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US federal minimum wage lowest in 50 years

deafplayer

TRIBE Member
THE RISE AND FALL OF THE MINIMUM WAGE (1946 - 2006)

The federal minimum wage is at its lowest point in 50 years



The federal minimum wage is at its lowest point in 50 years. Congress has not raised the minimum wage in a decade. As of December 2006, this will be the longest time Congress has ever gone without raising the minimum wage.
According to the Center for Economic and Policy Research, increasing the federal minimum wage to $7.25 per hour over the next 26 months — as proposed by Sen. Edward Kennedy in an amendment to the Department of Defense Authorization bill — would raise the annual earnings of the average full-time, full-year, minimum-wage worker[1] by $1,520 (Boushey and Schmitt 2005).[2]

Raising the minimum wage is only the first step in helping families to make ends meet. First, it is important to recognize that a substantial share of minimum wage workers are adults making significant contributions to the total family income. In the early 2000s, fewer than one-in-five minimum wage workers was under the age of 20 and half were between ages 25 and 54 (Boushey 2005). In 2002, minimum wage workers earned an average of 68 percent of their total family income (Chapman and Ettlinger 2004).

[1]Minimum-wage workers are defined here as earning between the current federal minimum wage of $5.15 per hour and the proposed new minimum wage of $7.25 per hour. We assume that a full-time, full-year, worker works 40 hours per week for 50 weeks per year, and a part-time, full-year worker, works 25 hours per week for 50 weeks per year.
[2]All expenditures reported and estimated increases are in 2004 dollars and based on 2004 expenditure and earnings data, which are the most recent full-year data available.

http://www.cepr.net/pressreleases/2006_06_19_graph.htm
 

Lurker

TRIBE Member
I saw this tonight too.

Congress & the Senate pass themselves payraises every year or two as well, which makes the situation even worse.

There were people saying that this would be bad for business though. I certainly don't agree with that shit, but it wouldn't surprise me that if the Feds raised the minimum wage, more jobs would move overseas when companies just shrug and say they can't compete.

The wage needs to move up along with import tarriffs on stuff that was made domestically for the longest time.
 

kerouacdude

TRIBE Member
from today's WSJ

Democrats Look to Keep
Minimum Wage on Table

Republicans Likely to Face
Election-Year Fight on Calls
To Raise the Federal Rate
By DAVID ROGERS and CHRISTOPHER CONKEY
June 20, 2006; Page A4

WASHINGTON -- Democrats aim to make the minimum wage a maximum political problem for Republicans this election year.

The minority party fired the first shot last week, when the House Appropriations Committee broke with its Republican leadership and approved a $2.10-an-hour increase as part of a spending bill for labor, health and education programs. Speaker Dennis Hastert responded by putting the measure on hold -- possibly until after the election.

But Democrats are poised to come back this morning and offer the same wage amendment as part of a second appropriations bill funding science and law-enforcement agencies.

"I gave the Republicans fair notice that we will attach it to anything we can," said Wisconsin Rep. David Obey, the committee's ranking Democrat. Sen. Edward Kennedy (D., Mass.) went to the floor of Senate yesterday and proposed to add the same amendment to a pending defense-authorization bill.

"We think it's both the right thing and good politics," said House Minority Whip Steny Hoyer (D., Md.).

Efforts to raise the minimum wage since 1997 have failed under Republican control of Congress, as business groups oppose the measure and lobbied against it. A group of more than 20 business organizations are fighting an increase this year, as part of the "Coalition for Job Opportunities." One member -- the National Federation of Independent Business, which represents small companies -- says a quarter of its members would have to cut jobs, at a total loss of 217,000 positions, if the federal minimum wage were raised to $6.65.

Despite business opposition, however, 21 states have enacted minimum wages above the $5.15 federal level, and roughly half the population lives in a state that already mandates higher hourly pay.

The last federal increase, signed into law months before the 1996 presidential elections, followed bargaining over tax- and health-insurance-related issues important to Republican conservatives. The same could happen now because the minimum-wage debate is coming to a head even as Republican leaders, already offering concessions to timber interests, are looking for the final Senate votes needed for a compromise on estate-tax relief. While far too early to predict, the party could solve two problems at once by linking the wage and estate-tax issues in an election-year deal.

Discomfort is growing among rank-and-file Republicans, especially as organized labor has mounted ballot issues in various states. Seven Republicans broke ranks with their leadership in the House Appropriations Committee last week, and Rep. Jo Ann Emerson (R., Mo.) said her polling on the issue in Missouri -- one of the states with a ballot initiative in the works -- testified to the issue's popularity. "It is a problem," Mr. Hastert said of the pressure now.

In the Senate, the challenge has been to get above the 60 votes needed to limit debate. In the past, Republicans have foiled Mr. Kennedy by offering a parallel amendment with antiunion provisions attached. What is different this year is that some Republicans are looking at an alternative -- that doesn't include the antilabor language and offers a smaller increase. "I would look that over," said Senate Budget Committee Chairman Judd Gregg (R., N.H.) and a past chairman of the Senate Health, Education, Labor & Pensions Committee.

Another factor could be Congress's own pay. While the minimum wage has remained frozen, lawmakers' salaries have risen with annual cost-of-living increases keyed to what is given federal employees. And last week's vote in the House Appropriations Committee followed a floor vote days before in which the House cleared the way for members to get another increase valued at thousands of dollars annually.

More Democrats have begun to ask how long the party can go along with such pay adjustments for Congress when Republicans block floor votes on the minimum wage.


"This is a rich man's support club," said Mr. Obey, who voted against this year's increase on the procedural vote. While the details aren't known, Minority Leader Nancy Pelosi (D., Calif.) is thought to have raised the issue with Mr. Hastert in conversations before the House vote on pay.

Polling for the liberal Democracy Corps has added to the pressure among Democrats. Among test planks for a Democratic platform, one of the most popular -- especially among independents -- is that Democrats would block any pay raise for Congress until the incomes of average workers begin to rise.

"It's a powerful statement, and it shows how out of touch Washington is," said Stan Greenberg of Greenberg Quinlan Rosner Research, who did the Democracy Corps survey. Just as Republicans in 1994 advocated term limits to highlight the arrogance of entrenched power in Congress, he said Democrats should make the link between members' pay and the minimum wage.

Business groups oppose any increase, arguing small businesses will be less willing to hire low-skilled workers if they have to pay more to do so.

Economists generally start from the proposition that increasing the cost of low-skill labor will reduce employer demand, hurting the intended beneficiaries. But they read the evidence on the effect of minimum-wage increases during the booming 1990s differently.

Despite those increases, after years in which inflation had eroded the purchasing power of the minimum wage, hiring was strong across the board and the increases are credited with helping to boost the fortunes of low-paid workers.

That added credibility to an argument made by professors David Card, of the University of California, Berkeley, and Alan B. Krueger, of Princeton University, who have challenged the conventional economic wisdom that higher minimum wages reduce hiring of low-wage workers by comparing the experiences of states that lifted their minimum wages in the early 1990s with those that didn't.

But an economist on the other side of the question, David Neumark of the University of California, Irvine, estimates poverty rates increase between 3% and 4% for every 10% increase in the minimum wage by depressing employment of low-skill workers. "The data are consistent with the idea that the people who are hurt are concentrated in poor families," Mr. Neumark said.
 

Ditto Much

TRIBE Member
Canada doesn't have a federal minimum wage. The vast majority of states set a higher standard then the federal minimum wage which is simply arbitrary. Hell right now Taco Bell is paying 8.50 and gives a $150 starting bonus on your second paycheck.

Newfoundland & Labrador $6.75
New Brunswick $6.50 (after exchange this is about 5.25 USD)

How can we in anyway place judgement in the USA when our minimum wage is basically the same thing and we litterally don't even have a federal minimum wage.
 
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man_slut

TRIBE Member
It's a problem and the worst thing about it is that labour has been co-opted to beleive that this is the right thing to do!
 

atbell

TRIBE Member
I think labour rates all over are just plain out of wack.

Minimum wages in particular should really be done on a much smaller geographic scale. How can anyone pretend that paying rent in Toronto or Vancouver is any where near paying rent in a smaller surounding city?

I like the idea of determining wages based on what someone's minimum budget would be. You'd start by finding a realistic price for rent, a weekly food alowance, transportation, utilities, clothing, and savings. Oh, and don't forget that the budget determines the needed AFTER tax income.
 

judge wopner

TRIBE Member
atbell said:
I think labour rates all over are just plain out of wack.

Minimum wages in particular should really be done on a much smaller geographic scale. How can anyone pretend that paying rent in Toronto or Vancouver is any where near paying rent in a smaller surounding city?

I like the idea of determining wages based on what someone's minimum budget would be. You'd start by finding a realistic price for rent, a weekly food alowance, transportation, utilities, clothing, and savings. Oh, and don't forget that the budget determines the needed AFTER tax income.
should people expect to pay rent and live a normal life in the most expensive city in the country earning minimum wage? rates would have to at least double to make this happen.
 

silver1

TRIBE Member
atbell said:
I like the idea of determining wages based on what someone's minimum budget would be. You'd start by finding a realistic price for rent, a weekly food alowance, transportation, utilities, clothing, and savings. Oh, and don't forget that the budget determines the needed AFTER tax income.
Rent in Ajax is lower than rent in Scarborough which is lower than rent in Downtown Toronto.

What if someone works a min wage job in downtown Toronto but lives in Scarborough or in Ajax?

How would you determine what that persons Min wage should be?

Is min wage based on the jobs location or where the person lives?
 
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atbell

TRIBE Member
Good points.

The problem that my thinking is trying to confront is the fact that dense cities have plenty of minimum wage jobs in them but rarely have any housing that can be covered with minimum wage pay.

How does one get around that? We can't just keep making crappy housing or smaller and smaller places to live.
 

praktik

TRIBE Member
atbell said:
Good points.

The problem that my thinking is trying to confront is the fact that dense cities have plenty of minimum wage jobs in them but rarely have any housing that can be covered with minimum wage pay.

How does one get around that? We can't just keep making crappy housing or smaller and smaller places to live.
Smaller and smaller people to fit IN the smaller and smaller places! Make a "only asians can procreate" rule - or genetically engineer smaller children!
 

judge wopner

TRIBE Member
atbell said:
Good points.

The problem that my thinking is trying to confront is the fact that dense cities have plenty of minimum wage jobs in them but rarely have any housing that can be covered with minimum wage pay.

How does one get around that? We can't just keep making crappy housing or smaller and smaller places to live.
you live like most people:

in distant suburbs and blow way too much time and money commuting into the city.

min. wage is not designed to pay rent and feed yourself alone, and to be honest, most jobs in the downtown core pay more than min. wage. the big manufacturing base in the west end like bramp/miss has mass amounts of min wage crappy factory jobs along with cheap ass housing. not the best set up but people manage to carve out a living.

the prov. just upped min. wage and plans to up it again in jan. but its still pretty low. $10 would be a nice start.
 

SellyCat

TRIBE Member
$10 seems totally decent. I don't just mean from a budgetary perspective, but from a moral one as well. People should not just scrape together a living--ideally. We are a very, very wealthy country and our citizens should all share in that prosperity.

There is so much more to life than having a roof over your head and three square meals a day. There's also culture, socialising, having fun and going out. This is what makes civil society in a city and that should be a priority. Focusing on basic survival needs is beneath this country's true potential.

In Europe, the quality of life is very important to the governments there. After WW2, the people rejected ideology and demanded that governments should only focus on the wellbeing of the people, not trying to make some self-agrandising monolithic state. So they have extensive job security programs, and wage and benefit guarantees so that people can actually enjoy their lives, not just survive them.

In a city like Toronto--really quite expensive--a $10 minimum wage might horrify some small businesses, but it seems like a ddecent and good starting point.

Before I was even out of high school, I had a job that was paying $15 an hour. That was a *lot* of money for a high school student. But as people get older and their living costs continue to rise as they get off their parents' teet, the picture begins to change.

Apparantly it's really fucking hard to find a "good job" in this city, and that sucks...because a lot of people went to university beleiving that it would guarantee them a decent job with a wage that could afford them a relatively comfortable existance. Well it turns out that was a constructed myth that has failed to correspond with reality.

The more I talk to people, the more I hear stories about people with Master's degrees holding down menial jobs that are FAR below their level of education. At the same time, I hear about people who never went to--or finished--university having decent jobs, because instead of going to school, they were gaining experience in the real world.

There was a thread about all this a while ago, but it got pruned. I'll see about starting another "so what the fuck are we gonna do?" thread.

Edit: I no longer had that high-paying job as a four years ago, and any job and/or opportunity since has not been over $10 an hour...So. as I gained a better educated, the income opportunities have fallen.
 
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Ditto Much

TRIBE Member
I'm cool with $10 an hour. But I think its time to stop charging income tax below 20k as well. If your not bringing home 20k a year I think society is better off letting you keep your money.
 
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Ditto Much

TRIBE Member
In Europe, the quality of life is very important to the governments there. After WW2, the people rejected ideology and demanded that governments should only focus on the wellbeing of the people, not trying to make some self-agrandising monolithic state. So they have extensive job security programs, and wage and benefit guarantees so that people can actually enjoy their lives, not just survive them.
You mean NORTHERN europe, and northern europe not including the UK. Because Spain is dirt fucking poor as is much of Italy and Greece and Portugal. Quality of life is one thing but remember that many of those european nations pay for these programs by lending money to third world nations and bankrupting them with intrest payments. The Netherlands and Belgium for instance would never have been able to fund there social programs (thus the massive cuts in the 90's) without massive exploitation of Africa during the 50's and 60's.
 

SellyCat

TRIBE Member
Ditto Much said:
You mean NORTHERN europe, and northern europe not including the UK. Because Spain is dirt fucking poor as is much of Italy and Greece and Portugal. Quality of life is one thing but remember that many of those european nations pay for these programs by lending money to third world nations and bankrupting them with intrest payments. The Netherlands and Belgium for instance would never have been able to fund there social programs (thus the massive cuts in the 90's) without massive exploitation of Africa during the 50's and 60's.
That's a very good point.

But in Spain and Italy, people seem to really enjoy their lives--from what I've seen travelling there. And that may not have anything to do with their wages--I don't know what they are there--it might have more to do with their social and cultural underpinnings.
 

deafplayer

TRIBE Member
Ditto Much
...but remember that many of those european nations pay for these programs by lending money to third world nations and bankrupting them with intrest payments. The Netherlands and Belgium for instance would never have been able to fund there social programs (thus the massive cuts in the 90's) without massive exploitation of Africa during the 50's and 60's.


and North America doesn't? Where do our Third World exploitation profits go to, if not social programs? I dont mean just limited to the specific action of lending, charging interest

All the first world countries are imperial/colonial, and surprise surprise, the wellbeing of (their own domestic) masses has not been the 'end'

Anyway I am very doubtful that you ahve anything to substantiate your assertion that they "would never have been able to fund their social programs" without the practice of 3rd world exploitation, as if social programs could not happen without vast anti-social programs [edit: as if it is necessary for prosperity to devestate others]
 

judge wopner

TRIBE Member
SellyCat said:
That's a very good point.

But in Spain and Italy, people seem to really enjoy their lives--from what I've seen travelling there. And that may not have anything to do with their wages--I don't know what they are there--it might have more to do with their social and cultural underpinnings.
i see where you are coming from. i used to think the same thing, until i spent time w/ my family in italy.

the north is very wealthy compared to the south. but even in the north its not easy to simply find a job, buy a house, 2 cars and get daycare for the kids. that stuff is super expensive comparitively (gas, energy prices and land are at a huge premium out there)

i do agree they are more laid back and relaxed, but id say the same about people from many poor countries, doesnt mean they are better off.

its difiuclty to make your stake in a place like italy, oppotunity is not as good as here, and i think many people have adjusted down their ambitions. i have about 30 cousins all over the country there and the one thing they all had in common was a distaste for the american notion of working so much. they thoght we were breaking our backs for nothing. they did not seem impressed by the succes of the family who immiigrated over here and got the big woodbridge houses etc etc.
this is my personal experience, but i think this is a not a rare sentiment in southern europe as a whole.

things are more relaxed, but there are emerging problems in how the nation will fund its generous social programs, where people retire early and have fat goverment pensions, increasingly refugee's are creating an underclass doing jobs that otherwise paid well: day care, elderly care and the like controled by the state, where goverment employee's would do such work for decent wages.

labour costs are higher in italy than say the eastern EU member states, many jobs are fleeing the great manufacturing base in the north.

im not sunny on their prospects and would be weary of any claims that they have made long term achievements to a "better" way of life. tourism is really their ace in the hole, but can it sustain and help grow a nation?
 
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Ditto Much

TRIBE Member
I wanted to reply first before going on to anyone else.

deafplayer said:
and North America doesn't? Where do our Third World exploitation profits go to, if not social programs? I dont mean just limited to the specific action of lending, charging interest
Actually as surprising as it is North America just didn't get anywhere near as close as the UK, Belgium and France in this regard. Things like the Suez canal and the African farming and water systems the Europeans just exploited far more. They also had a nasty habit of selling jet fighters to puppet regimes.

But there was no shortage of American and Canadian dirt as well. Now in the case of Canada we weren't a lending nation until the Candu program, the US became a major lender during the 73 oil embargo. Much of the third world debt occurred as a direct result of the oil crisis. The US and Europe lent money to purchase there own oil while funneling the profits back to themselves.


deafplayer said:
All the first world countries are imperial/colonial, and surprise surprise, the wellbeing of (their own domestic) masses has not been the 'end'

Anyway I am very doubtful that you have anything to substantiate your assertion that they "would never have been able to fund their social programs" without the practice of 3rd world exploitation, as if social programs could not happen without vast anti-social programs [edit: as if it is necessary for prosperity to devestate others]
I have a few bits and peaces but its largely personal opinion.

All I was trying to say is that first only a small chunk of Europe collects a higher minimum wage then us, and second that many of the most generous packages come from nations with some questionable periods in the last 50 years.

Switzerland really did build a banking industry on Nazi gold, this banking industry was one of the largest contributors to there social programs. The Swiss have it so good because they played dirty.
 

atbell

TRIBE Member
Ditto Much said:
Switzerland really did build a banking industry on Nazi gold, this banking industry was one of the largest contributors to there social programs. The Swiss have it so good because they played dirty.
I think the Swiss have it so good because the Swiss just plain didn't play. They've sat out almost every conflict, haven't joined the EU, and generally don't send troups anywhere... well other then to gaurd the pope.

It looks like they've really found a decent strategy for the time being, and if trouble comes a knocking I've heard they can physically shut down all the enterances to the country in a matter of hours.
 

deafplayer

TRIBE Member
Ditto Much
The vast majority of states set a higher standard then the federal minimum wage which is simply arbitrary. Hell right now Taco Bell is paying 8.50 and gives a $150 starting bonus on your second paycheck
[/b]


Congress May Have to Raise the Minimum Wage
By Mark Weisbrot

This column was distributed to newspapers by Knight-Ridder/Tribune Information Services on June 20, 2006. If anyone wants to reprint it, please let me know.

It’s a quiet war against America’s working poor: refuse to raise the minimum wage for a decade and watch rising prices eat away at the living standards of millions. That is what the United States Congress has done, and the minimum wage today buys less than it did before the last increase in 1997. In fact, it buys less than it did 50 years ago – a shameful new milestone in our country’s long march toward Third World levels of inequality.

At $5.15 an hour, today’s minimum wage won’t even buy two gallons of gas. At $10,300 a year for a full-time worker, it’s not even close to the meager poverty threshold of $13,000 for a single parent with one child.

But some 7.7 million workers are today working at minimum wage, or close enough that they would benefit from an increase. ["...to $7.25 [- not] enough. In terms of its real purchasing power, it wouldn’t bring the minimum wage to its level of 1968."] On average they are contributing about two-thirds of their family income. The majority are over 25 years old, and only 30 percent are teenagers. So much for the stereotype of minimum wage workers as high-school kids who live with their parents.

It was just over 10 years ago, in May 1996, that the U.S. House of Representatives passed the last increase in the federal minimum wage, from $4.25 to $5.15 an hour; it finally became law in August of that year. It was a hard-fought victory for the Democrats in a Republican-controlled Congress. Senator Ted Kennedy (D-MA) had to force a vote in the Senate by threatening to attach the wage increase to every piece of legislation in that chamber. But interestingly, when the vote came to the floor, it passed the Senate 74-24. Similarly, in the House, it passed by a vote of 281-144, despite the Republican majority.

Then, as now, more than 80 percent of the public favored the increase. Many Republicans didn’t want to be on the wrong side of that issue in an election year.

Now Kennedy is back, with proposed legislation that would increase the federal minimum wage to $7.25 per hour over the next 26 months. And last week Republicans on the House Appropriations Committee bucked their leadership and approved the increase.

The increase to $7.25 isn’t enough. In terms of its real purchasing power, it wouldn’t bring the minimum wage to its level of 1968. When one considers that productivity (output per worker) has more than doubled since then, it’s hard to justify anyone working for less than what was paid nearly four decades ago. But $7.25 is at least a step in the right direction.

The loss of real income at the bottom of the wage ladder is part of a broader long-term trend that ought to be the dominant theme in any national election: the failure of the majority of American employees to share in the gains from economic growth. Over the last 30 years the median wage has grown by about 9 percent, while productivity has increased by more than 80 percent. This is a sharp break with the past, when wages tended to grow with productivity, allowing for broadly shared prosperity.

To make things even worse, we have had a series of tax breaks in recent years – for example on stock dividends and capital gains – that are targeted toward upper income groups.

The minimum wage increase will buck this ugly trend toward increasing polarization of income and wealth, but it is hard to argue against. The Right will haul out the usual arguments, dating back to the 18th century, that such legislation will only hurt the people it is proposing to help, by making labor unaffordable and thereby reducing overall employment. But the mainstream of the economics profession has rejected this argument on the basis of empirical research. Why should anyone else believe it?

While minimum wage workers have been losing ground to inflation, Members of Congress have been hiking their own salaries, now at $165,200 per year. A House vote recently paved the way for another cost-of-living increase worth thousands of dollars annually. Congressional elections are about five months away. If Republicans in Congress want to block the minimum wage increase while raising their own pay, they could be playing with fire.


Mark Weisbrot is Co-Director of the Center for Economic and Policy Research, in Washington, DC


Center for Economic and Policy Research, 1611 Connecticut Ave, NW, Suite 400, Washington, DC 20009
Phone: (202) 293-5380, Fax: (202) 588-1356, Home: www.cepr.net

 

deafplayer

TRIBE Member
Ditto Much
The vast majority of states set a higher standard then the federal minimum wage which is simply arbitrary. Hell right now Taco Bell is paying 8.50 and gives a $150 starting bonus on your second paycheck.



Ralph Nader said:
Twenty-one states lately have raised their minimum wage above the federal minimum. None have reached the 1968 purchasing power level yet.

...
There is also the matter of simple fairness. Wal-Mart's CEO made $12,000 an hour, plus perks, in a recent year, while hundreds of thousands of his workers were making between $6 and $9 per hour, with very few if any benefits.
[FONT=Arial, Helvetica, sans-serif]Published on Thursday, June 24, 2006 by CommonDreams.org [/FONT]
[FONT=Arial, Helvetica, sans-serif]Democrats Finally Wake Up to Need For Minimum Wage Hike [/FONT]​
[FONT=Arial, Helvetica, sans-serif]by Ralph Nader
http://www.commondreams.org/views06/0624-20.htm
[/FONT]​
 
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