Daniel Galitsky
Calling the $7.25 federal minimum wage a “starvation wage,” upstart Democratic presidential candidate Bernie Sanders has called for a nationwide minimum of $15 an hour. Among other policies, this bold stance has ignited a fire under the Vermont senator’s rabid base of supporters.
Over the summer, 15 has proven a photogenic number to display on posters and trumpet to a crowd. However, it represents unrealistic pandering to an audience that is all too happy to gobble it up without thought of the consequences. While we should have a discussion about minimum wages, a federal minimum of $15 is preposterous.
If the minimum wage more than doubles, many young people, immigrants and other low-skilled workers will be unnecessarily left without a job. Young people just establishing their careers or working on the side while studying can benefit from jobs that pay less than $15.
Of course, not all jobs are resume-builders for extra cash.
Part of a solution might be to incorporate ideas from Australia’s minimum wage system. There, workers age 20 and younger work under a lower minimum wage than adult workers. The system helps separate resume-building jobs from those that workers depend on for living expenses.
Sanders is right to point out that, for workers who need to support a family on their incomes, low wages are a problem. However, simply raising the minimum wage is like banning thermometers from displaying temperatures that are too hot; it hides the underlying problem.
Adult workers that depend on the minimum wage suffer primarily from insufficient skills and education. Enforcing a wage of $15 could incentivize companies to replace them with technology and reduce the number of job opportunities, which could devastate those who need jobs the most.
When living in this state, one much more expensive than the national average, we need to recognize that a wage less than $15 can suffice in other areas of the country. The round number of $15 nationwide fails to take into account regional differences in the cost of living. A dollar goes further in Mississippi or Oklahoma than in California or Hawaii.
States and local jurisdictions should be free to set minimum wages that are appropriate for their local economies. In a diverse, massive country, the federal government imposing a more-than-doubled minimum wage is unrealistic.
According to the Pew Research Center, only 2.6 percent of workers earn the federal minimum wage, and more than half of these are younger than 24. The focus should be on matching workers with the skills they need to prosper rather than worrying about a state-mandated limit on agreements between workers and employers.
A more modest increase, President Obama’s proposed $10.10 has the potential to put more dollars in the pockets of poorer workers without placing the existence of their jobs at risk. The $15 minimum wage is an arbitrary round number that might help Sanders and his supporters sleep at night but is not a practical solution for struggling Americans.
Daniel Galitsky is a senior economics and finance major. He can be reached at dgalitskydbk@gmail.com.
