# 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:** 9
### Author:  [@John\_Mace](https://boards.straightdope.com/u/John_Mace)
#### Post date: [February 21, 2013, 1:17pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/161 "2013-02-21T13:17:55Z")
> [@panaccione](#):
>
> Well, I’d imagine it might be pretty hard to get to work or pay for any work related expenses on $1 hr. So I doubt anyone could possibly work for $1 hr. Sounds like common sense to me with a dash of math. 😉
>
> Although, looking back on the context of that comment, my comment was uncalled for. Sorry about that **Austerity.**
One big problem I have with the MW is that, from a small “l” libertarian point of view, it’s unclear to me that someone like **Austerity** needs to be “protected” from entering into a voluntary agreement with another adult wherein **Austerity** works for less than the legal MW.
I’m OK with consenting adults doing whatever they want in their bedrooms, and I’m also OK with consenting adults doing whatever they want in the market place. The only caveat is that both environments are safe from physical harm to a reasonable extent. We can argue about what that extent is, but the starting point should be that consenting adults can do what they want.
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### Author:  [@John\_Mace](https://boards.straightdope.com/u/John_Mace)
#### Post date: [February 21, 2013, 1:26pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/162 "2013-02-21T13:26:34Z")
And just so we can all see what actually economists say, here’s the entry from Wikipedia:
> [@](#):
>
> Until the 1990s, economists generally agreed that raising the minimum wage reduced employment. This consensus was weakened when some well-publicized empirical studies showed the opposite, although others confirmed the original view. Today’s consensus, if one exists, is that increasing the minimum wage has, at worst, minor negative effects.[76]
>
> According to a 1978 article in the American Economic Review, 90 percent of the economists surveyed agreed that the minimum wage increases unemployment among low-skilled workers.[77]
>
> A 1992 survey by published in the same journal revealed 79% of economists in agreement that a minimum wage increases unemployment among young and unskilled workers.[78]
>
> A 2000 survey by Dan Fuller and Doris Geide-Stevenson reports that of a sample of 308 economists surveyed by the American Economic Association, 45.6% fully agreed with the statement, “a minimum wage increases unemployment among young and unskilled workers”, 27.9% agreed with provisos, and 26.5% disagreed. The authors of this study also reweighted data from a 1990 sample to show that at that time 62.4% of academic economists agreed with the statement above, while 19.5% agreed with provisos and 17.5% disagreed. They state that the reduction on consensus on this question is “likely” due to the Card and Krueger research and subsequent debate.[79]
>
> A similar survey in 2006 by Robert Whaples polled PhD members of the American Economic Association. Whaples found that 37.7% of respondents supported an increase in the minimum wage, 14.3% wanted it kept at the current level, 1.3% wanted it decreased, and 46.8% wanted it completely eliminated.[80]
>
> Another survey in 2007 conducted by the University of New Hampshire Survey Center found that 73% of labor economists surveyed in the United States believed 150% of the then-current minimum wage would result in employment losses and 68% believed a mandated minimum wage would cause an increase in hiring of workers with greater skills. 31% felt that no hiring changes would result.[81]
>
> Surveys of labor economists have found a sharp split on the minimum wage. Fuchs et al. (1998) polled labor economists at the top 40 research universities in the United States on a variety of questions in the summer of 1996. Their 65 respondents were nearly evenly divided when asked if the minimum wage should be increased. They argued that the different policy views were not related to views on whether raising the minimum wage would reduce teen employment (the median economist said there would be a reduction of 1%), but on value differences such as income redistribution.[82] Daniel B. Klein and Stewart Dompe conclude, on the basis of previous surveys, “the average level of support for the minimum wage is somewhat higher among labor economists than among AEA members.”[83]
>
> In 2007, Klein and Dompe conducted a non-anonymous survey of supporters of the minimum wage who had signed the “Raise the Minimum Wage” statement published by the Economic Policy Institute. They found that a majority signed on the grounds that it transferred income from employers to workers, or equalized bargaining power between them in the labor market. In addition, a majority considered disemployment to be a moderate potential drawback to the increase they supported.[84]
So, let’s not go around stating that raising the MW results in more jobs as if that were an established fact. It ain’t. Nor is an established fact that it destroys jobs, but if we had to go by the consensus of economists, the latter is the more likely case.
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### Author:  [@septimus](https://boards.straightdope.com/u/septimus)
#### Post date: [February 21, 2013, 2:16pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/163 "2013-02-21T14:16:48Z")
> [@John\_Mace](#):
>
> And just so we can all see what actually economists say, here’s the entry from Wikipedia:
>
> > [@](#):
> >
> > … Today’s consensus, if one exists, is that increasing the minimum wage has, at worst, minor negative effects.
> > … the median economist said there would be a reduction of 1% [in teen employment]
>
> So, let’s not go around stating that raising the MW results in more jobs as if that were an established fact. It ain’t. Nor is an established fact that it destroys jobs, but if we had to go by the consensus of economists, the latter is the more likely case.
Thank you, **John Mace**. This thread has gone on for a while, with some posters making the totally-false implicit assumption that a 10% hike in MW leads to a 10% drop in MW employment. :smack: I think you’re the first who actually deigned to turn to the views of actual (gasp!) economists!
Nevertheless, I think your summary warrants clarification. First, I didn’t notice anyone here claiming that raising MW leads to a net increase of jobs (though that might well be true); did I miss something? Second, it should be emphasized that a 10% MW hike accompanied by 1% job loss _results in a 9% hike in total MW wages_. (One might question whether that is good for rich Job Creators, but it’s definitely good for the average MW worker.)
And, I think the synopsis words in your quote (“minor … 1%”) should have led you to less inflammatory diction than “_destroys_ jobs … more likely” in your own synopsis.
Since Chicagoans and other peculiar thinkers have a disproportionate voice when a “consensus” of today’s American economists is sought, it may not be wrong to quote from [a more leftish source](http://www.raisetheminimumwage.com/pages/job-loss):
> [@](#):
>
> … compares employment at restaurants in San Francisco and the neighboring East Bay before and San Francisco raised its minimum wage above the state minimum of $6.75 to $8.50 in 2004, and finds no reduction in employment or hours for restaurant workers in San Francisco.
> … examines growth in employment from 1998 to 2003 for small businesses with fewer than 50 employees, and found that employment in small businesses grew faster in states with minimum wages above the federal minimum wage than in states where the federal minimum of $5.15 an hour prevailed. In addition, the number of small businesses also grew faster in the states with higher minimum wages.
> … examines every minimum wage increase in the United States over the past two decades—including increases that took place during protracted periods of high unemployment—and finds that raising the wage floor boosted incomes without reducing employment or slowing job creation. The research demonstrates how a body of previous research—one frequently relied on by business lobbyists who oppose minimum wage increases—inaccurately attributes declines in employment to increases in the minimum wage by failing to sufficiently account for critical economic factors.
> [et cetera]
(BTW, should not the prior existence of higher MW’s in some states and cities reduce the impact of federal MW hike?)
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### Author:  [@John\_Mace](https://boards.straightdope.com/u/John_Mace)
#### Post date: [February 21, 2013, 2:34pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/164 "2013-02-21T14:34:34Z")
> [@septimus](#):
>
> Nevertheless, I think your summary warrants clarification. First, I didn’t notice anyone here claiming that raising MW leads to a net increase of jobs (though that might well be true); did I miss something?
I can’t read post 155 any other way than making that claim. It was that post which spurred me to post the wikipedia quote.
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### Author:  [@Tee](https://boards.straightdope.com/u/Tee)
#### Post date: [February 21, 2013, 3:52pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/165 "2013-02-21T15:52:10Z")
> [@panaccione](#):
>
> 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.
I doubt the existence of such a rule. Having qualities that distinguish you from the average $7.25/hour drone will probably result in a higher wage. Business owners are typically thrifty but not stupid, as your theory would suggest by some slavish adherence to the floor of hourly pay.
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### Author:  [@septimus](https://boards.straightdope.com/u/septimus)
#### Post date: [February 21, 2013, 4:31pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/166 "2013-02-21T16:31:34Z")
> [@John\_Mace](#):
>
> I can’t read post 155 any other way than making that claim. It was that post which spurred me to post the wikipedia quote.
That should teach me not to skim! :smack:
Nevertheless, the same claim is made with evidence at the site I linked to, and is not implausible. Whether a whopping 24% hike over three years exceeds a “sweet spot,” I don’t know, but since Congressional approval is needed one needn’t go too far out on a limb to guess that an actual rise would be smaller.
(While a hike to $9/hour might very well be good for America, a hike to $99/hour would not. I’m glad to see that at least you, **John Mace** , didn’t join the chorus snarking such obvious facts as though stupid caricatures were a path to wisdom.)
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### Author:  [@Kearsen](https://boards.straightdope.com/u/Kearsen)
#### Post date: [February 21, 2013, 5:00pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/167 "2013-02-21T17:00:38Z")
> [@septimus](#):
>
> Thank you, **John Mace**. This thread has gone on for a while, with some posters making the totally-false implicit assumption that a 10% hike in MW leads to a 10% drop in MW employment. :smack: I think you’re the first who actually deigned to turn to the views of actual (gasp!) economists!
>
> Nevertheless, I think your summary warrants clarification. First, I didn’t notice anyone here claiming that raising MW leads to a net increase of jobs (though that might well be true); did I miss something? Second, it should be emphasized that a 10% MW hike accompanied by 1% job loss _results in a 9% hike in total MW wages_. (One might question whether that is good for rich Job Creators, but it’s definitely good for the average MW worker.)
>
> And, I think the synopsis words in your quote (“minor … 1%”) should have led you to less inflammatory diction than “_destroys_ jobs … more likely” in your own synopsis.
>
> Since Chicagoans and other peculiar thinkers have a disproportionate voice when a “consensus” of today’s American economists is sought, it may not be wrong to quote from [a more leftish source](http://www.raisetheminimumwage.com/pages/job-loss):
> (BTW, should not the prior existence of higher MW’s in some states and cities reduce the impact of federal MW hike?)
I know you used % as a basis of comparison but the people affected by a MW increase is already small. Now you are talking about 9% of those getting to enjoy a raise. The other 1% do what exactly?
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### Author:  [@panaccione](https://boards.straightdope.com/u/panaccione)
#### Post date: [February 21, 2013, 8:03pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/168 "2013-02-21T20:03:11Z")
> [@John\_Mace](#):
>
> One big problem I have with the MW is that, from a small “l” libertarian point of view, it’s unclear to me that someone like **Austerity** needs to be “protected” from entering into a voluntary agreement with another adult wherein **Austerity** works for less than the legal MW.
>
> I’m OK with consenting adults doing whatever they want in their bedrooms, and I’m also OK with consenting adults doing whatever they want in the market place. The only caveat is that both environments are safe from physical harm to a reasonable extent. We can argue about what that extent is, but the starting point should be that consenting adults can do what they want.
I can agree with that and acknowledge that it is a reasonable principle. However, as I’ve stated before, there are certain “priorities” of a society that need to be maintained. These are negotiable, as you say “to an extent”, however everyone needs to cooperate.
What I’m saying is that we should work to make these priorities as abundant and efficient as possible. That is also a good starting point. It seems that your views coincide with this because as you say we need, “to keep the environment safe from physical harm.”
Most Libertarians that I encounter are not reasonable when it comes to this and personally I find that to be irresponsible. It seems that they think government should enact “property rights” and a “justice system” and that’s it. Feel free to let me know if I’m missing something. But, honestly I can’t understand that point of view. Sure, it ensures voluntary choice, but what about everything else?
Things will be better for all if we work on our foundation.
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### Author:  [@astorian](https://boards.straightdope.com/u/astorian)
#### Post date: [February 21, 2013, 8:30pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/169 "2013-02-21T20:30:38Z")
On one hand, Obama (like most liberals) wants to raise the minimum wage substantially, thinking this will lead to greater general porsperity.
At the same time, he wants to allow virtually unregulated immigration from Mexico.
How can you possibly raise wages for legally employed Americans if you’re simultaneously encouraging Mexicans, who’ll gladly settle for wages well below the legal minimum, to come to the U.S. in search of the kind of low-skill jobs that usually pay the minimum wage?
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### Author:  [@Buck\_Godot](https://boards.straightdope.com/u/Buck_Godot)
#### Post date: [February 21, 2013, 10:49pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/170 "2013-02-21T22:49:59Z")
> [@astorian](#):
>
> On one hand, Obama (like most liberals) wants to raise the minimum wage substantially, thinking this will lead to greater general porsperity.
>
> At the same time, he wants to allow virtually unregulated immigration from Mexico.
>
> How can you possibly raise wages for legally employed Americans if you’re simultaneously encouraging Mexicans, who’ll gladly settle for wages well below the legal minimum, to come to the U.S. in search of the kind of low-skill jobs that usually pay the minimum wage?
I don’t see this as a contradiction. As it stands now immigrants are willing to work at back breaking work for the current minimum wage because their other options are so poor. Americans on the other hand are not willing to fill those jobs at such a low wage. Employers therefore are more likely to hire immigrants than Americans because they can under-pay them.
With a higher minimum wage, more Americans will be willing to fill those jobs, resulting in less available jobs for immigrants whose main attractiveness to employers is their willingness to be exploited.
The main complaint about immigration is that it reduces overall wages. A high minimum wage therefore acts to mitigate this effect.
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### Author:  [@Lord\_Feldon](https://boards.straightdope.com/u/Lord_Feldon)
#### Post date: [February 21, 2013, 11:09pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/171 "2013-02-21T23:09:06Z")
When has Obama proposed “virtually unregulated immigration from Mexico”?
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### Author:  [@astorian](https://boards.straightdope.com/u/astorian)
#### Post date: [February 22, 2013, 3:52am UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/172 "2013-02-22T03:52:03Z")
> [@Buck\_Godot](#):
>
> I don’t see this as a contradiction. As it stands now immigrants are willing to work at back breaking work for the current minimum wage because their other options are so poor. Americans on the other hand are not willing to fill those jobs at such a low wage. Employers therefore are more likely to hire immigrants than Americans because they can under-pay them.
>
> With a higher minimum wage, more Americans will be willing to fill those jobs, resulting in less available jobs for immigrants whose main attractiveness to employers is their willingness to be exploited.
>
> The main complaint about immigration is that it reduces overall wages. A high minimum wage therefore acts to mitigate this effect.
You think employers who already flout the law by hiring illegal aliens are going to scrupulously obey minimum wage laws?
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### Author:  [@Buck\_Godot](https://boards.straightdope.com/u/Buck_Godot)
#### Post date: [February 22, 2013, 4:10pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/173 "2013-02-22T16:10:27Z")
> [@astorian](#):
>
> You think employers who already flout the law by hiring illegal aliens are going to scrupulously obey minimum wage laws?
For the most part employers who hire illegal immigrants follow all of the employment laws on paper. They withhold taxes and obey labor laws. Otherwise the next time there is an audit they would be up a creek. They just don’t bother looking too carefully at the fake SS cards and green cards they are given.
Below are a couple of articles supporting my position in case you were thinking I was just making stuff up.
[http://www.dallasfed.org/assets/documents/research/papers/2008/wp0805.pdf](http://www.dallasfed.org/assets/documents/research/papers/2008/wp0805.pdf)
[http://www.businessweek.com/articles/2013-02-13/could-a-9-minimum-wage-reduce-illegal-immigration](http://www.businessweek.com/articles/2013-02-13/could-a-9-minimum-wage-reduce-illegal-immigration)
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### Author:  [@Deegeea](https://boards.straightdope.com/u/Deegeea)
#### Post date: [February 22, 2013, 6:55pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/174 "2013-02-22T18:55:35Z")
I was not actually claiming that a minimum wage hike -always- raises employment. I was giving an example of how it could, at the low end of the curve, so to speak. Thanks for the support and no, it is not a perpetual motion machine (because you only gain when you go up to a certain balance point, and because of inflationary effects as I mentioned in my earlier post)
I did not point that out because I thought the opposing argument already had enough support in the thread and was debating, not essaying 🙂
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### Author:  [@R3d\_Anonymous](https://boards.straightdope.com/u/R3d_Anonymous)
#### Post date: [February 23, 2013, 8:59pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/175 "2013-02-23T20:59:00Z")
My opinion is that the minimum wage should not be raised. It’s not a wage that people are supposed to make a living out of, but for entry level jobs for beginning employees. Once they get used to the work environment and get some experience, they should be promoted or have their wage raised. The problem with raising the wage is that employers will have to pay their employees more which will result in them charging more for their products. For example, take a grocery store. If the people there working for $7 per hour start earning $9 per hour, then their employers aren’t just going to pay them more, but they’re going to take _our_ money. They’re going to charge more on their products in order to compensate for the raised wage. They will get an excuse to raise their prices. And technically it isn’t beneficial to the employees themselves that are earning the minimum wage because some of the extra money they will earn will probably lost in the increased prices due to the raised minimum wage. So no, I don’t think the minimum wage should be increased.
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### Author:  [@magellan01](https://boards.straightdope.com/u/magellan01)
#### Post date: [February 23, 2013, 9:49pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/176 "2013-02-23T21:49:00Z")
Here’s a better idea than just raising the minimum wage: mandate that no one can be paid the minimum wage for more than six months or so. That way, the employer is forced to either give the employee a raise—which they deserve now as they have more experience—or to get someone else in and retrain them. This would effectively raise the wages of those at the bottom of the ladder, but it introduces merit as the reason for the wage, not a dictum from the government. It’s also instructive to those on the lowest end of the economic spectrum that they are not just a body to fill any old slot, but a person with a set of skills, basic as they may be.
Also, this aligns with the good points made by **Anonymous User** , mainly, that a minimum wage job should be viewed as a stepping stone.
I’d also like to say that I second **Austerity’s** take on things.
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### Author:  [@John\_Mace](https://boards.straightdope.com/u/John_Mace)
#### Post date: [February 23, 2013, 9:56pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/177 "2013-02-23T21:56:10Z")
> [@magellan01](#):
>
> Here’s a better idea than just raising the minimum wage: mandate that no one can be paid the minimum wage for more than six months or so. That way, the employer is forced to either give the employee a raise—which they deserve now as they have more experience—or to get someone else in and retrain them.
No one automatically deserves a raise after 6 months. Employers need to be able to make hiring and firing decisions without ridiculous regulations like that. The person may have all the experience in the world, but if the job only rates MW, then the employer shouldn’t be made to pay someone more or incur the added costs of hiring and training someone new.
The best way you get out of the MW bracket is to earn a promotion to a job that pays better than MW.
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### Author:  [@Lobohan](https://boards.straightdope.com/u/Lobohan)
#### Post date: [February 23, 2013, 9:57pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/178 "2013-02-23T21:57:19Z")
> [@magellan01](#):
>
> Here’s a better idea than just raising the minimum wage: mandate that no one can be paid the minimum wage for more than six months or so. That way, the employer is forced to either give the employee a raise—which they deserve now as they have more experience—or to get someone else in and retrain them. This would effectively raise the wages of those at the bottom of the ladder, but it introduces merit as the reason for the wage, not a dictum from the government. It’s also instructive to those on the lowest end of the economic spectrum that they are not just a body to fill any old slot, but a person with a set of skills, basic as they may be.
>
> Also, this aligns with the good points made by **Anonymous User** , mainly, that a minimum wage job should be viewed as a stepping stone.
>
> I’d also like to say that I second **Austerity’s** take on things.
“Good job, Jeff! You’re an fine fry cook and a good friend. But your six months are up, so clean out your locker. You’re fired.” — \*A dude who manages a business that already has high turnover and minimum wage employees. \*
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### Author:  [@magellan01](https://boards.straightdope.com/u/magellan01)
#### Post date: [February 23, 2013, 11:26pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/179 "2013-02-23T23:26:27Z")
> [@John\_Mace](#):
>
> No one automatically deserves a raise after 6 months. Employers need to be able to make hiring and firing decisions without ridiculous regulations like that. The person may have all the experience in the world, but if the job only rates MW, then the employer shouldn’t be made to pay someone more or incur the added costs of hiring and training someone new.
First, he’s not getting an automatic raise, he’s getting an automatic job review,an evaluation. At that point, the employer does a mental calculation: do I pay this guy $0.50 or $1.00 more, or do I hire a new guy. I think this is a win for everyone concerned. Basically, the guys on probation for the six months. This will encourage the employee to do a really good job and force the hand of the employer to acknowledge that the guy, now with six months of direct experience, is worth a bit more than the absolute minimum.
Many white collar jobs have timeframes like this built in. And one other way it’s valuable is that if your employer doesn’t like you or does;t think you’re a good fit for the job, both employer and employee will be looking for better situations.
> [@John\_Mace](#):
>
> The best way you get out of the MW bracket is to earn a promotion to a job that pays better than MW.
That’s what my idea would do. It lays down a challenge to the employee. If he were interested in this job for minimum wage, he’d be more interested in it for minimum wage + $X, wouldn’t he? And if an employer needs a guy to do a minimum wage job, wouldn’t he be happier to have someone in the slot that he knows is doing a good job for that same amount?
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### Author:  [@magellan01](https://boards.straightdope.com/u/magellan01)
#### Post date: [February 23, 2013, 11:29pm UTC](https://boards.straightdope.com/t/obama-plans-to-raise-the-min-wage-to-9-an-hour/650366/180 "2013-02-23T23:29:52Z")
> [@Lobohan](#):
>
> “Good job, Jeff! You’re an fine fry cook and a good friend. But your six months are up, so clean out your locker. You’re fired.” — \*A dude who manages a business that already has high turnover and minimum wage employees. \*
More like, “Good job, Jeff. You’re a fine fry cook. And while this job really can’t pay much, I’d rather have you in it and pay you $1.00 more an hour for the job I now know you can do—and you have been doing—than to take a chance and some other guy. Nice job! Keep doing a great job and if things go well, I hope to be able to pay you even more someday.”
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