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President Obama tells Congress again to raise the minimum wage

In his weekly address Saturday, President Barack Obama called on Congress once again to raise the minimum wage to $10.10 an hour. Obama noted that while the economy continues to recover from the last recession, wages have barely ticked upwards over the past four years.

President Obama renews call on Congress to raise the minimum wage and help the economy and millions of Americans.
Photo by Pool/Getty Images

“Because even though our economy is growing, and our businesses have created about eight and a half million new jobs over the past four years, average wages have barely budged,” Obama said.

In his State of the Union address, Obama asked corporations to do the right thing and raise the minimum wage, and a few, including GAP, have done so. Announcing that his company will voluntarily raise its lowest-paid workers to $9 this year and $10 next year, Gap CEO Glenn Murphy said he regards the expense as a “strategic investment” that would pay for itself many times over in better productivity and morale (as well as lower job turnover and training costs).

Raising the minimum wage nationally will benefit millions of Americans and in so doing, benefit the national economy and help the bottom line of businesses – despite objections of many business groups.

Even though opponents of raising the minimum wage, mostly Republicans, claim most minimum wage workers are young people, facts tell a different story. The majority of minimum wage earners are adults and many are families with children. Only about three million of the 19 million minimum wage earners are under 18. Presently, a family of two or more with one bread winner, working full time earning minimum wage, lives below the poverty line.

According to the Council of Economic Advisers, raising the minimum wage would increase the earnings of 19 million workers, and benefit 28 million Americans including children. These include:

• 4.6 million households of married couples with children;
• 2.8 million households of unmarried persons with children;
• 4.9 households of married couples without children;
• 3.4 million persons under 18;
• 12.4 unmarried adult persons without children.

Republicans and other opponents of the minimum wage are claiming victory because the Congressional Budget Office (CBO) released a study that said that raining the minimum wage to $10.10 an hour would lift 900,000 persons out of poverty, but it might eliminate 500,000 jobs.

Those who use this study to justify not raising the minimum wage are misleading the public. Contrary to what the politicians are saying, the CBO did not say that it would cut 500,000 current jobs; the CBO said it might lead to 500,000 fewer jobs low-wage, no-benefit jobs from being created.

The CBO also said that in addition to raising 900,000 people out of poverty, it would pump $31 billion dollars into our economy. Most legitimate economists are quick to point out that the $31 billion dollars of spending power in the economy will create new demand for goods and services, and that will create jobs. The CBO totally underestimate that fact.

Raising the minimum wage has another benefit as well. It tends to raise the wages of low income people who are making more than the minimum wage today, but not enough to live on. If a person makes $8 an hour now, he is above minimum wage. He or she would get a raise as well.

Lastly, the low minimum wage is not only keeping working people and their children in poverty, it is costing taxpayers $200 billion a year in social programs. This is in effect amounts to welfare for companies making billions a year in profits. If the minimum wage was raised to $10.10, many of those people would no longer qualify for taxpayer-supported programs. This would reduce the deficit and that, according to what Republicans always say, will create jobs.

Politicians and cable news commentators can’t have it both ways. Cutting the deficit either creates jobs, or it doesn’t. They can’t say that cutting the deficit by reducing the demand for social programs does not create jobs, but cutting it by eliminating social programs does. Republicans need to start being intellectually honest with Americans.

Despite the president’s efforts, Congress is not likely to act. Speaker Boehner said he would rather commit suicide than raise the minimum wage. He just bought a pricey condo in Florida, so he must plan on being around a while. Meanwhile, millions of families and all Americans, except the top 1 percent, continue to suffer.

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