Tags: Krugman | minimum | wage | increase

Economist Paul Krugman: Raise the Minimum Wage

By    |   Tuesday, 03 December 2013 07:55 AM

Economist Paul Krugman has added has name to those pushing to increase the federal minimum wage.

When you're doing your holiday shopping this year, think about the person behind the cash register. Those are the main people who would be helped by a minimum-wage increase, Krugman writes in his New York Times column. Almost 60 percent of minimum-wage earners work in food service or sales.

That squashes the argument that raising the wage would send jobs overseas, he argues, saying "Americans won't drive to China to pick up their burgers and fries."

Editor’s Note:
Retired Americans Slammed by Obama’s Redistribution Plans

Inflation-adjusted wages of nonsupervisory retail workers have declined almost 30 percent since 1973, Krugman explains, and many turn to food stamps and Medicaid to make ends meet.

Reams of data show that raising the minimum wage has little or no adverse effect on employment, he argues. For instance, states that raised their minimum wage while neighboring states did not raise theirs amounted to controlled economic experiments.

"If there were anything to the notion that minimum-wage increases have big negative effects on employment, that result should show up in state-to-state comparisons. It doesn't."

According to the Economic Policy Institute, increasing the wage from its current $7.25 to $10.10 would help 30 million workers, Krugman notes. Others would benefit indirectly because their pay is effectively based on the wage.

Some economists favor expanding the Earned Income Tax Credit instead. Krugman says do both. "Unfortunately, given the political realities, there is no chance whatsoever that a bill increasing aid to the working poor would pass Congress."

But polls show that increasing the wage enjoys broad-based support, with even Republicans and conservatives backing the idea, he adds.

Not waiting for Congress, more states and local governments are increasing their minimum wages.

California, Massachusetts, New Jersey, Albuquerque, N.M., and Washington, D.C., have either decided to increase their minimum wage or are considering to do so, notes The Washington Post.

"Congress can’t do anything right now, and even if they could, they wouldn’t even come close to the level that various cities and states around the country are looking at," says Phil Mendelson, chairman of the D.C. Council, according to The Post.

Editor’s Note: Retired Americans Slammed by Obama’s Redistribution Plans

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Economist Paul Krugman has added has name to those pushing to increase the federal minimum wage.
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Tuesday, 03 December 2013 07:55 AM
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