DEBATENATE

Topics / Economy

The challenge

“We should raise the minimum wage to fifteen or twenty dollars”

Nate · AI character. Not a real person.

No. A fifteen or twenty dollar federal minimum hurts the workers it claims to help. The Congressional Budget Office scored a fifteen dollar minimum in twenty twenty-one. It said about nine hundred thousand people would rise out of poverty, and about one point four million jobs would disappear. The real minimum wage is zero. That's what you make when the law prices you out. And twenty dollars in rural Mississippi is not twenty dollars in Manhattan. You'll say seven twenty-five hasn't moved since two thousand nine. True. So if you want workers taking home more, cut their income and payroll taxes. That's a raise that doesn't cost anybody a job. Let me ask you this: if a teenager's first job is worth twelve dollars an hour, what happens to that job at twenty? You don't help anyone up the ladder by sawing off the bottom rung.

Debate him on this

His strongest arguments

  1. The government's own scorekeeper projected real job losses from a fifteen dollar federal minimum, right next to the gains.

    CBO's 2021 analysis of the Raise the Wage Act of 2021 estimated about 1.4 million fewer jobs and about 900,000 fewer people in poverty.

  2. Big local increases can backfire through cut hours, even where the hourly wage goes up.

    A University of Washington team studying Seattle's increase toward 13 dollars found that hours worked in low-wage jobs fell, which reduced the average earnings of low-wage workers.

  3. The federal minimum mostly touches young, entry-level workers who need a first job to learn how to work. One national number ignores huge differences in local costs.

    BLS reports that workers earning at or below the federal minimum make up a small share of hourly workers and are disproportionately young.

The best comeback, and his answer

Challenger: The federal minimum hasn't been raised since 2009, and inflation has eaten away its value. Many states and cities have raised their own minimums without the economy collapsing.

Nate: Seven twenty-five does buy less than it used to. But a state setting its own wage to fit its own costs is my point, not yours. Seattle and Biloxi are different planets. And if the goal is bigger paychecks, cut the payroll tax and every worker gets a raise with nobody laid off.

What he grants the other side

The federal minimum buys less than it did in two thousand nine.

The lines

Sources

  1. Congressional Budget Office, The Budgetary Effects of the Raise the Wage Act of 2021 (2021)
  2. U.S. Congress, Fair Minimum Wage Act of 2007, setting the 7.25 dollar federal minimum effective July 2009 (2007)
  3. Jardim, Long, Plotnick, van Inwegen, Vigdor and Wething, National Bureau of Economic Research, Minimum Wage Increases, Wages, and Low-Wage Employment: Evidence from Seattle, Working Paper 23532 (2017)
  4. U.S. Bureau of Labor Statistics, Characteristics of Minimum Wage Workers, 2023 (2024)

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