Minimum wage! Hyah!

Raising the minimum-wage is is a long-standing democratic stance. As the party that is more concerned with people as people, it only stands to reason. Especially when you can be working full time and still not make enough to afford housing.

From an economic point of view, these employed individuals are employed. They make money, and they spend every penny of it. They're cheap enough that small business can employ them affordably and thus further bolster the economy.

However, as we've learned in our own past and as we see in other countries, being paid peanuts doesn't help an economy along as well as it could. A healthy economy has a healthy and happy workforce behind it. And such is not possible if 75% of your income goes to keeping a roof over your head and keeping starvation at bay.

The Minimum wage was created in 1938 at $0.25/hour, which initially applied only to people involved directly in inter-state commerce or supplying goods for inter-state commerce. The wage was expanded to more areas in 1961 ($1.15/hr), greatly expanded in 1966 ($1.40/hr), and to the modern extent in 1978 ($2.65/hr).

As has been pointed out a number of places, the 'real value' of the minimum wage has decreased as of late. A good overview of the inflation-adjusted real value, and some other nice statistics, can be found here:

http://oregonstate.edu/instruct/anth484/minwage.html

One interesting statistic is the minimum wage percent of poverty graph, where a 40-hour-week minimum-wage earner is compared to the federal poverty level.

The minimum wage has varied from a maximum of 90% of the poverty level in 1968 and has been between 53 and 62% since 1985. This is the lowest percentage since the poverty level was established in 1959.

Democrats HATE this. As the party that the labor movement most identifies with, this just sticks in the ole craw. If you take a look at the Department of Labor's minimum-wage history chart you can see that the minimum wage was raised in 1981 to $3.35/hour, right at the end of the early 80's recession, and later increased nine years later to $3.80/hr during that recession. It was again raised in 1991 to $4.25. The gap between 1981 and 1990 created the longest gap between raises in the history of the minimum wage. This gap saw the percent-of-poverty-level drop from about 72% in 1981 to about 53% in 1989.

The arguments against the minimum wage are familiar. Businesses with thin margins will go out of business. Small business (a.k.a. small-margin) business will suffer. Job growth will slow.

Housing costs in particular have been insane in the last decade. Many areas saw a doubling (or worse) of housing costs, both in rental rates and in housing. Since this rate is well above inflation and the minimum wage hasn't kept up with inflation, this means that minimum-wage earners now have to pay a much higher percentage of their income to keep a roof over their heads. You can help this out by having more than one earner under a roof, but that gets a little weird after a while; never mind that child-care costs about as much as housing does these days.

As WalMart states, their employees aren't there to earn a living, they're there to earn some spare cash. Retirees, teens who don't have to pay housing costs, and second-job people. The minimum wage isn't a way of life, they say. While they are right, the real world does state that people frequently are stuck earning minimum wage.

The minimum wage does need to be raised. Kerry has said that he'd like to raise it to $7.00/hr, and that would bring the buying power of a minimum-wage earner to about where it was when Reagan took office the first time.