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One conservative, at least, is speaking for this majority. Ron Unz, a Silicon Valley millionaire and one-time Republican candidate for governor of California, is championing an initiative to raise his state’s minimum wage to $12 an hour. His reasons are thoroughly in keeping with his ideology.
Unz argues that a minimum wage hike “would function as a massive stimulus package.” He told ABC News that if the national minimum were increased to $12, “probably between $150 billion and $175 billion a year would go into the pockets of the lower-wage families that spend every dollar they earn. It would cause a tremendous boost in economic demand.”
He also pointed to the fact that government—through wage subsidies in the tax code, Medicaid and food stamps—is now conferring substantial benefits on employers of low-wage labor.
“One of the strange things in our society right now is that we have all these low-wage workers who are getting $7.50, $8 or $9 an hour,” Unz says, “and because they earn such small wages, the government subsidizes them with billions or tens of billions of dollars of social welfare spending that comes from the taxpayer. It’s a classic example of businesses’ privatizing the benefits of their workers while socializing the costs.”
In an important article in the economic journal Challenge, “A Conservative Case for the Minimum Wage,” Oren Levin-Waldman, professor of public policy at Metropolitan College of New York, offers a similar view and makes the compelling moral points. Higher pay “increases the autonomy of low-wage workers,” he says, thus advancing “personal freedom” and “a core concept in conservative thought, which is personal responsibility.” This, in turn, means less dependence “on the largesse of others.”
More recently, Wilson (1998) reported estimates developed by The Heritage Foundation using
the 11 US macro model of the US economy. The proposed 19.4% 1999-2000 increase in the
minimum wage was estimated to increase overall prices by 0.2% in the first year and by an additional
0.1% in the second year.
problem is a raise in minimum wage is a stimulus to inflation.
Minimum wage overall inflation effects are hard to find; the minimum wage might cause
more inflation in sectors or industries overpopulated by minimum wage workers.
Some subsequent studies have generally supported aspects of Krueger/Card. A 2004 study of available literature, “The Effect of Minimum Wage on Prices,” analyzed a wide variety of research on the impact of changes in the minimum wage. The paper, from the University of Leicester, found that firms tend to respond to minimum wage increases not by reducing production or employment, but by raising prices. Overall, price increases are modest: For example, a 10% increase in the minimum wage would increase food prices by no more than 4% and overall prices by no more than 0.4%, significantly less than the minimum-wage increase. - See more at: journalistsresource.org...
I've lived through one as a minimum wage worker, and it does everything they say despite what those little papers of yours are claiming - fewer jobs, increased prices, and devalued worth of everyone else's wages. I saw it all with my own eyes in my own direct experience when every single cent was near and dear.
Now this guy gets it and takes the time to think through consequences. Conservative used to (40 years ago) used to think this way.
If I already make $12 an hour and all of a sudden they raise minimum wage to $12 an hour, guess what? Now you have just added another person to the amount of people who make minimum wage that didn't before. Also, I am going to demand a raise, because I've been working here for 4 years and now make the same amount as somebody hired yesterday. See the problem?