Friday, February 23, 2007
A person working 40 hours a week should be able to live at or above the poverty line. This is not possible for a parent with even one child in a single U.S. city at the current federal level of minimum wage. The real value of the minimum wage is the lowest it has been in 50 years when adjusted for inflation.
There is a vast disparity between the federal minimum wage, and what actually equates to a living wage. A living wage is the minimum hourly wage a full-time worker would need to earn to stay above the poverty line. The poverty line is the minimum amount of income a person needs to maintain a reasonable standard of living. This varies from city to city and depends on how many people are in a household.
For example, the living wage in Lawrence is $7.44 for one adult and $13.76 for one adult supporting one child, according to Poverty in America’s living wage calculator, based on the Living Wage and Job Gap Study of Penn State. This means that to support a child, a worker would have to make nearly three times the current federal minimum hourly wage of $5.15 and double the University of Kansas’ $7. This would translate to 80- and 120-hour work weeks, respectively, to live at the poverty line.
By passing living wage ordinances, businesses subsidized and contractors working with city or state are required to pay their full-time workers wages that place them at or above the poverty line. The effects of living-wage ordinances would have little impact on the majority of the private sector because of these limitations. In general, cities are large consumers of business, making it profitable to adhere to the ordinances.
Opponents of living wage ordinances argue that the increase in wages would cause employers to have to cut jobs, but a study by the Economic Policy Institute — a nonprofit, nonpartisan think tank, of the effects of passing a living wage ordinance in Baltimore showed no resulting job loss and decreased turnover rates, helping to curb training costs.
In 2005, the then-Republican-led Senate rejected another bill that would have raised the minimum wage to $6.25. Every single Democrat voted in favor. In addition to passing living wage ordinances at a city level, states should raise the overall minimum wages. Twenty-nine states have already passed legislation doing that, showing that the legislation currently debated in Congress is long overdue.
The bill that has passed the Senate Feb. 1 and the House Feb. 16 would raise the federal minimum wage for the first time in nearly a decade to $7.25 throughout the next two years. For those of you who remember high school civics, there is the problem of tax bills having to originate in the House, further delaying the reconciliation of these two bills. According to the Economic Policy Institute, it would affect an estimated 14.9 million workers — 80 percent of whom are more than 20 years old.
Steps are being taken to fix this problem, but we still have a long way to go. Instead of a token raise that will likely not be repeated for another decade, the minimum wage should increase yearly with the rate of inflation. Living wage ordinances should be the rule instead of the exception.
Huffman is a Kansas City, Mo., junior in anthropology.
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Comments
Editorial: Minimum wage should match living wage
I can't believe Kansan editorial writers are still beating this dead horse.
First, the Economic Policy Institute. While it is indeed a non-profit think tank, it is ANYTHING but non-partisan. It is admittedly 'progressive', and is not shy about promoting a political agenda that includes wealth re-distribution and 'economic justice'. Once again, a Kansan editorial writer has taken the website description of an admittedly Liberal institution at face value, and tried to pass it off as 'non-partisan'.
Second, please go down to Summerfield Hall, find an Economics Professor, and have them explain the effects of a Price Floor artificially imposed at a price ABOVE the equilibrium, market-clearing value. The higher the Price Floor, the greater the economic surplus created. Note that any professor and any ECON textbook will give you this information.
As applied to the case of 'living wages', the Price Floor is the new minimum wage, the market clearing price level is the prevailing 'too-low' wage that you're trying to raise, and the economic surplus is more commonly known as unemployment.
Sorry, but one flawed study from a polictially-motivated think tank does not suddenly stand on its ear over 10,000 years of human behavior. Water still runs dowhill, the sun still rises in the East, and higher minimum wage laws artificially increasing the price of low-skilled labor cause unemployment. Write it down.
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