The minimum wage rate should be annually adjusted by the cost-price index.
Opponents of the federal minimum wage, (FMW) believe the federal minimum wage rate is a primary or particular driver of the U.S. dollar’s inflation; that falsehood is one of their rationalizations to support their predisposition to oppose the FMW rate.
FMW rate updates are political determinations and have always been reactions to the U.S. dollar’s inflation over a duration of years. Usually each minimum rate increase did not fully reflect the total rate of the dollar’s inflation over the duration since the prior minimum rate update.
Enterprises’ price increases are a reaction to market forces that include but are not limited to additional costs reflecting any increase of the FMW rate. Enterprises usually, (if not always) react quicker than the U.S. Congress.
All price increases contribute to the U.S. dollar’s rate of inflation. But due to the afore mentioned reasons, FMW rate increases lag behind the dollar’s inflation and thus are less a cause and more (than price increases due to other causes), a victim of the dollar’s inflation.
Opponents pretend that minimum wage only affects the very poorest of the working poor. Except in the cases of jobs requiring labor that’s in short supply, all wage scales are related to each other; (i.e. the rising tide raises all boats). The minimum and all job rates are related but less so if there are labor shortages for particular jobs.
The relationship is inverse to the difference between the minimum and the jobs’ rates; (i.e. proportionally the minimum rate is of greater benefit to lesser earners and of lesser benefit to greater earners purchasing powers but all employees somewhat benefit from the minimum rate).
Thus the minimum rate significantly increases the earners’ purchasing powers for no less than the lowest quarter of USA’s entire full time employee population.
Opponents object to the minimum rate intervening between employee- employer negotiations. There’s no intervention; there’s the same legal minimum rate for all tasks but no maximum upon any pay scales.
Opponents believe that the absolute poorest of the working poor’s wages should, (similar to other goods and product services), be subject to the free competitive market.
There are fewer employers and more unskilled job applicants. There is rarely if ever a shortage of unskilled labor. Employers can delay or outsource some tasks until they can be performed at lesser cost.
It’s contended that the unskilled labor markets’ are less than flat equitable market; the FMW rate is justified and its elimination would be detrimental to our economy.
It’s further contended that to the extent our FMW rate does not keep pace with the U.S. dollar’s inflation, it is adverse to our economy.
The minimum rate should be annually updated in the same manner as we now update social security retirement s. Those benefits would remain subject to our three federal branches government but rather than politically determined time and extents of updates, non-partisan statisticians would annually apply explicitly drafted formulas to determine the updates.
The FMW in 1968 was $1.60/Hr. Applying the cost- price urban index to that, it was equivalent to $10.69 in 2013 dollars. The minim rate should be increased gradually but $9/Hr is a low ball rate. I advocate for five years a dollar be annually added to the minimum rate prior to the index being applied. After five years, only the index should be annually applied to the minimum rate.