Wages Controversial Issue in America

WagesEveryone would probably like to have higher wages if at all possible, but that is one of the few points regarding wages that people can agree on. The proper role of the minimum wage (and what number it should be at) is a controversial issue in America.

Although the economy has gotten better since the crisis following 2008, things are still not close to where they should be. The unemployment rate has gone down, but it is still at over 6 percent. The unemployment still is not at the pre-2008 levels. For example in 2006, it was less than 5 percent. Some argue that the raising the minimum wage would make it more difficult for people to find entry-level jobs. At the very least, it seems like it could be an extra burden at a time when the economy is still trying to find its footing.

On an emotional level, raising the minimum wage might seem like a good idea. After all, few people want others to suffer or go through unnecessary hardship. However, there are valid reasons why the wage issue is so controversial in America.

According to one report, the Congressional Budget Office stated that raising the minimum wage to $10.10 per hour would help some Americans, but hurt others. An estimated 16.5 million people would benefit from increased wages, at least in the short-term. However, 500,00 jobs could be lost. If anything, that number seems fairly conservative.

One person from the White House Council of Economic Advisers suggested that the CBO’s report is not in line with what most economists believe. He seemed to think that a raise in wages would not have much of an impact on employment.

Some people have even suggested that raising the minimum wage at places like Wal-Mart would be like a stimulus to the economy. They estimate that resulting increase in prices would be fairly low and that lower paid workers would have more money to inject back into the economy. However, it is hard to predict what people will do.

Some have said that it would be small businesses that would be hurt by an increase in the minimum wage. A business owner must consider many factors in order to be successful. This problem is likely even more acute for small business owners since there are fewer resources available.

What makes the wage issue so controversial and problematic for Americans is that it is difficult to predict what the exact results would be. While it might be accepted that prices will rise, getting people to agree on how much the price increase will be, seems almost futile.

In a way, the wage debate almost mirrors the climate change controversy. There are plenty of statistics being thrown around by various groups, but which numbers are correct? There is certainly the possibility of bias on both sides of the political aisle.

While people might not agree on the exact consequences of a minimum wage increase, that does not change the fact that there will be consequences. The point of having a business is obviously to make money. The extra money that would be paid to workers must come from somewhere. Perhaps when people brush aside the potential consequences, they are being overly optimistic.

One article actually suggested that the government subsidize wages for low-income workers. Again, the money has to come from somewhere. Getting the government out of the economy as much as possible would be preferable.

Maybe what people need are more opportunities for economic growth and success, rather than a wage increase. In any case, the controversial issue of wages in America is not likely to die down any time soon.

Editorial By Zach Kirkman

Sources:
Los Angeles Times
Fox News
Bureau of Labor Statistics
Forbes

One Response to "Wages Controversial Issue in America"

  1. Kitana   February 22, 2014 at 9:45 pm

    When a large and widespread housing bubble burst in 2007, it created suffering with little hope of recovery without federal aid. Capitalism was subject to failure. If we allow markets we depend on to fail, then we end up with unnecessary Margaret Thatcher inspired suffering. A libertarian theory of free markets that could transition the private sector into a system that lets iconic, big businesses fail as a result of a recession, is still susceptible to another housing bubble. The proposed austerity politics of today would not treat the problem nearly as sufficiently as more stimulus, while not preventing another economic meltdown in the future. The disparity in wealth in this country is why the vast majority of citizens live off credit, mortgages they hope will inflate and find less opportunities for upward mobility than they deserve for their work.
    http://kmorte.blogspot.com/

    Reply

Leave a Reply

Your email address will not be published.