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Complete Formal Report PDF
Complete Formal Report PDF
Federal Minimum
Wage?
A Public Policy Report
Figure 1: Photo from twi1er depicts a machine that offers minimum wage to
anyone willing to turn it.
Abstract
This report has been set up as an opinionless representation of the
discussion sounding the minimum wage debate and has been intended to
provide stakeholders with an informative background on the subject. All
sources have been equally represented and balanced between opposing
arguments.
Table of Contents
INTRODUCTION ........................................................................ 5
METHODOLOGY ........................................................................ 5
RESULTS/DISCUSSION ............................................................. 6
CONJECTURE ................................................................................................. 6
Historical Background ............................................................................ 6
Current Events .......................................................................................... 7
DEFINITION ................................................................................................... 8
QUALITY ........................................................................................................ 9
Who is affected? ....................................................................................... 9
What are the effects? ..............................................................................10
ACTION......................................................................................................... 18
Bernie Sanders’ plan............................................................................... 18
Romney and Cotton’s plan ..................................................................... 19
Josh Hawley’s plan ................................................................................. 19
Raise The Wage Act 2023 ....................................................................... 19
What has already been done? ............................................................... 20
CONCLUSION ...........................................................................21
Introduction
In recent years, raising the federal minimum wage has become a hot topic
of debate for policy makers. In general, the public’s concern centers around
economic impact, inflation, job loss, and diminishing spending power.
Without absolute certainty as to what effects a federal raise may have, it is
difficult for many people to agree on the matter.
Methodology
The report will include a variety of sources, including expert opinions,
popular media representations, and visual arguments. These will be evenly
distributed between pro and con opinions to ensure a balanced, and
informative discussion for stakeholders.
Results/Discussion
This section of the report will focus on the findings of the analysis and how
they relate to each component of stasis theory.
Conjecture
The history surrounding the minimum wage is rather undisputable.
Therefore, sources agree that it has changed consistently in terms of
the actual minimum value, how far that value stretches, and how it is
mandated.
Historical Background
According to a Forbes article written by Kelly Anne Smith, the
first legally mandated federal minimum wage was instated in
1938 as a part of the Fair Labor Standards Act. She continues to
share that the original value was knocked down from 40 cents
per hour to 25 cents per hour due to pressure from
representatives in southern states (Smith, Minimum Wage
Debate).
Smith goes on to state that the federal floor has since been
updated for a total of 22 times, but allegedly only grew in
accordance with productivity through the 1960’s.
Zachary B. Wolf from CNN lets us know that it was at this time
that the minimum wage reached a metaphorical peak in terms
of inflation. Figure 2 shows us a graphical representation of this
trend from his article “Everything you need to know about the
debate over the $15 minimum wage.”
Current Events
Due in part to the drop in spending power and the historically
large wait for a federal raise, policymakers and the American
people have begun to debate the topic of once again raising the
minimum. Many attempts have been made to change public
policy in recent years.
Figures 5 and 6
demonstrate these
counter-concerns.
Figure 4: Pro-raise visual demonstrates the concerns of the current minimum.
Figure 5: An?-raise visual demonstrates ques?ons regarding a Figure 5: An?-raise visual demonstrates ques?ons regarding a federal raise.
federal raise.
This leads to the next question for stakeholders, what is the nature of
the issues this debate aims to address?
Definition
Sources from both sides tend to offer arguments centering around
morality and the economy.
So, to what extent are constituents being affected, and what effects
would a federal raise provoke?
Quality
Here is where sources begin to differ on nearly every account. There
appears to be a lack of consensus within the research about the
projected outcomes of federal raises. Additionally, sources repeatedly
contradict each other in terms of how a policy change may affect
stakeholders.
Who is affected?
As an expansion of stakeholders previously mentioned, the
parties who have been identified by sources as most at risk go as
follows:
• Small businesses
• Rural populations
• Service workers
• Low-income parties such as
o Low-income families
o Impoverished children
o Single mothers
o Individuals paid less than minimum wage (tipped
workers)
o Current minimum wage earners
o Individuals currently living in poverty
• Disadvantaged parties such as
o Women
o People of color
Raschke 10
Small businesses
Previously mentioned Virginia Foxx lays out how she
believes the aftermath will affect small businesses by
saying “Without the cash reserves or profit margins to
absorb the increase in labor costs, small businesses will
have a choice of several bad options. Among their choices
are laying off workers, raising prices on their customers,
replacing workers with robots, or going out of business."
Rural populations
Pro-raise Wolf from CNN acknowledges that a steep raise
may be harder to navigate in regions of the country where
the minimum wage remains the federal minimum, or
regions with a higher population of minimum wage
earners. He claims that according to the Bureau of Labor
Statistics, afflicted areas “are in the South – Louisiana,
Mississippi and South Carolina” (Wolf, Everything you
need to know).
Smith also ties this concern into the risk for small
businesses by pointing out that profit margins are likely
smaller in these areas due to a decreased cost of living.
Service workers
Many sources from both sides agree that workers in the
service industry are at a higher risk that other
occupations. Zachary Wolf explains why this is when he
lets us know that "the top industry for people making
minimum wage is the service industry, particularly food
service." (Wolf, Everything you need to know).
Low-income parties
The research surrounding low-income parties is a bit
more substantial and focuses more on the actual
monetary values we stand to lose or gain from a change in
policy.
Disadvantaged parties
Disadvantaged parties often tend to be low earners. CNN
journalist Zachary B. Wolf explains that "according to
BLS, [the lowest earners] are mostly young and they are
less likely to have more than a high school education, if
that. They are more likely to be working part-time than
full-time. A larger portion are women than men, and they
are less likely to married."
those with less than a high school diploma,” and adds that
“[the] CBO estimates that as many as three jobs could be
lost for every one person pulled out of poverty." (Foxx,
Cons of Minimum Wage).
Which leads to the final question; how are we proposing to solve this
issue?
Action
The article referenced by Kelly Anne Smith discusses three plans
presented during the covid 19 pandemic:
A quick look at the senators website reveals that this bill did in
fact pass the House of Representatives in 2021, but was
ultimately turned down by a Republican majority senate.
In her article, she states: "Sen. Mitt Romney (UT) and Sen. Tom
Cotton (AR) offered a counterproposal of raising the minimum
wage to $10 per hour over four years—but employers would
have to prove that their workers are legally
documented." (Smith, Minimum Wage Debate).
One could draw from this that many politicians have already
taken action.
Conclusion
The ongoing minimum wage debate is complicated, and it is hard to see a
clear path forward given its highly polarized nature.
Raschke 22
• Conjecture
o The minimum wage has not been increased since 2009, and
therefore has seen a reduction in spending power.
o Policy makers are currently debating this issue, but with little
progress.
• Definition
o The issue centers around conflicting morality, and economic
concern.
o All sides present a concern for the wellbeing of people but
disagree on how these concerns present themselves.
o All sides express a desire for a better economy and progressive
success but disagree on a means to achieve this.
• Quality
o Those most at risk are small businesses, less populated areas,
service workers, low-income parties, and parties at a
disadvantage.
o The risks to these stakeholders are not agreed upon, but
generally center around, poverty, job loss, wage disparity,
automation, inflation, business closures, an increased quality of
life.
• Action
o One well-known proposal is the $15 minimum wage, but this
number may be increasing.
o Some sources propose that minimum wage itself may be
causing poverty and suggest letting competition set wages.
o States and companies have slowly been increasing wages in the
absence of new federal legislation.
Works Cited
Sanders, Bernie. “We Must Raise the Minimum Wage to a Living Wage "
Senator Bernie Sanders.” Senator Bernie Sanders, 18 Apr. 2023,
www.sanders.senate.gov/op-eds/we-must-raise-the-minimum-wage-
to-a-living-wage/.
Smith, Kelly Anne. “What You Need to Know about the Minimum Wage
Debate.” Forbes, Forbes Magazine, 13 Oct. 2022,
www.forbes.com/advisor/personal-finance/minimum-wage-debate/.
Wolf, Zachary B. “Everything You Need to Know about the Debate over the
$15 Minimum Wage | CNN Politics.” CNN, Cable News Network, 26
Feb. 2021, www.cnn.com/2021/02/22/politics/minimum-wage-15-
dollar-debate-explainer/index.html.
Rugy, Veronique de. “Column: Why a $15 Minimum Wage Should Scare
US.” PBS, Public Broadcasting Service, 9 Sept. 2016,
www.pbs.org/newshour/economy/column-15-minimum-wage-scare-
us.
Zipperer , Ben. “The Impact of the Raise the Wage Act of 2023.” Economic
Policy Institute, Economic Policy Institute, 25 July 2023,
www.epi.org/publication/rtwa-2023-impact-fact-sheet/.