Raising the minimum wage strengthens our economy

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By RON GUILLOT

Patriotic Millionaires

 

America just celebrated a shameful anniversary. July 24th officially marked 13 years since the federal minimum wage was last raised, a record of congressional paralysis so long it’s reached historic levels. We are now living in the longest period without a minimum wage hike in our country’s entire history since the introduction of a federal wage floor in 1938.

Despite significant increases in worker productivity and cost of living since 2009, the minimum wage has stagnated at just $7.25 an hour, only $15,000 a year for a full-time worker. This is so low that it not only sentences minimum wage workers to lives of crushing poverty and insecurity but also impacts the communities they live in, damaging the health of our economy and society. This is simply unsustainable.

Congress’s inaction has created a permanent underclass of millions of Americans living in working poverty. It’s time for congressional action to right this wrong.

Over the last 13 years, we’ve seen a drastic shift in our economy, an international pandemic, historical inflation, and supply chain issues. It’s absurd to think that workers can survive on the same wage created to meet the minimum requirements of living back when Lady Gaga was number one on the pop charts.

$7.25 an hour was already inadequate in 2009 and is not even close to a livable wage for any American in 2022. In 93% of U.S. counties, a person earning the federal minimum wage cannot afford a single-bedroom apartment.

That shouldn’t come as a surprise, considering that when adjusted for inflation, the minimum wage today is worth 27% less than it was in 2009. That means full-time employees must work almost 11 more hours each week to meet the basic living standards of 13 years ago.

The minimum wage simply no longer does what it was designed to do: ensure that the low-income employees make enough to get by. With stagnant wages and skyrocketing inflation, it has left low-wage workers to fall further and further behind.

The argument for raising the minimum wage is not exclusively a moral one: the success of many state and local minimum wage hikes show that everyone stands to benefit from raising wages. If we look at the states that have already raised their minimum wage, we see what we already know; workers, local businesses and economies benefit from increased wages.

We live in a consumer-based economy, meaning that every time people buy necessities like gas or groceries or spend money at shops or restaurants in their communities, they invest in their local economies. American businesses depend on consumers being able to spend money in their local communities, but too many American workers make too little money to meaningfully participate in the economy. Giving millions of workers more spending money is a clear and effective economic stimulus that helps us build a better economy from the bottom up rather than trickled down.

Congress’s inaction on this issue would be shameful but understandable if this were a politically toxic issue, but the popularity of minimum wage increases makes their paralysis even more baffling.

Raising the minimum wage is one of the few remaining bipartisan issues, popular among red and blue voters alike. The vast majority of Democrats (85%) and independents (72%) believe the federal minimum wage should be raised, and even a 52% majority of Republicans agree. In a divided society like ours, it’s rare to see legislation such an overwhelming number of people agree on. Since 1997, every single minimum wage increase put directly to voters has passed, even in deeply red states like Arkansas, Missouri, Alaska and others.

Congress has a responsibility to the American people that should come before any promises or deals made with lobbyists, corporations, or donors – just about the only people in America who oppose raising the minimum wage. If Republican and Democratic voters agree that hard-working Americans deserve a raise, their legislators should enact legislation that reflects those values.

This country cannot afford another year of a stagnant minimum wage. The clock is ticking – every day, millions of Americans are working harder but falling further behind. It’s time for Congress to act and ensure this is the last year a $7.25 wage is the law of the land.

 

Ron Guillot is the vice president of sales at HeartBeam and an investor in equities, options, and direct start-ups. He is a member of the Patriotic Millionaires.

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