Another Year of Dithering, Another Year of Real Minimum Wage Cuts
Last March, I wrote about two bills before the U.S. Congress — H.R. 1010 in the House and S. 460 in the Senate. Together, these bills are known as the Fair Minimum Wage Act, and if passed they would increase the minimum wage from its current $7.25/hour to $10.10/hour over the next two years. After that point, the minimum wage would automatically increase to keep pace with inflation — the tendency of currency to be worth less as time passes. Tracked by the Consumer Price Index, inflation means that what a $1 dollar bought in February 1977 would take $4 to buy now. Sure, the minimum wage was “just” $2.30/hour back then, but what $2.30 could buy in Febuary 1977 would take $9.15 to buy today — and the minimum wage isn’t $9.15/hour. Because the minimum wage is $7.25/hour, significantly less than $9.15/hour, economists say that the minimum wage has declined in “real value” between 1977 and today.
A year ago this week, I complained that while members of the House and Senate dithered about the economy, failing to pass any minimum wage legislation, the real inflation-adjusted minimum wage fell by 8 cents an hour. It’s a year later, and as this graph shows, as the cost of living keeps creeping upward the real minimum wage keeps falling down — another 7 cents an hour, which may not seem like much to a lawyer billing corporate clients $1,000/hour, but which means a lot to someone only making $7.25:
The good news is that since last March, 62 more members of the House have added their names in support of the bill to hike the minimum wage (is your Representative one of them?). Since last March, 7 more members of the U.S. Senate have cosponsored their version of the bill (are your Senators among them?). The bad news is that as the most vulnerable workers in America keep earning less, and less, and less, there still aren’t enough well-heeled legislators willing to pass the bill.