Hiatt: Raising the minimum wage is a good idea
I applaud Stephen Prince for his column about the minimum wage in the August 29 Opinion page.
It’s generally agreed that the federal minimum wage had its greatest purchasing power in 1968 when it was $1.60 per hour, equivalent to almost $12 per hour in 2018 inflation-adjusted dollars.
If the minimum wage had kept pace with both inflation and increases in worker productivity since 1968, it would be over $19 per hour now.
Raising the minimum wage doesn’t benefit only governvment at all levels by increasing tax revenues and reducing expenditures for social programs, as Prince mentions, it starts a cycle of rising prosperity that benefits everyone in society; it certainly benefits the workers themselves, but additional purchasing power in the pockets of the poorest Americans also benefits businesses who see an expanded base of customers able to purchase their goods and services. Henry Ford realized this a century ago, when he was setting up his first automobile assembly lines: it would be good for business in general, and for the Ford Motor Company in particular, if he paid his assembly-line workers enough that they could actually afford to purchase one of the vehicles they were manufacturing.
Another worthy result of raising the federal minimum wage is that doing so would level the playing field across the nation, making it easier for farmers and business owners in relatively high-wage states like Oregon to compete with their counterparts in lower-wage states like Idaho.
For this reason alone, Oregon’s entire congressional delegation (I’m looking at you, Greg Walden) should support a federal minimum wage increase to at least $15 per hour, with continuing annual adjustments for inflation.