Earlier this month, Barack Obama gave a speech in which he vowed to increase the minimum wage to $10.10 per hour from the current $7.25. The New York Times reported:
Mr. Obama drew some of his biggest applause when he renewed his call for what he sees as a small but crucial step — an increase in the federal minimum wage, which at $7.25 an hour is lower than the minimum in a growing number of states. He and other supporters say an increase would also help workers earning above minimum wage by creating pressure to increase their pay, and in turn would spur more spending and economic growth.
Especially with low-paying service jobs among the fastest growing in the economy, Mr. Obama said, “It’s well past the time to raise the minimum wage,” he said.
Mr. Obama’s push is timed, in part, to help Senate Democrats pass a measure that would raise the minimum wage to $10.10 in three stages over two years, raise the separate minimum wage for tipped workers and peg both to rise with inflation. But House Republicans oppose the legislation, arguing that an increase would force many employers to cut their work force.
Mr. Obama disputed those arguments, and cited widespread public support for an increase.
In the very last paragraph of a separate article, the Times quotes David French, a senior vice president at the National Retail Federation, responding to the push to outlaw low-paying jobs:
There’s been a lot of growth of jobs in the retail and service sector. It’s been one of the bright spots. Why then should the policy response be to create fewer jobs? That’s a bizarre remedy to a crushing problem.
Indeed.
Then there’s Paul Krugman, who advocates for an increase in the minimum wage supposedly to help workers, arguing that doing so would not exacerbate unemployment, while at the same time he (a) argues for more inflation to reduce workers’ real wages to combat unemployment and (b) writes in his own economic textbooks that the effect of minimum wage laws are to increase unemployment.
