30 May, 2009

Minimum wage

I find it odd that, in a time of economic recession, when many people have to take part-time, minimum-wage jobs, no one is talking about raising the minimum wage. Even my parish bulletin seems to have forgotten what a "living wage" is. Too many full-time jobs pay so little these days that one has to live in poor conditions to make ends meet. I do happen to believe that laws prescribing a minimum wage for part time workers, and a living wage for full-time workers, are necessary for justice in a society, and one of the purposes of the law is to prescribe justice and right order, not merely to punish malefactors.

According to Wikipedia, the minimum wage law was last changed in May 2007, stepping the minimum wage rate up each year. I'd like to suggest (again) that an excellent avenue of reform would be to index the minimum wage in two different ways: (1) to the rate of inflation, as measured by the CPI, and (2) to index the minimum wage to the local cost of living: the cost of living in a city for those who live in cities, and the cost of living in a county for those who live in counties.

Of course, in keeping with my belief in free-markets, my personal preference is for refundable tax credits: child tax credits, earned income credit, etc. The problem is that (1) these come at the end of the year, rather than in each paycheck; (2) for some reason, these credits don't gain as much political traction as minimum wage laws, and (3) one can see refundable tax credits as a form of income redistribution, whereas a minimum wage law is, at least superficially, a prescription against injustice via exploitation.

No comments: