“Greed, for lack of a better word, is good.” This infamous line uttered by Gordon Gecko in the 1987 film “Wall Street” is indicative of a real philosophy practiced by many — and successfully by even fewer.
Indeed, the United States didn’t become the world’s largest economy through acts of generosity and humanitarianism. No, it was a cutthroat, kill or be killed mentality that propelled the country into levels of wealth and prosperity that went unchallenged for decades. The only problem? Well, it seems the Wall Street philosophy that got the U.S. to where it is now is the same philosophy causing anxiety for millions of Americans: greed.
Debates have begun to spring up both online and in the halls of Congress over raising the federal minimum wage to $15 per hour. Currently, the minimum wage is set at $7.25 and hasn’t budged in nearly 12 years. While a $7.75 increase may seem steep, it’s worth keeping in mind that the Raise the Wage Act introduced by Democrats would gradually raise the pay floor each year until settling at $15 in 2025.
As is the case with most issues in the U.S. today, there is a strong partisan split between whether or not raising the minimum wage would be a good idea. Generally, Democrats are in favor while most Republicans are against the bill, citing job loss and costs to small businesses as reasons to keep it the same.
There are certainly pros and cons to any policy, let alone one that would enact the largest minimum wage increase in history. However, the first step to solving a problem is recognizing that there is one. Many opponents of raising the minimum wage deny the need for an increase, with some even arguing that people should be grateful to earn as much as they do.
Republican Senator John Thune spoke against raising the minimum wage in front of Congress in late February. He tells a personal story of how he earned less than minimum wage growing up in South Dakota busing tables for a dollar an hour, eventually working his way up to the then minimum wage of $6 an hour as a cook. He claims that the small restaurant he worked for, as well as other small businesses, operate on small margins that would be unable to operate if forced to pay their workers $15 an hour.
As charming as Senator Thune’s personal anecdote is, it’s a woefully fallacious method of debating national wage policies. Additionally, the notion that increasing wages would lead to inflating the cost of goods and labor is similarly devoid of logic or context. To keep in line with the Senator’s restaurant story, studies have found that an increase to $15 an hour would raise prices at fast-food restaurants by 4.3%. In such a horrific dystopia, the price of a “Big Mac” would be raised by a whopping 17 cents.
Perhaps the most egregious part of the senator’s argument is the complete lack of awareness he demonstrates when telling his charming story of earning minimum wage as a teen in the ‘70s. For someone so worried about inflation, it’s ironic that he fails to consider that after adjusting for this factor, the $6 minimum wage he earned would be equal to roughly $22 an hour today. It’s important to note that this is $7 more than the amount he is in opposition to.
Here lies one of the biggest points of contention one should consider, regardless of which side of the debate Senator Thune or anyone else finds themselves on. The fact of the matter is that while inflation has increased the cost of living for the past 40 years, wages have barely budged for workers in that time. Even worse, the purchasing power of the minimum wage has seen a 15% drop since it was last raised in 2009.
This sort of regression is indicative of a larger problem when considering the appeal to austerity politics used by opponents of the act. It seems to be a matter of rejecting any sort of wealth distribution that doesn’t benefit the highest earners in the country. According to a 2018 Pew Research study, while wages have stagnated for working people, individuals in the top 10th percentile of wealth distribution have seen a five times greater increase in weekly earnings than the bottom 10th.
But wait, what about COVID-19? Surely, it’s had a detrimental effect on both workers and the top earners in this country. In such pestilent times, isn’t it fiscally irresponsible to impose such a radical increase of wages on the free market? Well, according to a new report from the Institute for Policy Studies and Americans for Tax Fairness, things are going just fine, if you’re a billionaire.
Per the report, U.S. billionaires have seen a collective increase of $1.1 trillion since the beginning of the COVID-19 pandemic. All the while, poverty rates in America have seen the steepest rise in more than 50 years. But, hey, who wants to pay 17 cents more for a burger, right?
Aside from fears of overinflation, another common argument against raising the minimum wage to $15 is the fear of job loss. A recent study from the Congressional Budget Office has estimated that 1.4 million Americans would lose their jobs if the policy is enacted. However, this does not take into account the estimated 3.7 million people it would lift out of poverty. Nor does this argument consider the fact that around 7.2% of the country’s labor force works multiple jobs, which would be greatly reduced if said jobs paid better wages.
Of course, all the data in the world is useless without real-life organization and solidarity. There is always going to be a reluctance to enact any policy that doesn’t interest individuals who hold the keys to the nation’s economy. While there are positives and negatives to any significant policy change, it’s important to recognize just who is benefiting from maintaining the status quo.