Hardworking families need a living wage

By Paddy Ryan

In today’s tough economic environment, hardworking American families relying on minimum wage salaries desperately need a minimum wage increase. The current federally mandated minimum wage is $7.25 an hour, but its real value in purchasing power is even lower after taking inflation into account. The real value of the minimum wage peaked in 1968. Ever since then, it has failed to keep up with the pace of inflation. If the minimum wage had kept up with the pace of inflation, it would currently exceed $10.50 an hour – a long way from $7.25.

According to the Economic Policy Institute, the real value of today's minimum wage is the lowest it has been in over 50 years.

Over the past 50 years, “as the basic income required to support a family has grown with inflation, the minimum wage has not kept pace with the rising costs of goods.”

It has become a nationwide epidemic. In the richest country in the world, there are people, families, children who go hungry at night, who can't afford school supplies, single-mothers who have to work three jobs just to afford a sub-standard apartment. An hourly wage of $7.25 amounts to an annual salary of $15,080; people who rely on the minimum wage cannot live on $7.25 an hour in an economy where apples cost $3 per pound, or where a gallon of gas costs $3.50.

Take minimum wage worker Margaret Lewis for example:

Margaret Lewis knows firsthand what it's like to live on the edge. She works as a transporter for passengers with disabilities at O'Hare International Airport. She wakes up at 1 a.m. to go to work, and spends the early morning hours pushing wheelchairs to gates and helping travelers on and off planes.With tips, and Illinois' minimum wage -- which is $1 above the federal minimum wage of $7.25 an hour -- Margaret makes about $18,000 a year, or $10,000 below the federal poverty limit for a household of five.
Margaret lives with her four school-age children in a three-bedroom apartment on Chicago's South Side. Two recent shootings on her block make her fear for her children's safety, but she cannot afford to move. Margaret is unable to pay the $850 per month rent, so she and her family perform janitorial tasks for the landlord to make ends meet. The children's clothing is all secondhand, Margaret uses food stamps to make sure everyone is fed and when it is time to buy shoes for school, she has to save an entire paycheck.

And Margaret Lewis is far from an anomaly. According to estimates, there are about 3.8 million more people like Margaret Lewis, struggling to survive on the current minimum wage.

A federal raise in the minimum wage - like the bill proposed in Congress by Representative Jesse L. Jackson Jr. - would give some relief to these struggling 3.8 million minimum wage workers who make up a sizable part of the working class.

Jackson's bill is called The Catching Up To 1968 Act Of 2012, and it immediately raises the minimum wage to $10.00 per hour and includes automatic minimum wage indexing "in proportion to the increase in the Consumer Price Index (CPI)."

Senator Tom Harkin of Iowa has also sponsored a bill introduced in the U.S. Senate, which would increase the minimum wage to $9.80 an hour over two years. The bill is called the Fair Minimum Wage Act of 2012. It was introduced and referred to Committee on July 26 of 2012 and it now has 16 co-sponsors in the U.S. Senate.

These bills would provide some much needed support to minimum wage workers in a time of desperation.

But it's not just minimum wage workers that would benefit from a minimum wage increase.

Raising the minimum wage helps everyone.

Of course raising the minimum wage helps those Americans who are struggling to survive on the current minimum wage. But it also helps higher wage earners by fueling economic growth as well.

Consumer spending fuels economic growth and "a 2011 paper by economists at the Federal Reserve Bank of Chicago found that a $1 minimum-wage increase lifts household income by about $250 and increases spending by about $700 a quarter in the following year."

If 3.8 million minimum wage workers all had their wages increased, we would see an increase in consumer spending. This increase in consumer spending would benefit small and medium businesses - still recovering from the 'great recession' - who would see an increase in customers. This would stimulate the economy and it would, in turn, create more jobs. It's simple economics.

In an interview on his proposed minimum wage bill, Representative Jesse L. Jackson Jr. said,

the economy would be bolstered by increasing “the purchasing power of millions of low-income and low-wage workers, and one proven and effective way of doing that is to raise the federal minimum wage.”

Representative Jackson is right, and it's not just fellow Democratic politicians like Senator Harkin who agree with him either.

A group of prominent economists including Joseph Stiglitz, Jeffrey Sachs, Laura Tyson, and Robert Reich sent a letter Monday July 23 to congressional leaders. The letter urges leaders on Capitol Hill to raise the minimum wage from $7.25 per hour to $9.80 by 2014.

"At a time when persistent high unemployment is putting enormous downward pressure on wages, such a minimum wage increase would provide a much-needed boost to the earnings of low-wage workers," the group wrote.

Democrats in Congress need to include a minimum wage increase into a list of their top priorities. It's in the best interest of working-class Americans and it is economically responsible because it encourages economic growth. In my opinion, it could be a populist message that may pay off for Democrats in the fall elections.

The only way that a raise in the minimum wage can happen is with pressure from a concerned citizenry. We can make that change happen. So, I ask you to share this diary in the hope that even one Congressional Democratic politician will read this and join us in moving forward with raising the minimum wage. I, again, ask you to share this diary in solidarity with labor and in support of the civil rights of all workers.