Economy 103 – Actual Progress on Conservative Priorities

One Sentence Argument:

Our current minimum wage forces taxpayers to pick up the slack with costly anti poverty programs and law enforcement, all to make sure multinational corporations can maximize profits.

The one fact that virtually no one on either side of this issue disputes is that you simply can’t live on an income of $7.25 an hour for 40 hours per week, only around $15,000 a year. It simply can’t be done. 

So how, then, do the millions of Americans earning the federal minimum wage survive? Through government welfare programs. From subsidized housing to Medicaid to the EITC to food stamps, there is a vast array of expensive government programs designed to ensure that the working poor in America are able to scrape by just enough to continue earning profit for their corporate bosses. 

Corporations like Walmart and McDonald’s, some of the largest and most profitable companies in the entire world, are able to pay their American workers just $7.25 an hour because they know that the government is going to pick up the slack. This is corporate welfare, plain and simple, and it costs American taxpayers billions of dollars per year.

It also isn’t an accident. A US Senator once told a donor that every time a proposal surfaces to cut food stamps, Walmart lobbyists swoop in to stop that bill in its tracks. Food stamps don’t just subsidize the company’s employees, they further pad its bottom line. Walmart makes money coming and going.

Let’s move on to another conservative priority, reducing crime. There is convincing evidence, presented in a 2016 study from the White House Council of Economic Advisors, that raising wages could substantially decrease crime rates. The Council estimated that “a 10 percent increase in wages for non-college educated men results in approximately a 10 to 20 percent reduction in crime rates.” More specifically, they calculated that raising the minimum wage to $12 by 2020 “would result in a 3 to 5 percent crime decrease (250,000 to 510,000 crimes) and a societal benefit of $8 to $17 billion dollars.” Another study shows that increasing the minimum wage by just 50 cents can reduce the probability that an individual ends up back in prison a year after being released by 2.8%. That’s a huge number for just a 50 cent increase! The anti-crime benefits would, conceivably, be even higher with a $15 minimum wage. 

There’s no other criminal justice proposal that could lead to hundreds of thousands of fewer crimes each year while costing the federal government no money whatsoever. In fact, it would actually save the government money by limiting the amount spent on law enforcement, courts, and prisons (keeping people in prison is very, very expensive).

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