The Economic Policy Institute has recently released a document supporting a minimum wage increase, citing the support of over 650 economists, including 5 Nobel Laureates. So what do conservatives have to say against this overwhelming evidence? Look no farther than Chicago Tribune columnist Steve Chapman for an article that is stunning in its glossing over of the evidence.
First, let's establish Chapman's credentials to dispute the economic evidence. He's a journalist from a big city paper and has been a fellow for libertarian think tanks. His academic work was in business administration and "general studies." You'll note the lack of "economics" or "economist" anywhere in that vitae. So when Chapman argues that, "if businesses could make more money with that tradeoff, the government wouldn't have to force them to do it -- greed would be motivation enough," he's speaking from his deep experience in punditry, not economics.
Chapman does try to enlist the help of someone with economics qualifications, and quotes one economist from the Hoover Institution (where he happens to have been a fellow). This economist says that "the consensus in the trade is that each 10 percent add-on would destroy 1 to 2 percent of young people's jobs. So a $7.25 minimum wage could mean the loss of up to 1.6 million positions." (emphasis mine) Interestingly, this "consensus" position seems to be shared by none of the 650+ economists (and Nobel Laureates) who have presented their evidence to the contrary, so it would seem this "consensus" consists of one economist and Mr. Chapman.
Chapman concludes his argument by nit-picking. Ted Kennedy has said that a family of three with one parent working full-time and the other half-time at minimum wage is still in poverty. That's sixty hours a week, year round, and income of "$15,450 a year in wages, less than the poverty level of $16,600." But Chapman pulls out his slide rule and argues that this is fudging, because the Earned Income Tax Credit - no doubt something Chapman has long supported - boosts this family's income to over $17,000, out of poverty. Yes, Mr. Chapman knows how important it was to clear that up, seeing as how $17,000 for a family with two working parents and one child is a veritable fortune.
Accounting for inflation, the real value of the minimum wage has declined from near $8 to $5.15 and the proposed increase to $7.25 still fails to restore that value. But to do that might be too much, says Chapman, it might actually raise a family out of poverty.
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