# Obama plans to raise the min. wage to $9 an hour.
**URL:** https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366
**Category:** Great Debates
**Created:** [February 15, 2013, 3:33am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366 "2013-02-15T03:33:15Z")
**Posts on this page:** 20
**Page:** 7
### Author:  [@John\_Mace](https://boards.straightdope.com/u/John_Mace)
#### Post date: [February 18, 2013, 6:13pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/121 "2013-02-18T18:13:47Z")
> [@Lightnin](#):
>
> Beats me. Although I must admit that your question seems kind of irrelevant- after all, we \*do \*have a minimum wage. Not increasing it results in a net loss for those who make minimum wage. It’s just a shame that employers aren’t adjusting for inflation, ain’t it? If they were, we wouldn’t be having this discussion.
Actually, it was an excellent question. It would be interesting to know, if anyone does, what reasoning was used originally when the first MW was set. There is every reason to have the MW keep up with inflation, but only after it is set to the “right” level. What we have now might be too high or too low. I honestly don’t know.
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### Author:  [@RickJay](https://boards.straightdope.com/u/RickJay)
#### Post date: [February 18, 2013, 11:32pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/122 "2013-02-18T23:32:36Z")
> [@magellan01](#):
>
> Why would it be a bad idea? My question goes to the necessity of a minimum wage at all. Not that I don’t think there are some minor benefits. But other than the inflation reasoning, which makes sense if you accept that there was some correct magical number before the proposed correction for inflation, the other reasons offered in this thread are as valid for a $20 minimum wage as a $7, $8, or $12 one.
Well, no, not really.
“Raising” or “lowering” something obviously is not equally valid a strategy on every point on the curve. One can argue whether the USA should be spending $700 million on defense, $600 billion, or $800 billion, and make reasonable arguments for all three. But few would argue the USA should be spending just eighty-four dollars on the DoD, or should be spending fifty quadrillion dollars.
The minimum wage must obviously have an ideal midpoint, or a range of roughly ideal midpoints (I’d have to assume the most socially benefician minimum wage would vary from place to place.) $7 is probably a bit too low - I can’t prove that, though, it’s a debatable point. However, $20 is almost certainly too high, which is why nobody is arguing for it.
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### Author:  [@panaccione](https://boards.straightdope.com/u/panaccione)
#### Post date: [February 19, 2013, 4:33am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/123 "2013-02-19T04:33:11Z")
> [@SweetiePotato](#):
>
> 1. My dad owns a small company and only hires Union workers. Union workers are much more expensive-- you have to pay pensions, fringe benefits, union-wages (which are much higher). If businesses were, as some of you are arguing, simply out to make as much money as possible, no one, my Dad included, would hire Union workers. So the argument that companies will always hire the cheapest possible employee over all others is not accurate, either.
When people say things like this, they mean to capture your attention and to make a point. Which is valid. The big brand retailers like Walmart, Target, and all the fast-food, and restaurant joints that make up the biggest section of employment in this country, **always** hire the cheapest labor possible.
Your dads company is the exception to the rule.
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### Author:  [@Lobohan](https://boards.straightdope.com/u/Lobohan)
#### Post date: [February 19, 2013, 4:37am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/124 "2013-02-19T04:37:54Z")
> [@John\_Mace](#):
>
> How do you pay them their first paycheck if the income isn’t generated until after their paycheck is due? Give them an IOU?
If your business is running at such a lean margin that they can’t front a minimum wage employee, that they fully expect to generate increased revenue from, that business is probably about to implode.
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### Author:  [@Lobohan](https://boards.straightdope.com/u/Lobohan)
#### Post date: [February 19, 2013, 4:39am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/125 "2013-02-19T04:39:14Z")
> [@John\_Mace](#):
>
> Actually, it was an excellent question. It would be interesting to know, if anyone does, what reasoning was used originally when the first MW was set. There is every reason to have the MW keep up with inflation, but only after it is set to the “right” level. What we have now might be too high or too low. I honestly don’t know.
If you’re going to have a minimum wage, I’d suggest that it be set so that a full time employee is out of the poverty range.
Assuming you have a reasonable description of what poverty is.
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### Author:  [@John\_Mace](https://boards.straightdope.com/u/John_Mace)
#### Post date: [February 19, 2013, 5:20am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/126 "2013-02-19T05:20:20Z")
> [@Lobohan](#):
>
> If you’re going to have a minimum wage, I’d suggest that it be set so that a full time employee is out of the poverty range.
>
> Assuming you have a reasonable description of what poverty is.
What would that be in $/hr?
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### Author:  [@septimus](https://boards.straightdope.com/u/septimus)
#### Post date: [February 19, 2013, 5:40am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/127 "2013-02-19T05:40:35Z")
There are various ways to think of minimum wage rules. They can be thought of as transfer payments (forced “charity”) from employers to their lowest-paid employees. They can be thought of as compensating lowest-wage workers for the fact they’re not unionized – if they acted together and had monopoly power they’d get much more than $9/hour.
The fact that demand for lowest-wage workers is known to be quite _inelastic_, suggests that the wage is not too high. Perhaps there’s some “sweet spot” for the elasticity coefficient.
_The ratio of median wage to minimum wage is much larger today than it was 60 years ago._ This gives a strong argument for increasing minimum wage, not only on humanitarian grounds, but due to the fact that countries with high inequality are less stable politically, socially and economically.
What is most important is to maintain a rational objective perspective. Strident whines like _The Market is God!_, _Why do you hate successful people?_, _If $9, why not $99?_ may have their place on talk radio or the stupider blogs, but fortunately are rarish at SDMB.
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### Author:  [@Terr](https://boards.straightdope.com/u/Terr)
#### Post date: [February 19, 2013, 5:49am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/128 "2013-02-19T05:49:35Z")
> [@septimus](#):
>
> The fact that demand for lowest-wage workers is known to be quite _inelastic_, suggests that the wage is not too high. Perhaps there’s some “sweet spot” for the elasticity coefficient.
Setting minimum wage high does not affect only lowest-wage workers. All those people who are currently earning between $7.26/hr and $9-10/hr will have to have raises in proportion. Also quite a few contracts specify wages in multiple of minimum wage. So a union worker who currently earns $29/hr will all of a sudden get a raise to $36/hr. That’s quite a jump. The effect will be much bigger than what you expect.
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### Author:  [@John\_Mace](https://boards.straightdope.com/u/John_Mace)
#### Post date: [February 19, 2013, 5:51am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/129 "2013-02-19T05:51:14Z")
> [@septimus](#):
>
> _The ratio of median wage to minimum wage is much larger today than it was 60 years ago._ This gives a strong argument for increasing minimum wage, not only on humanitarian grounds, but due to the fact that countries with high inequality are less stable politically, socially and economically.
>
> What is most important is to maintain a rational objective perspective. Strident whines like _The Market is God!_, _Why do you hate successful people?_, _If $9, why not $99?_ may have their place on talk radio or the stupider blogs, but fortunately are rarish at SDMB.
Yeah, those strident whines are as least as bad as those like “if it was good enough for 60 years ago, it’s good enough for today”.
Why should we postulate that the ratio of MW to median wage should be the same as it was 60 years ago? Sixty years ago, we were just coming out of WWII and the US was the only industrial power in the world whose infrastructure hadn’t been blown to bits. How does that compare to our place as a competitor in the global market today?
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### Author:  [@septimus](https://boards.straightdope.com/u/septimus)
#### Post date: [February 19, 2013, 5:59am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/130 "2013-02-19T05:59:36Z")
> [@Terr](#):
>
> Also quite a few contracts specify wages in multiple of minimum wage.
I didn’t know that. Roughly how many workers would be affected?
Strange is that, AFAICT, no one pointed this out in the MW threads until now.
> [@John\_Mace](#):
>
> Why should we postulate that the ratio of MW to median wage should be the same as it was 60 years ago?
😕 😕 Who said we should so “postulate”?
I merely pointed out the rising ratio as a symptom of rising inequality, which _is_ bad. I started a thread on that topic several months ago; I suppose you were on the incorrect side then, as now.
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### Author:  [@John\_Mace](https://boards.straightdope.com/u/John_Mace)
#### Post date: [February 19, 2013, 6:08am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/131 "2013-02-19T06:08:11Z")
> [@septimus](#):
>
> 😕 😕 Who said we should so “postulate”?
When you said:
> [@](#):
>
> The ratio of median wage to minimum wage is much larger today than it was 60 years ago. This gives a strong argument for increasing minimum wage
You didn’t actually mean that it was " a strong argument for increasing minimum wage"?
> [@](#):
>
> I merely pointed out the rising ratio as a symptom of rising inequality, which _is_ bad. I started a thread on that topic several months ago; I suppose you were on the incorrect side then, as now.
No, I was on the correct side.
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### Author:  [@Terr](https://boards.straightdope.com/u/Terr)
#### Post date: [February 19, 2013, 6:35am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/132 "2013-02-19T06:35:38Z")
> [@septimus](#):
>
> I didn’t know that. Roughly how many workers would be affected?
Don’t know the exact number. Here it is from SEIU:
> **[Missouri activists, unions say yes to cost-of-living](https://www.peoplesworld.org/article/missouri-activists-unions-say-yes-to-cost-of-living/)**
>
> JEFFERSON CITY, Mo - This is about workers in general, all workers - low-wage workers and union workers. This is about rewarding hard work that directly impacts the entire community and our economy, Clark Brown, a representative from the Service...
Clark Brown, a representative from the Service Employees International Union (SEIU): a higher minimum wage “drives up our union contract wages”.
Another article: [http://dailycaller.com/2013/02/18/unions-to-see-benefit-from-higher-minimum-wage/](http://dailycaller.com/2013/02/18/unions-to-see-benefit-from-higher-minimum-wage/)
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### Author:  [@septimus](https://boards.straightdope.com/u/septimus)
#### Post date: [February 19, 2013, 7:40am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/133 "2013-02-19T07:40:33Z")
> [@John\_Mace](#):
>
> You didn’t actually mean that it was " a strong argument for increasing minimum wage"?
My “much larger today … is a strong argument” does not translate to “postulating” an insistence on ratio equality.
It’s a sad sign when your arguments are so weak you need to misstate your debating opponent’s claims or to exaggerate facts.
I’ve not enough time to “push back” against all your errors. But in another recent post you claimed Standard Oil’s market share, presumably in distribution, had dropped to 60% by the time it was broken up. Did you have a cite for that? Or was it going to be “Well, maybe less than 70%” when push came to shove?
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### Author:  [@septimus](https://boards.straightdope.com/u/septimus)
#### Post date: [February 19, 2013, 8:24am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/134 "2013-02-19T08:24:30Z")
> [@Terr](#):
>
> So a union worker who currently earns $29/hr will all of a sudden get a raise to $36/hr. That’s quite a jump.
Do you have any cite for a multiple of this size? The article you link to in your follow-up mentions only a multiple of 1.15 (taking the workers it covers to a whopping $10.35/hour) and, in another case, that "each rate will be at least ten cents ($0.10) higher than the previous rate in the progression schedule.”
But, here’s a separate question.
Do you think libertarians should object to the MW hike on that grounds? I realize you may oppose MW on principle, but may I assume that you agree such contracts should not inhibit the government from hiking MW? Those contracts, wisely or not, were freely negotiated.
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### Author:  [@Terr](https://boards.straightdope.com/u/Terr)
#### Post date: [February 19, 2013, 8:39am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/135 "2013-02-19T08:39:31Z")
> [@septimus](#):
>
> Those contracts, wisely or not, were freely negotiated.
No they were not.
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### Author:  [@septimus](https://boards.straightdope.com/u/septimus)
#### Post date: [February 19, 2013, 8:51am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/136 "2013-02-19T08:51:31Z")
> [@Terr](#):
>
> No they were not.
Cite? Or is yours some anti-union play on words?
… And still waiting for the cite on “So a union worker who currently earns $29/hr will all of a sudden get a raise to $36/hr.”
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### Author:  [@Terr](https://boards.straightdope.com/u/Terr)
#### Post date: [February 19, 2013, 9:05am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/137 "2013-02-19T09:05:51Z")
> [@septimus](#):
>
> Cite? Or is yours some anti-union play on words?
It is not a voluntarily entered into contract because one side has its freedom of association violated by the government. If the employers were free to fire and replace the workers, and the contract was signed with no government force against the employers involved, THEN it would be a voluntarily entered into contract.
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### Author:  [@septimus](https://boards.straightdope.com/u/septimus)
#### Post date: [February 19, 2013, 9:14am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/138 "2013-02-19T09:14:48Z")
So it was a play on words.
> [@septimus](#):
>
> And still waiting for the cite on “So a union worker who currently earns $29/hr will all of a sudden get a raise to $36/hr.”
How about this one? Should I keep waiting or were you just blowing smoke?
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### Author:  [@RickJay](https://boards.straightdope.com/u/RickJay)
#### Post date: [February 19, 2013, 1:19pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/139 "2013-02-19T13:19:08Z")
> [@Terr](#):
>
> It is not a voluntarily entered into contract because one side has its freedom of association violated by the government. If the employers were free to fire and replace the workers…
The employer is perfectly free to tell the union to go to hell and refuse to sign anything.
See: the National Hockey League.
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### Author:  [@Saint\_Cad](https://boards.straightdope.com/u/Saint_Cad)
#### Post date: [February 19, 2013, 2:03pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/140 "2013-02-19T14:03:00Z")
Does anyone know what percentage of the workforce actually works for minimum wage?
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