Tags: Nader | minimum | wage | economy

Nader: Minimum Wage Should Be Increased to $10.50 to Boost Economy

Wednesday, 17 Apr 2013 12:55 PM

By Dan Weil

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Legendary consumer advocate Ralph Nader says the minimum wage should be increased to help the economy grow faster in addition to assisting workers themselves.

President Barack Obama has proposed lifting the minimum wage to $9 an hour by 2016 from $7.25 currently. But Nader supports a bill proposed by Rep. Alan Grayson, D-Fla., that would raise it to $10.50.

“It is long past time for minimum-wage workers to receive a raise,” Nader writes in The Wall Street Journal. “Had the federal minimum wage just kept pace with inflation since 1968, it would stand today at $10.67 per hour, not $7.25.”

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.

While the minimum wage has shed almost one-third of its inflation-adjusted value over the last 45 years, CEO compensation has soared 900 percent, Nader says.

A minimum wage increase helps the economy, because low-wage workers generally spend their pay increases on necessities, he explains.

“Studies from the Economic Policy Institute indicate that a $10.50 hourly minimum wage would increase economic activity by at least $30 billion over each of the first two years and add 140,000 jobs,” Nader writes.

And a minimum wage increase needn’t cause price increases, he states. Costco maintains reasonable prices despite starting its workers at $11.50 an hour plus benefits.

Conservatives, of course, disagree with Nader’s position.

“Raising the minimum wage reduces the availability of entry-level positions,” James Sherk, senior policy analyst at The Heritage Foundation, writes on its web site.

“This makes gaining the skills necessary to get ahead harder. States that raised their minimum wages in the 1990s saw workers earning less a decade later.”

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.

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