Minimum Wage Bumps Up To $5.85 This Week

The federal minimum wage is rising to $5.85 this week, up from $5.15. The change is part of a plan to give minimum-wage workers an additional 70 cent boost each summer until 2009, when the minimum wage will be $7.50, or about $15,000 a year before taxes and without taking time off.

The poverty level in the us is around $10,210 a year.

The effect that a minimum wage increase will have on the economy is hotly debated. Some say it will cost jobs and raise prices, others say that it won’t. We’ll find out.

Federal Minimum Wage Rising This Week [Washington Post]
(Photo:GrooverFW)

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  1. skrom says:

    Great, so all of us who arent making minimum wage dont get an $.70 raise and because businesses have to pay more for salary we all get screwed by higher prices to make up for it. The only people making minimum wage are kids who probably live at home, retired people looking for something to do, or illegal aliens. Even if you do work for minimum wage its rarely for long as long as you do a good job you get promoted.

  2. ihatemylife says:

    Wow!!! I can buy about 2 gallons of gas to drive the 25+ miles each way to work….

    I’m so greatful for the extra money where should I invest it… hmm.. oh I forgot I’m investing it in the big/oil and gas companies by paying 2.95 for gas when I WAS paying 2.00 not too long ago… I guess I’m investing in making big oil richer… oh joy of joys!

  3. badgeman46 says:

    Looks like no more summer jobs for teenagers. You can probably also count out that raise you were going to get for all you workers in the 7-15 dollar an hour range too. Come to think of it, that sandwich shop down the street will probably jack up the prices now that he has to pay his help more.

  4. ihatemylife says:

    Skrom makes a good point if you want to believe that .70 cents will drive up prices..

    Yet if you look at the rising cost of gasoline prices didn’t go up for most consumer goods…

    Also, wages don’t always rise if you do a “good job”

    I’m retired I’m not “looking for something to do” I need the money… I’ve been promoted and I’ve received a .10 cent per hour raise at one job the other job I have is minimum wage.

  5. roothorick says:

    This has ZERO effect on anyone working in the state of Wisconsin. WI state statutes already set a minimum wage of $6.50/hr. I’ll take my $6.95/hr from Walmart and be happy, kthx.

  6. mwdavis says:

    Minimum wage is already higher in 35 states than the federal minimum. What’s driving higher prices now are energy costs, health care and the massive growth in the supply of money (wars ain’t cheap).

    So, rather than deal, let’s blame the folks at the bottom. That’s what seems to be popular here.

  7. firefruze says:

    The U.S is surprisingly way bellow Canada in terms of Minimum wage,
    right now ontario stand at $8.00 an hour ( with plans to go to $10 by
    2010) and everything seems to go well although there is a bit of a lack
    of employment in the manufacturing sector ( due to our high dollar).

  8. nequam says:

    In Mass., the min. wage is $7.50 and will be $8.00 come Jan. 1, 2008. Of course the cost of living is higher here than in other places. Still, I can’t believe anyone anywhere can live on $5.85.

    I don’t know why people are bitter over this. If you, for instance, want people to get jobs rather than collect welfare, then you must also be willing to pay them a decent wage.

  9. yg17 says:

    Minimum wage in MO went from 5.15 to 6.50 the 1st of this year after we voted for an increase, and prices haven’t risen at all. Then again, the only types of places this might actually have to raise prices as a result are crapholes like McDonalds and Wal-Mart, and as good consumers, we shouldn’t be shopping there now, should we?

  10. azntg says:

    I don’t think the recent change is going to do jack for New York State. Our minimum wage is already $7.15/hr (for general jobs), which I think is still pretty hard to live by in New York City.

  11. zolielo says:

    @nequam: Same in CA the min. wage is $7.50 and will be $8.00 come Jan. 1, 2008.

  12. no.no.notorious says:

    @zolielo: same in ny

  13. GinaLouise says:

    In San Francisco, the minimum wage is about $9.14. Miraculously, we haven’t been overrun by newly rich McDonald’s workers in BMWs. And prices have … stayed the same. Oh, well. There goes that theory.

    Whoever thinks that only illegal immigrants and idle folks looking for extra pocket change are working minimum wage is very sadly out of touch with reality in this country.

  14. nan says:

    Minimum wage is just a way for employers to say “We’d pay you less, if we could.”

  15. Maulleigh says:

    I was making $3.35 in 1987? 1988? Thank god I was living with my parents.

  16. TechnoDestructo says:

    @nequam: When I was in San Angelo, I spoke to someone (the maid at Air Force billeting) who was paying, IIRC, 350 a month to rent a 2 or 3 bedroom house.

    Yeah, it’s really cheap to live some places.

  17. Josh says:

    Gosh, if only they raised the minimum wage to $25 or $30 per hour, we could eliminate poverty altogether. Since the foregoing comments have demonstrated in a conclusory fashion that an increase in production cost has no effect on prices, it stands to reason that the government should be setting the minimum wages at a level where everyone can afford McMansions, Mercedes and all the blow they could ever want. They might also need to pass laws forbidding employers from laying off workers, however, to keep them from trying to reduce labor costs by hiring fewer people. Also, laws against going out of business, being unhappy, and not smiling at babies might be in order.

  18. Chese says:

    When you take into account inflation, the minimum wage has been less and less every year. It doesnt. In fact in 1997 when the minimum wage was 5.15 that would equate to $6.40 in todays dollars. The poorest today make even less then they use to!

  19. clarient says:

    I pay $315 monthly for my 2-bed 1-bath… I make $7.00 and I go to school fulltime, and I can barely make rent/bills/groceries.

    I think Texas still abides by the federal minimum wage. Wish they would abpply that 70-cent increase to my pay, as well.

  20. t.a.m.s.y. says:

    If the federal minimum wage jumps 70 cents the next two summers, it’d end up at $7.25, not $7.50.

  21. andrewsmash says:

    Ooooh….look at all the angry libertarians. Maybe the reason teenagers, retarded people, and illegal aliens work for minimum wage is because they are the only ones willing to deal with lousy working conditions, asshole customers (and management), unpaid overtime, and other assorted wonderfulness for such low pay. You can make more per hour begging on the street and probably deal with less abuse. Now according to economic logic, since you can make a higher wage begging (therefore doing less work for more pay), it must mean that people who beg are smarter than your average minimum wage employee. But since we have outsourced all of the jobs that actually pay a living wage to unskilled employees, it could also mean that a greater portion of the population is stuck in minimum wage jobs without being able to rise up to construction, manufacturing, or script-based customer service. Since I plan on entering a career path that depends on a lot people in my local economy having a little money, it doesn’t matter to me that the minimum wage is going up. However, if I were, say, a salesman, who depends on having an small number of people with a large amount of cash (which is probably made by paying lower wages to lots of employees), the idea of a higher minimum wage might make me a tad nervous. Cause a lot of people with a little money are going to spend more on day-to-day expenses, where a few people with a lot of money are going to splurge on luxury items, and God knows that no one becomes a billionaire that way.

  22. Karmakin says:

    There is a certain point where forcing raising wages will result in the jobs being lost, because the productivity of the job is less than the wage to be paid, literally it can’t sustain itself.

    However, there’s no reason to believe that the current, or even the new wages are anywhere close to that point. It might cut into profits, and there may be a very low number of marginal jobs that will be cut out, but on the other side of the coin, new jobs will be created because of the higher amount of money churn resulting in greater demand for services (essential in a service based economy)

  23. StevieD says:

    Price increase will abound in many business sectors.

    Why? Because wages for many small business are often tied to multiples of the minimum wage.

    As an example, one of my suppliers pays their entry level manufacturing employees 2.5x the minimum wage, with other employees receiving much larger wages. That “LITTLE” minimum wage increase will have dramatic effects on that specific labor intensive manufacturer with only 20 employees. On Friday I received notice that August 1st the long term office manager and an key employees will take an early retirement and the manufacturer will raise prices an average of 6% on their entire product line.

    I wonder why? Maybe because labor prices are suddenly increasing 13.6% and their labor costs are, by my estimation, about 40 to 45% of the product costs?

    6% is a huge chunk of a price increase. I will be sure to pass the price increase onto my customers.

    Service and restuarants are even harder hit:

    The local non-franchise taco stand raised prices on tacos by $0.20 on July 1st in “anticipation of the rising minimum wage”.

    I just went out for dinner with the family. The locally owned restuarant that I have frequent for 20+ years is having a price increase on most menu items on July 24th. The owner says that he is having to give his kitchen help a $1.50 raise or risk losing them to the chain restuarant with much higher wages that is opening down the street in the next month.

    My parents favorite chain restuarant just raised the price of non-alcoholic beverages from ~$1.50 to $2.50, and non-bottled water, which used to be free, will now cost $1.50.

    No free water? That really sux green slimmy swamp water.

    And those burger franchises down by the interstate? Yep, wage impact is coming. Last month they were advertising on their signs that starting wages were $8.50 per hour. The first blink happened midweek. I saw a sign that said starting wages $9.50.

    I am sure burger and drink prices will quickly follow.

    Oh, and one last comment. My car was in a fenderbender. I backed into a telephone pole. My fault. $350 in damages. Not filing the claim with the insurance company (especially since I have a $500 deductible). The quote from the auto repair shop was good until ……. yep, you quessed it, July 24th. Why July 24th? Because the shops labor rates will increase by $2.00/hr.

    Yep, that minimum wage sure is good for people.

  24. andrewsmash says:

    @StevieD: So your prices go up, and the prices of your favored businesses go up, but does this mean you will have to move into a smaller house? Take on a few roommates? $2.00 an hour can make a big difference when it represents a third of your income. How do these price increases change your life? Or is it just your wallet taking a little hit?

  25. frogman31680 says:

    minimum wage in my state is 6.85 I believe. But the increase is costing others jobs. I live on the border and our neighboring state minimum wage is $5.45 (now $5.85). People are coming over looking for work.

    And the increase in wages is being passed onto consumers. Fast food places raised their prices almost a dollar more per meal. Our local mom and pop stores have higher prices than they used to as well. This is why I don’t like the minimum wage. When you force employers to pay more for their workforce, then the expense is passed onto the consumer. Most businesses won’t eat that profit loss, and to believe otherwise is just foolish to me.

    I’d like personally to see the studies that show the positive sides to a minimum wage increase. Thank you consumerist.com for letting me rant.

  26. ZekeSulastin says:

    @andrewsmash: By extension, the price increases will affect those living on small wages as well, especially since it is the low-end wage-earners who are likely to spend money on fast food et. al. in which the prices are increasing. The end effect isn’t all that great for said earner …

    Besides, once more money was available, wouldn’t the price of the cheap housing go up as well? Also, remember that some businesses may have issues with the new wage …

    And of course it sucks for those who make more, since they absorb the price increase with little recompense, but this is the Consumerist, where if you’re above the poverty line or a capitalist everyone hates you :p

  27. Jesse in Japan says:

    An increase in the minimum wage will increase consumer spending at the low end of the economic spectrum. More people having more money and spending it means that the economy will improve.

    The same businesses that will be hit hard by increased employee payroll will, by contrast, see their bottom-lines improved by increased sales. Wal-Mart and McDonald’s especially should be overjoyed, because most of that added circulating money will ultimately come right back to them.

  28. EtherealStrife says:

    @StevieD: It’s called inflation. It’d be nice if we could have the same prices year after year, but that isn’t happening. So the bottom rung needs to be given a boost, which should (over time) trickle up.
    “6% is a huge chunk of a price increase. I will be sure to pass the price increase onto my customers.”
    Good. That’s what you’re supposed to do if you can’t handle the hit. The customers will decide if it’s acceptable or not.

    “one of my suppliers pays their entry level manufacturing employees 2.5x the minimum wage”
    Wages based on multiples of minimum wage are asinine. Find another supplier, or talk some sense into the fool who set it up that way.

  29. nequam says:

    There seems to be quite a bit of guesswork going on here, as though this is the first time it’s happened. The minimum wage has risen over time. In many (most?) states, the raises have been frequent and sometimes significant. Does past experience with these raises demonstrate increased prices? There must be some info out there no?

  30. Karl says:

    Washington’s minimum wage is already $7.93/hr, and our unemployment rate has been on a downward trend since mid-2003.

  31. TVarmy says:

    @joshlawless: Well, the cost of living is going up, so we need to set a new legal minimum. If there’s mass deflation, you can have a minimum wage decrease. Cool?

  32. skrom says:

    Wages should be based on what someone wants to pay. If Bob id only paying his emplyoees $2 an hour chances are noone will work for him and he will have to raise his wages to attract employees. Mandated minimum wages are stupid. The only reason some places pay minimum wage which is hardly any (even McDonalds pays $2 an hour over minimum wage where I live) is because people agree to work for minimum wagge. If nobody agreed to then they would have to raise their pay to stay in business. Hence why 90% of people who make minimum wage are teenagers and illegal aliens. Its people who either live with their parents or have multiple roommates that make minimum wage. NOBODY supports a family on it.

  33. nequam says:

    @skrom: It would be interesting for you to provide some figures on those last three sentences.

    There were complaints last year (or 2005?), when the Labor Dept. released figures on the demographics of minimum wage workers (which IIRC on their face dispute SKROM’s claims), that some employers like Wal-Mart make a habit of paying workers just slightly over the minimum wage so that they can claim that their workers are better paid. This sort of practice skews the figures when studies tally the number of min. wage earners. More accurate studies look at workers earning within a range of the min. wage (e.g., within $0.50 or $1). People in this range are likely to benefit from an increase even though they nominally earn more than the minimum. I think the Terminator looked at this issue in Calif. and the results favored raising the min. wage. I’m sure somebody else has better info than me.

  34. yg17 says:

    Perhaps it’s just the liberal in me talking, but if me having to spend 50 cents more on my meal at a fast food restaurant means that their employees can make a halfway decent wage, then I’m all for it. I like helping people. I can afford that extra 50 cents. In the long run, that 50 cents is going to mean more to them than it is to me.

  35. Thaddeus says:

    July 1st, it went right to $7.50 in Illinois. So mush for the wait.

  36. Lordstrom says:

    To further Josh’s point, which no one really acknowledged, why stop there? Why not just take minimum wage to it’s logical socialist conclusion and pay everyone a hefty salary without regard to skill or intelligence?

    I find it odd that liberals tip-toe the minimum wage thing, but won’t just come out and admit they want everyone to make the same amount of money. Why not just admit that?

  37. Perspex says:

    Oh my god, there is so much wank on here that it’s absolutely unbelievable. Just… wow. I’m disgusted with Consumerist readers now, but I guess it makes sense that the demographic for a blog on consumerism would be greedy assholes.

  38. yg17 says:

    @lorddave: Because that’s not what we want. A doctor shouldn’t make the same as a burger flipper at McDonalds. We don’t want everyone to make the same amount of money, we just want everyone to make enough to live comfortably. If you happen to go beyond a McJob and make more, great. You earned it. But people shouldn’t be living on the street because their job doesn’t pay enough for them to put a roof over their head.

  39. Lordstrom says:

    @yg17: So you do think everyone should be making at least $18 an hour, right? Because that is what comfortable living is for large cities.

  40. Grrrrrrr, now with two buns made of bacon. says:

    So if you raise the minimum wage, the prices will go up. If you don’t raise the minimum wage, the prices will still go up anyway. In fact, maybe because the prices have gone up is a good reason to raise the minimum wage so people can afford to live. Even if you have a McJob, you still need food, clothing, and shelter, or else you won’t be going to your McJob.

    Come on, the whole “everybody should make the same wage” argument is BS, but so is the “if we raise the minimum wage, the economy is going to collapse” argument.

    The price of products and services will have to go up by a tiny amount to pay for that. On the other hand, usually somebody making minimum wage is out spending the money and putting it back into the economy, not hiding it in Swiss bank accounts or tax-shelters, so that wage increase should find itself right back into the economy, not stuffed into some Senator’s mattress.

    I know..if it’s fine to pay adults substandard wages that they can’t possibly survive on, we should just bring back child-labor! Let those little useless freeloading bums contribute something to the economy! Why, they’re getting off scott-free, and not even paying taxes! This is an outrage! We could get the service-sector back on track AND have our cheap tacos too!

    Jesus, folks, we’re talking about going from $5.15 to $5.85. Let’s see…$5.85 X 40 hours =$234.00 a week before taxes. Chop out another 10% for taxes…wow…a whole $840.00 a month to pay for food, clothing, shelter, transportation, and health-care. Look out, Beverly Hills! Here come the extravagant lifestyles!

  41. BenMitchell says:

    The reason for the increase in costs is not because of a min. wage hike. It is because our government has no control over its spending. Inflation in this country is out of control. If you reduce the value of the dollars you pay people – then the only counter is to increase the amount of dollars given to someone so that they balance out. This is basic economics – and is the reason we have to have 2 incomes in the family to enjoy the same lifestyle that only 1 income would have produced only 25-30 years ago. Oh and by the way -BTW: I’m a libertarian who makes over 80k/yr and I FULLY support the min. wage hike. Unlike some of these people who are opposed to the hike – I still remember my college macro econ classes and believe it will only benefit society.

  42. HawkWolf says:

    there appear to be two big viewpoints.

    One is that minimum wage is a bad idea, because it doesn’t let the market decide what should be a minimum wage. If we pay people two dollars an hour, then they won’t want to work for us.

    But we already pay people two and three dollars an hour; they’re called ‘Waiters’ and we assume people will tip them enough to make the difference, however that money comes directly from the customer and doesn’t have to filter through the mess of business taxes, etc.

    Also, people who can’t get a job at all may be likely to take one for 2 dollars an hour, if it’s more than what they’d get for a free handout from the government.

    The other viewpoint is that we need to provide people a minimum standard of living, which is a fairly socialist ideal. It’s not to provide everyone the same living conditions and wage, just to make sure there aren’t people living in their own vomit.

    The downside of that viewpoint is that some people don’t deserve to get free money because giving it to them means they won’t ever try to actually work. They’ll simply rely on it.


    Unfortunately, this issue just seems really complicated and made out of two sort of irreconcilable differences. That’s all I can make of it. You can’t have it both ways. You can’t be ‘good’ to people and also ‘let the market decide’. You either pony up and take responsibility for people’s welfare – with all the goods and bads – or you let people sort it out with their own lowest-common-denominator games. (Example: walmart comes in, causes local businesses to shut down, funnelling workers into walmart, who can then pay them whatever they want because the people otherwise wouldn’t have a job.)

  43. Christovir says:

    Sheesh, the ambient level of logical fallacies in here is downright toxic! Name-calling, ad hominem attacks, and straw-men are not really arguments…

    The minimum wage has been studied extensively by economists, and most results suggest recent increases around the world have not caused the loss of other jobs (Stewart, 2004a; Stewart, 2004b), and if there are price increases, they are small enough to be undetectable. There is plenty more on Google Scholar; go have a look for yourself.

    It always amazes me how the actual research on a topic gets completely left out of any discussion of it.

  44. zolielo says:

    As an economist I do not like getting into the minimum wage arguments. But I will say that whatever the government does markets can correct over time; either for the better or the worse – depending on one’s view.

    What is neat is a contra to this topic; that there should be no maximum wage. It is an old economics trick question to mess with students.

    Elasticity analysis puts forth that one could be paid any amount as long as it is approximately 1/6 times the revenue one generates.

  45. yg17 says:

    @lorddave: By comfortable, I mean enough to at least feed your family and have somewhere to live. Perhaps “comfortable” was the wrong word, and that can be done for less than 18 bucks an hour

  46. kditty says:

    comfortable for me is between $12-$15 and hour, with my girlfriend working to. as of right now i make $9 an hour and that hardly pays my daycare for the month. 670 dollars for rent, $540 a month for child care, $160 a month for gas, and about $80 a month for lunch etc… i am not making it on this wage but it seems to be an excepted wage in ohio. if people make more than minimum wage then they are usually happy. dont get me wrong, if i was a teenager living with my parents, what i bring home weekly would be great, but im not and there is really no way to advance as of right now because every place wants to pay under $9 an hour. my best bet is to wait on a union labor dispute and take a scab job at $25 an hour, paid lodging and 300 a week per diem. the per diem at my scab job weekly was more than i bring home for 40 hours worth of work at my current job.

  47. TedOnion says:

    All right people, you’ve got this all wrong.

    First, labor does NOT follow a simple supply and demand! Labor is not mobile, that is someone working a factory job for $7/hour will not and can not uproot their entire family and move across the country to take a job that pays $8/hr. Also unlike a consumer buying an apple, a job is not an optional purchase. If your choice is a job that pays $2/hour or no job, you will take the $2/hour job! You have to earn money one way or another.

    Minimum wage is not a question about anything you all have mentioned. The question is what is the minimum standard of living an American willing to work a full time job should be able to maintain? Should they be able to afford food, housing, and god forbid health care or education?!

    If you are happy seeing your fellow citizens starving in shanty towns like those you see in pictures from those dusty countries then by all means support worker exploitation and oppose the minimum wage. (a logical fallacy I know.)

    Economists can argue all day and night about the effects of a minimum wage increase. Thats what they do, they talk about facts. However, the effect of a minimum wage is a normative question.

    I’m really disappointed in consumerist’s readers lately. This place has gone right down the crapper like a unwanted newborn at prom. What happened here!?

  48. str1cken says:

    Support a maximum wage!

    We should certainly be able to offset the price increases of a .70 pay raise by dropping the CEO compensation from $100,000,000 to just $1,000,000, no?

    Maybe things will get even CHEAPER!

  49. agent2600 says:

    Why don’t we all just go back to substance farming? is that how people used to live and eat? Whats with all this consumerism, buying things that we don’t need.

    I heard there is plenty of room in montana

  50. synergy says:

    @firefruze: The gap between Canadian and U.S. minimum wage is even worse considering that, as of this week, I got 96¢ Canadian for my US$1 whereas about 8 years ago it was around C68¢/US$1. Hmm. I wonder what’s happened in the last 8 years…

  51. allstarecho says:

    @roothorick: You make $6.95 an hour at WalMart? You’re getting screwed. I know several WM employees, some brand new, making $7.75 an hour and we’re in lil ole poor Mississippi where the cost of living isn’t high.

  52. MissAnnThrope says:

    @STEVIED Hey, has it occurred to you at all that the prices of consumer goods are currently being dragged up by more than in increase in minimum wage?

    Things like transportation costs have gone up dramatically with rising gas prices. I’ve been noticing the price of things like meat and fresh produce going up dramatically as gas prices rise. But then, it sounds like you haven’t eaten a meal at home in years, so you wouldn’t know what’s happening to the prices in the supermarket, now would you?

    You’re whining about an increase in minimum wage, an increase in your fast food, the fact that your favorite restaurant is raising prices to pay employees a competitive salary that must be above minimum wage to begin with, so he can compete with the chain down the streeet. That is called capitalism. Survival of the fittest. Competition. How much is going into his pocket if he has to raise the price of each entree to pay people $1.50 an hour more? Minimum wage went up from $5.15 an hour to $5.85 an hour, not to $6.65 an hour. So either he was paying them under the table and less than the federal minimum wage, or he’s not very good at running his business. Perhaps a better chef to offset the chain?

    You’re whining about the hamburger chains on the highway offering $8.50 an hour and now $9.50 an hour to try to lure employees. Perhaps you do math in an alternate dimension. But $9.50 an hour is WELL above minimum wage and in most states, you can still get federal energy assistance on that kind of wage, especially if you have a family to support, or you don’t have 15 roommates to offset the price of fuel oil in winter. Has it occurred to you that they’re paying so much over minimum wage because otherwise, they couldn’t even get high school drop outs to work under such conditions? In a fast food place, one second you’re emptying the garbage bins, the next second you’re unclogging the toilet the local kids threw every tube of toilet paper down and the next second you’re making someone’s burger. And you’re still making less than a janitor at the NY Times or the Pentagon. You’re even making less than most garbage men start at.

    You can whine about the increase all you want. But you have to pay employees that don’t live with mom and dad enough to afford the insurance on the van they’re living in. Which is just about what people who make minimum wage can afford to live in.

    But Stevie, think. Have you looked at your electric bill lately? Look at the rise in price per kilowatt hour that we’ve all been hit with as gas costs rise. Eat at home for once, so you can see what groceries cost anymore. Don’t go on about the sale items, those are loss leaders. They’re sold below cost to get people into the supermarket and buy other necessities that will make a profit for the store.

    One last thing… If the minimum wage increasing for the first time in ten years is the reason for ALL inflation, then why has there been any inflation in the last ten years?

    Your reasoning is faulty.

  53. asherchang says:

    finally, the minimum wage will catch up somewhat to inflation!

  54. andrewsmash says:

    Why is that black & white thinking is used instead of analog arguments – a

  55. andrewsmash says:

    I have no idea why the above posted. Sorry about that. The point I was going to make was “Why do people use the argument that supporting a higher minimum wage is akin to socialism?” Even in socialism, one benefits from receiving an education, it’s just not a monetary benefit. A doctor wouldn’t have to engage in the brutal physical labor of a farmhand, for example. I think the problem is one of status. We have confused the amount of personal wealth with the quality of the person. If you aren’t wealthy, then nothing else you accomplish has merit. Therefore, some people want others to be as poor as possible if that situation leads to them becoming marginally more wealthy. The whole idea of business as a vehicle to wealth didn’t seem to become widespread until the last 40 or 50 years. In the great olden times, owning a business was a way to subsist, and if you got wealthy, you were part of a very small minority. People who bullied their way into wealth were seen as, for lack of a better word, tacky. Gordon Gecko was a parody, people! A clever slap at the disgusting profiteering of the 80′s. For the record, I see myself as an FDR democrat. Government serves the people by providing what they cannot accomplish as individuals. It is there to counterbalance the power of business. It provides jobs in times of economic weakness, social services for those that can’t afford them, war time protection, and peace time prosperity. It doesn’t hire contractors, it punishes American companies that outsource, and it sure as hell doesn’t grant corporations the rights of the individual. I know that everyone has a different view of government, and that’s how it should be. It’s a construct, based on mutual agreement. It just disturbs me that it is moving in the direction of elites and peons with nothing in between.

  56. Lordstrom says:

    So, give me a number. What is the amount that minimum wage needs to be? $10? $12? $15?

    If minimum wage were $15, would people complain that it needs to be higher? Be honest.

  57. andrewsmash says:

    Question for any economists: what if the minimum wage was directly tied to the housing market (both ownership and rental)? It seems the most basic expense is keeping a roof over one’s head, so would that translate into a “fair” minimum wage?

  58. kditty says:

    if minimum wage was $15 then i think that would be a start at making people happy. the reason i get paid so little is because my boss is allowed to pay me a low wage for hard work that he makes a killing from, and hes still uptight about ‘man hours’. ive worked a job at 15$ an hour and i had enough money to pay rent, day care, phone/cable/internet, buy groceries, gas, heat, water, and natural gas etc. and still have money to go out and do something fun. that stuff adds up and there is no way i could do it on $9 an hour without the help of my girlfriend.

    it kind of sucks but there are people who are WAY worse off than me, so i try not to complain. i say just hike the minimum wage, dont make my time spent making a company more and more money seem so worthless. maybe minimum wage should be based on what a company makes in a year, with an absolute minimum of $6.85(ohio).

  59. miborovsky says:

    If I’m not wrong, most states’ minimum wage are already around the $7 mark. So this will in effect have little consequence.

  60. skrom says:

    @kditty:

    There is your problem. You shouldnt be paying for daycare. You should be staying home with your kids while your husband works or he could stay home and you can work. But I guess you were irresponsible and had a kid you couldnt afford. Really it makes no sense to work 40 hours a week when 38 hours pays for daycare.

  61. fauxfatale says:

    @skrom: Nice bunch of assumptions there! So by your assessment, only the very rich should reproduce? Very democratic. Also, I believe kditty is male.

    If childcare was subsidized this wouldn’t be a problem and people wouldn’t blame parents for being poor because they have to pay for childcare. Come on.

  62. Lordstrom says:

    only the very rich should reproduce?

    Nope, just those that are financially stable or willing to make sacrifices(cable, internet, “fun”).

    If childcare was subsidized this wouldn’t be a problem and people wouldn’t blame parents for being poor because they have to pay for childcare.

    Oh my God. Why is it the first solution of problems for half this country is to run to the government? Many people *would* have a problem at the disgusting notion of paying taxes so the government can take care of irresponsible people’s children.

    Jesus Christ when did Consumerist become a socialist haven?

  63. wickedwaltz says:

    While it is true most jobs pay more than the minimum wage, if you wanted make a change that would address the income of the lower wage worker it would be to get rid of the income tax on income under $20,000.

    The lost income could be made up by not only raising the taxes on wealthy, but also by actually going after them and collect the taxes. Close the loopholes and make corporations actually pay their due. Why has it seem to become taboo to suggest that the rich, who get enjoy the sweetest fruits of living in America, not pay for it?

    If you make $15,000 a year and the government takes $1500 off the top, a fifty cents increase in your hourly rate really doesn’t mean much.

  64. rdldr1 says:

    … and the McJobbers rejoyce!
    I used to work in one back in college, I wish I was paid $7.50 and hour.

  65. not_seth_brundle says:

    @nan: Awesome Mr. Yuk avatar!

  66. markwm says:

    @wickedwaltz:

    “The lost income could be made up by not only raising the taxes on wealthy, but also by actually going after them and collect the taxes.”
    The wealthy already do pay taxes, and a considerable chunk of taxes at that. The ones who would be hurt most by an action such as this would be those in the 21,000 to 100,000 range, who would wind up footing more of the bill. Unfortunately, ‘wealthy’ is an elusive thing to define. To many, someone is wealthy if that person has more money and things than they do. How do you define ‘wealthy’ to make them pay more than their fair share? How is it more fair to charge someone 30%+ of their income, because you consider them ‘wealthy’?

    “Close the loopholes and make corporations actually pay their due. Why has it seem to become taboo to suggest that the rich, who get enjoy the sweetest fruits of living in America, not pay for it?”
    Despite what everyone is told, corporations do not pay taxes, they simply collect them. Any tax ‘paid’ by a corporation has come from an individual, whether it is payroll tax, the embedded tax, or any of the other taxes out there.

    Wouldn’t the simpler solution be for people to take responsibility for their actions? Not to sound heartless (I have a heart, it’s just very cold), but perhaps people should look at their lives and why they are where they are. If you can’t afford to have a child at this moment, maybe you shouldn’t. Instead, wait until you are more financially stable. If you’re a college kid working your way through school (as I did), make sacrifices. You’re going to college for an education, not to live the MTV Springbreak life. Live without cable, get an aerial antenna if you must have television. Don’t buy/rent movies, go to the library. Make a few minor sacrifices now to live better tomorrow.
    The problem with this country is we have too many grasshoppers and not enough ants.

  67. Jaysyn was banned for: http://consumerist.com/5032912/the-subprime-meltdown-will-be-nothing-compared-to-the-prime-meltdown#c7042646 says:

    @ihatemylife:

    I don’t know where you’re living bub, but nearly everything in north Florida is 10-15% more expensive than it was a year ago.

  68. vladthepaler says:

    Great. Now let’s watch the inflation that results from the mandatory 11% raises. Doesn’t anyone realize that this money has to come from somewhere?

  69. banned says:

    Every time the min wage rises anywhere, the resulting backlash is always people screaming about inflation and higher prices and always proves to be false. The truth is giving these people a nominal raise will not go into savings, they will go back into the economy, which in the end, strengthens it. The economy is successful when there is a constant flow of money so the rich people are more of a hinder to it by hoarding money than the poorest who spend it.

  70. markwm says:

    @rocnrule:
    Yup. That is probably one of the most asinine comments I have ever seen. All rich people have huge money bins with dollar signs on top, just like Scrooge McDuck, where they hoard their money, and occasionally swim through it. Sure.
    They don’t possibly reinvest that money in ventures that will make them more money, with the side benefit of helping those in whom they invested. Nope, couldn’t possibly do things like that. That would do a lot more for the economy than impulse spending, so there’s no way they could do that.

  71. Lordstrom says:

    @vladthepaler: Of course. It comes from money trees that companies own!

  72. celyn says:

    I just know that in the 1890s, there was no minumum wage in the US. In the 1950s there was. I know which decade I’d rather have lived in.

  73. chartrule says:

    $5.85 an hour that sucks

    here in Ontario, Canada, minimum wage is $8.00/hr.
    and is currently in progress of possibly being raised to $10.00/hr.

    as of this moment $1.00 CDN = $0.95 USD

    so $8.00/hour CDN = $7.64/hour USD

  74. banned says:

    @markwm:
    You’re right, however most rich people invest in rich companies, who in turn invest in bigger companies, and aside from the taxes, very little of that trickles down to the rest of us. Sure some people with wealth do share, but the majority try to keep the money/power amongst themselves. Raising the minimum wage forces those people to share, and it may hurt ma and pa stores, but they generally have few employees. The fact remains, economies do not suffer in the end.

  75. Jesse in Japan says:

    @lorddave: When you say irresponsible do you mean irresponsible because they had sex or irresponsible because they didn’t go to the trouble to have an abortion?

  76. markwm says:

    @rocnrule:
    The very fact that those businesses that are invested in exist helps the economy. Those businesses have to have employees, they produce consumable goods or services, and despite your statement, they do a lot for development in their communities. Just because they don’t hold a Ted Turner-style press conference every time they make a donation, that does not mean they do not.
    Also, the economy is not a zero-sum game. Person A having money does not automatically mean Person B will not. Therefore, a rich person being rich does not mean a poor person cannot have money.
    Raising the minimum wage does not ‘force the rich to share’, it artificially manipulates
    the economy. While there has been no definitive evidence presented that mandatory minimum wage increases affect the economy on a macro level, little attention is given to the micro-economic level, where it can and does have a grave impact.

    Let’s look at it from a different perspective. I own Widgets Inc. My competitor down the street, Doodads Unlimited, offers generally the same product I offer, only at a higher price. I do great business, but he does terribly. He then gets the idea to lobby the city to set a mandatory minimum price for widgets. I now have to sell my widgets at the same price DU does. My customers now incur the higher prices, which they have to cover somehow, more than likely by passing it on to _their_ customers. This can cause loss of employees, freeze on hiring, slowing of business growth, etc. The results of this may not be immediately evident, because it’s difficult to quantify a decrease in growth of business, or a loss of potential jobs.
    Now, how is that any different than a minimum wage? Labor is a service offered, a product. By mandating a minimum for that product, it is going to have an effect on the economy. The only real difference between a widget and labor is that an emotional spin can be put on labor. You can show faces and say things like, “Ralph works two minimum wage jobs just to support his family of 6. Ralph, how do you do it?” and then get Ralph’s response that tugs at the heart strings. Unfortunately, as sad as Ralph’s plight may be, that should have no bearing on what he is paid. The quality and quantity of his work should determine that. Ralph’s life decisions are the only things that have a bearing on his situation, and he needs to reassess them, not expect his employer to do it just because he needs it.

  77. markwm says:

    @Jesse in Japan:
    It’s not a binary situation where you can say, “Have sex and have a child or not have sex and not have a child.” To say that the option is either to not have sex or to have an abortion is a willful misrepresentation of the situation and overlooks a myriad of options: birth control, adoption, family support…
    I can’t speak for LordDave, but I would say the irresponsibility comes from having a child that cannot readily be supported. To expect someone else to provide the means of support is irresponsibility. To support the child to the best of your means once it is here is a sign of responsibility. Knowing that you cannot raise the child properly and putting it up for adoption is a sign of responsibility.
    Birth control is not 100% effective, but it has a higher effective rate than is evidenced by the number of children born into situations where they cannot be supported, and birth control is definitely cheaper than raising a child. It just comes down to personal responsibility and accountability.
    As I said in my previous post, business is not there to pay a person what he needs to survive. It is there to survive in and of itself. Part of this survival involves a symbiotic relationship in which a person provides his or her time in exchange for money. Both parties must find this equitable for it to occur. If a person of sound mind and body takes a job for minimum wage, he is agreeing that his time and skill set is worth the bare minimum legally allowable to be paid. The truth of the matter may be that his time and skills are actually worth less than this, but the business cannot legally pay him his actual worth. This is all totally independent from what the person may need to sustain himself and his family. In this case, the person needs to improve his skill set to make his time more valuable.

  78. ltlbbynthn says:

    It’s not going to cost anybody jobs. Economically, the real minimum wage is around $7, thought that’s not the law. Congress could raise it to $7.25 tomorrow and nothing would happen to the job market.

  79. Josh says:

    Why is it that when congress mandates an increase in cigarette prices (through taxes), everyone gushes about how great it is that said price increase will discourage smoking, and when congress mandates an increase in fuel prices (through taxes and mandated additives), everyone gushes about how great it is that said price increase will discourage people from buying polluting SUVs, but when congress mandates an increase in labor prices (through the minimum wage), everyone rushes to their keyboard to dismissively sneer that this won’t result in fewer hirings, more firings, or any other reduction in the consumption of labor?

    Are we to believe that people care about the cost of their cigarettes and their gasoline, but turn a blind eye to the cost of their employees?

  80. BenMitchell says:

    @markwm:

    I have to agree on this one – I am 28 and have been having sex now for ummm well for a while. And I use proper birth control methods – why, because I cannot afford a child right now. I would love to have a child, in fact my g/f and I have discussed having 2 or 3 but no more. But right now we are both working 2 jobs to pay off debts incurred when we were stupid and putting money away. This is called being responsible.

    With that said – I still believe that the minimum wage is all that separates us from Mexico. You want proof that the markets can’t be trusted to do the right thing – Levi’s moved there operations to Mexico and have reduced cost nearly 48% – the saving passed to US consumers – We now pay more for Levis.
    Or how about Outsourcing – jobs that should go to young workers or those needing jobs at an entry level position are outsourced to overseas markets where they can pay reduced rates for labor – saving to US consumers – nill! The result is a loss of American Jobs and hurts us in the end. Why because fewer jobs = less consumer confidence. That makes the market sluggish.