people. I was grateful to have a job and quickly moved on after graduation.
Obama wanted to raise federal minimum wage from $7.25 to $10.10, a nearly 40% increase. According to the computation, this is the wage that a family of 3 with one full-time worker will stay above the poverty line: an income for food, water, and shelter to survive. That family will be worse off if the full-time worker lost his or her job.
Economists do not agree if minimum wage affect unemployment or not. Paul Krugman, a prominent economist, thought not. Others cited studies elsewhere in contradiction. They also disagree whether raising minimum wage will trigger inflation.
Leave politicking alone, the real debate is who work for the minimum wage: teenagers who need supplemental pocket money, the second income of the family getting extra discretionary spend, or the sole providers without upward mobility. There is no one solution to these three problems.
Why not keep the minimum wage low to encourage full employment. For those stuck below the poverty line, we can provide them with social welfare. Note that government has been dispensing social welfare for a very long time and raising the minimum wage won’t stop it either.
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