The federal minimum wage has stood at $7.25 an hour since 2009. This is by far the longest period that we have gone without an increase in the minimum wage since it was first established in 1938. In the 12 years since the last increase, prices have risen by 29%, which means the minimum wage has lost a bit less than one-third of its value.
As a result of the federal government’s failure to raise its minimum wage, many states and cities have decided to increase the minimum wage for workers under their jurisdiction. Twenty-one states now have minimum wages higher than the federal minimum. There also have been efforts to raise city minimum wages where states have declined to raise the wage floor statewide, although many states now prohibit this practice.
Some have argued that the increases in state and city minimum wages make an increase in the federal minimum wage unnecessary. This is not the case. The idea of setting a national minimum wage is to create a national standard ensuring that every worker in the country has a decent standard of living. We impose national standards all the time, and they are often quite popular.
Just to take two obvious examples, Social Security and Medicare are both national programs. People get the same Social Security check (based on their earnings) regardless of where they lived, when they worked, or where they lived when they retired.
The same applies to Medicare. The health care facilities and doctors differ from state to state, but people contribute the same amount and are entitled to the same benefits regardless of where they live.
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We also apply national standards for workplace safety. The Occupational Safety and Health Administration doesn’t tell employers in Alabama or Wyoming that it’s OK to have an unsafe workplace. If a particular hazard would lead to a fine or closing in New York or California, it should lead to a fine or closing in any other state.
Probably the best example of national standards is civil rights. There were, and possibly are, several states that would rather not be bound by civil rights laws. Their political leadership was fine with discrimination based on race, ethnicity, gender, sexual orientation, or disability. In fact, the politicians of the 1960s didn’t argue against civil rights legislation based on their desire to discriminate. Rather, they argued against it based on states’ rights.
It would be ironic if opposition to a federal minimum wage is to be grounded in claims of states’ rights. A disproportionate share of the workers who would benefit from a higher minimum wage are the same groups that are protected by civil rights laws.
It is understandable that employers who profit from paying workers very low wages will be opposed to a higher minimum wage. It is also possible that they can use their political power at the state level to prevent the minimum wage from being raised. This is the same story we saw 60 and 70 years ago as racist politicians prevented the passage of anti-discrimination laws at the state or local level.
Dean Baker is an economist and co-founder of the Center for Economic and Policy Research (cepr.net), a progressive think tank in Washington, D.C.
