Raising the Minimum Wage for Working Men and Women in California and the Rest of America

Gap's Minimum Wage Move Adds Twist to Debate

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On the day that Facebook paid $19 billion for the aptly named WhatsApp, San Francisco’s Gap, Inc., announced it would raise its minimum wage for American employees to $9 per hour this year and $10 per hour in 2015. The announcement probably won’t make a dent in the income-inequality gap in the Bay Area, but at least it showed some upward movement for low-wage workers outside the Golden State.

According to Gap CEO Glenn Murphy, politics had nothing to do with the move. He wrote on the Gap website that it was “a business decision that’s right for our brands” and a “strategic investment.”

Nonetheless, President Obama shrewdly glommed on to the announcement by applauding the San Francisco-based retail giant for a decision expected to raise pay for 65,000 employees out of a U.S. workforce of about 90,000.

Obama then called on Congress to pass a Democratic measure to raise the minimum wage to $10.10 per hour – “all without requiring a single dollar in new taxes or spending. It’s time to pass that bill and give America a raise.”

Ironically, San Francisco has become ground zero in the minimum-wage debate, even though the clothing chain’s workers in the city won’t benefit because Ess Eff’s minimum wage already is $10.74 per hour. Elsewhere in California, the state minimum wage will rise to $9 per hour in July and to $10 in 2016.

James A. Dorn, a fellow with the Libertarian-leaning Cato Institute, also applauded Murphy, although he came to a conclusion different from Obama’s. “This is free-market, Randian thinking: Self-interest is the motivating factor, not altruism,” Dorn blogged. The market worked – and well. No need for another wrong-headed Washington Knows Best law, when Washington really only cares about what’s best for the political class.

From the West Coast of the right spectrum, there is a different voice: Palo Alto’s Ron Unz, the wealthy entrepreneur and one-time GOP candidate for governor, has been making an alternative argument, “the conservative case for a higher minimum wage.”

Unz is championing a ballot measure to raise the California minimum wage even higher than the $10 rate mandated in a law passed by the Legislature and signed by Gov. Jerry Brown last year. Unz argues that if Californians raise the minimum hourly rage to $12, every full-time worker would be earning $25,000 a year; for couples, that would mean $50,000. Working-class Californians would increase their incomes by a collective $15 billion annually.

Unz argues that higher wages should wean some workers off social welfare programs, ending “a hidden government subsidy to low-wage businesses, allowing them to shift the burden of their low-wage employees over to the taxpayer.”

• Category: Campaign, National • Tags: Debra J. Saunders