Let’s do the numbers on a $15 minimum wage
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Why is it so hard to raise the minimum wage? Even the leading expert on the topic isn’t quite sure.
“It’s actually really popular to raise the minimum wage in the United States, it’s popular across the partisan divide,” said Arindrajit Dube, an economist with the University of Massachusetts at Amherst. “It just becomes very embroiled in politics…. But then you put it actually as a ballot initiative, it pretty much always passes — including in red states, blue states, purple states.”
After the wage has spent more than a decade at $7.25 an hour, Dube said resistance to a hike is softening among industries like fast food and retail, which used to be hard-liners. Democrats have been trying to tie a new federal minimum wage to the COVID relief bill, but they’ve hit procedural and partisan snags.
Monday the nonpartisan Congressional Budget Office added a wrinkle. Its analysis said that raising the minimum wage to $15 an hour by 2025 would lift almost a million people out of poverty and raise wages for 17 million more — but it would cost the economy 1.4 million jobs.
So today on the show we’ll go deeper into the issue with Dube, who calls the CBO projection “a bit too pessimistic.” He’ll also tell us how this conversation plays out overseas, how minimum wage hikes affect spending and gross domestic product, and why a country as big and diverse as the U.S. needs a federal minimum wage at all.
Later in the show, listeners call in with their experiences teaching in-person classes and getting the vaccine. Plus the rapper Dessa — recently behind this Janet Yellen banger — answers the Make Me Smart question.
When you’re done listening, tell your Echo device to “make me smart” for our daily explainers. Coming up: fashion week, Bob Iger and Presidents Day. Also, don’t forget to subscribe to our newsletter! You can find the latest issue here.
Finally, if you’re interested in minimum wage and other labor issues in the U.S., you’ll want to check out the latest season of “The Uncertain Hour,” which is all about how the typical American job has been gigged, temped and subcontracted away.
Here are links to everything we talked about on the show today:
- You can read more about Dube here: “The Burger Flipper Who Became a World Expert on the Minimum Wage” from Bloomberg
- “Even a divided America agrees on raising the minimum wage” from Brookings
- The CBO’s latest analysis of a minimum wage hike, and one from 2019 (be warned: both are PDFs)
- “No Quick Fix for Auto Chip Shortage” from The Wall Street Journal
- “Biden: Yellen needs a ‘Hamilton’ musical. Dessa: Here you go.” from “Marketplace.” You can also hear “Who’s Yellen Now?” on YouTube and all the streaming services.
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