Building on the successful 2004 ballot initiative in Florida, advocates for workers are pushing to pass minimum wages increases across the country, including here in North Carolina. 17 states have already boosted their state minimum pay above the federal standard, which hasn't changed since 1997 and, thanks to inflation, is worth less than it did in 1955.
Those who oppose a minimum wage hike -- business interests and their allies -- don't like them because they cut into profit margins. But the public reason they give for opposing an increase is because the claim higher costs will "destroy jobs."
But David Sirota points to an interesting exchange last week between Rep. Bernie Sanders (I-VT) and new Federal Reserve Chairman Ben Bernanke, in his testimony to the House Financial Services Committee:
SANDERS: Chairman Bernanke, should the Congress raise the minimum wage so that every worker in America who works 40 hours a week escapes from poverty? A very simple question, sir.
BERNANKE: I'm going to be an economist and give you the one hand, the other hand. On the minimum wage, it's actually a very controversial issue among economists. Clearly, if you raise the minimum wage, then those workers who retain their jobs will get higher income and therefore it helps them. The concerns that some economists have raised about the minimum wage are first, is it as well targeted as it could be? That is, how much of the increase is going to the teenage children of suburban families, for example? And secondly, does it have any employment effects? That is, do higher wages lower employment of low-wage workers?
SANDERS: And your response is?
BERNANKE: My response is that I think it doesn't lower employment.