WASHINGTON, D.C. — The term “minimum wage” usually evokes images of blue-collar workers barely scrapping by and working long and hard hours. The Fair Standards Labor Act of 1938 is responsible for instituting a seven-day work week while creating a national minimum wage. The national minimum wage has steadily increased over the years; however, it has come under much security in the last few years as growing income inequality and the divide between the rich and poor is steadily widening.
The recent push by United States President Barack Obama to raise the national minimum wage from $7.25 per hour, which was set on July 24, 2009 to $10.10 per hour is coming under a great deal of scrutiny.
The minimum wage is a hot topic due to the effect that raising it will have on the economy.
The issue that is being pushed to the front is that in a recent congressional budget office report. It was projected that if the national minimum wage were raised to $10.10 per hour, the raise would reduce overall employment in the U.S. by 500,000 people. This is what is being reported most in the media by critics of the Obama Administration’s effort to raise minimum wage.
The positive economic boost that this raise would give to tens of millions of Americans is colossal.
The Los Angeles Times reports that income for those living below the poverty line would rise by a combined $5 billion. The Washington Post recently published an article which examined the study of University of Massachusetts-Amherst economist Arin Dube , whose paper convincingly illustrates with a plethora of other scholars that raising the minimum wage will directly eliminate poverty.
According to Dube’s research, raising the minimum wage to $10.10 would lift over 4.6 million people directly out of poverty.
The clothing company Gap has become a pioneer in this field, however.
The company announced that its new set minimum wage would be $9 per hour and that they would raise it again to $10 per hour by 2015. This move was applauded by Obama and many others who see the positive effects that raising the minimum wage will have on both the overall economy as well as many people’s personal lives.
Raising the national minimum wage is another step in the long road to eliminating poverty in the U.S. There is more than enough evidence from leading economic authorities that show that while there may be some job elimination as a result, the overall effect of raising the minimum wage will have a positive effect on people in poverty in the U.S. and boost the economy as well.
The U.S. is one of the most powerful countries in the world; this step will be another positive move towards eliminating both income inequality and disparity in a nation who strives to do the same all around the globe.
– Arthur Fuller