Obama: Wants to index the minimum wage to inflation. Doable?

[bicentennial_baby]

I think he wants to do it on a yearly basis, iirc. I assume that he means indexing the Federal minimum, and will continue to let the states go higher if they so choose, as it is set up now. What effect do you think this will have for the average low-income worker?

I voted for Obama, btw, and this thread will probably sink like a stone. Just curious to hear the thoughts of others on this topic. :hi:

[Kurt_and_Hunter]

1. I imagine there are arguments on both sides

One problem is that whenever you start indexing, you are saying the minimum wage is as high as it's supposed to be, because indexing will take it off the table going forward.

(Social security is indexed, but that is an ostensibly self-financing system, not based on what retirees "should" get.)

But it's not automatically a bad idea. As long as we get the MW up higher before considering indexing, or else we lock in a sucky wage.

[bicentennial_baby]

2. Very good point

Thanks for your response. :)

[mrreowwr_kittty]

8. In a recent speech, he said he wanted to raise it, then index it.

I forget to how much, I think $9.50 an hour.

[TexasObserver]

3. It's doable and it has to be done.

Otherwise, some goon like Bush gets in office and forces the lowest wage earners to see their dollar power driven lower each year.

[bicentennial_baby]

4. Yes, I agree...

I just wonder about the overall net effect on working people, considering that our measure of inflation, the CPI, does not account for fuel and food prices, due to volatility.

[TexasObserver]

12. That has to be corrected. It must include food and fuel, or it's invalid

They are using a rate of inflation for rich people and applying it to poor people, who spend a much, much larger percentage of their money on fuel and food costs.

[ayeshahaqqiqa]

5. I think it is a great idea!

I've been at this job for 7 years. Haven't had a raise in the last 5 years. This is basically the same as earning less. If the minimum rises, eventually I'll be making minimum wage, and maybe then it will shame my boss into raising my salary.

[bicentennial_baby]

9. That exactly what it is, earning less over time.

I agree that it's a very good idea. And it's a win-win, as increasing income also increases income spent on consumption (in the general economic sense of the word), and is good for the economy. Not overnight, but as a standing gov't policy, indexing the wage to inflation seems like a good plan.

[HiFructosePronSyrup]

6. Of course it's doable.

Yes we can.

[no name no slogan]

7. It's a long time coming

This should have been done years ago.

[bicentennial_baby]

10. I agree with you, and the more I think about it,

the more evident it becomes that it's the only remotely fair thing to do.

[MH1]

11. I think it's a great idea.

I think some of the underpinnings need to be monitored and possibly corrected - like how inflation is calculated for example, and what the rate should be - but the idea of indexing seems like a no-brainer to me.

[izzybeans]

13. Sure. It will force HR departments to make tough choices though. Do they continue to stroke

their bosses ego by arguing for huge salaries at the expense of company profitability or do they argue for equitable pay for all those that bring value to the organization?

Most are too petrified to not continue stroking.

I say the minimum wage should be indexed to a % of CEO compensation (all of it)

[ayeshahaqqiqa]

14. No THERE'S a great idea!

I think that a CEO's salary should never exceed X% of the lowest paid worker. Your idea is another aspect of the same concept.

[izzybeans]

15. I agree whole heartedly. And it wouldn't impact business because it would come

from the same budget. If someone says it would be harmful for the economy is either lying or has never worked a budget before.

[ozone_man]

16. Great idea, as long as the coming depression doesn't make it negative.

:)

I think the cause or our recession and possible depression is the great disparity in wealth, so I am in full support of raising the minimum wage up much higher than it is. At the same time we have to tax the rich. We have to end their tax breaks. And we need a wealth tax. A redistribution of wealth and income is the only way toward a healthy economy. Bottom line is consumer spending is 2/3 of GDP, and without he consumer, there is very little GDP.