Two Economists Discuss a Minimum Wage Increase
Pollin ordered a burrito. Then he launched the opening volley. “We should have a minimum wage that enables everybody including all the people at the Pizza Hut and Taco Bell to lead a minimually decent life,” he said. “And in order to do that you can’t just rely on the market alone.”
Neumark said he agreed with Pollin on one count. “I don’t like the idea that people who work live below poverty conditions, or even somewhat above poverty conditions,” he replied. But, he added, “I think the question is: does a minimum wage actually help?”
Over at Marketplace, two economists discuss the pros and cons of raising the minimum wage, which is making news again after Congressional Democrats introduced a bill which would raise the federal minimum wage from $7.25 an hour to $9.80 an hour over two years. One argues that a higher minimum wage would lead businesses like fast food restaurants to eliminate jobs and raise their menu prices. The other argues that businesses would see more productivity because people who are decently paid stay in their jobs, which means a better relationship with managers and less of a need to train new people, who are less efficient or knowledgable as veteran staff members. The one thing they both agree on: a higher minimum wage won’t fix poverty—for that we need to fix unemployment because higher wages mean nothing if you don’t have a job.
Photo: Eric Marcus