SOCIETY REQUIRES MINIMUM WAGE TO BE A PRIORITY

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Whether or not to raise the minimum wage is a heated topic that has both supporters and challengers.
Photo By: Isabella Rivera, Photographer


By: Logan Zelk, Reporter

With all the associated negatives and growing mountains of evidence delineating the toxicity of poverty, one could say poverty is the heaviest modern crime, and a minimum wage that falls behind inflation is a nail in a poor person’s coffin.

What is minimum wage? It is the set bar for a wage established by either a state or the Federal government where businesses must pay that wage at the very least to it’s base employees, with U.S. minimum wage set at $7.25. If the minimum wage is set by the Federal government, then every state must comply, but states can raise the minimum wage higher if they prefer. The other significant term is living wage, or the income required to live on the bare minimum without starving. If the minimum wage doesn’t meet the living wage, problems occur, mostly those where people accumulate debt or can’t eat due to insufficient funds, which are generally seen as a failure of society.

Senior Nicky Blonsick says, “We’re trying to increase economic flow and increase the living standard. [The minimum wage] is necessary so there is a standard for business and workers; without it there would be a lot of abuse [towards] workers.”

Beyond the strict direct effect of the minimum wage, an increased minimum wage is correlated with advances in society. One can look to the UNDP’s HDI (human development index, a measure of how developed a country is). More developed than the U.S.A. lie several countries, Norway being number one with Australia, Switzerland, and the Netherlands following. The common trait these countries hold is that they all have a much higher minimum wage than the U.S. These countries also have higher happiness indexes and experienced well being.

That said, correlation does not equal causation. So, how does the minimum wage work specifically? Demand-side economic theory says that with an increase in pay to all workers, who are the largest demographic of consumers, more money is available to be used to buy the necessities to live. This in turn increases supply bought and generates extra revenue that flows into the companies, creating the resources and demand for more jobs and thus more individuals able to buy goods.

AP Economics teacher Mr. Chuck Blackwell says, “We have a lot of poor people, who have lost jobs for a variety of reasons, and the idea is that if, from a demand side, people have no money, there is nothing being bought. With fair wages, there comes increased consumption, increased income from that consumption, and then more jobs open. When lower income earners receive more, they spend more as a percentage of their income.”

One of the constant questions that rises, when minimum wage appears on agendas, is the concern of where the new resources will come from in order for businesses to pay those higher wages. The answer lies in the bulky top of the business — CEO wages. In fact, the current distortion between base employee pay and CEO pay is near egregious; the average CEO has 331x larger paycheck than their base employee. The money used to better civilians lives exists, but the company executives are reluctant.

Blackwell says, “There’s a lot of research in the ratio of workers to executive pay, and income inequality has grown disproportionately since 1970. This is often a large indicator of economic unhealthiness.”

And along with the stats and figures is the human side. When it comes to humans, there is a moral obligation as members of society to prevent wanton suffering and rather painful conditions such as hunger or poverty. Higher stress, reduced life expectancy, reduced life quality, higher crime, higher homicide and rape rates, and higher child neglect come with poverty.

AP World History teacher Mr. Robert Ash says, “Personally, I think there is [a moral component]. I would argue that the economy is such in this modern world that you’re locked in the system, and [that system] has to a degree take care of the people. Not everyone has the resources to go to college or inherit wealth, and we shouldn’t disparage.”
The matter of minimum wage is not just one of policy. It is one of social security, economic well being, and moral satisfaction.