What Are The Pros And Cons Of Raising Minimum Wage

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“This is a very simple issue. Either you’re in favor of raising wages for hardworking Americans, or you’re not. Either you want to grow the economy from the middle out and the bottom up so that prosperity is broad-based, or you think that top-down economics is the way to go.”

These remarks were made by President Obama after the bill to raise the minimum wage to $10.10 was blocked by congress. While I agree with most of what President Obama says here, there is one part I do not, to me the issue of raising the minimum wage is far from simple.

Minimum wage has been a very controversial issue throughout history. It was introduced, at a level of $0.25 per hour, in 1938 by President Franklin Delano Roosevelt. This was a move to help combat
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The report goes on to state that minorities and women are a large part of the workforce that works for minimum wage. As with any economic policy, it is very hard to concretely say whether raising the minimum wage is the right decision for the economy because there are so many different factors in play. We will never know the true effect of increasing the minimum wage until we see it in action. However, we can definitely debate about the merits of raising minimum wage, which is what I plan on doing in this essay. I believe there are several reasons for why the federal minimum wage should be …show more content…
A person who works full time for minimum wage would make less than $3000 above the poverty line. If that person is providing for a child then they would be $1000+ under the poverty line (DOL). This shows us that the current minimum wage level can barely support a person on their own much less a single parent. This is without taking into consideration future education expenses as well as retirement. If the minimum wage is raised to $10.10, Arundrajit Dube estimated that over 6 million people would move above the poverty line. 6 million people might not seem like a lot in the grand scheme of things, but when you consider the amount of money the US government would spend on welfare for those 6 million people it certainly adds up. Which brings me to my next point that raising the minimum wage will reduce government spending on welfare. Currently there are numerous welfare programs available such as SNAP (food stamps), TANF, LIHEAP and many more. If the minimum wage was set at $10.10, SNAP’s spending would reduce by over $4 billion (West and Reich). If you consider all income supplementing programs, the US government would save over $7 billion annually. All in all it would make the morale of the people much better as well as make the economy more self-sufficient as people will be able to spend and invest their own income rather than relying on the government to help them

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